Opinion
No. 347202
05-14-2020
STEVEN SCHNEIDER and JULIE ANN SCHNEIDER, Plaintiffs-Appellants, v. CITY OF ORCHARD LAKE VILLAGE, GERRY MCCALLUM, BARTON RACHWAL, and ANDREA RACHWAL, Defendants-Appellees.
If this opinion indicates that it is "FOR PUBLICATION," it is subject to revision until final publication in the Michigan Appeals Reports. UNPUBLISHED Oakland Circuit Court
LC No. 2018-164868-CH Before: K. F. KELLY, P.J., and BORRELLO and BOONSTRA, JJ. PER CURIAM.
Plaintiffs brought this action after their neighbors, defendants Barton Rachwal and Andrea Rachwal (the Rachwals), constructed a new dwelling and changed the landscaping on their property in the city of Orchard Lake Village. Plaintiffs generally alleged that the changes violated applicable deed restrictions and local zoning ordinances. Plaintiffs also named the city of Orchard Lake Village (the City) and its building official, Gerry McCallum, as defendants. Plaintiffs appeal as of right the trial court's order granting defendants' motions for summary disposition and dismissing all of plaintiffs' claims and for the reasons set forth in this opinion, we affirm.
I BACKGROUND
The Rachwals and plaintiffs own neighboring properties. The properties were originally part of a single tract that was subdivided into three parcels. At the time the properties were subdivided, the owner imposed covenants and restrictions to run with the land. Plaintiffs were involved in litigation with other neighbors before the Rachwals purchased their lot in 2011. In litigation commenced in 2006, plaintiffs reached a settlement in 2009 with the Rachwals' predecessor, Matthew Flynn. That settlement order provided, in relevant part, that plaintiffs could enforce the existing deed restrictions in place for the property then owned by Flynn, but upon a sale or transfer of that property, plaintiffs would receive $50,000 from the closing proceeds and "release any rights to enforce the restrictions on the Flynn property," but "[i]f no payment is made as provided herein, [plaintiffs] shall continue to have such rights of enforcement."
The Rachwals purchased the Flynn property in 2011 and built their own home on the property. It is undisputed that the Rachwals did not pay plaintiffs $50,000 at the time of closing. Plaintiffs later informed the Rachwals in a letter that they could pay the $50,000 amount at a later time to obtain a release of the deed restrictions. That letter, dated December 5, 2012, stated in relevant part:
. . . For the reasons we discussed in our conversation, and the reasons pointed out in the letter from our attorney . . .my wife and I believe it is in our best interest the Building and Use Restrictions continue to remain operational.
I pointed out in our phone conversation, we would be willing to release the restrictive covenants for the payment required in the amount of $50,000. [sic] which we believe was due upon purchase or your property.
We believe this decision ultimately serves both of our best interests to move forward freely and unencumbered; thereby only leaving the matters of the drainage ditch to be properly maintained by the parties . . .
The Rachwals subsequently tendered the $50,000 amount. In lieu of accepting that payment, plaintiffs filed this lawsuit.
Although plaintiffs filed a lengthy 66-page complaint that asserted several different theories of relief, their claims involved two primary issues: (1) the Rachwals violated the deed restrictions applicable to their property, which plaintiffs were entitled to enforce under the 2009 settlement order, and (2) the Rachwals performed work on their property in violation of several ordinances, which the City failed to enforce. In lieu of filing an answer, the Rachwals filed a motion for summary disposition pursuant to MCR 2.116 (C) (4), (5), (7), and (10), arguing, in part that the 2009 settlement allowed them to buy their way out of the deed restrictions. Hence, the Rachwals argued, once they tendered payment of $50,000 as provided for in the 2009 settlement, they were released from the deed restriction in their entirety. They further argued that plaintiffs were obligated to accept payment but because they had refused to do so, plaintiffs waived their right to enforce the restrictions against the Rachwals.
Plaintiffs responded to the Rachwals' motion by arguing that the Rachwals were still subject to the deed restrictions because they decided not to tender the $50,000 amount when they purchased their property and did not offer the money until eight years later. Therefore, plaintiffs had the right to enforce the deed restrictions. Plaintiffs also argued that they could prove special damages from the unapproved changes the Rachwals made to their property in violation of local ordinances. The Rachwals further argued that plaintiffs lacked standing to assert any violations of local ordinances related to the construction on their property because plaintiffs did not suffer any damages of a special character distinct and different from injuries to the general public.
Defendant City of Orchard Lake Village also moved for summary disposition on multiple grounds.
