                         STATE OF MICHIGAN

                          COURT OF APPEALS



BONY ROCHLANI a/k/a BONI ROCHLANI,                       UNPUBLISHED
                                                         September 4, 2018
              Plaintiff-Appellant,

v                                                        No. 336651
                                                         Oakland Circuit Court
SANFORD AARON and ACUJUST, LLC,                          LC No. 2016-150924-CK

              Defendants-Appellees.


BONY ROCHLANI a/k/a BONI ROCHLANI,

              Plaintiff-Appellant,

v                                                        No. 336768
                                                         Oakland Circuit Court
SANFORD AARON and ACUJUST, LLC,                          LC No. 2016-150924-CK

              Defendants-Appellees.


BONY ROCHLANI a/k/a BONI ROCHLANI,

              Plaintiff-Appellant,

v                                                        No. 336786
                                                         Oakland Circuit Court
PIONEER STATE MUTUAL INSURANCE                           LC No. 2016-150923-CK
COMPANY,

              Defendant-Appellee.


Before: SERVITTO, P.J., and GLEICHER and STEPHENS, JJ.

PER CURIAM.




                                            -1-
         In these consolidated matters, plaintiff appeals as of right trial court orders: (1) granting
summary disposition in favor of defendants Sanford Aaron and Acujust, LLC on plaintiff’s
negligence and breach of fiduciary duty claims against them; (2) imposing sanctions against
plaintiff and her counsel for violating MCR 2.114(D) and (E), and; (3) granting summary
disposition in favor of defendant Pioneer State Mutual Insurance Company on plaintiff’s claim
that it breached their insurance contract. We affirm in all cases and remand to the trial court to
award sanctions in favor of Sanford Aaron and Acujust, LLC for their actual damages and
expenses, including reasonable attorney fees, incurred in having to respond to plaintiff’s
vexatious appeal pursuant to MCR 7.216(C) in Docket No. 336651.

         Plaintiff owns a home in West Bloomfield, Michigan, and had a homeowner’s insurance
policy on the home through Pioneer State Mutual Insurance Company (“Pioneer”). On or about
February 26, 2014, plaintiff claims that she incurred damages to the home and the personal
property within due to the freezing and sudden bursting of water pipes in the home, and the entry
of raccoons into the garage. On or about June 3, 2014, plaintiff hired defendants Sanford Aaron
and Acujust, LLC to provide her with insurance adjusting services relating to a claim for the loss
to be filed with Pioneer. Pioneer ultimately denied the claim. On January 7, 2016, plaintiff filed
suit against Sanford Aaron and Acujust, LLC (collectively “Aaron”) alleging breach of fiduciary
duty, breach of contract, and negligence relating to their handling of her claim.

        The trial court granted summary disposition in favor of Aaron and further found that
plaintiff and her counsel violated MCR 2.114(D) and (E) by submitting verified pleadings which
failed to attach or specifically identify the denial letter that Pioneer had sent, and which
“otherwise lack arguable legal merit, are ungrounded in fact, and are unwarranted by existing
law . . . .” The trial court thus sanctioned plaintiff and her counsel and awarded defendants
reasonable expenses incurred from the filing of plaintiff’s amended complaint, including
reasonable attorney fees, reducing the sanctions to a judgment in Aaron’s favor in the amount of
$36,181.90.

        On January 7, 2016, plaintiff filed a separate action against Pioneer alleging that it
breached their insurance contract and seeking declaratory relief.1 Pioneer moved for summary
disposition, contending that there was no question that plaintiff intentionally concealed or
misrepresented material facts relating to the claim, thereby voiding the policy, and that she also
did not report the loss to Pioneer in a timely manner, thereby extinguishing any rights and
obligations under the policy. The trial court agreed, entering summary disposition in favor of
Pioneer.




1
  We note that in both actions, plaintiff and her counsel signed the complaints stating that there
was “no other civil action arising out of the same transaction or occurrence as alleged” in each
respective complaint—despite the fact that the complaints did, in fact, arise out of the same
transaction or occurrence. This is in violation of MCR 2.113(C)(2).


