'Neither admits nor denies' disputed by plaintiff

Co-defendant's answer deemed admissions in mortgage fraud scheme

In a lawsuit filed in Oakland County Circuit Court, plaintiff Joseph D. Blouin sought damages from defendants Robert V. Yeo Jr., Ricardo del Valle, American Security Real Estate Partners LLC and Michael R. Sayers from a fraud scheme.

The scheme involved defendants' request for a short-term loan to provide emergency financing for a real estate transaction that had purportedly fallen through. As security for the loan, defendants gave plaintiff mortgages on two commercial properties. In reality, there was no pending real estate transaction, and the mortgages had been signed by entities that had no ownership interest in the properties.

Plaintiff obtained default judgments against Yeo, del Valle and American Securities after the court granted plaintiff's motion to strike their answers on the basis that they had each altered the signature block on Sayers' answer and filed it as their own.

While Sayers had filed an answer, it was largely non-responsive in that it consisted of a nearly unwavering recitation of the statement "Defendant neither admits nor denies but leaves Plaintiff to his proofs."

Plaintiff then filed a motion for summary judgment pursuant to MCR 2.116(C)(9) and (10), citing, inter alia, the Michigan Supreme Court decision in Pitcher v. Pitcher, 314 Mich. 648 (1946), which held that where a defendant answers a plaintiff's charges by neither admitting nor denying them, it shall be considered an admission on all matters of which the defendant must be considered to have personal knowledge. Because the fraud allegations against Sayers were specific with respect to his actions, his responses of "neither admits nor denies" were deemed admissions.

The court granted summary judgment against Sayers on each count against him, including fraud, aiding and abetting fraud, aiding and abetting breach of fiduciary duty, civil conspiracy and conversion. Plaintiff was awarded $1.5 million

Type of action: General civil

Type of injuries: Fraud loss

Name of case: Blouin v. Yeo, et al.

Court/Case no./Date: Oakland County Circuit Court; 09-104935-CZ; May 12, 2010

Name of judge: Daniel P. O'Brien

Highest offer: $20,000

Verdict amount: $1.5 million

Attorney for plaintiff: Sara E.D. Fazio

Attorney(s) for defendant: Withheld

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