Fun with Scrivener’s Error, Collateral Estoppel and Res Judicata

By Doug Chalgian on March 20, 2021

 

This unpublished opinion explores the differences between res judicata and collateral estoppel, while touching on the limits to using an affidavit of scrivener’s error to clear title to real property.

Matt deeded Parcel A to himself and Appellee as joint tenants with rights of survivorship.  Then Matt died vesting title in Parcel A in Appellee.

Two years later, the attorney who prepared said deed files an affidavit of scrivener’s error stating that the deed should have said Parcel B not Parcel A.  [It is never clear who sought this affidavit or why it was prepared.]

A few more years pass and an Order of Assignment from Matt’s estate conveys the residue to surviving spouse of Matt, but that order does not reference either Parcel A or B.  [Curiously, Appellee apparently had a hand in preparing this Order.]

Decades later, Appellant, who has a beneficial interest in the estate of the now deceased surviving spouse of Matt, goes to Court to quiet title to parcel A and amend the Order of Assignment from Matt’s estate to include Parcel A.  She offers the scrivener’s affidavit as proof.  In that matter, Appellee refuses to be deposed (for which he is sanctioned), refuses to answer other discovery requests, and does not participate in trial, except to file a brief after the proofs are completed, which brief says that under Michigan law an affidavit of scrivener’s error cannot be used to alter the substantive rights of an owner without that owner also signing off, which he did not do.  Accordingly, Appellee argues, the request for relief, which would have caused title in Parcel A to be deemed to have passed to the beneficiaries of the estate of Matt’s surviving spouse, must be denied, the result of which would be to leave Appellee as the owner of Parcel A, and title to Parcel B uncertain.  The trial court agrees with Appellee, and the petitions filed by Appellant are denied.

Then, Appellant files a new petition seeking the same relief only as to Parcel B.  She asserts: If the scrivener’s error is not valid, then Parcel B should have been in the estate of Matt’s surviving spouse and should pass to her accordingly.  But Appellee objects, saying that this new petition is barred by collateral estoppel and res judicata.  Again, the trial court sides with Appellee, and it is from this order that this appeal is filed.

In the Court of Appeals, the trial court’s order is reversed.

In their opinion, the COA distinguishes between collateral estoppel and res judicata.

The COA explains that for collateral estoppel to apply, the prior case must have involved the same parties and the same issues.  In this case, the COA notes, only the ownership of Parcel A was litigated, not Parcel B.  Accordingly, collateral estoppel does not apply here.

Res judicata, the COA says, could apply since the purpose of res judicata is to force judicial resources to be used economically, and if a matter could have been raised in a proceeding, and should have been raised in a proceeding, then the subsequent proceeding may be barred by res judicata.  The COA notes that in this case ownership of Parcel B could have been addressed in the first case, and that res judicata could be applied.  But the COA goes on to say that the decision of when to apply res judicata is based on pragmatic considerations, and here, where the issue being raised in the second case was made more relevant because of the outcome of the first case, the application of res judicata would not be appropriate.   In other words, until the trial court decided that the scrivener’s affidavit was ineffective, there was no reason for Appellant to litigate title to Parcel B.  Accordingly, the trial court is reversed.

To read In Re Estate of Matt Malnar, click here.

mm By: Doug Chalgian
Doug Chalgian

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