Case Information
*1 If this opinion indicates that it is “FOR PUBLICATION,” it is subject to revision until final publication in the Michigan Appeals Reports.
S T A T E O F M I C H I G A N C O U R T O F A P P E A L S ESTATE OF LEONARD TYNER, by ARLINDA UNPUBLISHED HICKMAN, Personal Representative, July 1, 2021
Plaintiff/Counterdefendant-Appellee,
and
DEWAYNE BROWN,
Intervenor-Appellee v No. 351784
Wayne Circuit Court SANDRA O’BEY, LC No. 18-015920-CH
Defendant/Counterplaintiff-Appellant,
and
BING METALS GROUP, INC,
Defendant. Before: R EDFORD , P.J., and B ORRELLO and T UKEL , JJ.
P ER C URIAM .
Defendant/counterplaintiff Sandra O’Bey appeals as of right the trial court’s order granting in part and denying in part the competing motions for summary disposition filed by O’Bey and the Estate of Leonard Tyner. O’Bey argues that the trial court erred by concluding, on the basis that they had been in a meretricious relationship, that she did not have a valid contract with Leonard; *2 the written contract attempted to compensate O’Bey for past performance; and O’Bey’s reliance on Leonard’s repeated verbal promises to pay O’Bey was unreasonable. O’Bey additionally argues that the trial court lacked subject matter jurisdiction to enter an order quieting title to the property at issue in this case. We agree in part and disagree in part with O’Bey.
Over the course of 30 years O’Bey gave Leonard about $750,000. She claims this money was a loan; Leonard claims that O’Bey gave him the money gratuitously. Leonard and O’Bey did not have a written contract until August 9, 2018. Now O’Bey seeks to recover the $750,000 from Leonard’s estate under multiple legal theories. Disputes of material fact prevent any grant of summary disposition regarding O’Bey’s unjust enrichment claims as well as her innocent misrepresentation claims based on oral contracts. O’Bey’s innocent misrepresentation claims based on the written promissory note, however, fail due to a lack of consideration. Additionally, O’Bey did not actually challenge one of the trial court’s reasons for granting summary disposition to Leonard’s estate regarding O’Bey’s fraud claims. Finally, O’Bey lacked standing to challenge whether the trial court had subject matter jurisdiction to enter the order quieting title in this case.
I. UNDERLYING FACTS
A. HISTORY OF THE PROPERTY AT ISSUE
This case arises out of a dispute regarding loans O’Bey allegedly made to Leonard and on his behalf over the course of their 30-year friendship; these loans were for an alleged business relationship to own and operate a property located at 1130 West Grand Boulevard, Detroit, Michigan (the property). Bing Metals Group, Inc. conveyed the property via warranty deed to *3 Lue Ease Tyner on March 9, 2003. Lue Ease died on April 11, 2011; she apparently died intestate with her husband, Leonard, as her sole heir. As such, the parties agree that Leonard should have inherited the property through probate.
Probate proceedings regarding Lue Ease’s estate began in Oakland County Probate Court shortly after Lue Ease’s death, but her estate was administratively closed before the property was distributed from her estate. Leonard did not obtain the property’s title until after his death when the trial court, in this case, entered an order on December 12, 2019, quieting title to the property and transferring it to Leonard’s estate.
B. O’BEY’S PAYMENTS TO LEONARD
O’Bey and Leonard were friends for roughly 30 years. Additionally, they had a romantic relationship for an unspecified 15 years. Over the course of their 30-year friendship, O’Bey gave Leonard about $750,000. O’Bey claims she gave Leonard this money as part of a business relationship premised on his ownership of the property. According to O’Bey, Leonard always promised he would repay her, but he never specified when he would repay her and they did not have a written contract until August 9, 2018. According to Leonard, however, all of the money O’Bey gave him was gratuitous and he never promised to repay her.
The situation came to a head in August 2018 while Leonard was hospitalized following a stroke. On August 9, 2018, O’Bey presented Leonard with two documents: a quitclaim deed for the property and a promissory note stating that Leonard would repay O’Bey the $750,000 he owed her by selling the property. The promissory note provided, in relevant part:
For consideration received, (funds advanced by Sandra O’Bey), payor, his heirs or assigns promise to pay the sum of $ 750,000.00 Thousand Dollars ($ 750,000.00) to SANDRA O’BEY within [sic] upon the sale of the building located at 1130 West grand Blvd., Detroit, Michigan, which was formerly used by Sandra O’Bey and Leonard Tyner for leasing purposes. Said property is described as: [the property’s legal description.]
