Motion for Peremptory Reversal and Immediate Consideration

7/25/2019 Motion for Peremptory Reversal and Immediate Consideration

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STATE OF MICHIGAN

IN THE COURT OF APPEALS

In the Matter of:MARTHA ANN GRIMM,

Protected Individual. Appeals Court Docket No.: 326240 327012

consolidatedERIC C. GRIMM, Probate Court

Docket No.: 11-87628-CAInterested Party / RegularlyAppointed Conservator / Muskegon County Probate Court Judge:Respondent / Appellant, Hon. Gregory C. Pittman

v.

P.W. SERVICES, INC.,

Interim Conservator / Petitioner/Appellee.

______________________________________________________________________/Eric C. Grimm (P58990) Gregory R. Todd (P70978)ERIC C.GRIMM,PLLC POLARIS LAW,PLCAttorney for Respondent / Appellant Attorney for Petitioner / Appellee

P. O. Box 41 P. W. Services, Inc.Muskegon, MI 49443-0041 P.O. Box 164Phone: (734) 717-4900 Grand Haven, MI 49417Fax: (888) 502-1291 (616) 422-5921Email: [email protected] Email: [email protected]

Counsel representing other interested persons in the probate court proceeding have notentered appearances, but will be served with the Appellants motion.______________________________________________________________________/

RESPONDENT / APPELLANT ERIC C. GRIMMS MCR

7.211(C)(4) MOTION FOR PEREMPTORY REVERSAL

MOTION FOR IMMEDIATE CONSIDERATION

In the Matter of Martha Ann Grimm v. P.W. Services, Inc., Nos. 326240, 327012.


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RESPONDENT / APPELLANT ERIC C. GRIMMS MCR

7.211(C)(4) MOTION FOR PEREMPTORY REVERSAL

AND MOTION FOR IMMEDIATE CONSIDERATION

Martha Ann Grimm is the widow of the late Hon. Fredric A. Grimm, Jr., formerly a

Michigan district court judge. Martha presently is a Protected Individual under the ESTATES

AND PROTECTED INDIVIDUALS CODE(EPIC), and has been since August 29, 2011. Respondent

/ Appellant Eric C. Grimm is the eldest child of Martha Grimm. Respondent / Appellant also

was properly and regularly appointed Martha Grimms conservator and guardian, on August 29,

2011. Respondent / Appellant remains deeply interested in Martha Grimms well-being, in

maximizing her autonomy, see In re Bittner, No. 320688, __ Mich. App. __, 2015 WL 5224935

(Mich. Ct. App. Sept. 8, 2015) (Addendum J to Brief (Br.)), and in protecting Martha Grimm

from financial and other harm. This appeal seeks to accomplish just that.

MCR 7.211(A) states, A motion is made in the Court of Appeals by filing:

(1) 5 copies of a motion (one signed) stating briefly but distinctly the factsand the grounds on which it is based and the relief requested;

(2) the entry fee;(3) for a motion . . . for peremptory reversal, 5 copies of a supporting brief. . .

. A brief must conform to MCR 7.212(C) as nearly as possible . . . .(4) a motion for immediate consideration if the party desires a hearing on a

date earlier than the applicable date set forth in subrules (B)(2)(a)-(e);(5) proof that a copy of the motion, the motion for immediate consideration if

one has been filed, and any other supporting papers were served on allother parties to the appeal.

Id. Respondent / Appellant respectfully moves, under MCR 7.211(A) and MCR 7.211(C)(4) for

peremptory reversal. The governing rule, MCR 7.211(C)(4), states:

Motion for Peremptory Reversal. The appellant may file a motion for peremptoryreversal on the ground that reversible error is so manifest that an immediatereversal of the judgment or order appealed from should be granted without formalargument or submission. The decision to grant a motion for peremptory reversalmust be unanimous. An order denying a motion for peremptory reversal mayidentify the judge or judges who would have granted it but for the unanimityrequirement of this subrule.

Page 1 of 19In the Matter of Martha Ann Grimm v. P.W. Services, Inc., Nos. 326240, 327012.


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Id. Respondent / Appellant also respectfully moves, as permitted in MCR 7.211(A)(4), for

immediate consideration, to protect the Protected Individual from continuing financial and other

harm. All parties or counsel have been contacted in writing (see Exhibit 1, email dated

Thursday, September 17, 2015), several days in advance of the filing of this motion, to advise

them of its impending filing, as well as the included immediate consideration motion, in an effort

to secure consent to the requested relief. To date, no response has been received from anyone.