                                                 -2-
       These appeals followed.

                                        Docket No. 336651

        Plaintiff first contends that the trial court erred in granting summary disposition in favor
of Aaron, as there was a genuine issue of material fact concerning the effects of Aaron’s failures
to provide sufficient proofs of loss to Pioneer. We disagree.

        We review de novo a trial court's decision regarding a motion for summary disposition.
Bernardoni v City of Saginaw, 499 Mich 470, 472; 886 NW2d 109 (2016). In reviewing a
motion for summary disposition brought under MCR 2.116(C)(10), we consider the affidavits,
pleadings, depositions, admissions, and documentary evidence filed in the action or submitted by
the parties in the light most favorable to the party opposing the motion. Quinto v Cross & Peters
Co, 451 Mich 358, 362; 547 NW2d 314 (1996). Summary disposition under MCR 2.116(C)(10)
is appropriate where the documentary evidence shows there is no genuine issue with respect to
any material fact, and the moving party is entitled to judgment as a matter of law. Id.

        To prevail on a claim for breach of contract, a plaintiff must establish by a preponderance
of the evidence that “(1) there was a contract, (2) the other party breached the contract, and (3)
the breach resulted in damages to the party claiming breach.” Bank of Am, NA v First Am Title
Ins Co, 499 Mich 74, 100; 878 NW2d 816 (2016). Causation of damages is an essential element
of any breach of contract action. Miller-Davis Co v Ahrens Const, Inc, 495 Mich 161, 178; 848
NW2d 95 (2014).          That is, the plaintiff must establish a causal link between the
asserted breach of contract and the claimed damages. Gorman v Am Honda Motor Co, Inc, 302
Mich App 113, 118–19; 839 NW2d 223 (2013). “The party asserting a breach of contract has
the burden of proving its damages with reasonable certainty, and may recover only those
damages that are the direct, natural, and proximate result of the breach.” Doe v Henry Ford
Health Sys, 308 Mich App 592, 601–02; 865 NW2d 915 (2014), quoting Alan Custom Homes,
Inc v Krol, 256 Mich App 505, 512; 667 NW2d 379 (2003).

        To establish a prima facie case of negligence, a plaintiff must prove: “(1) a duty owed by
the defendant to the plaintiff, (2) a breach of that duty, (3) causation, and (4) damages.” Case v
Consumers Power Co, 463 Mich 1, 6; 615 NW2d 17 (2000). “Whether a defendant owes a
particular plaintiff a duty is a question of law that this Court reviews de novo.” Bailey v
Schaaf, 494 Mich 595, 603; 835 NW2d 413 (2013).

         Proximate causation is a required element of a negligence claim. Loweke v Ann Arbor
Ceiling & Partition Co, LLC, 489 Mich 157, 162; 809 NW2d 553 (2011). “To establish
proximate cause, the plaintiff must prove the existence of both cause in fact and legal cause.”
Weymers v Khera, 454 Mich 639, 647; 563 NW2d 647 (1997). Cause in fact requires the
plaintiff to “present substantial evidence from which a jury may conclude that more likely than
not, but for the defendant's conduct, the plaintiff's injuries would not have occurred.” Id. at 647-
648 (quotation marks and citation omitted). “To establish legal cause, the plaintiff must show
that it was foreseeable that the defendant's conduct may create a risk of harm to the victim, and . .
. [that] the result of that conduct and intervening causes were foreseeable.” Id. at 648 (quotation
marks and citation omitted; alterations in original). Causation is an issue typically reserved for


                                                -3-
the trier of fact unless there is no dispute of material fact. Holton v A+ Ins Assoc, Inc, 255 Mich
App 318, 326; 661 NW2d 248 (2003).

