“The general purpose of case evaluation under MCR 2.403 is to expedite and simplify the final settlement of cases to avoid a trial.” Vandercook v Auto-Owners Ins Co, 325 Mich App 195, 202 (2018).
Any civil action in which the relief sought is primarily money damages or division of property may be submitted to case evaluation, including actions filed in district court, unless the parties stipulate to an ADR process outlined in MCR 2.403(A)(2)-(3),1 in which case the parties cannot be subsequently ordered to participate in case evaluation without their written consent. MCR 2.403(A)(1); MCR 2.403(A)(5).
“A court may exempt claims seeking equitable relief from case evaluation for good cause shown on motion or by stipulation of the parties if the court finds that case evaluation of such claims would be inappropriate.” MCR 2.403(A)(4). However, when a trial court does not exempt any aspect of plaintiff’s claim under MCR 2.403(A)(4), neither party objects to case evaluation, and the case involves one plaintiff against one defendant, the case evaluation panel has the entire case for consideration and determination. Vandercook, 325 Mich App at 204-205 (finding that plaintiff’s failure to address certain claims in his case evaluation summary did not serve to exempt those claims from the panel’s consideration). Parties do not have the authority to exempt claims from case evaluation without court approval. See CAM Constr v Lake Edgewood Condo Ass’n, 465 Mich 549, 557 (2002).
“The judge to whom an action is assigned or the chief judge may select it for case evaluation by written order after the filing of the answer
(a) on written stipulation by the parties,
(b) on written motion by a party, or,
(c) if the parties have not submitted an ADR plan under [MCR 2.403(A)].”MCR 2.403(B)(1).
C.Objections to Case Evaluation
To object to case evaluation, a written motion and notice of hearing must be filed and served within 14 days after notice of the order assigning the case to case evaluation. MCR 2.403(C)(1). “The motion must be set for hearing within 14 days after it is filed, unless the court orders otherwise.” Id. “A timely motion must be heard before the case is submitted to case evaluation.” MCR 2.403(C)(2).
Each party must pay a case evaluation fee. MCR 2.403(H)(1). “Only a single fee is required of each party, even where there are counterclaims, cross-claims, or third-party claims.” MCR 2.403(H)(2). Similarly, “[i]f one claim is derivative of another (e.g., husband-wife, parent-child) they must be treated as a single claim, with one fee to be paid[.]” MCR 2.403(H)(3). The court must waive a case evaluation fee imposed under MCR 2.403(H) if the person is entitled to a fee waiver under MCR 2.002.2 MCR 2.403(H)(2). See Section 1.11 for additional discussion of fee waivers.
Refundable fees. Fees paid pursuant to MCR 2.403(H) must be refunded to the parties if:
•the order submitting the matter to case evaluation is set aside by the court;
•the court adjourns the case evaluation hearing on its own initiative; or
•with at least 14 days written notice to the ADR clerk, the parties settle, dismiss, enter a judgment disposing of the action, or an order of adjournment is entered by stipulation or motion. MCR 2.403(H)(4).
Nonrefundable fees. Fees paid pursuant to MCR 2.403(H) must not be refunded if:
•the fees are applied to an adjourned hearing date; or
•absent good cause, a requested adjournment is made and granted less than 14 days before the scheduled case evaluation. MCR 2.403(H)(5).
E.Submission of Summary and Supporting Documents
At least 14 days prior to the hearing, parties are required to serve a case evaluation summary and supporting documents pursuant to MCR 2.107, and file proof of service and three copies of the summary and supporting documents with the ADR clerk. MCR 2.403(I)(1)(a)-(b). “Each failure to timely file and serve the materials identified in [MCR 2.403(I)(1)] and each subsequent filing of supplemental materials within 7 days of the hearing, subjects the offending attorney or party to a $150 penalty to be paid in the manner specified in the case evaluation hearing. Filing and serving the materials identified in [MCR 2.403(I)(1)] within 24 hours of the hearing subjects the offending attorney or party to an additional $150 penalty.” MCR 2.403(I)(2).
F.Case Evaluation Decision3
The panel’s case evaluation must be in writing and submitted to the ADR clerk within 7 days after the case evaluation hearing. MCR 2.403(K)(1). The evaluation must indicate if it is a nonunanimous award. Id.The panel must provide a written copy of the evaluation to the attorney for each party if an evaluation is made immediately following the hearing. Id. “If an evaluation is not made immediately following the hearing, the evaluation must be served by the ADR clerk on each party within 14 days after the hearing.” Id. Except as indicated in MCR 2.403(H)(3) (derivative claims), the panel’s case evaluation “must include a separate award as to each plaintiff’s claim against each defendant and as to each cross-claim, counterclaim, or third-party claim that has been filed in the action.” MCR 2.403(K)(2). For purposes of MCR 2.403(K)(2), “all such claims filed by any one party against any other party shall be treated as a single claim.” Id. In addition, although the evaluation cannot include a separate award on any equitable claim, the panel may consider equitable claims when determining the award amount. MCR 2.403(K)(3).