The trial court granted defendants' motions stating:
THE COURT FINDS:
The matters are before the Court on Defendants Barton Rachwal, Andrea Rachwal, the City of Orchard Lake Village, and Gerry McCallum's motions for summary disposition on Plaintiffs Steven Schneider and Julie Ann Schneider's claims against them. After reviewing the original pleadings and the supplemental pleadings submitted by the parties, the Court finds that it is proper to dismiss the remaining claims because it agrees with Defendants that Plaintiffs lack standing. Moreover, the Court agrees with the additional rationale contained in Defendants' pleadings to support summary disposition in their favor.
THEREFORE, THE COURT HEREBY ORDERS:
Defendants' motions are granted. This order resolves the last pending claim and closes the case.
This appeal ensued.
II. WAIVER OF THE DEED RESTRICTIONS
On appeal, plaintiffs argue that the trial court erroneously held that plaintiffs lacked standing to enforce the deed restrictions. Clearly, plaintiffs argue, the 2009 settlement gave plaintiffs standing to enforce the deed restrictions, and plaintiffs did not waive their right to enforce the deed restrictions pursuant to the 2009 settlement because plaintiffs never received $50,000 at the time of closing when the Rachwals purchased the property.
In their reply brief, the Rachwals do not dispute that plaintiffs have standing with regard to the deed restrictions. Rather, the Rachwals argue, the trial court's ruling on standing was limited to plaintiffs' claims to enforce the ordinances. The Rachwals further argue that the trial court dismissed plaintiffs' ability to enforce the deed restrictions on the basis of waiver and estoppel.
A trial court's decision on a motion for summary disposition is reviewed de novo. Spiek v Dep't of Transp, 456 Mich 331, 337; 572 NW2d 201 (1998). Although the trial court did not state under which subrule it was granting defendants' motions, the Rachwals moved for summary disposition with regard to the deed restrictions under MCR 2.116(C)(10). A motion under MCR 2.116(C)(10) tests the factual support for a claim. A court must consider the pleadings, affidavits, depositions, admissions, and any other documentary evidence submitted by the parties, and view that evidence in the light most favorable to the nonmoving party to determine if a genuine issue of material fact exists. MCR 2.116(G)(5); Maiden v Rozwood, 461 Mich 109, 118-120; 597 NW2d 817 (1999). Summary disposition should be granted if, except as to the amount of damages, there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Babula v Robertson, 212 Mich App 45, 48; 536 NW2d 834 (1995).
The trial court gave only a single specific reason for granting summary disposition—that plaintiffs lack standing. The trial court did not explain if that ruling applied to all or only some of plaintiffs' claims. Moreover, the only argument the Rachwals made with regard to standing was that plaintiffs lacked standing to allege ordinance violations. As previously stated, on appeal, the Rachwals agree with the plaintiffs that standing is not a basis for granting the Rachwals summary disposition with respect to plaintiffs' claims to enforce the deed restrictions.
In its ruling, the trial court also stated that it was granting summary disposition because it agreed "with the additional rationale contained in Defendants' pleadings to support summary disposition in their favor." Therefore, on appeal, we consider the Rachwals' arguments in the trial court that they were entitled to summary disposition with regard to any claims involving the deed restrictions because plaintiffs either waived their right to enforce the restrictions or promissory estoppel prohibits plaintiffs from seeking enforcement of the restrictions.
The 2009 settlement agreement, with regard to future enforcement of deed restrictions applicable to the Rachwals' property provided:
G. . . .It is understood that upon any sale, transfer of title of the Flynn property, other than the current foreclosing bank obtaining title through foreclosure, that the Schneiders shall be paid the sum of Fifty Thousand and 00/100 ($50,000.00) Dollars at the closing from the closing proceeds and the sum of Thirty-Five Thousand and 00/100 ($35,000.00) Dollars shall be placed in escrow with the Title Company to satisfy the requirements of Flynn as set forth in Paragraph 2(B) herein, with any excess returned to Flynn. Upon receipt of such $50,000.00, Schneiders shall then release any rights to enforce the restrictions on the Flynn property, except as provided in the Amendment, Modification and Release of Declaration of Restrictions of Beath Woods. If no payment is made as provided herein, Schneiders shall continue to have such rights of enforcement.