        A fiduciary relationship arises from the reposing of faith, confidence, and trust, along
with the reliance of one upon the judgment and advice of another. First Public Corp v
Parfet, 246 Mich App 182, 191; 631 NW2d 785 (2001), vacated in part on other grounds, 468
Mich 101; 658 NW2d 477 (2003). A fiduciary is under a duty to act for the benefit of the other
person concerning matters within the scope of the relationship. Teadt v Lutheran Church
Missouri Synod, 237 Mich App 567, 581; 603 NW2d 816 (1999). “Damages may be obtained
for a breach of fiduciary duty when a position of influence has been acquired and abused, or
when confidence has been reposed and betrayed.” In re Duane v Baldwin Tr, 274 Mich App
387, 401; 733 NW2d 419 (2007) (internal quotation marks and citation omitted). The existence
of a legal duty is a question of law for the court. Id.
        Plaintiff signed a contract with Aaron on June 3, 2014, wherein Aaron agreed to “assist in
the preparation, presentation and adjusting of insurance claim,” and plaintiff agreed to provide
Aaron with “all relevant information regarding claim procedures, policy requirements . . . and
any other information that may be needed to the claim.” Plaintiff asserted that Aaron breached
the contract with her by providing a sworn statement in proof of loss to Pioneer that was
deficient. Plaintiff claims that Pioneer advised Aaron that the sworn statement was deficient and
that the deficient sworn statement caused Pioneer to send plaintiff’s claim for further
investigation and schedule her for an examination under oath. Plaintiff further asserted that
Aaron failed to timely provide Pioneer with repair estimates and timely schedule inspections of
the property and that all of Aaron’s failures amounted to a failure to properly and adequately
prepare, present, and adjust plaintiff’s claim, which ultimately caused Pioneer to deny her claim,
caused her a diminution in the value of her home, the loss of personal property, and the costs of
additional living expenses.

        Assuming that all of the actions asserted by plaintiff in fact occurred and that Aaron’s
actions did constitute a breach of contract, breaches of fiduciary duties, and breach of duties in
negligence, plaintiff did not establish that any of the breaches were the proximate cause of any
damages suffered. Pioneer denied coverage for plaintiff’s loss in a letter dated April 24, 2015.
The letter stated:

       The documents submitted by you to Pioneer State Mutual Insurance Company
       purporting to be sworn statements in proof of losses and all other documents
       purporting to be sworn statements in proof of loss subsequent to the initial proof
       of loss, relating to the water and raccoon losses which occurred on or about
       February 26, 2014, at your home . . . cannot be accepted by the company as
       proofs of loss. Accordingly, those documents are hereby rejected and your claim,
       fully, finally and formally denied for the following reasons, among others:

              You did engage in fraud and/or false swearing and/or misrepresentation
               with respect to the sworn statement in proof of loss submitted regarding
               your knowledge and notice of the claimed loss and the amount of the loss.

              You did engage in fraud and/or false swearing and/or material
               misrepresentation with respect to your statements made at your

                                                -4-
               Examination Under Oath regarding the documentation submitted in
               furtherance of your claim including, but not limited to, your Proof of Loss
               and the amount of loss.

              You did, or someone by or at your direction intentionally caused this loss
               to occur.

              You failed to give prompt notice of loss to us and prejudiced our
               investigation and the evaluation of the circumstances around the loss
               including potential damages.

              You failed to cooperate in our investigation as it relates to making your
               son available to answer questions by PSMIC employees and/or
               representatives.

       As a result of your actions as described above, your policy is void at the time you
       submitted the loss notice on May 20, 2014.

        Aaron assisted plaintiff in preparing her sworn statement in proof of loss. Assuming that
plaintiff is correct in her assertion that the sworn statement and its later corrected version were
deficient, a deficient sworn statement in proof of loss was not a stated reason for Pioneer’s denial
of plaintiff’s claim. While the denial letter did state the sworn statements in proof of loss
“cannot be accepted by the company as proofs of loss” the letter did not state that the denial was
based upon deficient or inaccurate proofs of loss. Instead, the letter went on to say that the
sworn statements in proof of loss are rejected and plaintiff’s claim “fully, finally and formally
denied for the following reasons, among others . . . .” Only the listed reasons that follow that
sentence are the reasons for Pioneer’s denial of her claim—and none have to do with a deficient
sworn statement in proof of loss. Thus, contrary to plaintiff’s assertion, her claim was not denied
due to persistent failures to provide sufficient proofs of loss to the insurer and the insurer did not
cite this among the reasons for declining coverage. Moreover, none of the reasons cited for
declining coverage can be attributed to Aaron.