In certain tort cases, “if the panel unanimously finds that a party’s action or defense as to any other party is frivolous, the panel shall so indicate on the evaluation.” MCR 2.403(K)(4). If a party’s claim or defense is found to be frivolous, that party may file a motion within 14 days seeking judicial review of the panel’s finding. See MCR 2.403(N)(2). For more information on a proceeding involving a potentially frivolous claim, see Section 6.5(G).
In certain medical malpractice cases, the evaluation must specifically find whether there has been a breach of the applicable standard of care, or whether reasonable minds could differ on whether a breach occurred. MCR 2.403(K)(5). Although specific discussion of case evaluation in the context of medical malpractice is outside the scope of this benchbook, see Section 9.11 for more information on medical malpractice actions generally. In addition, see the Michigan Judicial Institute’s Evidence Benchbook, Chapter 4, for information on expert testimony, including experts in medical malpractice cases.
G.Judicial Review of Panel Finding a Claim or Defense Frivolous
”In a tort case to which MCL 600.4915(2) or MCL 600.4963(2) applies, if the panel unanimously finds that a party’s action or defense as to any other party is frivolous, the panel shall so indicate on the evaluation.” MCR 2.403(K)(4). “Except as provided in [MCR 2.403(N)(2)], if a party’s claim or defense was found to be frivolous under [MCR 2.403(K)(4)], that party shall post a cash or surety bond, pursuant to MCR 3.604, in the amount of $5,000 for each party against whom the action or defense was determined to be frivolous.” MCR 2.403(N)(3). “The bond must be posted within 56 days after the case evaluation hearing or at least 14 days before trial, whichever is earlier.” MCR 2.403(N)(3)(a). An insurance company that insures a defendant against a claim may not act as the surety. MCR 2.403(N)(3)(b). The court must dismiss a claim found to be frivolous or enter a default against a defendant whose defense was declared frivolous if the party fails to post bond as required. MCR 2.403(N)(3)(c). “The action shall proceed to trial as to the remaining claims and parties, and as to the amount of damages against a defendant in default.” Id.
A party whose claim or defense was unanimously declared frivolous “may request that the court review the panel’s finding by filing a motion within 14 days after the ADR clerk sends notice of the rejection of the case evaluation award.” MCR 2.403(N)(2). Oral arguments are permitted at the court’s discretion, but the motion can only be supported by summaries and documents that were considered by the case evaluation panel. MCR 2.403(N)(2)(a). “If the court agrees with the panel’s determination, the provisions of [MCR 2.403(N)(3)] apply, except that the bond must be filed within 28 days after the entry of the court’s order determining the action or defense to be frivolous.” MCR 2.402(N)(2)(c). A judge who hears a motion under MCR 2.402(N) cannot preside at a nonjury trial of the action. MCR 2.402(N)(2)(d).
MCR 2.403(N) does not apply to actions that sound in contract. Wilcoxon v Wayne Co Neighborhood Legal Servs, 252 Mich App 549, 552 (2002).
H.Acceptance or Rejection of Evaluation
Within 28 days of being served with the evaluation,4 each party must file with the ADR clerk a written acceptance or rejection of the evaluation. MCR 2.403(L)(1). Failure to do so constitutes a rejection. Id. “Even if there are separate awards on multiple claims, the party must either accept or reject the evaluation in its entirety as to a particular opposing party.” Id.
When the evaluation involves multiple parties, specific rules apply:
“(a) Each party has the option of accepting all of the awards covering the claims by or against that party or of accepting some and rejecting others. However, as to any particular opposing party, the party must either accept or reject the evaluation in its entirety.
(b) A party who accepts all of the awards may specifically indicate that he or she intends the acceptance to be effective only if
(i) all opposing parties accept, and/or
(ii) the opposing parties accept as to specified coparties.”
If such a limitation is not included in the acceptance, an accepting party is deemed to have agreed to entry of judgment, or dismissal as provided in [MCR 2.403(M)(1)], as to that party and those of the opposing parties who accept, with the action to continue between the accepting party and those opposing parties who reject.” MCR 2.403(L)(3).
“The grammar of [MCR 2.403(L)(3)(a)-(b)] indicates that the word ‘some’ in the phrase ‘accepting some and rejecting others’ refers to the awards, not the parties.” Mercantile Bank Mtg Co, LLC v NGPCP/BRYS Ctr, LLC, 305 Mich App 215, 225 (2014) (finding that although the case evaluation panel failed to follow the court rules when it issued a single award for multiple parties, the plaintiff’s partial acceptance/partial rejection of the single award was an improper response that constituted a rejection of the entire evaluation).
A party’s acceptance or rejection cannot be disclosed until the expiration of the 28-day period. MCR 2.403(L)(2). Once the 28 days has passed, the ADR clerk must send a notice indicating each party’s response to the evaluation. Id.
