S & S Builders Inc v. Kings Lane Ltd Dividend Housing Assn Lp, 328745

Background

S&S Builders contracted to renovate a Burton, Michigan housing project for a fixed price; amendments to the construction contracts were later executed.
Kings Lane Partnership (limited partnership) claimed those amendments were invalid because its general partner’s president, Eesam Arabbo, lacked required prior written consent from limited partners under the 2006 Partnership Agreement.
After limited partners seized control, Kings Lane Partnership and Columbia Housing sued Arabbo, Kings Lane GP, and SJS Investments on partnership-related claims; S&S Builders pursued breach of contract, unjust enrichment, and account stated against Kings Lane Partnership.
The trial court severed the partnership-based claims from the construction action and consolidated them with a separate action involving Arabbo and his entities.
The trial court granted summary disposition for Kings Lane Partnership, dismissing S&S Builders’ contract, unjust enrichment, and account stated claims.
The Court of Appeals consolidated two appeals: one challenging severance and consolidation (treated as leave granted) and one challenging summary disposition; the court affirmed both rulings.

Issues

Issue	S&S Builders' Argument	Kings Lane Partnership's Argument	Held
Whether the trial court properly severed partnership claims and consolidated them with a related action	Severance prejudiced defendants; claims/defenses are interdependent and risk preclusion	Severance appropriate under court rules because partnership claims arose separately and consolidation promoted efficiency	Court affirmed severance (treated appeal as leave to appeal) — severance under MCR 2.207 proper and not prejudicial
Whether S&S Builders proved breach of contract	Amendments to construction contracts were valid and created liability for Kings Lane Partnership	Amendments were invalid because Arabbo lacked actual or apparent authority under the Partnership Agreement; S&S Builders knew of the limitation	Summary disposition affirmed — S&S Builders failed to show authority; equitable estoppel/imputed knowledge bars enforcement of amendments
Whether unjust enrichment claim survives despite express contract	Entitled to recover for extras not covered by the express contract	Express fixed-price contract (and change provisions) governs; unjust enrichment unavailable where express contract covers subject	Dismissed — express contract governed changes, so unjust enrichment claim barred as a matter of law
Whether account stated claim survives	Invoices and lack of objection establish account stated	Underlying debt depends on validity of contract/amendments; cannot use account stated to create a liability where none existed	Dismissed — S&S Builders could not establish a valid underlying debt because amendments were invalid

Key Cases Cited

Chen v. Wayne State Univ., 284 Mich. App. 172 (court’s jurisdictional standards for appeals)
Miller-Davis Co. v. Ahrens Constr., Inc., 495 Mich. 161 (contract breach elements)
Maiden v. Rozwood, 461 Mich. 109 (summary disposition standards)
James v. Alberts, 464 Mich. 12 (principal bound by agent’s actual or apparent authority)
Thomasma v. Carpenter, 175 Mich. 428 (account stated cannot create underlying liability where none exists)
Belle Isle Grill Corp. v. City of Detroit, 256 Mich. App. 463 (unjust enrichment cannot supplant an express contract)