The parties do not dispute that no payment was made or offered to plaintiffs when Flynn sold the property to the Rachwals in 2011. However, after the Rachwals acquired their property, they sent a letter to plaintiffs, advising them that they would not pay the $50,000 at that time and requesting that plaintiffs sign a release related to the deed restrictions, as plaintiffs had done for another neighbor. In the previously quoted written response of December 5, 2012, plaintiffs advised the Rachwals that the deed restrictions should remain in place, but further stated they would be "willing to release the restrictive covenants for the payment required in the amount of $50,000 . . ."
Plaintiffs' letter of December 5, 2012 is proof that they agreed to modify the original settlement order with respect to the timing of the payment by accepting the $50,000 payment after the closing to obtain release of the deed restrictions. Hence, plaintiffs waived their rights with regard to both the payment and to enforce the deed restrictions by rejecting the payment and filing this action instead.
In Quality Prod & Concepts Co v Nagel Precision, Inc, 469 Mich 362, 364-365; 666 NW2d 251 (2003), our Supreme Court explained:
[P]arties to a contract are free to mutually waive or modify their contract notwithstanding a written modification or anti-waiver clause because of the freedom to contract. However, with or without restrictive amendment clauses, the principle of freedom to contract does not permit a party unilaterally to alter the original contract. Accordingly, mutuality is the centerpiece to waiving or modifying a contract, just as mutuality is the centerpiece to forming any contract.
This mutuality requirement is satisfied where a waiver or modification is established through clear and convincing evidence of a written agreement, oral agreement, or affirmative conduct establishing mutual agreement to modify or waive the particular original contract. In cases where a party relies on a course of conduct to establish waiver or modification, the law of waiver directs our inquiry and the significance of written modification and anti-waiver provisions regarding the parties' intent is increased. [Emphasis in original.]
The Rachwals presented clear and convincing evidence that plaintiffs agreed to modify the terms of the 2009 settlement agreement to extend the timeframe for making the specified $50,000 payment to obtain a release from the deed restrictions. By the terms of the 2009 order, it was solely up to the Rachwals whether to invoke that provision, which they did when they tendered the specified payment in 2018. The parties agree that the $50,000 payment by the Rachwals was a condition precedent to plaintiffs' obligation to release the deed restrictions. A condition precedent is a fact or event that the parties intended must have occurred before there is a right to performance. Able Demolition, Inc v City of Pontiac, 275 Mich App 577, 583; 739 NW2d 696 (2007).
The 2009 settlement established a $50,000 amount for release of the deed restrictions, payable when Flynn sold or transferred the property, but there was no limitation on when the property could be sold or transferred. Similarly, there was no time limitation when plaintiffs agreed after the closing to release the deed restrictions in exchange for payment of the specified $50,000 amount. Therefore, plaintiffs cannot argue that they were justified in rejecting the $50,000 amount due to the passage of time and still enforce the deed restrictions against the Rachwals. The 2009 agreement did not give plaintiffs control over whether or when they would be required to release the deed restrictions. Rather, plaintiffs conditioned release of the deed restrictions on payment of $50,000, which was up to the Rachwals. By tendering the agreed-upon $50,000 amount, the Rachwals satisfied the condition precedent to obtain the release.
The affidavits from plaintiffs and their attorney do not create an issue of fact regarding whether plaintiffs' December 5, 2012 letter to the Rachwals modified the timeframe whereby the Rachwals could pay the $50,000 to be released from the deed restrictions at any time in the future. Plaintiffs' counsel's own affidavit confirms that there was an offer by the Rachwals to make that payment, but asserts that plaintiffs rejected it because they did not believe the $50,000 amount was sufficient to cover the cost of their perceived damages.
The $50,000 amount set forth in the 2009 settlement order is a type of liquidated-damages provision. Plaintiffs agreed in 2009 that they were willing to accept that amount to release their right to enforce the deed restrictions. A liquidated-damages clause is an agreement by the parties to set the amount of damages in the event of a breach. UAW-GM Human Resources Ctr v KSL Recreation Corp, 228 Mich App 486, 508; 579 NW2d 411 (1998). Whether a liquidated-damages clause is enforceable is a question of law, and courts will sustain such provisions if the amount is reasonable in relation to the possible injury suffered and is not unconscionable or excessive. Id. Here, there is no record evidence for concluding that the liquidated-damages clause would be unconscionable or excessive.
The Rachwals also argued that promissory estoppel applied to prevent plaintiffs from enforcing the deed restrictions after leading the Rachwals to believe that they could be released from the restrictions by paying $50,000 at any time.