This appeal is a consolidated appeal. Two orders of the Muskegon County Probate

Court, one dated Feb. 12, 2015, and the other dated April 7, 2015, (see Exhs. 2, 3, Orders), are

under appeal. Both consolidated appeals are timely. See Br., at 1.

Peremptory reversal should be granted as to bothof the orders under appeal because, as

to eachof them, the reversible error is so manifest that an immediate reversal of the judgment or

order appealed from should be granted without formal argument or submission. Indeed, the need

for peremptory reversal is especially manifest in this case because the Protected Individual

continues to be subject to significant financial injury on an ongoing basis, and peremptory

reversal is necessary and essential in order to stop that continuing and significant harm to her.

Moreover, since September 2014, the Protected Individual has experienced extraordinary levels

of stress and anxiety precisely because of improprieties occurring in probate court, and this has

had a corresponding negative impact on the Protected Individuals physical health. Neglecting

to grant peremptory reversal is likely to prolong and magnify the negative emotional and

physical health impacts to the Protected Individual, for a year or more. This harm, too, should

be prevented by remedying the manifest reversible error swiftly and expeditiously.



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STATEMENT OF FACTS

On December 5, 2014, the Respondent / Appellant abruptly was replaced as Martha

Grimms conservator. No statutory notice of any good cause to change conservators was

provided; no hearing was held as required by statute, before a decision was pre-announced.

Briefs had been filed, to advise the probate court of the applicable standard and procedure, but

those were disregarded in a conference back in chambers, off the record.

The Muskegon County Probate Court, instead of following the statutory procedures,

merely advised selected lawyers (beforegoing on-record) that it already had decided in advance

that a forensic audit outside the normal procedures for a conservatorship, would be conducted

and completed prior to April 30, 2015. And in the meantime, according to the pre-

announcement, a company called P.W. Services (at some cost to the Protected Individual) would

act as temporary or interim conservator, while the audit was underway (also at a significant

cost of up to $10,000.00 to the Protected Individual). This forensic audit was mostly

redundant of work that already had been done (at little or no cost to the Protected Individual) by

the Muskegon County Sheriffs Department, and by the properly-appointed conservator.

It is now September, 2015. The forensic audit still has not been completed.

The notion that P.W. Services was to serve in a temporary or interim capacity now

has been revealed (by the passage of more than four extra months, and counting) to have been a

hoax and a ruse simply to dislodge the properly-appointed conservator from providing

necessary and essential oversight, and for the purpose of reassigning the checkbook to a probate

court regular, more willing to play ball with the other regulars, and to approve rapidly-

increasing bills for unnecessary professional services, without meaningful scrutiny.

Worse, other information not disclosedon December 5, 2014, is even more troubling.



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The properly-appointed conservator had selected a well-regarded and well-qualified real

estate agent, to list some real estate in North Muskegon the house in which the Protected

Individual had lived with her husband from 1970 - 2009. The day prior to the Dec. 5 hearing, a

listing agreement prepared by said realtor was circulated for all interested parties and counsel to

review, and to provide a reasonable time to object or to propose changes and revisions. The

entire time from December 4, 2014, to December 29, 2014, not a single objection has been

identified. There was, so far as we can determine, absolutely no conflict and no

controversy, either about the genuine conservators existing selection of an agent to handle the

listing, or about the existing terms of the listing (including the listing price of $119,000.00).

The properly-appointed conservator proceeded in a transparent way, with disclosure and

an opportunity to object. No suggestion ever has been made that there was any error in this

existing plan for how to list the real estate, and at what price. What neither the interim

conservator nor the probate court bothered to disclose until well after December 29, 2014, was

that the interims real mission had nothing to do with preservingthe status quo antewhile the

forensic audit was conducted but instead was all about changing the status quo ante right

out of the gate, by immediately substituting a new lead agent, and manufacturing nearly a 20%

reduction (a $19,100.00 discount) in the listing price, before the listing even went live.

The interim received her Letters of Authority on Dec. 22, 2014. The very next day,

without telling the regularly-appointed conservator what she was doing, the interim started

pressuring the existing realtor (with fiduciary loyalties solely to the Protected Individual) to

lower the listing price. The existing realtor responded in writing, clearly stating that the value of

the real estate should not be underestimated in other words, a reminder of the interim

conservators solemn fiduciary duty to act solelyin the Protected Individuals interest, too.



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The interim, frustrated in her pursuit of her real objective (unrelated to the Protected

Individuals best interest) of discounting the home before it was even listed, then brought in her

regular or go-to agent,1 so the regular agent could serve as lead agent. In order to

incentivize the existing agent, the interim stripped the existing agent of half of the sellers-side

half of the commission, but let the existing agent know she could keep the other half of the

sellers side of the commission, by following the leader. Or do all the work and collect nothing.