* * *
Said building shall be sold or listed for sale at a reasonable price within 2- years, and the lump payment shall be payable at 17755 Gregory Road, Gregory, Michigan 48137 upon closing.
O’Bey and the notary who notarized both documents claim that Leonard signed the documents and that he was mentally competent to do so. In contrast, Leonard denied signing the documents. 60 feet wide as now established and the Northwesterly line of the Grand Trunk Railroad right of way.
Thus, we will use the “Grand Boulevard” address in this opinion.
C. PROCEDURAL HISTORY
Leonard filed a complaint in December 2018 seeking to quiet title to the property. O’Bey answered the complaint, claiming she was entitled to the property. She also filed a complaint of her own alleging that Leonard owed her $750,000. She alleged that his failure to repay her unjustly enriched Leonard and breached his contracts with O’Bey. O’Bey further alleged that Leonard either fraudulently induced her to loan him money or that his innocent misrepresentation caused her to loan him the $750,000. Leonard and O’Bey then filed competing motions for summary disposition; during this time Leonard died and his estate was substituted as a party in the case.
Following the parties’ competing motions for summary disposition, the trial court entered an order quieting title to the property and transferring it to Leonard’s estate. The trial court then turned to the parties’ motions for summary disposition relating to O’Bey’s payments to Leonard. In doing so, it granted summary disposition to Leonard’s estate on O’Bey’s breach of contract claims, holding that the promissory note was not supported by valid consideration because it relied on past consideration, it also ruled that the statute of frauds barred O’Bey’s oral contract claims. The trial court granted summary disposition to Leonard’s estate on O’Bey’s remaining claims as well, holding that all of the money O’Bey paid Leonard was presumptively gratuitous because: (1) they had been in a meretricious relationship, (2) O’Bey failed to plead her fraud in the inducement claim with sufficient particularity, and (3) O’Bey’s innocent misrepresentation claim failed because she was not in privity of contract with Leonard. Finally, the trial court concluded that, although most of O’Bey’s unjust enrichment claims failed because her payments to Leonard were presumptively gratuitous due to their meretricious relationship, she was entitled to repayment for property tax payments she made within the six-year statute of limitations; it also concluded that the statute of frauds barred O’Bey’s promissory estoppel claims. This appeal followed.
II. STANDARD OF REVIEW
A motion for summary disposition under MCR 2.116(C)(10) tests the factual sufficiency
of a complaint and is reviewed de novo.
Joseph v Auto Club Ins Ass’n
,
The moving party has the initial burden to support its claim with documentary evidence,
but once the moving party has met this burden, the burden then shifts to the nonmoving party to
establish that a genuine issue of material fact exists.
AFSCME v Detroit
,
Finally, “[w]e review de novo questions of statutory interpretation.”
Hayford v Hayford
,
III. UNJUST ENRICHMENT
O’Bey argues that the trial court erred by granting summary disposition to Leonard’s estate on her unjust enrichment claims. We agree. The trial court erred by making a factual finding that Leonard and O’Bey had been in a meretricious relationship and, by extension, granting summary disposition to Leonard’s estate regarding O’Bey’s unjust enrichment claims. Disputes of material fact regarding when O’Bey’s unjust enrichment claims accrued and whether Leonard promised to repay her prevent any grant of summary disposition regarding O’Bey’s unjust enrichment claims at this time.
Michigan has long followed the rule that a party cannot sustain an unjust enrichment claim
if the parties have an express contract. See
AFT Michigan v Michigan
,
“Unjust enrichment is an equitable doctrine.”
Genesee Co Drain Commr v Genesee Co
,
The trial court concluded that the payments O’Bey made to Leonard were presumably gratuitous because they had been in a meretricious relationship.