        The first reason stated for denying plaintiff’s claim was that plaintiff engaged in fraud or
false swearing with respect to the sworn statement as it concerned her knowledge and notice of
the claimed loss and the amount of the loss. Aaron could only fill out the sworn statement as to
plaintiff’s knowledge and notice of the claimed loss based on the information that plaintiff
provided. Aaron would have no independent way of determining when plaintiff knew of the
claimed loss. And, plaintiff did not claim in her complaint that Aaron provided inaccurate
information in the sworn statement; rather, she alleged that information was missing.

         With respect to the amount of the loss, the initial sworn statement indicated that whole
damage and loss was yet to be determined, with an explanation given that plaintiff would require
services provided by various third parties to determine the costs and was waiting for the
insurance carrier’s decision before proceeding accordingly. Sanford Aaron testified at deposition
that at the time he initially spoke to plaintiff about submitting her proof of loss, she had not had
anyone at the home to assess the damage or give her an estimate as to repairs. He thus
encouraged her to hire a remediation and restoration company to get this process started. In a

                                                 -5-
second sworn proof of loss, a figure for damages was supplied, which, according to Aaron, came
from estimates for remediation and reconstruction that were prepared by a company called
Emergency Restoration. Sanford Aaron testified that he is not an expert in water loss or damage,
remediation, or reconstruction, and he relied on the figures provided by Emergency Restoration
as accurate, just as he relied on plaintiff’s representation as to when she discovered the damage
and how it occurred as accurate. The stated reason for denial, then, cannot be attributed to
Aaron.

        As to the second reasons for denying plaintiff’s claim, that she engaged in fraud or gave
false statements at her examination under oath regarding the documentation submitted in
furtherance of her claim, plaintiff testified at her deposition that Sanford Aaron was not with her
at her examination under oath nor did he give any false statements for her.

        Addressing the third reason for denying plaintiff’s claim, that she or someone at her
direction intentionally caused the loss to occur, there is no indication that Aaron knew that
plaintiff did or would be accused of causing the loss to occur. Sanford Aaron was not accused of
causing the loss to occur and did not know plaintiff before she hired him at the recommendation
of a restoration company. And, Sanford Aaron testified that he had no reason to disbelieve
plaintiff as to her explanation of how the loss occurred.

        The fourth reason given for denying plaintiff’s claim was that she failed to give prompt
notice of the loss and prejudiced Pioneer’s investigation and the evaluation of the circumstances
around the loss. The loss occurred at some point in February 2014. Plaintiff testified that she
did not advise Pioneer of the damage until May 2014. She further testified that she did not hire
Aaron until June 2014 and admitted that if there was delay in reporting the loss to Pioneer, it was
not Aaron’s fault.

        Finally, Pioneer denied plaintiff’s claim because she “failed to cooperate in our
investigation as it relates to making [her] son available to answer questions by PSMIC
employees and/or representatives.” Plaintiff hired an attorney for her examination under oath.
Plaintiff testified that this attorney advised her that Pioneer also wanted to take her son Kris’s
examination under oath. According to plaintiff, Kris lives in Los Angeles and was unavailable.
Plaintiff testified that she did nothing to make Kris available because the attorney told her she
did not have to do so.

       Because plaintiff cannot establish that Aaron caused the denial of her claim or any other
damages, the trial court appropriately granted summary disposition in Aaron and Accujust’s
favor.

       Plaintiff next claims that the trial court erred in concluding that her claims were devoid of
arguable legal merit and in awarding attorney fees and costs to Aaron. We disagree.