Remember, the interim conservator already had started demanding price changes to the

Protected Individuals disadvantage three days priorto the lead agent even getting involved

or seeing the real estate. Thus, any notion that the reduction in listing price from $119,000.00 to

$99,900.00, before the listing even went live, came from the agents plural rather than from

the faithless probate fiduciary herself, or resulted from consensus, rather than financial

leverage, also was self-evidently pretextual. In reality, the interim conservator herself was the

original source of momentum and pressure to subordinate the Protected Individuals financial

interests, to the interests of the go-to real estate company, and delivering the buyer a discount.

The Listing Agreement that had been circulated both on Dec. 4 and on Dec. 6, 2014, for

comment or objection, remained available for signature. But closer to New Years Eve than to

Christmas Day, during a particularly slow week for residential real estate, on Dec. 29, 2014, the

interim conservator (without disclosing any of the adverse changes to the Protected Individual

or to any interested parties) signed a different listing agreement. This was obviously a worse

listing agreement for the Protected Individual, on its face. The stated commission was 7% rather

1If a company like PW Services is supposed to protect the assets of Protected Individuals,and has over 100 real estate transactions over a decade (including corresponding commissions)to hand out to realtor(s), the question naturally occurs why should this work be sole-sourcedonly to just one realty company, without taking competitive bids, to secure the best possibleterms for each PW Services customer. This level of coziness with one realtor is troubling.



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than the previously-negotiated 6% (3 percent for buyers agent; 3 percent for sellers); the listing

price was $19,100.00 lower $99,900.00 rather than $119,000.00. And the RE/Max brokerage

was on both sidesof the transaction representing both the seller (the Protected Individual) and

the buyer, simultaneously. This was a clear conflict of interest, and especially to be avoided

when assets of a Protected Individual are at stake.

The properly-appointed conservator, the next day (Dec. 30, 2015), asked in writing to

see the newly-signed listing agreement. That was not provided until a month later.

Likewise, the interim conservator made no advance disclosure of the terms of any

offers that had been made, and no advance disclosure of the Purchase Agreement, before

unilaterally accepting it. The slow pace of responsiveness to legitimate inquiries from the

properly-appointed conservator, should be contrasted with the alacrity of the interims

response to the buyers and the go-to, lead agent in order to get the hasty sale closed.

Reggie Balcom, another agent with RE/Max Muskegon, on December 31, 2014 (New

Years Eve), took Cori and Michael Fris (the buyers) through the subject real estate. The

fabulously elated buyers got what might be termed a great deal at least for them, not so much

for the Protected Individual. So much so that the buyers did not even attempt to negotiate

about the price(an unmistakable sign that the listing was below-market). And the buyers also

happened to have $100,000.00 in cash on hand to make a full-price offer on New Years Eve,

which offer P.W. Services found the time to accept the same day (but not to respond to a written

inquiry from the regularly-appointed conservator, inquiring about the skulduggery afoot).

Reggie Balcom of RE/Max was in the same office as Lou Bulthouse, the lead agent

and go-to agent of P.W. Services. Thus the very same office was on both sides of this real

estate transaction. No disclosurewas made to the Protected Individual (the seller), or to any of



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her family members, of this conflict of interest, until after the Purchase Agreement already had

been signed by P.W. Services. And RE/Max managed to score a double dipping

commission, by representing both the buyers and sellers simultaneously.

The buyers, it turns out, are related to Sue (Fris) Schrumpf, who retired recently from the

Muskegon Charter Township Police Department, where she worked alongside her husband, Don

Schrumpf, the police chief (we learned this, incidentally, from Tom Hasper, who used to serve as

Police Chief for Roosevelt Park, and now serves in that capacity for Rothbury Mr. Hasper has

exhibited extraordinary curiosity about, and has devoted detailed attention to, this transaction

since even before the change in conservators). Don Schrumpf and the former Township

Attorney, Harold (Hal) Hermanson, both now teach as adjuncts (Don teaches Criminal Justice;

Hal teaches Business Law) for Baker College. Hermanson also happens to be legal consel for

Marthas two daughters. Did these buyers with $100,000.00 in cash on hand just happen by

accident, and as total random strangers, to discover such a good deal (nearly a 20% discount) on

real estate with a view of Muskegon Lake on New Years Eve? Presumably, that is a fair

question. Certainly, no disclosure was made by any of those responsible for engineering this

transaction, to the probate court or the Appellant, of anything other than the sellers bare names.