Promissory estoppel consists of (1) a promise, (2) that the promisor should reasonably have expected to induce action of a definite and substantial character on the promisee's part, and (3) that produced reliance or forbearance of that nature in circumstances such that the promise must be enforced if injustice is to be avoided. Klein v HP Pelzer Auto Sys, Inc, 306 Mich App 67, 83; 854 NW2d 521 (2014).
Again, plaintiffs do not dispute that they sent a letter to the Rachwals confirming that they would not enforce the time limits in the 2009 order. Plaintiffs should have reasonably expected the letter to lead the Rachwals to believe that they could pay the $50,000 at any time to obtain a release of the deed restrictions. The Rachwals relied on that promise and offered the agreed amount. They have shown that failure to enforce that promise would result in injustice because they were induced to believe they could obtain the release at any time.
For these reasons, we hold that the trial court did not err by granting the Rachwals' motion for summary disposition with respect to the deed restrictions.
III. ORDINANCE VIOLATIONS
Plaintiffs also argue that the trial court erred by dismissing their claims against the City, McCallum, and the Rachwals premised on alleged violations of local ordinances. The trial court ruled that plaintiffs do not have standing to assert such claims.
Defendants moved for summary disposition under MCR 2.116(C)(5) ("[t]he party asserting the claim lacks the legal capacity to sue"). When reviewing a motion under MCR 2.116(C)(5), a court is required to consider the pleadings, depositions, admissions, affidavits, and other documentary evidence submitted by the parties to determine whether the moving party is entitled to judgment as a matter of law because the party bringing the action lacked the legal capacity to sue. Wortelboer v Benzie Co, 212 Mich App 208, 213; 537 NW2d 603 (1995). Whether a party has standing involves a question of law that is also reviewed de novo. Mich Ass'n of Home Builders v Troy, 504 Mich 204, 212; 934 NW2d 713 (2019).
Plaintiffs' complaint included allegations related to building and zoning ordinances that they claimed the Rachwals violated and the City failed to enforce. Count V alleged that plaintiffs were entitled to abatement of a nuisance. Plaintiffs alleged that they suffered special injury affecting their rights and substantial interests, which were detrimentally affected in a manner different from the general public. Plaintiffs alleged that they "have damages which are special and distinct and different from the injury suffered by the general public or any other neighboring property owners, because no other property owners are immediately affected by the violations that have taken place by the acts of the Rachwals and the Schneiders have standing to assert their claim to relief from the violations of the Rachwals, and the failure to comply with the Zoning Ordinances and lack of enforcement by the City and the Building Official."
"The purpose of the standing doctrine is to assess whether a litigant's interest in the issue is sufficient to 'ensure sincere and vigorous advocacy.' " Lansing Sch Ed Ass'n v Lansing Bd of Ed, 487 Mich 349, 355; 792 NW2d 686 (2010). Standing involves whether a particular litigant is a proper party to request adjudication of an issue and not whether the issue is justiciable. Id. Therefore, one with a legal cause of action has standing. Id. at 372. One can also have standing to seek declaratory relief under MCR 2.605, such as
[w]here a cause of action is not provided at law, then a court should, in its discretion, determine whether a litigant has standing. A litigant may have standing in this context if the litigant has a special injury or right, or substantial interest, that will be detrimentally affected in a manner different from the citizenry at large or if the statutory scheme implies that the Legislature intended to confer standing on the litigant. [Lansing Sch Ed Ass'n, 487 Mich at 372.]
The Rachwals argued that all ordinance violations must be evaluated under the doctrine of public nuisance, Towne v Harr, 185 Mich App 230, 232; 460 NW2d 596 (1990). However, public nuisances must be abated by a public officer and not by an individual's action. Id. A private individual may not bring a public nuisance claim unless he can show that he suffered damages of a special character distinct and different from an injury suffered by the public in general. Id.
First, it is clear that plaintiffs do not have standing to bring any ordinance-violation claims against the Rachwals because their objections involve landscaping by the Rachwals on their land. Plaintiffs concede that these claims relate only to aesthetics, but argue that a local ordinance requires that landscaping and retaining walls be aesthetically pleasing and harmonious with the nearby development. However, even if we presume local ordinances address matters such as the aesthetics of landscaping, plaintiffs did not show that they suffered any special damages, different than the general public, with regard to the aesthetics of the Rachwals' landscaping. Plaintiffs' objections to the appearance of a retaining wall and the placement or removal of trees and shrubs are matters that relate primarily to aesthetics, which affect all members of the public in the same manner. Plaintiffs have not shown how any landscaping changes made by the Rachwals impact plaintiffs' property directly or specifically, in a manner different from the general public. Because plaintiffs did not establish special damages different from the general public, the trial court did not err by dismissing any claims against the Rachwals involving ordinance violations. Additionally, because plaintiffs' claims against the City involve only the City's enforcement of applicable ordinances to the Rachwals' property and plaintiffs lack standing to challenge the enforcement of those ordinances, the trial court properly dismissed all of plaintiffs' remaining claims against the City.