[S]ervices rendered during a meretricious relationship are presumably gratuitous. To overcome this presumption, plaintiff must show that she expected compensation from defendant at the time she rendered the services and that defendant expected to pay for them. The trier of fact resolves this question by considering all the circumstances, including the type of services rendered, the duration of the services, the closeness of the relationship of the parties, and the express expectations of the parties. [ Featherston v Steinhoff ,226 Mich App 584 , 589;575 NW2d 6 (1997) (quotation marks and citations omitted).]
Black’s Law Dictionary defines a meretricious relationship as “[a] stable, marriage-like
relationship in which the parties cohabit knowing that a lawful marriage between them does not
exist.”
Black’s Law Dictionary
(11th ed). An examination of this Court’s opinions utilizing the
phrase “meretricious relationship” reveals that this Court accords the phrase the same meaning as
set forth in Black’s Law Dictionary. See, e.g.,
Featherston
,
The trial court concluded, without explaining its reasoning, that Leonard and O’Bey had
been in a meretricious relationship. The trial court erred by doing so for multiple reasons, the first
of which is that such a factual finding should not be made at the summary disposition stage of
proceedings. See
Barnes
, ___ Mich App at ___; slip op at 4. Additionally, the record does not
establish that Leonard and O’Bey ever cohabitated. Consequently, cohabitation, an essential
element of a meretricious relationship, is absent in this case. Finally, a meretricious relationship,
even if it did exist, would do no more than create a presumption that O’Bey’s payments were
gratuitous. Whether that presumption has been overcome, however, is a question for the jury. See
Featherston
,
*7
As for whether the elements of an unjust enrichment claim have been met, disputes of
material fact prevent summary disposition on this issue. Leonard undoubtedly received a monetary
benefit from O’Bey over the course of their friendship and romantic relationship. As such, the
first element of unjust enrichment has been met. See
Bellevue Ventures, Inc
,
Our Supreme Court “has long recognized that statutes of limitation may apply by analogy
to equitable claims.”
Taxpayers Allied for Constitutional Taxation v Wayne Co
,
Leonard moved for summary disposition on this issue. Thus, we must view the record in the light most favorable to O’Bey when considering her unjust enrichment claims. See Patrick , 322 Mich App at 605. The trial court did not consider the equitable defense of laches, and Leonard’s estate does not argue on appeal that it applies here. Thus, we will not address that issue. Whether the statute of limitations applies to O’Bey’s unjust enrichment claims, however, is properly before this Court. As discussed, the normal six-year statute of limitations for breach of contract claims applies to unjust enrichment claims. Thus, the statute of limitations bars all of O’Bey’s claims that arose more than six years before February 6, 2019, the date she filed her counterclaim.
The record fails to establish when Leonard allegedly promised he would repay O’Bey. “A
loan made with no fixed time of repayment is payable on demand.”
Jackson v Estate of Green
,
IV. INNOCENT MISREPRESENTATION
O’Bey argues that the trial court erred by granting summary disposition to Leonard’s estate on her innocent misrepresentation claims. We agree in part and disagree in part. O’Bey’s innocent misrepresentation claim premised on the promissory note fails for lack of consideration, but disputes of material fact regarding her innocent misrepresentation claims premised on the oral contracts prevent summary disposition of those claims. Additionally, the statute of frauds does not bar enforcement of the oral contracts and the record is insufficient to determine whether the statute of limitations bars any of O’Bey’s claims based on the oral contracts.
A. INNOCENT MISREPRESENTATION
Innocent misrepresentation is a type of fraud claim. M&D, Inc v WB McConkey , 231 Mich
App 22, 26-29;
A claim of innocent misrepresentation is shown if a party detrimentally relies upon a false representation in such a manner that the injury suffered by that party inures to the benefit of the party who made the representation. The innocent misrepresentation rule represents a species of fraudulent misrepresentation but has, as its distinguished characteristics, the elimination of the need to prove a fraudulent purpose or an intent on the part of the defendant that the misrepresentation be acted upon by the plaintiff, and has, as added elements, the necessity that it be shown that an unintendedly false representation was made in connection with the making of a contract and that the injury suffered as a consequence of the misrepresentation inure to the benefit of the party making the misrepresentation. Thus, the party alleging innocent misrepresentation is not required to prove that the party making the misrepresentation intended to deceive or that the other party knew the representation was false. Finally, in order to prevail on an innocent misrepresentation claim, a plaintiff must also show that the plaintiff and defendant were in privity of contract. [ M&D, Inc v WB McConkey ,231 Mich App 22 , 27-28;585 NW2d 33 (1998) (citations omitted).]