P.W. Services filed a motion with the probate court, seeking approval of the sale. Both

the properly-appointed conservator (son Eric, an attorney with 20 years experience) and the

Protected Individuals son Michael (a banker with asset valuation and finance experience) filed

written objections (Addenda C and D to Br.), pointing out the irregularities in how the real estate

transaction was handled, and explaining that the Protected Individuals best interests obviously

had not been given priority over the financial agendas of RE/Max (to secure a double dipping

commission), and the buyers (a large discount, at the Protected Individuals expense).



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The probate court, at the real estate hearing conducted on Feb. 12, 2015, oddly did not

seem to realize that a full-price cash offer, made on New Years Eve, after a house had been

exposed to the open market for less than 48 hours (and it is an interesting question whether a

listing that is only live between December 29 and 31 actually constitutes exposure to the open

market, given the high likelihood that most real estate professionals are spending time with

family and friends, and not perusing listings that week), calls into question whether the proposed

transaction is in the protected individuals best interest. Instead, the Muskegon County Probate

Court actively sought to advocate for making the transaction happen. For instance:

MS. MORRIS: . . . Theres no apparent reason for the rush to sell it. There was arush to list it because there was a [c]ourt order ordering it to be listed, but therewas no rush to sell it. And theres no given reason why for why the price wasreduced, raising questions as to why that was done and certainly from my clientsperspective, that wasnt in his mothers best interest because its THE COURT: What question did it raise?MS. MORRIS: leaving money on the table. Well, it raised, it raised why.THE COURT: Why why was it listed at it was listed at 99-9; is that correct?What was it listed for?MS. MORRIS: Ninety-nine thousand, nine hundred. But there THE COURT: And they got a full price cash offer for that?MS. MORRIS:

Within two days, full price cash. But that suggests that

suggests that it was listed too low and the original THE COURT: Well it also could possibly suggest that it was right priced anda savvy realtor or real estate investor said, thats a good price and Ill buy it.

Is that not an equally possible alternative possibility?

MS. MORRIS: I think its suspect . . . .

Transcript, at 14:17 - 15:16 (Feb. 12, 2015) (emphasis added) (Tr.). And, indeed, it is just

simple common sense that such an offer, occurring without even any attempt at price

negotiation, strongly suggests that the listing was so underpriced that the buyer was afraid

someone else might learn about the listing, and snatch it out from under them first.

The principal section of EPIC relating to real estate transactions, states as follows:

A conservator shall not sell or otherwise dispose of the protected individualsprincipal dwelling, real property, or interest in real property . . . without approval



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of the court. The court shall only approve the sale [or] disposal . . . of or lienagainst the principal dwelling, real property, or interest in real property if, after ahearing with notice to interested persons as specified in the Michigan court rules,the court considers evidence of the value of the property and otherwisedetermines that the sale, disposal, mortgage, pledge, or lien is in the protected

individuals best interest.

MCL 700.5423(4) (emphasis added). Moreover, In the context of the sale of real property,

there is an obligation to seek the highest price obtainable. In re Green Charitable Trust, 172

Mich. App. 298, 315; 431 N.W.2d 492 (1988). (citing Thiel v. Cruikshank, 96 Mich. App. 7, 12;

292 N.W.2d 150 (1980). The entire circumstances of the case [must] be considered in

reviewing a contested sale [and] the duty to obtain the best price has been expanded . . . to

specifically include . . . the determination of fair market value,2the proper marketing3of the

property, and the adequacy of the price obtained.). Id., at 315-17 (emphasis added).

Consideration of evidence of value is a mandatory precondition, embodied in the

statutory text itself. At the hearing conducted February 12, 2015, the only evidence of value

presented, was presented by Respondent / Appellant, the properly-appointed conservator. All

the moving party presented was a 2014 (i.e., valuation date as of tax day 2013, Dec. 31,2013

,

making it necessarily an entire year out-of-date)4 assessment from the City Assessor. But that

dollar amount was necessarily unreliable, and the probate court was correctly informed that the

SEV in an assessment carries less weight than an appraisal. Tr., at 16 (Feb. 12, 2015).

2The interim conservator could have obtained an appraisal, to support any deviation from

the already-recommended listing price. She admitted at the hearing, she did not. Tr., at 88.3Obviously, marketing efforts that consist only of a listing, especially when that listing

only is live for less than 48 hours from December 29 to 31, on their face are not consistent withthe obligation to seek the highest price obtainable.

