STATE OF MICHIGAN IN THE 17th CIRCUIT COURT FOR KENT COUNTY
DAVID L. COBB,
Plaintiff,
vs.
VARNUM, RIDDERING, SCHMIDT & HOWLETT, LLP; and VARNUM, LLP,
Defendants.
Case No. 13-10838-NMB
HON. CHRISTOPHER P. YATES
OPINION AND ORDER GRANTING DEFENDANTS' MOTION FOR SUMMARY DISPOSITION UNDER MCR 2.116(C)(10)
In May 2008, Plaintiff David Cobb loaned $500,000 to Darin DeClark. That turned out to
be a terrible investment. DeClark defaulted on his obligation to repay the loan, and a dower interest
ofDeClark' s wife complicated the sale of real property that secured the loan. Cobb filed this action
in an effort to recover his loss on the loan from Defendant Varnum, Riddering, Schmidt & Howlett,
LLP ("Varnum"), 1 which provided Cobb with legal advice about the transaction. Specifically, Cobb
contends that Varnum breached its professional obligations to warn him of the dower problem and
to obtain a personal guaranty of the loan from Darin DeClark's father, Bruce DeClark. The Court
concludes, however, that Cobb's legal-malpractice claims are unsustainable because the dower issue
ultimately worked out in Cobb's favor, thereby allowing him to obtain the full value of the property,
and Varnum' s conduct did not deprive Cobb of a personal guaranty from Bruce DeClark. Therefore,
the Court must award summary disposition to Varnum under MCR 2.l 16(C)(10).
1 Plaintiff Cobb has named as defendants "Varnum, Riddering, Schmidt & Howlett, LLP" and "Varnum, LLP." Those two defendants appear to be the same entity, so the Court shall treat the two defendants as one and the same.
I. Factual Background
Defendant Varnum has moved for summary disposition pursuant to MCR 2.116(C)(l 0) . "In
evaluating a motion for summary disposition brought under this subsection, a trial court considers
affidavits, pleadings, depositions, admissions, and other evidence submitted by the parties in the light
most favorable to the party opposing the motion." Maiden v Rozwood, 461Mich109, 120 (1999).
Accordingly, the Court shall set the factual background by discussing the entire record in the light
most favorable to Plaintiff Cobb.
When Darin DeClark and his father, Bruce DeClark, needed capital to expand their business
in 2008, they approached Plaintiff Cobb to ask about a loan. 2 See Defendants' Motion for Summary
Disposition, Exhibit 2 (Deposition of David Cobb at 25). Those discussions culminated on May 15,
2008, in a $500,000 loan from Cobb to Darin DeClark that was memorialized by a promissory note
and a personal guaranty signed by Darin Declark. 3 Id., Exhibits 10-14. Those loan documents came
from Varnum, which had sent them in generic form to Cobb on November 30, 2007. See id., Exhibit
2 (Deposition of David Cobb at 36) & Exhibit 9 (e-mail from Peter Roth to Cobb on November 30,
2007). But Cobb negotiated the terms of the Darin DeClark loan without any input from Varnum.
See id., Exhibit 2 (Deposition of David Cobb at 26, 57).
2 Darin DeClark and his father, Bruce DeClark, apparently owned and operated a company called Superior Manufacturing Group. See Defendants' Motion for Summary Disposition, Exhibit 2 (Deposition of David Cobb at 29). As Plaintiff Cobb explained, "Bruce was the brains behind the business and he had the relationships with the vendors[,]" but "he had the business name in Darin's name[.]" Id.
3 The record includes two versions of both the promissory note, see Defendants' Motion for Summary Disposition, Exhibits 10-11, and the guaranty. See id., Exhibits 12-13. Careful scrutiny reveals that each document was dated May 15, 2008, and signed by Darin DeClark, but not notarized until May 22, 2008. Compare id., Exhibits 10, 12 with id., Exhibits 11 , 13. The check from Plaintiff Cobb to Darin DeClark bears the date of May 15, 2008. See id., Exhibit 14.
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On May 16, 2008, Plaintiff Cobb spoke with Attorney Peter Roth of Defendant V am um. See
Defendants' Motion for Summary Disposition, Exhibit 8 (Varnum billing sheet). To secure the loan
to Darin DeClark, Cobb received mortgages on two parcels of real property- a vacant parcel owned
by Darin DeClark, and a cottage owned by Bruce DeClark. See id., Exhibit 2 (Deposition of David
Cobb at 49). Cobb retained Attorney Roth to draft and record those mortgages. See id., Exhibit 3
(Deposition of Peter Roth at 24). By all accounts, Attorney Roth successfully completed that task,
see id., Exhibits 19-20 (recorded mortgages), but the parties disagree about whether Attorney Roth
had additional obligations to Cobb that Attorney Roth failed to satisfy. Specifically, Cobb contends
that Attorney Roth should have advised him about potential complications arising from the dower
rights of Darin DeClark' s wife with regard to one mortgaged parcel and should have suggested that
Cobb obtain a personal guaranty from Bruce DeClark.