In their respective briefs, the parties also discuss whether plaintiffs were obligated to exhaust their administrative remedies by first pursuing their claims before defendant City's Zoning Board of Appeals. Given our conclusion that plaintiffs lack standing to pursue claims related to ordinance violations, resolution of this issue becomes unnecessary. --------
Plaintiffs also argue that their right to procedural due process was violated because defendant City approved the Rachwals' site plan changes without providing notice to plaintiffs to permit them to object to those changes. This argument relies on plaintiffs' perceived right to review any site plan changes pursuant to the deed restrictions. However, because any right to review the Rachwals' site plan changes derives from the deed restrictions, plaintiffs' right to approve the site plans was extinguished by the Rachwals' tender of the agreed-upon $50,000 payment.
Accordingly, the trial court did not err by granting summary disposition for defendants on the basis that plaintiffs lacked standing to challenge the alleged ordinance violations.
III. DISQUALIFICATION OF COUNSEL
Plaintiffs argue that the trial court erred by ruling that their initial attorney, Robert Jacobs, and his associated law firm, Jackier Gould, P.C., were disqualified from representing plaintiffs in this matter due to a conflict of interest.
We review for clear error any factual questions related to the existence of a conflict of interest involving counsel's disqualification. We review de novo the application of ethical rules to the decision regarding the disqualification of counsel. Lamont Community Church v Lamont Christian Reformed Church, 285 Mich App 602, 613; 777 NW2d 15 (2009). Findings of fact are clearly erroneous when this Court is left with a definite and firm conviction that a mistake was made. Id.
The Rachwals moved to disqualify both Jacobs and his associated firm, Jackier Gould. They explained that Barton Rachwal had been a long-time client of Nathan Upfal and Jackier Gould since 2002, when Barton hired Upfal to represent him in forming his professional corporation. Since then, Upfal had continued to represent Barton by preparing the annual meeting minutes for his professional corporation. Both Upfal and Jacobs are "of counsel" members of Jackier Gould. Barton sent an e-mail to both attorneys, as well as the named partners at Jackier Gould, alerting them that he was an existing client of the firm and that Jacobs's adverse representation of plaintiffs was an impermissible conflict of interest, contrary to MRPC 1.7.
In response, Upfal sent Barton a letter notifying him that he was withdrawing as counsel so that Jacobs could continue to represent plaintiffs. Upfal's letter to Barton provides, in relevant part:
This letter will confirm our telephone conversation yesterday, pursuant to which we discussed the following:
1. I am of counsel to Jackier Gould, P.C.
2. Robert Jacobs is also of counsel to Jackier Gould, P.C., and Mr. Jacobs represents a client whose interests are adverse to your interests. In fact, you have informed me and Mr. Jacobs has confirmed to me that Mr. Jacobs recently notified you in writing of the possibility of litigation between you and his client.
3. On September 13, 2017, you notified me, Mr. Jacobs, and two attorneys associated with Jackier Gould, P.C., of the following: "There is a clear conflict of interest here under MRPC 1.7 and 1.8. I have been advised that "of counsel" attorneys are members of the firm for conflict purposes. I do not consent to or waive this conflict of interest."
4. Yesterday when we spoke, you confirmed that you do not waive any conflict of interest.
5. Yesterday, I spoke with and sought advice from legal ethics counsel.
Therefore, regretfully, this letter will confirm that I am withdrawing from my representation of you and your law firm. As I indicated to you, I occupy offices at Jackier Gould, P.C.; therefore, I believe that I owe that law firm an obligation or duty (whether morally or legally) to seek to not disrupt or jeopardize their business interests. Since you have informed me of the conflict, I feel compelled to take this action. I cannot and do not speak to any similar or dissimilar decisions in this regard by Mr. Jacobs.
Please also note that, as I mentioned to you and as I believe you are aware, from my past or current representation of you (which I believe and recall has been limited to the formation of your law firm entity and the preparation of annual minutes) I was not privy to any information relating to your dispute with Mr. Jacobs' client. I have never represented you in connection with this dispute.
