Opinion
Docket No. 327159.
05-03-2016
In re BIBI GUARDIANSHIP.
Wood, Kull, Herschfus, Obee & Kull, PC, Farmington Hills (by Katherine Wainright Shensky ), for Nadima Bibi. Vincent D. Giovanni, Franklin for Lorraine Wallace.
Wood, Kull, Herschfus, Obee & Kull, PC, Farmington Hills (by Katherine Wainright Shensky ), for Nadima Bibi.
Vincent D. Giovanni, Franklin for Lorraine Wallace.
Before: JANSEN, P.J., and SERVITTO and M.J. KELLY, JJ.
PER CURIAM.In this dispute over guardianship, petitioner, Nadima Bibi, appeals by leave granted the circuit court's appellate opinion and order, which affirmed the probate court's guardianship decision in favor of respondent, Lorraine Wallace. We conclude that the probate court erred when it applied principles of preclusion to Bibi's petition and that the circuit court erred when it affirmed the probate court's order. Accordingly, we reverse and remand for further proceedings in the probate court.
In re Guardianship of Bibi/Wallace Minors, unpublished order of the Court of Appeals, entered September 30, 2015 (Docket No. 327159).
I. BASIC FACTS
This case arises out of a guardianship dispute between the minor wards' grandmothers. It began not long after the entry of a consent judgment in an earlier Canadian proceeding. According to the parties, the wards' parents have a long history of substance abuse, transient living, criminal activity, and incarceration for drug offenses. The Canadian proceeding was a "child protection proceeding" instituted by the Windsor–Essex Children's Aid Society (Children's Aid) under Ontario's Child and Family Services Act, RSO 1990, c C.11 (Can). The parties to that proceeding, including Bibi, agreed to the consent judgment. Under the terms of the consent judgment, the court "placed" the wards under the joint care and custody of Wallace and the wards' maternal aunt, "subject to the supervision of [Children's Aid] for a period of six months," and subject to further terms and conditions. The following spring, the wards' father died. Around that same time, their mother was incarcerated in a Florida county jail.
Bibi subsequently petitioned the probate court and asked it to appoint her as the wards' full guardian. In a cross-petition, Wallace also asked to be appointed the wards' guardian. The probate court determined that Bibi's petitions were barred by collateral estoppel and res judicata arising from the Canadian consent judgment. It then granted Wallace's request.
Bibi appealed the probate court's decision in the circuit court, and the circuit court affirmed. It determined that the probate court had properly applied collateral estoppel to bar Bibi's petition. In the alternative, it agreed with Wallace's argument that Bibi failed to establish grounds for revisiting an existing custody order. Specifically, it stated that Bibi failed to establish proper cause or a change of circumstances sufficient to justify "reopening the guardianship decision of the Ontario Court...."
Bibi now appeals in this Court.
II. ANALYSIS
A. STANDARDS OF REVIEW
Bibi argues on appeal that the probate and circuit courts erred by applying res judicata and estoppel and erred in applying the relevant law. "This Court reviews de novo whether the trial court properly interpreted and applied the relevant statutes...." Kaeb v. Kaeb, 309 Mich.App. 556, 564, 873 N.W.2d 319 (2015). This Court also reviews de novo whether the trial court properly applied legal doctrines such as res judicata and collateral estoppel. Estes v. Titus, 481 Mich. 573, 578–579, 751 N.W.2d 493 (2008). We likewise review de novo issues concerning choice and conflicts of law. Talmer Bank & Trust v. Parikh, 304 Mich.App. 373, 383, 848 N.W.2d 408 (2014), vacated in part on other grounds 497 Mich. 857, 852 N.W.2d 896 (2014).
This Court, however, reviews for an abuse of discretion a probate court's dispositional rulings and reviews for clear error the factual findings underlying a probate court's decision. In re Lundy Estate, 291 Mich.App. 347, 352, 804 N.W.2d 773 (2011). A probate court "abuses its discretion when it chooses an outcome outside the range of reasonable and principled outcomes." In re Temple Marital Trust, 278 Mich.App. 122, 128, 748 N.W.2d 265 (2008). A probate court's "finding is clearly erroneous when a reviewing court is left with a definite and firm conviction that a mistake has been made, even if there is evidence to support the finding." In re Bennett Estate, 255 Mich.App. 545, 549, 662 N.W.2d 772 (2003).