        “A trial court's finding that an action is frivolous is reviewed for clear error.” Kitchen v
Kitchen, 465 Mich 654, 661–62; 641 NW2d 245 (2002). We also review for clear error “the trial
court's determination whether to impose sanctions under MCR 2.114.” Guerrero v Smith, 280
Mich App 647, 677; 761 NW2d 723 (2008). “A decision is clearly erroneous where, although



                                                -6-
there is evidence to support it, the reviewing court is left with a definite and firm conviction that
a mistake has been made.” Kitchen, 465 Mich at 661-662.

        A party pleading a frivolous claim is subject to paying the costs of the other party. MCR
2.114(F); MCR 2.625(A)(2); MCL 600.2591. These authorities not only authorize but require a
court to sanction an attorney or party that files a frivolous action or defense. Meisner Law Group
PC v Weston Downs Condo Assn, 321 Mich App 702; 909 NW2d 890 (2017). Imposing
sanctions for asserting a frivolous action or defense is meant to deter parties and their attorneys
from filing documents or asserting claims or defenses that have not been sufficiently investigated
and researched or that are intended to serve an improper purpose. Id. “A court must determine
whether a claim or defense is frivolous on the basis of the circumstances at the time it was
asserted.” Id.

        “Frivolous” means:

               (i) The party's primary purpose in initiating the action or asserting the
               defense was to harass, embarrass, or injure the prevailing party.

               (ii) The party had no reasonable basis to believe that the facts underlying
               that party's legal position were in fact true.

               (iii) The party's legal position was devoid of arguable legal merit. [MCL
               600.2591(3)(a)]

     Sanctions shall also be imposed by the trial court if a document is signed in violation of
MCR 2.114. Under MCR 2.114(D):

       The signature of an attorney or party, whether or not the party is represented by an
       attorney, constitutes a certification by the signer that

       (1) he or she has read the document;

       (2) to the best of his or her knowledge, information, and belief formed after
       reasonable inquiry, the document is well grounded in fact and is warranted by
       existing law or a good-faith argument for the extension, modification, or reversal
       of existing law; and

       (3) the document is not interposed for any improper purpose, such as to harass or
       to cause unnecessary delay or needless increase in the cost of litigation.

If a document is signed in violation of the above, the trial court “shall impose upon the person
who signed it, a represented party, or both, an appropriate sanction, which may include an order
to pay to the other party or parties the amount of the reasonable expenses incurred because of the
filing of the document, including reasonable attorney fees.” MCR 2.114(E).

        In her complaint, plaintiff asserted that the sworn statements on proof of loss submitted
by Aaron on her behalf were deficient and that Pioneer denied her claim because “it determined
that the sworn statements in proof of loss were fraudulent and misrepresented the amount of the

                                                 -7-
loss and for Aaron’s other failures to timely provide Pioneer with information required under the
Sworn proof of Loss such as specification of damage to the Property, an estimate of repairs or an
inventory of Plaintiff’s damaged personal property.” However, prior to filing the complaint,
both plaintiff and her attorney had received the denial letter from Pioneer explicitly stating the
reasons for the denial of her claim. Plaintiff did not attach the denial letter to her complaint or
even mention it. And, as previously detailed, none of the reasons set forth in the denial letter had
anything to do with a “deficient” sworn statement in proof of loss. Instead, the denial letter
details actions on plaintiff’s part that caused Pioneer to deny her claim. Because plaintiff and her
counsel had the denial letter in their possession before filing the complaint and, rather than
acknowledging the stated reasons for Pioneer’s denial of her claim, asserted the baseless and
meritless argument that her damages were caused by actions of Aaron, the trial court did not err
in finding that plaintiff’s complaint was frivolous as defined in MCL 600.2591(3)(a), or devoid
or arguable legal merit. Thus, the trial court did not err in sanctioning plaintiff and her counsel
for filing sanctionable pleadings under MCR 2.114(E).

        Plaintiff’s assertion that Sanford Aaron is an attorney litigant and thus barred from
recovering attorney fees is also devoid of legal merit. Plaintiff admittedly hired Sanford Aaron
as a public insurance adjuster. Plaintiff admitted at her deposition that she did not hire him as an
attorney, he provided no legal services to her, and that she did not sue him in his capacity as an
attorney. Thus, Sanford Aaron is not an attorney litigant. That Sanford Aaron is also an attorney
and employed a member of his law firm to defend him in this action does not preclude him from
recovering attorney fees expended in defending himself against an action brought against him as
a public adjuster.