At the hearing on the motion for disqualification, Jacobs's counsel advised the court that Upfal was present and was prepared to testify that he did not represent Barton personally, but only represented his professional corporation. The court determined that it was not necessary to have Upfal testify because the court would rely on Upfal's letter.
The trial court granted the Rachwals' motion to disqualify Jacobs as plaintiffs' counsel, stating:
Okay. And I understand that argument, Mr. Einhorn. But what it comes down to, though, is you don't—you want to essentially have, for lack of a better term, you want to run—I want to run a clean case. I want to make sure that there's not going to be any issues but the issues that are necessary for the resolution of the matter that is actually complained of.
And I understand that Mr. Upfal wants to take—wants to give sworn testimony. And it wouldn't have to be sworn because as attorneys you're all under oath all the time, 24/7, quite frankly. But he wants to be able to say he didn't—somehow he didn't mean what he said in the letter and/or he meant to write it to the law firm, whatever.
That letter is what the letter says. And I'm going to take the letter for what it says and that was essentially getting a notice from Mr. Rachwal saying I'm not waiving any conflict, so he turns around and then fires him. And either wants to claim he was a past client or a never client, whatever it is, it's fairly damning.
And based on the elements I've gone through of 1.7(a), finds that defendant is in their right in what they're asking for today and that motion is granted.
MRPC 1.7(a) provides:
(a) A lawyer shall not represent a client if the representation of that client will be directly adverse to another client, unless:
(1) the lawyer reasonably believes the representation will not adversely affect the relationship with the other client; and
(2) each client consents after consultation.
The first step in addressing conflicts under MRPC 1.7(a) is to determine if the lawyer's representation of one client is directly adverse to the interest of another client. Avink v SMG, 282 Mich App 110, 117; 761 NW2d 826 (2009). In Avink, this Court held that clients' interests are directly adverse when one client sues another client. Id. There is no dispute that Jackier Gould could not represent plaintiffs in this matter while it still had Barton as a client.
Plaintiffs contend that the dual representation was permissible because both Jacobs and Upfal were only "of counsel" to the law firm. However, to the extent that Jacobs and Upfal were both only "of counsel" to Jackier Gould, that does not mean that the entire firm and all attorneys associated with the firm were not disqualified. MRPC 1.10(a), which addresses imputed disqualifications, provides that, "[w]hile lawyers are associated in a firm, none of them shall knowingly represent a client when any one of them practicing alone would be prohibited from doing so by Rules 1.7, 1.8(c), 1.9(a), or 2.2." Because Jacobs and Upfal were both working with Jackier Gould, even though having only an "of counsel" relationship to the firm, if the entire firm was disqualified, the disqualification extends to both Jacobs and Upfal.
Because the dual representation in this case was adverse, dual representation is prohibited by MRPC 1.7(a) unless the attorney believes that the representation will not adversely affect the attorney-client relationship and both clients consent after consultation. Avink, 282 Mich App at 118. In this case, Barton did not consent to dual representation. Accordingly, because at least one of the clients did not consent, the trial court did not err by requiring that plaintiffs' counsel withdraw from this case. Avink, 282 Mich App at 118-119.
Plaintiffs rely on Rymal v Baergen, 262 Mich App 274, 319; 686 NW2d 241 (2004), to argue that the party seeking disqualification has the burden of demonstrating how and as to what issues the likelihood of prejudice would result. However, that case involved MRPC 1.9 and the former representation of a client. In Rymal, this Court also applied the prejudice requirement by citing a case that addressed the prejudice to a party from having to call an attorney as a witness. See Kubiak v Hurr, 143 Mich App 465, 471-472; 372 NW2d 341 (1985), and cases cited therein. A showing of actual prejudice is not necessary when the ground for disqualification is dual representation of current clients, and one client does not consent. For this reason, the trial court did not err by refusing to conduct an evidentiary hearing.
The trial court also did not err by refusing to conduct an evidentiary hearing to determine whether Barton, as opposed to his corporation, was a client of Upfal. As the trial court observed, Upfal's letter to Barton specifically stated that he was "withdrawing from my representation of you and your law firm." Given Upfal's express statement in his letter, the trial court did not err by determining that clarification of the scope of Upfal's representation was not necessary.
Accordingly, the trial court did not err by disqualifying plaintiffs' counsel, Jacobs, from representing plaintiffs in this matter.
Affirmed. Defendants having prevailed in full, may tax costs. MCR 7.219(A).
/s/ Kirsten Frank Kelly
/s/ Stephen L. Borrello
/s/ Mark T. Boonstra