Contracts

This summary also appears under Litigation

 

Issues: Breach of contract action; In re Smith Trust; "Mootness"; Barrow v. Detroit Election Comm'n; Contempt of court; In re Robertson; Arbor Farms, L.L.C. v. Geostar Corp.; Johnson v. White; Jurisdiction to amend a final order; In re ITC Application; Hill v. City of Warren; MCR 7.208(A); Surety liability; City of Ferndale v. Florence Cement Co.; PR Post Corp. v. Maryland Cas. Co.; Motion to set aside a default; Shawl v. Spence Bros., Inc.; MCR 2.603(D); "Good cause"; Alken-Ziegler, Inc. v. Waterbury Headers Corp.; Michigan Department of Transportation (MDOT); Detroit International Bridge Company (DIBC)

Court: Michigan Court of Appeals (Unpublished)

Case Name: Department of Transp. v. Detroit Int'l Bridge Co.

e-Journal Number: 58406

Judge(s): Per Curiam – Boonstra, Markey, and K.F. Kelly

 

In these consolidated cases, the court affirmed the trial court's order granting the plaintiff-MDOT partial summary disposition in the contract action, holding that the matter was moot and concluding that there was no dispute that defendant-DIBC "failed to construct Part A of the S32 bridge in accordance with the design plan, that it took over and closed 23rd Street without the city's permission, and built structures in accordance with a design not approved by MDOT." The trial court ordered MDOT to complete DIBC's portion of the bridge project, and ordered DIBC to "fully cooperate" with MDOT and pay $16 million into an account to fund the project. In Docket No. 315453, DIBC's argument that MDOT was not entitled to summary disposition because the parties had not reached an "agreed design," was moot because Part A of the bridge had been completed. Further, even if this issue were not moot, the parties' "Implementation Agreement" and "Amendatory Agreement" and the Performance Bond plainly supported summary disposition for MDOT. In Docket No. 315847, DIBC's post-judgment motions were properly denied. The court also held that the trial court was divested of jurisdiction to amend its 3/20/13 order by adjusting the amount of damages because a court cannot amend its orders while an appeal is pending. Also, there was no evidence that the parties stipulated to the amendment. Thus, the court vacated the trial court's 4/8/13 order. In Docket No. 315912, DIBC's surety, defendant-Safeco Insurance Company of America, was found to have "coextensive" liability with its principal, DIBC. MDOT had Safeco defaulted for failing to appear or file a timely answer. Although Safeco moved to set aside the default, the trial court properly refused, finding that it had failed to show "good cause" or a "meritorious defense." Safeco was "obligated to pay on its bond because DIBC has been found liable for breach of contract and has materially breached its agreements with MDOT." The court affirmed the order entering judgment against Safeco.

 

Full Text Opinion

This summary also appears under Business Law

 

Issues: Contracts of guaranty; Comerica Bank v. Cohen; Bandit Indus., Inc. v. Hobbs Int'l, Inc. (After Remand); Relevance; MRE 401; In re Dearmon; Contract formation; "Mutuality"; Kloian v. Domino's Pizza, LLC; Whether a lack of certain terms is fatal to a contract; Opdyke Inv. Co. v. Norris Grain Co.; Nichols v. Seaks; Judicial avoidance of contractual obligations based on indefiniteness; Calhoun Cnty. v. Blue Cross Blue Shield of MI; Extrinsic evidence; Waites v. Miller; Requirement that a promise to answer for the debt of another be in writing; MCL 566.132(1)(b); Kelly-Stehney & Assoc., Inc. v. MacDonald's Indus. Prods., Inc. (On Remand); Prospective application of contracts; In re Estate of Slack; "Any" and "all" defined; Holland v. Trinity Health Care Corp.; Remedy for breach of contract; Corl v. Huron Castings, Inc.; Alan Custom Homes, Inc. v. Krol; A lessor's mitigation of damages; M & V Barocas v. THC, Inc.; Landin v. HealthSource Saginaw, Inc.; BLT Burger DC, LLC v. Norvin 1301 CT, LLC (DC); Krasne v. Tedeschi & Grasso (MA); McGuire v. City of Jersey City (NJ); Attorney fees; MRPC 1.5(a); Adair v. State (On Fourth Remand); Department of Transp. v. Randolph; Augustine v. Allstate Ins. Co.; University Rehab. Alliance, Inc. v. Farm Bureau Gen. Ins. Co.; "Piercing the corporate veil"; Lakeview Commons v. Empower Yourself; Dutton Partners, LLC v. CMS Energy Corp.; Foodland Distrib. v. Al-Naimi; Michigan Uniform Fraudulent Transfer Act (UFTA)(MCL 566.31 et seq.); Estes v. Titus; Columbia Assoc., LP v. Department of Treasury; Common area maintenance (CAM) charges

Court: Michigan Court of Appeals (Unpublished)

Case Name: Weckle v. ASKP LLC

e-Journal Number: 58360

Judge(s): Per Curiam – Stephens, Talbot, and Beckering

 

The court held that the trial court did not err in finding that defendant-David Peterson personally guaranteed the lease agreement with the plaintiffs-landlords, that it applied to all four leases, and that David and an entity he owned (defendant-ASKP) were liable for unpaid rent and CAM charges. It also held that the trial court did not abuse its discretion by awarding attorney fees for plaintiffs or by rejecting defendants' counterclaim. Finally, it held that the trial court did not err by dismissing plaintiffs' claims to pierce the corporate veil and for relief under the UFTA. Plaintiffs sued defendants alleging that ASKP was liable for unpaid obligations under its lease agreements and that David and his wife (also a defendant) were liable on personal guaranties. The trial court entered judgment for plaintiffs against ASKP and David. On appeal, the court rejected defendants' argument that the trial court clearly erred by finding that David intended to be bound by the personal guaranty signed in connection with the fourth lease agreement. It found that David's promises and performances were set forth with reasonable certainty, and that "the trial court did not err by supplying the requisite terms or by finding that the personal guaranty was enforceable." The court next rejected defendants' argument that, assuming the personal guaranty is enforceable, the trial court erred by concluding that it applied to all four leases. It found that "the plain language of the guaranty contract referred to 'the whole quantity or amount' owed, or 'the whole or full amount' owed by" ASKP. "This language clearly and unambiguously expresses an intent to apply to" ASKP's obligations on all four lease agreements. Further, defendants failed to establish that the damages award was clearly erroneous. The CAM charges were a direct, natural, and proximate result of" ASKP's breach, and "plaintiffs were entitled to recover the cost of paying the CAM charges." The court further found that the trial court did not abuse its discretion by awarding reasonable attorney fees of $19,677.93 based on the contingent-fee agreement between plaintiffs and their counsel. As to the dismissal of defendants' counterclaim, since "the trial court's factual findings were not clearly erroneous, there is no merit to any assertion by defendants that plaintiffs fraudulently induced [David] into signing the guaranty, that they negligently induced him into doing so, or that [he] was mistaken about what he was signing." Finally, the court rejected plaintiffs' claim that the trial court erred by dismissing their claims to pierce the corporate veil and for relief under the UFTA. It found that while David "abused the corporate form," plaintiffs could not show fraud or "establish fraud that would warrant permitting plaintiffs to reach the assets of the Florida entities under the UFTA." There was "no evidence of an intent to defraud, hinder, or delay plaintiffs" in their collection efforts, and no evidence that ASKP "intended to incur, or believed it would incur, debts beyond its ability to pay as they became due." Affirmed.

 

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