1.Issues Regarding Rejection
If the evaluation is rejected, “the action proceeds to trial in the normal fashion.”5 MCR 2.403(N)(1). Before trial, the ADR clerk will place a copy of the case evaluation in a sealed envelope and file it with the clerk of the court. MCR 2.403(N)(4). In a bench trial, the envelope should not be opened, and the parties should not reveal the case evaluation amount until after the court has rendered its judgment. Id. Declaring a mistrial and reassigning the case to another judge is the only appropriate sanction “where a party, in clear violation of MCR 2.403(N)(4), makes a blatant effort to influence the court before it renders judgment and there is no suggestion that the revelation was done as a means to forum shop.” Bennett v Med Evaluation Specialists, 244 Mich App 227, 231-233 (2000). See also MCR 2.403(N)(2)(d) (“[t]he judge who hears a motion under [MCR 2.403(N)] may not preside at a nonjury trial of the action”). However, “a new trial is [not] required in every case in which a violation of MCR 2.403(N)(4) occurs.” Cranbrook Prof Bldg, LLC v Pourcho, 256 Mich App 140, 144 (2003) (new trial was not required where “case evaluation was revealed to the court before commencement of trial under the presumption that the case would be tried by a jury” and plaintiffs did not seek a new trial under MCR 2.403(N)(4) until an adverse judgment was entered). “[T]he appropriate sanction depends on the particular facts of the case.” Cranbrook, 256 Mich App at 144.
2.Issues Regarding Acceptance
“If all parties accept the panel’s evaluation, the case is over.” CAM Constr v Lake Edgewood Condo Ass’n, 465 Mich 549, 557 (2002). Where there is acceptance by all parties, the trial court should enter the judgment “in accordance with the evaluation, unless the amount of the award is paid within 28 days after notification of the acceptances, in which case the court shall dismiss the action with prejudice.” MCR 2.403(M)(1). “The judgment or dismissal shall be deemed to dispose of all claims in the action and includes all fees, costs, and interest to the date it is entered, except for cases involving rights to personal protection insurance benefits under MCL 500.3101 et seq.,[6] for which judgment or dismissal shall not be deemed to dispose of claims that have not accrued as of the date of the case evaluation hearing.” MCR 2.403(M)(1). See also Magdich & Assoc, PC v Novi Dev Assoc LLC, 305 Mich App 272, 274-275 (2014), where the parties accepted a case evaluation award without qualification and the plaintiff paid the award to the defendant before the trial court granted defendant’s motion to amend its counter-complaint. The plaintiff moved for entry of an order of dismissal with prejudice under MCR 2.403(M), alleging that the case was resolved with regard to all claims, which the trial court denied. Magdich, 305 Mich App at 275. The Michigan Court of Appeals reversed, holding that “both parties accepted the case evaluation award without qualification, and therefore, the case is over.” Id. at 281 (noting that the court rule does not allow a party to make a showing that less than all issues were submitted to case evaluation).
“If only a part of an action has been submitted to case evaluation pursuant to [MCR 2.403(A)(4)] and all of the parties accept the panel’s evaluation, the court shall enter an order disposing of only those claims.” MCR 2.403(M)(2).
In cases involving multiple parties, the judgment or dismissal referenced in MCR 2.403(M)(1) must “be entered as to those opposing parties who have accepted the portions of the evaluation that apply to them.” MCR 2.403(M)(3).
I.Motion to Set Aside Case Evaluation
Although a case is completely settled once both parties accept a case evaluation award, a party is not precluded from filing a motion to set aside its acceptance. Goch Props, LLC v C Van Boxell Transp, Inc, 477 Mich 871 (2006). A trial court has discretion to set aside an acceptance of the award before or after entry of a judgment on the award, but should set aside after entry of a judgment “only if failure to do so would result in substantial prejudice.” Reno v Gale, 165 Mich App 86, 92-93 (1987).
1 See Section 6.4 for more information on ADR and MCR 2.403(A)(2)-(3).
2 “Notwithstanding any other provision of [MCR 2.002], courts must enable a litigant who seeks a fee waiver to do so by an entirely electronic process.” MCR 2.002(L).
3 Discussion of the case evaluation hearing is outside the scope of this benchbook. For more information on the hearing itself, see MCR 2.403(J).
4 For cases filed in district court this time period may be shortened. See MCR 2.403(A)(1).
5 See Chapter 7 for discussion of civil trials.
6 MCL 500.3101 et seq. governs no-fault cases. In “no-fault cases involving the right to PIP benefits, the trial court’s judgment may not dispose of claims that have not accrued as of the date of the case evaluation hearing.” Vandercook v Auto-Owners Ins Co, 325 Mich App 195, 205 (2018). However, any claims that have accrued “at the time of the case evaluation are, as a matter of law, disposed of pursuant to MCR 2.403(M)(1).” Vandercook, 325 Mich App at 205 (any wage loss that had accrued prior to the date of the case evaluation hearing was deemed resolved despite plaintiff’s refusal to address accrued wage loss in his case evaluation summary, or the notation inserted in his acceptance form).