Action for breach of contract & mortgage foreclosure; Statute of limitations (SOL) for action on a promissory note; MCL 440.3118; SOL to foreclose a mortgage; MCL 600.5803; Degen v Degen’s Estate; Principle that a new promise to pay an existing debt that is not barred by a SOL is supported by consideration & restarts the limitations period; United States v Gardner (6th Cir); Acknowledgment of indebtedness; In re Booth’s Estate

The court held that the trial court erred by finding plaintiff’s foreclosure action was time barred, but did not err by finding her breach of contract and unjust enrichment claims were time barred. Plaintiff loaned defendant $60,000 in exchange for a note and mortgage on defendant’s home. She later loaned defendant another $20,000, though no documents were signed. Plaintiff never received any payments on the $60,000 mortgage, so she had defendant sign a 6/28/2000 letter stating: “I reaffirm the debt mentioned above still exists and I acknowledge the fact that the interest continues to accrue on this debt.” She later paid plaintiff $30,000 dollars for the unsecured loan—the principal plus $10,000 in interest. Plaintiff sued her on the mortgage alleging breach of contract, unjust enrichment, and requesting foreclosure of the property. The trial court granted summary disposition for defendant, finding the SOL had already run. Plaintiff argued that it erred by finding the SOL barred her mortgage claim because it necessarily had to resolve a question of fact to reach this conclusion, and one existed as to whether a payment was made. Assuming, as she consistently stated, that “no payments were made by defendant on the mortgage note, the limitations period for the promissory note began on [5/21/95], and would end six years after the mortgage’s due date, [5/21/01]. Assuming the same, the limitations period applicable to foreclosure of the mortgage began on [5/21/95], and would end 15 years after the due date,” 5/21/10. However, plaintiff consistently stated she “never received any payment on the $60,000 mortgage, and . . . the $30,000 payment received from defendant was for the separate, unsecured loan.” Accepting this as true, “the trial court did not err in concluding that no payment was made on the mortgage, and finding without more that the” SOL barred her claims. But a new promise to pay an existing debt that is not barred by a limitations period “is supported by consideration and restarts the limitations period[.]” Here, there was “no genuine issue of material fact that the [6/28/2000], letter renewed the debt.” In addition, the letter “renewed the debt such that the original terms of the mortgage and note began anew at the date of signing.” Finally, the foreclosure action was not time barred to the extent it was “based upon any missed installment payments due between” 12/3/04 and 6/28/05. However, as the SOLs “for the breach of contract and unjust enrichment claims are much shorter,” those claims were properly dismissed. Affirmed in part, reversed in part, and remanded.