Court reinstates claims by business parter/employee after relationship collapses

Steven Hamilton sued Arthur Jeannot and others, alleging he had been treated badly in the attempt to renovate and reopen the Brookside Inn in Benzie County.  The trial judge summarily dismissed his lawsuit and sanctioned his attorney for filing a frivolous claim.  Hamilton and his lawyer appealed.  The Court of Appeals reversed.  It concluded that the lawsuit was not frivolous, and in fact that there were genuine issues of material fact to be decided. 

The lower court had ruled that Hamilton must re-pay promissory notes that Hamilton had executed, despite his claim that the notes were part of a complicated business transaction that had not been fulfilled by the defendants.  The higher court agreed that he raised questions of fact and pointed to the fact that he worked for 17 months on the renovation before he was "dismissed' by Jeannot.  The appellate court emphasized contradictions in Jeannot's claims as simple as arguing that Hamilton paid the Inn staff, when they were, in fact, on Jeannot's payroll.

The Court also reinstated Hamilton's defamation claim arising out of Jeannot's statement that Hamilton "embezzled or attempted to embezzle funds."  Although Jeannot argued that the related statements were merely "opinion," the Court noted that they alleged a crime and were therefore defamation per se.