Consequently, an innocent misrepresentation claim requires the plaintiff to establish that (1) he or she detrimentally relied on a false representation; (2) the plaintiff’s injury benefitted the party who *9 made the representation; and (3) privity of contract. Id . Additionally, “the party alleging innocent misrepresentation is not required to prove that the party making the misrepresentation intended to deceive or that the other party knew the representation was false.” Id . at 28.
O’Bey claims that Leonard repeatedly told her he owned the property and that this representation induced her to repeatedly give him money because she believed she was engaged in a business relationship with the property’s owner. The record clearly establishes that Leonard did not own the property until after his death, when the trial court entered an order quieting title to the property and transferring it from Lue Ease’s estate to Leonard’s estate. Consequently, any representation Leonard made to O’Bey that he owned the property was false.
In her deposition, O’Bey acknowledged that she knew Lue Ease owned the property, but she testified that she believed Leonard operated the property with Lue Ease and that he had the ability to bring in a partner. Additionally, O’Bey also believed Leonard owned the property after Lue Ease’s death, in large part because that was what Leonard told her. Consequently, Leonard’s representation that he owned the property was false and O’Bey’s interest in the property clearly benefitted Leonard because he received hundreds of thousands of dollars from her as a result of her belief that he owned the property. Thus, when viewing the record in the light most favorable to O’Bey, the only remaining element for her innocent misrepresentation claim is whether she and Leonard were in privity of contract.
B. PRIVITY OF CONTRACT
“The essential elements of a contract are parties competent to contract, a proper subject
matter, legal consideration, mutuality of agreement, and mutuality of obligation.”
McCoig
Materials, LLC v Galui Const, Inc
,
“In ascertaining the meaning of a contract, we give the words used in the contract their plain and ordinary meaning that would be apparent to a reader of the instrument.” Rory v Continental Ins Co , 473 Mich 457, 464; 703 NW2d 23 (2005). “A fundamental tenet of our jurisprudence is that unambiguous contracts are not open to judicial construction and must be enforced as written.” Id . at 468. Contracts are enforced “according to their unambiguous terms because doing so respects the freedom of individuals freely to arrange their affairs via contract.” Id .
1. VALIDITY OF THE PROMISSORY NOTE
In relevant part, the promissory note provided
For consideration received, (funds advanced by Sandra O’Bey), payor, his heirs or assigns promise to pay the sum of $ 750,000.00 Thousand Dollars ($ 750,000.00) to SANDRA O’BEY within [sic] upon the sale of the building located at 1130 West grand Blvd., Detroit, Michigan, which was formerly used by Sandra O’Bey and Leonard Tyner for leasing purposes. Said property is described as: [the legal description of the property]
By its plain terms, the promissory note established that Leonard would pay O’Bey $750,000 for
“consideration received,” which the promissory note defined as “funds advanced by” O’Bey. This
is clearly past consideration. O’Bey argues that the promissory note established continuing
consideration, not past consideration, because the promissory note did not require Leonard to pay
O’Bey until the property was sold. O’Bey is correct that the promissory note did not require
immediate payment from Leonard, but the consideration offered by O’Bey nevertheless existed
entirely in the past. The promissory note’s plain language referenced only past consideration from
O’Bey, and did not contemplate any additional consideration O’Bey was required to provide
between the signing of the promissory note and her receipt of payment. Thus, the promissory note
was not supported by proper consideration and, therefore, was not a valid contract. See
Shirey
,
2. VALIDITY OF THE ORAL CONTRACTS
The analysis does not end here, however, because O’Bey’s innocent misrepresentation claim is also supported by the numerous alleged oral contracts between herself and Leonard, formed when Leonard promised each time O’Bey gave him money to repay her. Leonard and O’Bey dispute whether he ever actually promised to repay her and, therefore, a dispute of material fact precludes a ruling regarding whether the oral contracts actually existed. Nevertheless, the statute of frauds and statute of limitations may nevertheless bar O’Bey’s innocent misrepresentation claims based on the oral contracts. The statute of frauds could establish that, despite an agreement between Leonard and O’Bey, no valid contract existed; additionally, the statute of limitations could bar O’Bey’s innocent misrepresentation claims as untimely.
a. STATUTE OF FRAUDS
“The statute of frauds exists for the purpose of preventing fraud or the opportunity for
fraud, and not as an instrumentality to be used in the aid of fraud or prevention of justice.”