B. CHOICE OF LAW
We must first determine whether Michigan or Canadian law governs the preclusive effect of the Canadian consent judgment. As a matter of comity, our Courts have recognized the validity of judgments from foreign nations. See Dart v. Dart, 460 Mich. 573, 597 N.W.2d 82 (1999). Likewise, "a consent judgment is a settlement or a contract that becomes a court judgment when the judge sanctions it," Acorn Investment Co. v. Mich. Basic Prop. Ins. Assn., 495 Mich. 338, 354, 852 N.W.2d 22 (2014) (quotation marks and citation omitted), and, subject to an exception, "interpretation of contract provisions is governed by the law of the state in which the contract was entered," Jones v. State Farm Mut. Auto. Ins. Co., 202 Mich.App. 393, 398, 509 N.W.2d 829 (1993), mod on other grounds by Patterson v. Kleiman, 447 Mich. 429, 433 n. 3, 526 N.W.2d 879 (1994). The exception to the rule is that, "[i]f the court of last resort in the foreign [jurisdiction] has not declared the applicable foreign law with absolute certainty, then Michigan law controls an action instituted in a Michigan forum." Jones, 202 Mich.App. at 398, 509 N.W.2d 829 (quotation marks and citations omitted). This exception applies to a foreign jurisdiction's application of preclusion principles. See id. at 398–401, 509 N.W.2d 829 (concluding that Michigan law controlled because the Kentucky Supreme Court had not declared with absolute certainty whether Kentucky's application of the doctrine of res judicata would bar the plaintiff's claim). Both collateral estoppel and res judicata are applied in a flexible, discretionary manner under Canadian law. Penner v. Niagara (Regional Police Servs. Bd.), 2013 SCC 19, ¶ 29; 2 SCR 125 (Can, 2013); R v. Mahalingan, 2008 SCC 63, ¶¶ 109–110; 3 SCR 316 (Can, 2008). Therefore, we shall apply Michigan law to determine whether the Canadian consent judgment should be given preclusive effect. See Jones, 202 Mich.App. at 398, 509 N.W.2d 829.
C. UNIFORM CHILD–CUSTODY JURISDICTION AND ENFORCEMENT ACT
As a preliminary matter, we shall address the parties' arguments concerning the application of the Uniform Child–Custody Jurisdiction and Enforcement Act (UCCJEA), MCL 722.1101 et seq. Under the UCCJEA, a guardianship proceeding qualifies as a "child-custody proceeding," MCL 722.1102(d), and the phrase "child-custody determination" is broadly defined as "a judgment, decree, or other court order providing for legal custody, physical custody, or parenting time with respect to a child," including "a permanent, temporary, initial, and modification order," MCL 722.1102(c). The UCCJEA further defines "physical custody" as "the physical care and supervision of a child." MCL 722.1102(n). Therefore, despite the fact that the Canadian consent judgment established a temporary placement for the wards, it nevertheless qualifies as a "child-custody determination" regarding "physical custody" under the UCCJEA.Because the consent judgment qualified as a child-custody determination, after the probate court became aware of the Canadian proceeding, it had to confer with the Ontario court regarding jurisdiction before it could exercise its own jurisdiction to issue a guardianship decision. See Fisher v. Belcher, 269 Mich.App. 247, 255, 713 N.W.2d 6 (2005). After conferring with the Ontario court, the probate court was permitted to exercise its jurisdiction under the UCCJEA if the prior " proceeding [was] terminated or ... stayed by the [foreign] court ... because a court of this state is a more convenient forum...." MCL 722.1206(1) ; see also Fisher, 269 Mich.App. at 255, 713 N.W.2d 6.
At the July 2014 petition hearing, the probate court noted for the record that it had conferred with the Ontario court and received "confirmation" that there was "nothing pending over in the [Ontario c]ourt" and that the Ontario court would accordingly terminate its jurisdiction over the wards. Because Bibi, Wallace, and the wards all now reside in Michigan, this state was clearly the more convenient forum. Consequently, after the Ontario court indicated that it had "nothing pending" in the prior action, and that it would terminate its jurisdiction as soon as the probate court assumed jurisdiction, the UCCJEA no longer applied.
D. COLLATERAL ESTOPPEL
Bibi argues that the probate court erred when it applied collateral estoppel to bar her petition. "Collateral estoppel is a flexible rule intended to relieve parties of multiple litigation, conserve judicial resources, and encourage reliance on adjudication." Rental Props. Owners Ass'n of Kent Co. v. Kent Co. Treasurer, 308 Mich.App. 498, 529, 866 N.W.2d 817 (2014). "The doctrine of collateral estoppel must be applied so as to strike a balance between the need to eliminate repetitious and needless litigation and the interest in affording litigants a full and fair adjudication of the issues involved in their claims." Storey v. Meijer, Inc., 431 Mich. 368, 372, 429 N.W.2d 169 (1988). However, collateral estoppel "does not apply to consent judgments where factual issues are neither tried nor conceded." Smit v. State Farm Mut. Auto. Ins. Co., 207 Mich.App. 674, 682, 525 N.W.2d 528 (1994), citing Van Pembrook v. Zero Mfg. Co., 146 Mich.App. 87, 102–103, 380 N.W.2d 60 (1985). There is no indication that the factual issues involved in the prior proceeding were actually tried or conceded by entry of the consent judgment. On the contrary, the consent judgment was merely an agreement between the parties regarding a temporary placement for the wards who were under the supervision of Children's Aid.