4Prop A places a limit on how much the assessment can rise from year-to-year, even ifmarket prices are rising faster. The year-old assessment also did not reflect a 2014 roofreplacement. See MCR 211.2(2) (explaining significance of tax day for ad valoremtaxation).



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In contrast, the Respondent / Appellant presented both a current full appraisal of the

subject real estate by a professionally-qualified appraiser, see Addendum B to Br.; Tr., at 19-21

(Feb. 12, 2015), and the valuation conclusion from a prior appraisal, done with a valuation date

of December 31, 2011. Tr., at 56. Thus, the record contained unrebutted professional

appraisal evidence that the market value of the North Muskegon subject real estate had

increased by $25,000.00 in only three years meaning, it was in the Protected Individuals best

interest not to sell at all, but to hold off selling so as to benefit from market appreciation).

The onlyappraiser to testify at the real estate hearing, offered unrebuttedtestimony that

the listing should have been at $119,900.00 (thus, should have been $20,000 higher than the

listing that went live just before New Years Eve) (Tr., at 26), and the expected sale price in a

truly arms-length transaction (the fair market value) is $114,000.00 not $99,900.00. Tr., at 19.

Thus, approximately $15,000.00 of the Protected Individuals money was left on the

table. The unrebutted testimony of the only qualified appraiser to testify, was unequivocal:

MS. MORRIS: Youve heard testimony since youve been in the courtroom thatthe property was listed for $99,900.00. In your opinion, was that an appropriatelisting price?A No.

Tr., at 21. Not only did no appraiseroffer any valuation opinion in support of the proposed

sale, but no real estate professional at all testified in support of the sale. The two real estate

agents Lucille Bulthouse and Vivian Keene were conspicuously absent from the courtroom,

which conveniently prevented them from being cross-examined about how the $20,000.00

discount came about. The one witness to testify the interim conservator herself, Rachel

Cereska, was not qualified as an expert,5 and lacked any credentials under the UNIFORM

5Q Ms. Cereska, my name is Charyn Hain. I represent Michael Grimm. I just have afew questions for you. You just indicated youre not a real estate agent. Are you

(continued...)Page 10 of 19In the Matter of Martha Ann Grimm v. P.W. Services, Inc., Nos. 326240, 327012.


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STANDARDS OF PROFESSIONAL APPRAISAL PRACTICE, to offer an opinion of real estate value.

Attorney Morris clearly objected on the record, to the consideration of anyhearsay that Cereska

might claim came from the two real estate agents who could not be cross-examined:

MS. MORRIS: And just to respond, I do object to the [c]ourt consideringhearsay statements from the real estate agents that arent here today.

Tr., at 18 (Feb. 12, 2015). Thus, there existed no admissibleand relevant valuation evidence for

the probate court even to consider, other than the qualified appraisal experts opinion, that the

real estate was worth $114,000.00, that the listing price of $99,900.00 was improper, and that the

home should have been listed for $119,900.00. The testimony also included a clear explanation

of how the interim conservator had violated her fiduciary duties to the Protected Individual:

Q Thank you. Paragraph 44, you state that you believe that the listingagreement for 119 at six percent commission was in your mothers bestinterest and that Ms. Cereska breached her fiduciary duties to my motherby signing the other listing agreement that resulted in the sales agreementMs. Cereska asks the court to approve. Is that still your position today?

A Absolutely.Q What fiduciary duty did she breach?A She violated three fiduciary duties.Q Explain them then.A Number one, she changed from a sellers agent who like the [probate]

fiduciary has the obligation to represent solely the intersts of MarthaGrimm to a dual agent who has divided loyalties. That that is thedefinition of a breach of fiduciary duty. Number number two, shedropped the price and she knew she dropped the price by $20,000.00.And number three, she jacked up the commission and didnt even tell meabout it.

Tr., at 66-67. When the probate court got around to making a ruling, it acknowledged, I have

no reason to challenge or disagree or overlook or ignore that appraisal. . . . Mr. Rottman is

recognized as a legitimate and capable real estate appraiser in this area and I didnt hear anything

5(...continued)an appraiser?A I am not.

Tr., at 86 (Feb. 12, 2015).Page 11 of 19In the Matter of Martha Ann Grimm v. P.W. Services, Inc., Nos. 326240, 327012.