Lakeside
Oakland Dev, LC v H & J Beef Co
,
(1) In the following cases an agreement, contract, or promise is void unless that agreement, contract, or promise, or a note or memorandum of the agreement, contract, or promise, is in writing and signed with an authorized signature by the party to be charged with the agreement, contract, or promise: (a) An agreement that, by its terms, is not to be performed within 1 year from the making of the agreement.
“[I]f there is any possibility that an oral contract is capable of being completed within a year, it is
not within the statute of frauds, even though it is clear that the parties may have intended and
thought it probable that it would extend over a longer period and even though it does so extend.”
Hill v Gen Motor Acceptance Corp
,
The trial court concluded that the statute of frauds voided all of the oral contracts in this case because the promissory note provided that the property would be sold in two years. But the promissory note provided that the property “shall be sold or listed for sale at a reasonable price within 2-years ,” not two years in the future. (Emphasis added). Leonard’s oral promises were not oral versions of the promissory note and they did not establish when he would repay O’Bey. [6] As such, no term of the oral contract precluded Leonard from immediately repaying her. Consequently, the trial court erred by concluding that the oral contracts fell within the statute of frauds.
b. STATUTE OF LIMITATIONS
There is no specific statute of limitations for innocent misrepresentation claims. As such,
the general six-year statute of limitations applies to O’Bey’s innocent misrepresentation claims.
See MCL 600.5813 (“All other personal actions shall be commenced within the period of 6 years
after the claims accrue and not afterwards unless a different period is stated in the statutes.”).
“[T]he period of limitations runs from the time the claim accrues,” unless an exception not at issue
in this case applies. MCL 600.5827. “[T]he claim accrues at the time the wrong upon which the
*12
claim is based was done regardless of the time when damage results.”
Id
. See also
Boyle v General
Motors Corp
,
As explained in Part III, however, the record fails to establish when Leonard allegedly
promised his repayment would take place. As such, he was required to do so in a “reasonable
time” that the jury must determine. See
Jackson
,
C. INNOCENT MISREPRESENTATION CONCLUSION
Viewing the record in the light most favorable to O’Bey, she has established all of the required elements for an innocent misrepresentation claim with the exception of privity of contract. The privity of contract component of O’Bey’s innocent misrepresentation claim falls into two categories: the written promissory note and the oral contracts.
The promissory note was not supported by proper consideration because it relied on past consideration. Thus, the trial court did not err by granting summary disposition to Leonard on O’Bey’s innocent misrepresentation claims based on the promissory note. The oral contracts also present disputes of material fact regarding whether Leonard agreed to repay O’Bey. Additionally, the statute of limitations and statute of frauds do not bar O’Bey’s innocent misrepresentation claims based on the oral contracts because the record fails to establish when Leonard promised repayment would take place. As such, summary disposition on this issue would be inappropriate at this time.
V. FRAUD IN THE INDUCEMENT
O’Bey abandoned this issue because she failed to challenge the trial court’s conclusion that she did not plead her fraud claim with sufficient particularity. Consequently, we will not address it on the merits.
O’Bey failed to address, in her brief on appeal, the issue of whether she pleaded her fraud claims with sufficient particularity. As such, the issue is abandoned. See Cheesman v Williams , 311 Mich App 147, 161; 874 NW2d 385 (2015) (“An appellant may not merely announce a position then leave it to this Court to discover and rationalize the basis for the appellant’s claims; nor may an appellant give an issue only cursory treatment with little or no citation of authority.”). The trial court granted summary disposition to Leonard’s estate on O’Bey’s fraud claims on two grounds: (1) lack of pleading with sufficient particularity and (2) O’Bey’s reliance on Leonard’s promises to repay her were unreasonable. Based on our reading of the trial court’s opinion and *13 order, each ground could independently support its order. As such, O’Bey failed to actually challenge one of the grounds supporting the trial court’s order granting summary disposition to Leonard’s estate on O’Bey’s fraud claims. Thus, O’Bey failed to challenge the entirety of the trial court’s order granting summary disposition to Leonard’s estate on this issue. Consequently, we will not address this issue further.