In October 2011 , Darin DeClark defaulted on his obligation under the promissory note. See
Defendants' Motion for Summary Disposition, Exhibit 2 (Deposition of David Cobb at 66-67). In
response, Plaintiff Cobb began exercising his rights as a secured creditor, but he discovered that the
parcel of real estate owned by Darin DeClark had potential dower issues and that Bruce DeClark had
never signed a personal guaranty. See id. (Deposition of David Cobb at 67, 69). Consequently, on
November 15, 2013, Cobb filed suit against Defendant Varnum, claiming professional negligence
with respect to the unreleased dower interest of Darin DeClark's wife and the absence of a personal
guaranty signed by Bruce DeClark. Varnum ultimately moved for summary disposition under MCR
2.116(C)(IO), contending that both aspects of Cobb's legal-malpractice claim are fatally defective.
Therefore, the Court must now determine whether Cobb can proceed to trial on his theories oflegal
malpractice despite Varnum's well-supported motion for summary disposition.
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II. Legal Analysis
Defendant Varnum insists that the Court must resolve this entire case in its favor by awarding
summary disposition under MCR 2. l l 6(C)(l 0). Such relief should be granted if"there is no genuine
issue regarding any material fact and the moving party is entitled to judgment as a matter of law."
West v General Motors Corp, 469 Mich 177, 183 (2003). "A genuine issue of material fact exists
when the record, giving the benefit of reasonable doubt to the opposing party, leaves open an issue
upon which reasonable minds might differ." Id. Using these well-understood standards, the Court
must decide whether Varnum is entitled to summary disposition on each of Plaintiff Cobb' s theories
of legal malpractice.
To prevail on his claim for legal malpractice, Plaintiff Cobb must demonstrate "the existence
of an attorney-client relationship, (2) negligence in the legal representation of the plaintiff, (3) that
the negligence was the proximate cause of an injury, and ( 4) the fact and the extent of the injury
alleged." Kloian v Schwartz, 272 Mich App 232, 240 (2006). In legal malpractice cases, "an expert
is usually required to establish the standard of conduct, breach of the standard, and causation." Dean
v Tucker, 205 Mich App 547, 550 (1994). To be sure, "[w]here the absence of professional care is
so manifest that within the common knowledge and experience of an ordinary layman it can be said
that the defendant was careless, a plaintiff can maintain a malpractice action without offering expert
testimony." Law Offices of Lawrence J Stockier, PC v Rose, 174 Mich App 14, 48 (1989). But as
our Court of Appeals has noted (albeit in an unpublished decision), such cases are "rare." Passeno
v Hullman, Nos 252486 & 254227, slip op at 2 (Mich App April 26, 2005) (unpublished decision).
Accordingly, a legal-malpractice claim ordinarily cannot survive without expert testimony. In light
of these principles, the Court shall consider Cobb' s two malpractice theories seriatim.
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A. The Dower Issue.
Plaintiff Cobb complains that Attorney Roth - on behalf of Defendant V am urn - neglected
to provide notice of a potential dower problem with respect to the parcel of real estate held by Darin
DeClark. But Cobb's counsel forthrightly conceded at oral argument and in a supplemental brief that
Cobb "recently received a deed releasing the dower interest [that] cured the Defendant's malpractice
error . ... "4 See Plaintiffs Supplemental Brief in Opposition to Defendants' Motion for Summary
Disposition at 1. Because of that development, Cobb no longer faces any cloud on the title that could
impair his ability to exercise his rights under the mortgage on that parcel of real estate. Nevertheless,
Cobb insists that he still can demand damages from V arnurn for its alleged malpractice in failing to
inform him of the potential impact of the dower interest of Darin DeClark's wife. Specifically, Cobb
contends that he can recover the attorney fees and costs that he expended in his effort to clear up the
dower problem. The Court disagrees.
Under Michigan law, attorney fees ordinarily "are not recoverable as an element of costs or
damages unless expressly allowed by statute, court rule, common-law exception, or contract." See
Marilyn Froling Revocable Living Trust v Bloomfield Hills Country Club, 283 Mich App 264, 297
(2009). Plaintiff Cobb has no statute, court rule, common-law exception, or contractual language
to support his demand for attorney fees. Instead, he relies entirely upon the argument that he had to
expend attorney fees in a foreclosure action and in the instant case to clear up the dower problem.
Although that expenditure may evoke some measure of sympathy, the Court cannot simply disregard
Michigan law and award attorney fees to Cobb in the absence of some legal basis to do so. The only
4 A copy of the recorded deed in lieu of foreclosure signed by Darin DeClark and his wife, Debra DeClark, has been provided to the Court as Exhibit 6 to the plaintiff's supplemental brief in opposition to the defendants' motion for summary disposition.