        We further find that the appeal in this matter was vexatious. Plaintiff and her counsel
were aware at the time plaintiff filed her complaint that her claim with Pioneer had been denied
for reasons unrelated to Aaron, yet plaintiff still undertook litigation. Throughout the litigation,
it was revealed that plaintiff was untruthful about prior insurance claims for water damage and
evasive about how and when the claimed damage occurred, remediation efforts, and repairs.
There was no reasonable basis for a belief that there was a meritorious issue to be determined on
appeal in this matter. Sanctions are thus awarded in favor of Sanford Aaron and Acujust in an
amount equal to their actual damages and expenses incurred, including reasonable attorney fees,
in having to respond to the vexatious appeal pursuant to MCR 7.216(C).

                                       Docket No. 336768

      Plaintiff challenges the amount of attorney fees awarded to Aaron as a sanction.
“The amount of sanctions imposed by a trial court is reviewed for an abuse of discretion.” BJ's
& Sons Const Co, Inc v Van Sickle, 266 Mich App 400, 410; 700 NW2d 432 (2005).

       MCR 2.114(E) provides, in relevant part:

       Sanctions for Violation. If a document is signed in violation of this rule, the
       court, on the motion of a party or on its own initiative, shall impose upon the
       person who signed it, a represented party, or both, an appropriate sanction, which
       may include an order to pay to the other party or parties the amount of the


                                                -8-
       reasonable expenses incurred because of the filing of the document, including
       reasonable attorney fees.

MCR 2.114(E) only requires the trial court to impose an appropriate sanction, which may include
an order to pay reasonable attorney fees; therefore, the trial court has the discretion to tailor
its sanction to the circumstances. Kaeb v Kaeb, 309 Mich App 556, 565; 873 NW2d 319 (2015).
“The burden of proving the reasonableness of the requested fees rests with the party requesting
them.” Vittiglio v Vittiglio, 297 Mich App 391, 409; 824 NW2d 591 (2012), quoting Smith v
Khouri, 481 Mich 519, 528–529; 751 NW2d 472 (2008).

      Factors to be considered in determining the reasonableness of an attorney fee are set forth
in MRPC 1.5 and include:

       (1) the time and labor required, the novelty and difficulty of the questions
       involved, and the skill requisite to perform the legal service properly;

       (2) the likelihood, if apparent to the client, that the acceptance of the particular
       employment will preclude other employment by the lawyer;

       (3) the fee customarily charged in the locality for similar legal services;

       (4) the amount involved and the results obtained;

       (5) the time limitations imposed by the client or by the circumstances;

       (6) the nature and length of the professional relationship with the client;

       (7) the experience, reputation, and ability of the lawyer or lawyers performing the
       services; and

       (8) whether the fee is fixed or contingent.

Additional factors to be considered are: “(1) the professional standing and experience of the
attorney; (2) the skill, time and labor involved; (3) the amount in question and the results
achieved; (4) the difficulty of the case; (5) the expenses incurred, and; (6) the nature and length
of the professional relationship with the client.” Smith, 481 Mich at 529, quoting Wood v Detroit
Automobile Inter–Ins Exch, 413 Mich 573, 588; 321 NW2d 653 (1982).

        In support of its motion to enter a judgment that included costs, including reasonable
attorney fees, Aaron attached a verified bill of costs and the 2014 Economics of Law Practice
Attorney Income and Billing Rate Summary Report. The trial court held an evidentiary hearing
to determine the amount of sanctions to award Aaron and, after the hearing, issued an opinion
and order setting forth a detailed analysis of all of the above factors, taking into consideration the
evidence and exhibits presented by Aaron. While plaintiff challenges the $300 hourly rate
charged by attorney David Warren (and accepted by the trial court), the rate falls within the
range of billing rates of those in Warren’s field of practice, and office location. Plaintiff also
challenges the total amount of time claimed by counsel, but counsel testified at length
concerning the time he spent on the case and the billings submitted. The explanations and time

                                                 -9-
billed were reasonable and sought in good faith, and the trial court did not abuse its discretion in
awarding the amount of sanctions that it did.