VI. SUBJECT MATTER JURISDICTION
O’Bey argues that the trial court lacked subject matter jurisdiction to enter its order quieting title to the property and transferring it to Leonard’s estate. We decline to address that issue, however, because O’Bey lacks standing to challenge the trial court’s subject matter jurisdiction.
At the trial court level “a litigant has standing whenever there is a legal cause of action.”
Lansing Sch Ed Ass’n v Lansing Bd of Ed
,
In general, standing requires a party to have a sufficient interest in the outcome of
litigation to ensure vigorous advocacy and in an individual or representative
capacity some real interest in the cause of action, or a legal or equitable right, title,
or interest in the subject matter of the controversy. [
Pontiac Police & Fire Retiree
Prefunded Group Health & Ins Trust Bd of Trustees v Pontiac No 2
, 309 Mich App
611, 621;
VII. CONCLUSION
For the reasons stated in this opinion, we affirm in part and reverse in part the trial court’s order granting summary disposition to Leonard’s estate. We additionally affirm its order quieting title to the property and transferring it to Leonard’s estate. We do not retain jurisdiction.
/s/ James Robert Redford /s/ Stephen L. Borrello /s/ Jonathan Tukel
Notes
[1] Leonard died during the course of the trial court proceedings. For ease of reference, we will refer to Leonard by his first name because his wife, Lue Ease Tyner, is also a relevant individual in this case.
[2] We note that the record is not clear regarding the actual street address of the property at issue in this case. The parties and the warranty deed refer to the property as having a “Grand River” address, but the promissory note, quitclaim deed, and order quieting title in this case all refer to the property as having a “Grand Boulevard” address. The property’s legal description is identical in the warranty deed, promissory note, quitclaim deed, and order quieting title. As can be seen in the legal description of the property below, the property’s legal description references “Grand Blvd.,” not “Grand River”: Lots 19 to 28, inclusive of Block 3, Bella Hubbard Subdivision of part of P.C. 77, North of Michigan Avenue, Detroit, Wayne County, Michigan, according to the plat thereof, recorded in Liber 4, Page 94, Wayne County Records. Also, vacant alley in the block bounded by West Grand Blvd., Magnolia St., Vinewood Ave., and the railroad right of way, except that portion of said lots deeded to the City of Detroit for boulevard purposes and included in the Grand Blvd. Also, all that part of Lots 22 to 28 inclusive, Block 3 of the plat of Bella Hubbard Subdivision of part of P.C. 77, North of Michigan Ave., Springwell Township, City of Detroit, Wayne County, Michigan according to the plat thereof as recorded in Liber 4, Page 94 of plats, Wayne County Records, being all that part of West Grand Blvd., lying between the East line of West Grand Blvd. 150 feet wide as now established and a line 29 feet Westerly thereof, and lying between the South line of Magnolia Street
[3] “Although cases decided before November 1, 1990, are not binding precedent, MCR 7.215(J)(1),
they nevertheless can be considered persuasive authority.”
In re Stillwell Trust
, 299 Mich App
289, 299 n 1;
[4] As used in this opinion, the phrase “when Leonard promised he would repay O’Bey” refers to point in time in the future that Leonard allegedly promised O’Bey would receive his repayment, not the point in time at which Leonard made the promise that he would repay O’Bey.
[5] MCL 566.132 was amended by
[6] To the extent that O’Bey argues to the contrary that the oral promises were oral versions of the promissory note and, therefore, the statute of limitations for those claims began to run on the date the promissory note was signed, this claim is plainly not supported by the record. O’Bey and a friend of Leonard and O’Bey both testified, in their depositions, that Leonard repeatedly promised to repay O’Bey for the money she gave him, but neither one testified that these oral promises had the same terms as the promissory note.
[7] As discussed in Part III, when no time is specified for performance in a contract a “reasonable time” is presumed, which depends on the “facts and circumstances of each case.” Jackson , 484 Mich at 217.
