Summary disposition was granted to defendants, Richard D. Knight and K-Air, Inc., pursuant to MCR 2.116(C)(6) after the trial court determined that when this action was filed in the Oakland Circuit Court, another action had been initiated and was pending between the same parties involving the same claims in the Genesee Circuit Court. A subsequent motion for rehearing by the plaintiffs, Fast Air, Inc., and Dean Greenblatt, was denied, and plaintiffs appeal as of right. We reverse and remand.
This case arises out of a failed business deal between plaintiffs, defendant Richard Knight, and an investor, Alice Gilbert. On March 19, 1996, defendant Richard Knight filed an action against plaintiffs and Gilbert in the Genesee Circuit Court, alleging breach of fiduciary duties, breach of contract, intentional infliction of emotional distress, and legal malpractice against Gilbert. Plaintiffs were not served with process in that case. The summons was extended on October 17, 1996, but expired on January 15, 1997, without plaintiffs' being served. The case against them was therefore dismissed. On October 23, 1996, before the expiration of the extended summons in the Genesee case, plaintiffs initiated this action in the Oakland Circuit Court, alleging fraud in the inducement, breach of contract, fraudulent misrepresentation, breach of fiduciary duties, conversion, tortious interference with a business relationship, and detrimental reliance. On November 18, 1996, defendants filed a motion for summary disposition pursuant to MCR 2.116(C)(6) and (8) or, in the alternative, for a change of venue. On August 18, 1997, seven months after the Genesee case against plaintiffs had been dismissed, the trial court in this action granted summary disposition in favor of the defendants pursuant to MCR 2.116(C)(6).
On appeal, plaintiffs argue, without citing any authority, that MCR 2.116(C)(6) did not apply because they were not parties to the Genesee action because they had never been served with process. We find this argument to be disingenuous, but nevertheless, we reverse and remand. We review the grant of a motion for summary disposition de novo. Spiek v. Dep't. of Transportation, 456 Mich. 331, 337, 572 N.W.2d 201 (1998).
The issue in this case is one of first impression, specifically whether a motion brought under MCR 2.116(C)(6) can be granted where another action, which was initiated between the same parties and involved substantially similar claims, was dismissed before the ruling on the motion under MCR 2.116(C)(6). We are, thus, called on to construe MCR 2.116(C)(6).
MCR 2.116(C)(6) provides that a motion for summary disposition is appropriate where "[a]nother action has been initiated between the same parties involving the same claim." Actions are initiated in Michigan upon the filing of a complaint, and not upon service of process. See MCR 2.101(B), which states that an action
In this case, an action was initiated on March 19, 1996, when defendant Richard Knight filed his complaint against plaintiffs and Gilbert in the Genesee Circuit Court. Both plaintiffs and defendant Richard Knight were parties to the Genesee action. "A `party' to an action is a person whose name is designated on record as plaintiff or defendant." Black's Law Dictionary (5th ed.). Thus, when plaintiffs filed the instant complaint, there was another civil action initiated between the same parties involving substantially similar claims arising out of the same failed business transaction
However, when the motion for summary disposition was decided by the Oakland Circuit Court, the Genesee case against plaintiffs had been dismissed. There was no action initiated and pending between the same parties at that time. MCR 2.116(C)(6) is ambiguous to the extent that it does not indicate when the determination of the existence of another commenced action is made: at the time of the ruling regarding the motion under MCR 2.116(C)(6) or at the time the suit in question is filed. Keeping in mind that statutes should be interpreted and applied in accordance with the intent of the drafter, Mahrle, supra; Put v. FKI Industries, Inc., 222 Mich.App. 565, 569, 564 N.W.2d 184 (1997), we hold that MCR 2.116(C)(6) does not operate where another suit between the same parties involving the same claims is no longer pending at the time the motion is decided.