                                        Docket No. 336786

       Plaintiff avers that the trial court erred in granting summary disposition in favor of
Pioneer where she demonstrated that she substantially complied with the insurance contract and
made no material misrepresentations. We disagree.

       We review de novo a trial court's decision regarding a motion for summary disposition.
Maiden v Rozwood, 461 Mich 109, 118; 597 NW2d 817 (1999). We also review de novo the
construction of an insurance contract. Sunshine Motors, Inc v New Hampshire Ins Co, 209 Mich
App 58, 59; 530 NW2d 120 (1995).

        The homeowner’s insurance policy that plaintiff held with Pioneer contained duties
imposed on plaintiff after a loss, including the duties to give prompt notice of the loss to Pioneer,
protect the property from further damage, make reasonable and necessary repairs to protect the
property and keep an accurate record of repair expenses. The policy provides that no suit may be
brought against Pioneer unless the plaintiff complies with policy provisions. The policy also
contains provisions allowing it to void the policy under certain conditions. For example, the
policy provides:

               The entire policy will be void if, whether before or after a loss, an insured
       has:

               a. intentionally concealed or misrepresented any material fact of
               circumstance;

               b. engaged in fraudulent conduct; or

               c. made false statements;

               relating to this insurance.

       In interpreting insurance policies, we are guided by well-established principles of
contract construction. McKusick v Travelers Indemnity Co, 246 Mich App 329, 332; 632 NW2d
525 (2001). “The policy must be enforced in accordance with its terms; therefore, if the terms of
the contract are clear, we cannot read ambiguities into the policy.” Id.

         On May 20, 2014, plaintiff reported a loss due to water damage and raccoons that had
occurred sometime in February 2014. In support of its motion for summary disposition,
defendant submitted a report dated August 19, 2014, detailing the results of an inspection
conducted on plaintiff’s home just two days after the reported loss. The report noted that, on
first inspection, there were “many questionable issues” relative to plumbing repairs purportedly
completed by a handyman, and there was no wet carpet or standing water anywhere but in the
basement where water was still entering from an unknown source. The report noted possible
coverage issues regarding the following: a lack of prompt notice of the loss, plaintiff’s failure to
prevent or minimize mold from developing or to mitigate mold once it was discovered,

                                                -10-
plaintiff’s failure to provide documentation or records concerning purported plumbing repairs,
and a lack of evidence of frozen plumbing lines.

         Defendant also provided plaintiff’s examination under oath, during which plaintiff
testified that she may have had one other insurance claim a long time back due to a tree falling.
She testified that when she and her husband were in Chicago in February 2014, a friend of their
son’s had gone into the home to water the plants. He notified them that there was water leaking
in the house. Plaintiff and her husband returned from Chicago a short time later to find ice in the
garage and water in the kitchen, on the porch, in her son’s bathroom, and in the basement.
Plaintiff’s husband went down to the basement and discovered the sump pump switch was not
working. He changed the switch and water started draining from the basement. Plaintiff
testified that she had never noticed any mold in the home. She further testified that she and her
husband had a handyman named “Mike” come four or five times after the loss at issue and start
performing some plumbing repairs. Plaintiff testified that there was a hole in her garage roof
that was tarped off, perhaps sometime in the October or November of 2013, and that there was
no prior water damage to the house.

        At her deposition, however, plaintiff testified that her home had been damaged to her due
to water when a pipe broke in the summer of 2008. When asked about a January 2009 claim
relating to a sump pump failure and resulting water damage, plaintiff stated that she could not
remember. Plaintiff testified that there was no water damage in the garage when she left for
Chicago in February 2014, nor was there any water damage on the second or first floor of the
home or in the basement. Yet, she also testified that there had been previous damage in her son’s
bathroom (located above the garage) due to a broken shower head—but that it had been repaired.