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precedent that offers any assistance to Cobb "allows recovery of reasonable attorney fees incurred
in prior litigation with a third party- not with the defendant." G & D Co v Durand Milling Co, Inc,
67 Mich App 253, 257 (1976). But even that decision conditions the recovery of attorney fees upon
a showing that "the party at fault is guilty of malicious, fraudulent or similar wrongful conduct, not
simple negligence as is claimed here." Id. at 260. Because Cobb has neither alleged nor shown that
V amum engaged in "malicious, fraudulent or similar wrongful conduct" in failing to advise him of
the dower problem, Cobb cannot recover his attorney fees as damages. 5 See id. Therefore, the Court
must grant summary disposition to Varnum on Cobb' s legal-malpractice claim predicated upon the
dower problem.
B. The Personal Guaranty From Bruce DeClark.
Plaintiff Cobb contends that Attorney Roth- acting on behalf of Defendant V amum - should
have pointed out that a personal guaranty from Bruce DeClark would have afforded more protection
to Cobb than the personal guaranty executed by the obligor on the promissory note, Darin DeClark.
Although the Court readily recognizes that a personal guaranty from Bruce DeClark would have been
much more helpful to Cobb than the essentially redundant guaranty from Darin DeClark, the Court
cannot deduce that Cobb necessarily has a viable legal-malpractice claim for that reason. Cobb has
proffered no expert testimony - and has even failed to identify any expert witness - to support that
legal-malpractice claim. That shortcoming, in and of itself, almost certainly forecloses Cobb from
proceeding on his legal-malpractice claim. See, ~. Beattie v Firnschild, 152 Mich App 785, 790-
5 To the extent that Plaintiff Cobb demands costs from the foreclosure litigation as an element of damages in the instant case, he is barking up the wrong tree. Cobb could have sought costs in the foreclosure action ifhe was the "prevailing party" there, see MCR 2.625(G)(l ), but Cobb cannot use the instant case as a vehicle for obtaining costs incurred in that separate matter.
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793 (1986) (requiring expert testimony where attorney "was representing members of this family in
a simple real estate transaction").
More fundamentally, Plaintiff Cobb's legal-malpractice theory impermissibly rests upon pure
speculation that either Attorney Roth (acting on behalf of Defendant Varnum) or Cobb (acting at the
behest of Attorney Roth) could have persuaded Bruce DeClark to sign a personal guaranty. In fact,
Bruce DeClark testified that he would not have agreed to sign a personal guaranty, see Defendants'
Motion for Summary Disposition, Exhibit 6 (Deposition of Bruce DeClark at 16), and Cobb himself
acknowledged that Bruce DeClark never agreed to guarantee the loan. See id., Exhibit 2 (Deposition
of David Cobb at 100). To the extent that Cobb now insists he would have refused to make the loan
to Darin DeClark without a guaranty from Bruce De Clark, the record reveals that Cobb's contention
constitutes unfounded speculation. Cobb did not even investigate the value of the two properties on
which he received mortgages to secure the loan, see id. (Deposition of David Cobb at 49-50), which
reveals Cobb' s willingness to extend the $500, 000 loan to Darin DeClark despite potential concerns
about the extent of Cobb's protection in the event of a default. Moreover, Cobb gave Darin DeClark
the personal check for $500,000 on May 15, 2008, before Darin DeClark had signed the promissory
note or the guaranty, id., (Deposition of David Cobb at 43-45), which bespeaks Cobb's willingness
to furnish $500,000 to Darin DeClark even in the absence of adequate assurance of repayment.
Our Court of Appeals has held, in a legal-malpractice case, that the '"plaintiff must introduce
evidence which affords a reasonable basis for the conclusion that it is more likely than not that the
conduct of the defendant was a cause in fact of the result."' Pontiac School Dist v Miller, Canfield,
Paddock & Stone, 221 Mich App 602, 615 (1997). The "'mere possibility of such causation is not
enough[.]"' Id. Here, Plaintiff Cobb has presented no evidence to establish that any shortcomings
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in Defendant V am um' s representation caused Cobb to lose the protection of a guaranty from Bruce
DeClark or to go forward with a loan that Cobb otherwise would have refused in the absence of that
guaranty. Because this lack of evidence on the element of causation dooms Cobb's claim for legal
malpractice, the Court must grant summary disposition to Varnum on Cobb's claim regarding Bruce
DeClark's personal guaranty.
III. Conclusion
For all of the reasons set forth in this opinion, the Court must grant summary disposition to
the defendants under MCR2. l 16(C)(IO) on every aspect of Plaintiff Cobb's legal-malpractice claim.
Cobb's failure to bolster his claim with any expert testimony, his satisfactory resolution of the dower
problem, and the speculative nature of causation regarding Bruce DeClerk's personal guaranty leave
the Court no other option. 6
IT IS SO ORDERED.
Dated: January 26, 2015 HON. CHRISTOPHERP. YATES (P41017) Kent County Circuit Court Judge
6 Although the Court's ruling appears to be a final order that resolves the last pending claim and closes the case, the Court has chosen not to include that determination in this opinion. Instead, the Court shall conduct a status conference before declaring the case closed.
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