The rule is designed to stop parties from endlessly litigating matters involving the same questions and claims as those presented in pending litigation. In other words, its purpose is to prevent "litigious harassment" involving the
While we acknowledge that at the time of the filing of this suit, there was another case initiated and pending, we find that the purpose of MCR 2.116(C)(6) is not served by dismissal of the Oakland case under the circumstances presented. The maintenance of this action does not result in "litigious harassment" or needless and duplicative expenditures because, at the time of dismissal, there was no action initiated and pending involving the same parties and same claims. In fact, this is the first pending action where the parties can and will litigate these issues. In the Genesee action, plaintiffs were never, because of defendant Knight's failure to serve them, called on to defend any claims and were never entitled to pursue their claims as counterclaims. If we were to hold that MCR 2.116(C)(6) operates where other litigation was initiated but later dismissed, an absurd result, which ignores the purpose of the rule, is reached. For example, defendant Knight could have purposefully withheld service in order to prevent plaintiffs from asserting counterclaims in the Genesee action, while at the same time arguing that the Oakland action cannot proceed because of the Genesee action. This is not the purpose of the rule, and, in fact, is inconsistent with substantial justice.
In Sovran Bank, N.A. v. Parsons, 159 Mich.App. 408, 407 N.W.2d 13 (1987), the plaintiff filed suit to renew a judgment against the defendant (the first case). The summons and complaint were served on the defendant in Florida. The defendant alleged lack of personal jurisdiction because of the way process was served. Later, while the jurisdictional questions were still pending in the first case, the plaintiff filed a second complaint in the same circuit court (the second case), and was able to personally serve the defendant in Michigan. Upon the defendant's motion, the second case was dismissed pursuant to MCR 2.116(C)(6). A panel of this Court ruled that the dismissal of the second case was erroneous under the circumstances. Sovran, supra at 411-412, 407 N.W.2d 13. In so ruling, it stated:
When determining whether the motion under MCR 2.116(C)(6) should have been granted, the Sovran Court focused on
In Chapple, supra, the Court also considered all the facts presented at the time of the decision regarding the motion. In Chapple, two defendants were sued in the Montcalm Circuit Court. The plaintiff had previously sued the same two defendants, making the same claims, in the Kent Circuit Court. One defendant, Sempliner, had been dismissed from the Kent case. Sempliner was relieved from the Montcalm case because the court found that no cause of action had been stated against him. Chapple v. Nat'l. Hardwood Co., 234 Mich. 496, 497, 208 N.W. 704 (1926). The other defendant, Jacobson, however, had not been dismissed from the Kent case. He argued that the Montcalm Circuit Court action should be abated because there was a former suit pending, involving an identical matter. In ruling in favor of Jacobson, the Court of Appeals considered that the Kent case was already filed when the Montcalm case was initiated, and that the Kent case was still pending. Chapple, supra, 234 Mich. at 298, 207 N.W. 888. The Court intimated that the purposes of abatement are only served where there is another action pending at the time of the decision regarding the request for abatement. Id.
On the basis of Sovran, supra, and Chapple, supra, we find that summary disposition cannot be granted under MCR 2.116(C)(6) unless there is another action between the same parties involving the same claims currently initiated and pending at the time of the decision regarding the motion for summary disposition. And, if there is another action pending and the party opposing the motion under MCR 2.116(C)(6) raises a question regarding whether that suit can and will continue, a stay of the second action pending resolution of the issue in the first action, should be granted.
On appeal, plaintiffs also argue that Oakland County was the only proper venue for their claims. This issue was not preserved for appeal because it was not raised in and decided by the trial court. Adam v. Sylvan Glynn Golf Course, 197 Mich.App. 95, 98, 494 N.W.2d 791 (1992). Moreover, a resolution of that issue is not necessary to the disposition of this case.
Finally, plaintiffs argue that the trial court should have heard oral argument before deciding the motion for summary disposition. MCR 2.119(E)(3) specifically authorizes the court, in its discretion, to dispense with or limit oral arguments with regard to motions. We review such a decision for an abuse of that discretion. Bancorp Group, Inc. v. Michigan Conference of Teamsters Welfare Fund, 231 Mich.App. 163, 169, 585 N.W.2d 777 (1998), lv. pending. We find no abuse of discretion here, where the trial court was fully apprised of the parties' positions, by way of the parties' briefs, before rendering a decision.
Reversed and remanded. We do not retain jurisdiction.