Additionally, the consent judgment was not a final decision on the merits. By its own terms, the consent judgment was a temporary resolution of the wards' placement "for a period of six months," subject to ongoing review, not a final, conclusive resolution of the child protection proceedings. The issues involved in the prior proceeding also differ from those at issue here. For collateral estoppel to preclude relitigation of an issue, "the ultimate issue to be concluded must be the same as that involved in the first action." Rental Props., 308 Mich.App. at 529, 866 N.W.2d 817. "The issues must be identical, and not merely similar." Id. In the Canadian proceeding, the ultimate issue was what steps were necessary and appropriate under Canadian law to protect the wards from harm, with due consideration of the children's best interests; it did not involve a determination of who would be the best guardian for the children under Michigan's Estates and Protected Individuals Code (EPIC), MCL 700.1101 et seq. The issues involved in this petition are not identical to those involved in the Canadian proceeding, and for that reason, the probate court erred when it applied collateral estoppel to bar Bibi's petition.
E. RES JUDICATA
The probate court similarly erred when it applied res judicata to bar Bibi's petition. "The doctrine of res judicata is intended to relieve parties of the cost and vexation of multiple lawsuits, conserve judicial resources, and encourage reliance on adjudication, that is, to foster the finality of litigation." Bryan v. JPMorgan Chase Bank, 304 Mich.App. 708, 715, 848 N.W.2d 482 (2014) (quotation marks and citation omitted). For res judicata to preclude a claim, three elements must be satisfied: "(1) the prior action was decided on the merits, (2) both actions involve the same parties or their privies, and (3) the matter in the second case was, or could have been, resolved in the first." Adair v. Michigan, 470 Mich. 105, 121, 680 N.W.2d 386 (2004). "[T]he burden of proving the applicability of ... res judicata is on the party asserting it." Baraga Co. v. State Tax Comm., 466 Mich. 264, 269, 645 N.W.2d 13 (2002).
Because we conclude that the probate court erred when it applied collateral estoppel and res judicata, we do not consider Bibi's arguments that the probate court also erred by failing to hold an evidentiary hearing or by failing to state sufficient factual findings to support its decision.
--------
Although "[r]es judicata applies to consent judgments," Ditmore v. Michalik, 244 Mich.App. 569, 576, 625 N.W.2d 462 (2001), the consent judgment at issue here was not a final decision for purposes of res judicata. "To be accorded the conclusive effect of res judicata, the judgment must ordinarily be a firm and stable one, the ‘last word’ of the rendering court...." Kosiel v. Arrow Liquors Corp., 446 Mich. 374, 381, 521 N.W.2d 531 (1994) (quotation marks and citation omitted). Thus, neither orders granting temporary relief "until ... further order" of the court, id., nor interlocutory orders, Indiana Ins. Co. v. Auto–Owners Ins. Co., 260 Mich.App. 662, 671 n. 8, 680 N.W.2d 466 (2004), generally carry preclusive effect under res judicata. The consent judgment was clearly not intended to be the last word of the Canadian court with regard to the wards. It was, rather, an agreement between the parties regarding a temporary placement. Indeed, it ordered Wallace and the maternal aunt to maintain a certain residence until " further Order of the Court."
Even if the consent judgment could be characterized as a final decision, "[r]es judicata does not bar a subsequent action between the same parties or their privies when the facts have changed or new facts have developed," Bennett v. Mackinac Bridge Auth., 289 Mich.App. 616, 636 n. 10, 808 N.W.2d 471 (2010), or when there has been an intervening change of law that "alters the legal principles on which the court will resolve the subsequent case," Ditmore, 244 Mich.App. at 581 n. 5, 625 N.W.2d 462. More than a year passed between the entry of the consent judgment and the probate court's decision, during which there were intervening changes of both fact and law. During that time, the wards' father died, their mother was imprisoned, the authority of Children's Aid to supervise the wards expired, and the proper venue for a guardianship or custody changed from Ontario to Michigan. Moreover, according to Bibi's allegations, which Wallace did not contest in the probate court, numerous other material facts had also changed: the maternal aunt no longer lived with Wallace to provide joint care and custody for the wards, the relationship between Bibi and Wallace had deteriorated significantly—Bibi claimed that Wallace requested compensation in exchange for allowing her to visit the children and then ultimately denied her access to them—Wallace became dependent on the aid of others to provide proper care and custody for the wards, Wallace began to permit her autistic son to babysit the wards, Wallace admitted in written correspondence that she was having difficulty caring for the wards, and despite the mother's addiction issues, Wallace permitted her to live with and care for the wards. Finally, because the wards began to reside in Wayne County, Michigan law eventually displaced Ontario law.