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that made me think otherwise during the course of his recitation. Nonetheless, the probate court

then promptly disregarded the only competent and reliable evidence of value, and relied instead

solely upon third-hand hearsay representations about what certain real estate agents (not present)

allegedly might have done or said. Tr., at 104. Even though Ms. Cereska admitted she had not

commissioned any appraisal to support any reduction in the listing price, and that marketing

efforts consisted of a listing that was live only from Dec. 29-31, 2014, the probate court

nonetheless deemed this conspicuous lack of diligence, instead to constitute reasonable

inquiries . . . based on the best information she had available to her. Id. In the probate courts

view, the real estate was priced to sell, id., but in common parlance, that suggests discounted,

underpriced, or at a below-market price so it is hardly evident why that would be a reason to

allow the sale to go forward. The trial court also made the mis-statement that the bottom line

here is that there was an order by this [c]ourt that this property at North Muskegon be sold. Tr.,

at 102. There was never any such order. The only order that was entered (without any hearing

to ascertain whether it was actually appropriate to sell, with the market value obviously rising

faster than the carrying costs), was an order directing a listingto be completed by a date certain,

which is entirely different from an order setting a deadline for a sale.

The probate courts central legalpremise is on page 105 of the transcript:

And somehow theres the alluding to the fact that there may have been some levelof some level of closeness or coziness in this deal, but the reality is is thishappens every day in real estate transactions that a listing agent and a buyersagent come out of the same company. And theres no ethical, theres noprofessional, there is no legal detriment to that occurring.

As it turns out, the probate court has the law completely upside-down. Even setting aside, for

the moment, the reality that this is an ESTATES AND PROTECTED INDIVIDUALS CODEcase, and the

EPIC necessarily governs and treating the matter instead purely as a real estate matter (thus,



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assuming (hypothetically) that we have instead of a Protected Individual, a fully competent seller

capable of protecting himself or herself in an arms-length transaction),6stillboth as a matter of

law and of published real estate professional standards, there isan ethical issue presented, there

isa professional standard to be followed, and there is a legal standard to be applied. If MCL

339.2517 is not satisfied, then the law has been violated. The probate courts legal analysis

omits the legalreality that this happens every day in real estate transactions onlyif all of the

requirements of MCL 339.2517 (including tworounds of conspicuous written disclosure to the

seller, of rights that the seller is giving up) are completely satisfied. Thus, even from a pure real

estate standpoint, the probate court obviously got the law wrong manifest reversible error.

I. REVERSIBLE ERROR IS SO MANIFEST THAT AN IMMEDIATE REVERSAL

OF THE JUDGMENT OR ORDER APPEALED FROM SHOULD BE GRANTED

WITHOUT FORMAL ARGUMENT OR SUBMISSION BECAUSE THE

PROBATE COURTS CENTRAL LEGAL PREMISE GOT SETTLED LAW

ABOUT REAL ESTATE OF PROTECTED INDIVIDUALS UPSIDE-DOWN.

Even though the probate court was just plan wrong even as a matter of pure real estate

law, what it really got wrong was failing to recognize the legal question in front of it was not a

real estate question at all, and not governed by the above-referenced statute but instead is

governed by EPIC and by well-established standards of fiduciary duty and agency law.

The question here is a question of statutory interpretation. The Legislatures intent in EPIC

namely, to protect those who are unable to protect themselves from financial and other harm is

clear. If the Legislature intended for MCL 339.2517 to serve as an enormous loophole and

6A real estate licensee can be the agent of both the seller and the buyer in a transaction,but only with the knowledge and informed consent, in writing, of both the seller and thebuyer. MCL 339.2517(3). Dual agent means a licensee who . . . provides services . . .without the full range of fiduciary duties owed by a buyers agent and a sellers agent .MCL 339.2517(11)(f). On its face, this arrangement is incompatible with the mandatoryfiduciary duties of undivided loyaltyof a conservator under EPIC. MCL 700.1212(1).



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exception to the mandatory duty of undivided loyaltyof those entrusted with safekeeping the

real property of protected individuals, MCL 700.1212(1);7MCL 700.5416 (a conservator shall

act as a fiduciary and observe the standard of care applicable to a trustee,) then the Legislature

would and should have said so. Conspicuously, the Legislature said no such thing.

Not only does there exist no conceivable or rational policy reason to legislate such an

exception to EPICs mandatory duty of undivided loyalty, but to do so would require

introduction and passage of presently non-existent legislation. Courts, certainly, cannot make

such dramatic changes in legislation; nor are professional conservators, or real estate agents,

authorized to manufacture their own rules in an effort to become a law unto themselves.