        Pioneer also provided the deposition of Philip Gap, who was contacted by plaintiff’s son
and hired by plaintiff to perform a mold assessment on the home and write a protocol to
remediate the mold. Gap inspected the home on June 24, 2016, and testified that water entered
through the garage roof due to multiple impacts on the roof and affected a bathroom adjoining
the garage. He further testified that a strong odor of mold emanated from the basement as soon
as he opened the door and that the basement was extremely moldy. He testified that he was told
that there had been a water leak from a refrigerator ice maker in the basement and his inspection
led him to believe there had been water damage based on such an event.

        Pioneer additionally provided the deposition testimony of John David, president of
Emergency Restoration. He testified that he met with plaintiff and her son at their home but they
were not forthcoming with information and he did not believe what they said was actually going
on in the home, so he did not want the job. David testified that mold growing in the basement
did not happen in just a few weeks, and the hole in the garage roof where they said raccoons
came in was “just odd” to him and made him uncomfortable. David testified that because of this,
he gave them a list of public insurance adjusters and left. According to David, the damage he
saw in plaintiff’s home was not consistent with damage caused by one frozen pipe event.

        Finally, Pioneer provided documents showing that plaintiff had filed claims for water
damage loss in 2008 and 2009 and that her policy was in danger of being cancelled in 2011 until
she allowed Pioneer to inspect her home. A 2011 inspection showed soffit deterioration in a
corner of the garage which created openings into the attic space. This unprotected attic space

                                               -11-
was adjacent to the water pipes for the second and first floor bathrooms. Defendant also
provided an April 17, 2015 report from WJE Architect and Engineer Specialists. The report
noted that damage to the garage roof shingles was consistent with an abrupt exterior impact and
that the damage was located directly beneath a large tree with overhanging limbs. The report
also noted that a significant amount of work had been performed over the years on the basement
sump pump and that the pump discharges water into a basement toilet (with evidence that it had
been used in this fashion for a lengthy period of time). Mold was noted on a basement wall not
connected with the walls near where the purportedly frozen and burst pipes were located, and the
ceiling of the basement was noted to have no damage consistent with water coming from above.
WJE opined that, based on evidence and inspection, if any water loss occurred, it was minor and
localized to the three bathrooms, with no structural damages having resulted from the water loss.
WJE further opined that although there is evidence of vermin in the garage attic space, there is
no evidence that they caused any significant damage to the walls or ceiling that would make the
pipes susceptible to freezing, and that the basement water damage is not related to any water
coming from above but is instead due to bad grading and manipulations to the sump pump and
pit over the years.

        There is no dispute that plaintiff did not notify defendant of the alleged loss until three
months after it occurred, did not submit a sworn statement in proof of loss until nearly six
months after the loss, and plaintiff testified that she did not have an accurate record of repair
expenses. In addition, documentary evidence established that if, in fact, a water loss occurred,
plaintiff did not mitigate the loss. These actions could be construed as violations of plaintiff’s
duties under the policy.

       More importantly, the policy clearly provides that the entire policy is void if plaintiff
makes false statements with respect to the insurance. Though plaintiff testified that no prior
water damage occurred in the home, and that she did not notice any mold in the home or any
damage to the roof of the garage due to raccoons, the evidence clearly contradicts her testimony,
as does her own later testimony. Plaintiff, therefore, made material false statements regarding
prior water damage to her home and Pioneer was entitled to void her policy. Pioneer thus did not
breach its contract with plaintiff when it denied her claims.

       Affirmed in all cases and remanded to the trial court to award sanctions in favor of
Sanford Aaron and Acujust, LLC for their actual damages and expenses incurred, including
reasonable attorney fees, in having to respond to plaintiff’s vexatious appeal pursuant to MCR
7.216(C) in Docket No. 336651. We do not retain jurisdiction.



                                                            /s/ Deborah A. Servitto
                                                            /s/ Elizabeth L. Gleicher
                                                            /s/ Cynthia Diane Stephens




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