Given these changed circumstances, it was error for the probate court to apply res judicata to bar Bibi's petitions. In guardianship matters involving minor children, our probate courts are charged to "appoint as guardian a person whose appointment serves the minor's welfare," even if that person is a "professional guardian." MCL 700.5212. But instead of basing its guardianship decision on the appointment that would serve the wards' welfare, the probate court relied on its erroneous application of preclusion principles, reasoning that because Bibi's petitions were barred, it could simply grant Wallace's competing petitions. In doing so, the probate court abdicated its statutory authority to decide the issue on the merits and, therefore, it abused its discretion. See Loutts v. Loutts, 298 Mich.App. 21, 24, 826 N.W.2d 152 (2012) (noting that a trial court's failure to exercise discretion when required constitutes an abdication and, therefore, an abuse of discretion). In situations such as this, when our courts are entrusted with safeguarding the interests of minor children, res judicata must be applied with great care. See Pierson Sand & Gravel, Inc. v. Keeler Brass Co., 460 Mich. 372, 383, 596 N.W.2d 153 (1999) ("The goal of res judicata is to promote fairness, not lighten the loads of the state court by precluding suits whenever possible.").
F. PROPER CAUSE OR CHANGE IN CIRCUMSTANCES
We next consider the alternative grounds for affirmance offered by Wallace. See Middlebrooks v. Wayne Co., 446 Mich. 151, 166 n. 41, 521 N.W.2d 774 (1994) (recognizing that an appellee may urge alternative grounds in support of a judgment in its favor). In the circuit court, Wallace argued that Bibi had not established grounds for revisiting an established custody order. The circuit court agreed. On appeal, Bibi argues that the circuit court erred by concluding that her purported failure to establish proper cause or changed circumstances under the Child Custody Act, MCL 722.21 et seq. , was a valid ground for affirming the probate court's guardianship decision. We agree. Contrary to Wallace's arguments on appeal, MCL 722.27(1)(c) does not apply to guardianship decisions by the probate court; it applies to custody actions, orders, and judgments in "the circuit court." MCL 722.27(1) ; see also MCL 722.26(1) (stating that the act applies to "circuit court child custody disputes and actions"); MCL 722.26b(1) and (5) (granting guardians standing to bring custody actions and providing that the probate judge who appointed the guardian should act as the circuit judge for such child custody actions). The probate court generally has exclusive jurisdiction over a proceeding that concerns a guardianship. MCL 700.1302(c). Because there was no custody order from the circuit court involving the wards, the probate court's guardianship order neither could nor did modify "an order or judgment of the circuit court." Consequently, MCL 722.27(1)(c) did not apply and the circuit court erred when it determined otherwise.
G. REASSIGNMENT ON REMAND
Bibi argues that the probate judge made several comments that warrant reassignment of the case on remand. "The general concern when deciding whether to remand to a different trial judge is whether the appearance of justice will be better served if another judge presides over the case." Bayati v. Bayati, 264 Mich.App. 595, 602, 691 N.W.2d 812 (2004). In deciding whether to remand to a different judge, this Court considers whether "the original judge would have difficulty in putting aside previously expressed views or findings," whether "reassignment is advisable to preserve the appearance of justice," and whether "reassignment will not entail excessive waste or duplication." Id. at 603, 691 N.W.2d 812.
Bibi contends that the probate judge made comments that suggest bias against her:
Just because she [Bibi] has a lot of money and has the ability to access the Courts, doesn't mean that she gets to constantly re-litigate the same issues over and over again. And that's the way I see it, is that this [action] is a re-litigation of things that took place in 2012 in the Canadian Court system. And I don't see anything with respect to Ms. Wallace's care of these children that should cause me to open up this can of worms on this competing guardianship matter.
We agree that the probate judge's comments about Bibi's wealth were inappropriate, but we do not agree that the comments warrant reassignment. The record does not show that the probate judge would have difficulty in putting aside her previously expressed views or findings. Id. Reassignment is also not necessary to preserve the appearance of justice. Even though the probate court's application of preclusion principles was erroneous, that fact does not demonstrate bias or prejudice that would tend to give the appearance of impropriety. See In re Susser Estate, 254 Mich.App. 232, 237, 657 N.W.2d 147 (2002).
III. CONCLUSION
We reverse the decisions of the circuit and probate courts and remand this matter to the probate court for consideration of the petitions on the merits.
Reversed and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.
JANSEN, P.J., and SERVITTO and M.J. KELLY, JJ., concurred.