Historically, the National Association of Realtors has taken the categorical position that

dual agency ought never to be allowed, and ought to be forbidden for all real estate licensees,

in all circumstances. See Addendum A to Br. This is consistent with long-standing Michigan

law.8 Andrie v. Chrystal-Anderson & Associates Realtors, Inc., 187 Mich. App. 333, 335-37;

466 N.W.2d 393 (1991), leave denied, 439 Mich. 903, 478 N.W.2d 652 (1991). The real estate

industry continues to recognize that dual agency situations regularly involve a serious risk of

both ethicaland professionalmisconduct by real estate professionals, as well as the risk of legal

penalties. See MICHIGAN REALTORS, DUAL AGENCY (Aug. 2010), Exh. 4; GREATER

7A fiduciary shall observe the standard of care described in section 7803 and shalldischarge all of the duties and obligations of a . . . fiduciary relationship, including the duties of

undivided loyalty; . . . care and prudence in actions; and segregation of assets held in thefiduciary capacity.

8As an interesting aside, the North Muskegon realtor whose antics prompted both Andrieand related litigation by Emma Wyant Ted Slater at the time of the events referenced inAndrie, was married to the mother of Gabriel Smith (see Br., for more about Gabriels role inthis case), who presently goes by the name of Barbara Kleaveland. Gabriel was a co-defendantwith one of Marthas daughters, Kirsten, in a recent criminal trial.



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METROPOLITAN ASSOCIATION OF REALTORS, TOP LEGAL QUESTIONS 2012, Exh. 5 (avoiding

misconduct in dual agency situations remains top issue for calls to hotline); Ronald R. Rossi,

Is it a crime to be a dual agent? (July 2014), Exh. 6; Matt Carter, Dual agency and double-

dipping still risky business, INMAN (Nov. 1, 2011). State regulators have issued advisories to

real estate buyers and sellers, warning about the risks associated with dual agency situations.

E.g., NEW YORK DEPARTMENT OF STATE,OFFICE OF GENERAL COUNSEL,MEMORANDUM LI12:

BE WARY OF DUAL AGENCY, Exh. 8. Given the probate courts self-reported familiarity with

what purportedly happens every day in real estate transactions, Tr., at 105, it comes as

something of a surprise that the lower court would be so deeply unaware that there clearly isan

ethical challenge, there isa professional risk, and there isa set of legal rules to be followed.

In some (not all) states, legislation such as MCL 339.2517, has made it possible in very

narrow and specific circumstances for dual agency to arise, but only with informed,

written, consent. See note 6, supra.

The whole premise of MCL 339.2517 is that well-informed buyers and sellers who are

able, andhavecapacity, to spot shady conduct, and to self-protect in an arms-length transaction

with prominent and written statutory disclosure that a dual agent, if approved, will behave

without the full range of fiduciary dutiesowed by a buyers agent and a sellers agent can

decide for themselves whether to approve what the divided-loyalty agent proposes.

In contrast, by necessity, a Protected Individual under EPIC is not such a principal, and

as a matter of law, lacks capacity to self-protect. Especially when (as is the case here) the

Protected Individual, in clear violation of her right of maximum autonomy,9 is systematically

deprived of all notice that dual agency is even proposed, and all opportunity to voice her own

9See In re Bittner, supra.



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views on whether the real estate agent discounting her property ought to be permitted to have

divided loyalties dual agency is self-evidently a bad idea. Which is precisely why

maintaining the fiduciary duty of undivided loyalty is so critically important in EPIC cases

otherwise, moral hazardboth for the probate and for the real estate fiduciaries, is off the charts.

The relationships between a subagent [RE/Max] and the appointing agent [PW

Services] and between the subagent and the appointing agents principal are

relationships of agency as stated in 1.01. 1 Restatement 3d, Agency, 3.15(1) (emphasis

added). Thus, if P.W. Services is acting as Martha Grimms fiduciary, and PW selects a real

estate licensee (RE/Max or Nedeau) also to act in a fiduciary (broker or agent) capacity for

Martha, then the duties of RE/Max are to Martha; P.W. also is responsible to Martha for

RE/Maxs conduct if RE/Max has divided loyalties, or otherwise acts in an improper way. Id.

A fiduciary relationship includes all the traditional duties of any fiduciary: (1) undivided

loyalty; (2) full disclosure of all material facts; (3) reasonable care and diligence, (4)

accountability; (5) confidentiality; and (6) obedience. NATIONAL ASSOCIATION OF REALTORS,

WHO IS MY CLIENT?, at 4-7 (Addendum A to Br., at 4-7). It is undisputed that RE/Max was

selected as a subagent of PW Services, and therefore necessarily owed the same fiduciary duty

of undivided loyalty to the principal (Martha Grimm) as EPIC requires of PW services. It is

also undisputed that Reggie Balcom and Lou Bulthouse come from the same RE/Max office,

resulting in divided and conflicting loyalties, that categorically violate the mandatory

requirement of undivided loyalty to Martha, the principal and seller.

