94 Mich. App. 770 | Mich. Ct. App. | 1979
Lead Opinion
Plaintiff appeals as of right from the trial court’s grant of accelerated judgment in favor of defendants which dismissed two counts of plaintiff’s complaint. Plaintiff alleged that a March 11, 1977, letter of intent formed the basis for an enforceable contract between it and defendants. The trial court found the March 11, 1977, letter was not a contract but an unenforceable agreement to agree.
On appeal, plaintiff argues there was a genuine issue of material fact as to whether the parties intended the March 11, 1977, letter of intent to be an unenforceable agreement to agree or a binding contract. We disagree.
We first note that defendants raised the argument of dismissing plaintiff’s complaint by a motion for accelerated judgment pursuant to GCR 1963, 116.1. Although the two counts of plaintiff’s complaint based on contract should have been disposed of by means of a motion for summary judgment under GCR 1963, 117.2(3), plaintiff has not objected on appeal, and it does not appear to us that plaintiff will suffer any prejudice by this Court’s treatment of this issue in terms of summary judgment. See Warvel v Michigan Commu
Since plaintiff has come forward with no extrinsic evidence raising an ambiguity, it must be determined if the March 11, 1977, letter of intent is ambiguous on its face so as to give rise to a genuine issue of material fact. The law will not make a contract where the parties intended none, nor will it regard an arrangement as completed which the parties regard as incomplete. Central Bitulithic Paving Co v Village of Highland Park, 164 Mich 223, 228; 129 NW 46 (1910). On the other hand, an instrument is enforceable as a contract even though incomplete or indefinite in some of its terms if it is established that the parties intended to be bound by the agreement. J W Knapp Co v Sinas, 19 Mich App 427, 431; 172 NW2d 867 (1969).
Our review of the March 11, 1977, letter of intent convinces us the trial court was correct in finding it to be an unambiguous, unenforceable agreement to agree. The letter was entitled: "Letter of Intent Re Construction and Operation of 18,000 Seat Arena”. In its introductory paragraphs the letter stated:
"The actual implementation of all agreements will await the drafting and execution of the contracts and leases that will be required to cover the proposed transaction. This letter will serve to express the intention of both parties to seek, in good faith, as soon as practical, the drafting and execution of such documents as may be required to cover all the matters herein expressed and such other matters as may be mutually agreed.
"It is the intention of the signatories to enter into such agreements that would provide essentially the following * * *.”
The body of the letter was couched throughout in
"If this letter properly reflects your understanding of the spirit and intent of what the parties are attempting to achieve, would you please so indicate by signing and returning one copy of this Letter of Intent.”
In our opinion, the language of the March 11, 1977, letter of intent clearly shows it was not intended to be a binding contract but operated only as an unenforceable agreement to agree. See Professional Facilities Corp v Marks, 373 Mich 673, 679; 131 NW2d 60 (1964), Socony-Vacuum Oil Co, Inc v Waldo, 289 Mich 316, 322-324; 286 NW 630 (1939).
Our resolution of this issue renders any discussion of the other issues raised on appeal unnecessary.
Affirmed.
Dissenting Opinion
(dissenting). I respectfully dissent.
In response to defendants’ motion for accelerated and/or summary judgment, the trial court filed a carefully prepared, written opinion indicating the reasons and supporting authorities for its ruling. The majority affirms the trial court’s ruling.
The trial court denied the motion for accelerated judgment based on alleged lack of execution of the March 11, 1977, letter of intent, indicating there were issues of fact. I agree. The trial court granted the motion for accelerated judgment on counts one and two, believing that the letter of intent was too
The trial court granted the motion for summary judgment under GCR 1963, 117.2(3), asserting absence of acceptance of the letter of intent by delivery back. I disagree.
Last, the trial court denied the motion for summary judgment on count three under GCR 1963, 117.2(1). I agree.
I do not find the March 11, 1977, letter of intent free from ambiguity. The facts regarding the parties’ face-to-face negotiations may shed light on their intentions. It should be noted that the interpretation of the letter of intent urged on the trial court and on this Court by defendants-appellees seems to strip the written instrument of any contractual significance. By the same token, it is altogether clear that the letter of intent does not include many matters which would have gone to the heart of the contemplated final contract. These conflicting approaches to the parties’ meaning are the stuff of which ambiguity is made. If there is ambiguity, this is not a case for accelerated or summary judgment.
It is possible that, after hearing all the proofs, a fact finder might conclude that the parties intended their March 11, 1977, letter of intent to provide reimbursement to plaintiff for expenditures made in furtherance of the project in the event defendant arbitrarily and unilaterally terminated the project.
Such a fact issue does not lend itself to determination by accelerated and/or summary judgment. It may well be that a fact finder would eventually reject plaintiff’s claims, but to so find in response to defendants’ motion seems premature.
Consequently, I would reverse the granting of accelerated and/or summary judgment and remand for trial of these issues on the merits.