In short, the reversible legal error by the trial court is so obvious and manifest, that

reversal of the order appealed from should be granted without formal argument or submission.



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III. REVERSIBLE ERROR ALSO IS MANIFEST BECAUSE THE PROBATE

COURTS DISREGARD OF UNREBUTTED VALUATION EVIDENCE,

COMBINED WITH IMPROPER RELIANCE ON RANK HEARSAY

CONSTITUTES CLEAR ERROR.

The unrebutted non-hearsay valuation evidence that the probate court was required to

consider, clearly and unambiguously establishes that a listing at $99,900.00 was too low; that the

fair market value was at least $14,100.00 higher $114,000.00; and that the listing price should

have been $119,900.00. The trial court also failed to take evidence on [t]he entire

circumstances of the case, as required by In re Green, 172 Mich. App. at 315, and indeed

actively intervened to obstruct efforts to present all the suspicious facts and circumstances

(including the probate courts own prior questionable actions) as part of the hearing record.

Under the circumstances, given the overwhelming evidence of impropriety, clear error

a definite and firm conviction that a mistake has been made necessarily is present;

recognizing the probate courts clear error, and reversal of its order, is unavoidable.

III. REVERSIBLE ERROR IS SO MANIFEST THAT AN IMMEDIATE REVERSAL

OF THE JUDGMENT OR ORDER APPEALED FROM SHOULD BE GRANTED

WITHOUT FORMAL ARGUMENT OR SUBMISSION BECAUSE THEPROBATE COURT HAS SOUGHT TO INTERFERE WITH PROPER

APPELLATE REVIEW BY INFLICTING ADDITIONAL FINANCIAL HARM

UPON THE PROTECTED INDIVIDUAL, TO DETER A LAWFUL APPEAL.

The probate court in this case evidently does not like having its decisions and views

questioned and reviewed on appeal, even though the MICHIGAN COURT RULESexpressly promise

proper appellate review as a matter of right in probate cases such as this one. The probate

courts distaste for proper appellate supervision apparently is so great that (before an appeal is

even heard and decided) the probate court has elected to enrich the interim conservator, and to

inflict financial harm upon the Protected Individual, by pe-emptively shifting P.W. Services

appellate legal bills, onto the Protected Individual. In other words, other than this appeal itself,



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no remedy existsfor this clear and unmistakable self-dealing by P.W. Services (subsidizing its

own appellate legal fees out of the Protected Individuals pocket), because P.W. Services now

conveniently enjoys the cover of a probate court order giving its blessing to this flagrant

self-dealing by P.W. Services. Defending an appeal that accuses P.W. Services (with good

reason) of violating its fiduciary duties, is in no way necessary to the administration of the

conservatorship estate. Instead, it would easily be possible to substitute another conservator

entirely to administer the estate. Were that done, and if P.W. services (no longer tasked with

anything related to the conservatorship) to submit for reimbursement of legal fees incurred in a

still-pending appeal, obviously PW Services would have no right to extract money belonging to

the Protected individual from her estate.

Rather, P.W. Services either would have to follow the American Rule, like every other

litigant, or to turn the defense of the appeal over to the errors and omissions insurance carrier

from which P.W. Services already ought to have secured a policy. Why should the innocent

Protected Individual, be forced to pay the legal bills of the faithless fiduciary?

Certainly, there is no legal requirement or entitlement, that P.W. Services gets to enrich

itself at the expense of the very person it is supposed to protect, by subsidizing its own

misconduct defense, out of the Protected Individuals pocket.

Especially troubling is the notion that the probate court is essentially offering a preview

of how it hopes an appeal might turn out, before the appeal is decided by the Court of Appeals,

and declaring in advance that it thinks PW Services (and the probate court itself) are and ought

to be the victors, before the merits are even heard. This is troublingly close to a judge sitting on

an appeals panel, to review a trial court decision that the judge himself or herself, previously

made the troubling ethical implications of which should be obvious.



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The reversible error of the probate court is unmistakably manifest, and the harm to the

Protected Individual is serious and continuing. Immediate reversal is therefore necessary and

appropriate under the circumstances, to correct egregious wrong-doing.

Respectfully submitted,

Dated: September 23, 2015. __/s/ Eric C. Grimm_______ Eric C. Grimm (P58990)ERIC C.GRIMM,PLLCCounsel for Respondent / AppellantP.O. Box 41Muskegon, Michigan 49443-0041(734) 717-4900Fax: (888) 502-1291.


Documents

Motion for Peremptory Reversal and Immediate Consideration