Briarwood v. Faber's Fabrics, Inc.
| Decision Date | 24 November 1987 |
| Docket Number | Docket No. 90857 |
| Citation | 163 Mich.App. 784,415 N.W.2d 310 |
| Parties | BRIARWOOD, a Michigan partnership, Plaintiff-Appellee/Cross-Appellant, v. FABER'S FABRICS, INC., a Michigan corporation, and Robert G. Faber, jointly and severally, Defendants-Appellants/Cross-Appellees. |
| Court | Court of Appeal of Michigan — District of US |
Miro, Miro & Weiner (by Samuel C. Damren and Bruce L. Segal), Bloomfield Hills, for plaintiff-appellee/cross-appellant.
Raymond F. Clevenger, Ann Arbor, for defendants-appellants/cross-appellees.
Before WEAVER, P.J., and KELLY and KIRWAN, * JJ.
Defendants appeal as of right from the Washtenaw Circuit Court's order granting plaintiff's motion for summary disposition on the basis of MCR 2.116(C)(9) and (10). Defendants further appeal as of right from an order granting plaintiff's motion for summary disposition as to defendants' counterclaim on the basis of MCR 2.115(B) and 2.116(C)(8) and (10). Plaintiff appeals as of right from the court's denial of sanctions allowable under MCR 2.114(E), and further requests expenses incurred on appeal allowable under MCR 7.216(C)(1)(a). We affirm the orders of summary disposition as to plaintiff's claim and defendants' counterclaim. We further order defendant to pay plaintiff's expenses, remanding to the trial court for determination of the amount of sanctions.
This suit arises from a ten-year lease agreement dated May 29, 1973, between plaintiff, Briarwood, and defendant Faber's Fabrics, owned by defendant Robert G. Faber, for premises located at Briarwood Mall in Ann Arbor, Michigan. The agreement provided that Faber was to conduct business on the leased premises for the entire term of the lease and was to pay rent and other charges set forth in the lease. The lease was to expire on January 31, 1984.
In 1983, when Faber sought an extension of the lease, Briarwood refused to extend the lease at the same location. However, Briarwood offered to let Faber continue occupancy at one of several other locations in the mall. Faber rejected these offers. Instead, Faber began withholding rent and, on October 13, 1983, abandoned the premises without Briarwood's consent. Briarwood did not lease the space to another tenant during the three and one-half months remaining on Faber's lease, but did use the empty premises for storage.
On January 31, 1984, Briarwood filed a complaint against the individual and corporate defendants, seeking $12,413.12 in unpaid charges owed by the corporate defendant at the time it vacated the premises, plus $22,412.27 in accrued rent and other charges for the period following the vacation of the premises through the end of the lease term. Defendants counterclaimed, alleging that over $100,000 had been expended for improvements to the leased premises, that the alternate locations offered by Briarwood were unsuitable to defendants' business, and that Briarwood had wrongfully refused to renew the lease, thereby causing the failure of defendant business.
The trial court granted partial summary disposition in favor of Briarwood on the issue of defendants' liability for rent and damages under the lease, but denied its motion as to amount of damages until resolution of the issues of mitigation and setoff. The trial court also granted summary disposition to Briarwood on defendants' counterclaim. The trial court's opinion did not address Briarwood's motion for expenses obtainable as sanctions under MCR 2.114(E). Defendants appeal as of right from summary disposition granted in favor of Briarwood on defendants' counterclaim. Briarwood appeals as of right from the trial court's denial of sanctions and also requests expenses incurred on appeal pursuant to MCR 7.216(C)(1)(a).
Defendants argue that Briarwood's refusal to extend the lease constituted constructive eviction, that the vacation of the premises constituted a surrender of the premises or termination of the lease, and that, therefore, the trial court erred in granting Briarwood's motion for summary disposition. We disagree.
The trial court granted Briarwood's motion for summary disposition on the basis of MCR 2.116(C)(9) and (10). 1 In deciding a motion brought under MCR 2.116(C)(9), only the pleadings may be considered. MCR 2.116(G)(5). On appeal, the trial court's findings of fact will not be set aside unless clearly erroneous. MCR 2.613(C).
In deciding a motion brought under MCR 2.116(C)(10), the trial court is to consider affidavits, pleadings, depositions, admissions, and documentary evidence. MCR 2.116(G)(5). The adverse party must make some showing by opposing affidavit, testimony, depositions, admissions, or documentary evidence that there exists a genuine issue for trial. MCR 2.116(G)(4). Bennington Twp. v. Maple River Inter-Co. Drain Bd., 149 Mich.App. 579, 584-585, 386 N.W.2d 599 (1986). The trial court should not grant the motion where, giving the benefit of reasonable doubt to the opposing party, it appears that such an issue exists. Brooks v. Reed, 93 Mich.App. 166, 170, 286 N.W.2d 81 (1979).
We find no error in the trial court's granting of summary disposition under MCR 2.116(C)(9) or (10). The parties agreed that the lease required defendants to pay rent and perform other obligations for the full ten-year term, that defendants vacated the premises before the lease expired, that defendants had been withholding rent before vacating the premises, and that defendants paid no rent after vacating. These facts establish defendants' liability under the lease.
Nor were defendants' defenses of surrender, termination and constructive eviction supported by the facts. Surrender of a lease goes beyond merely vacating or abandoning the premises and requires mutual agreement. Pyle v. Orzell, 350 Mich. 298, 303, 86 N.W.2d 163 (1957). Mutual agreement clearly did not exist in this case. Briarwood showed no intention of releasing Faber from its obligations, having rejected defendants' request to surrender the store for the remainder of the lease. The lease specifically provided that, in case of default, Briarwood could re-enter and relet the premises on defendants' behalf while continuing to hold defendants liable for any rental shortfall. Hence Briarwood's storage use of the premises was not an implicit acceptance of surrender since, even had Briarwood relet the premises, rent paid by the new tenant would have only mitigated Briarwood's damages.
Similarly, Briarwood's refusal to extend the lease and defendants' abandonment did not act as a termination. Briarwood specifically rejected defendants' offer to terminate the lease for a settlement sum, and the lease provided that Briarwood's reentry would not be construed as termination of the lease unless Briarwood so notified defendants in writing. As Briarwood never notified defendants to this effect, termination did not occur.
Finally, Briarwood's acts did not amount to constructive eviction, 2 since defendants alleged no fact or action by Briarwood which would constitute such eviction. On the contrary, defendant Robert Faber admitted in deposition that Briarwood had denied no legal benefits of tenancy and had done nothing to cause an early abandonment of the premises.
Therefore it was not clearly erroneous for the trial court to find that, while Briarwood's storage use of the premises prevented it from charging defendants full rent, such use did not act as a termination or acceptance of surrender and that none of defendants' alleged defenses were supported by the facts.
Defendants also argue that the trial court erred when refusing summary disposition under MCR 2.116(C)(8) 3 and (10) on their counterclaim of breach of contract and tortious interference with business relations. A motion for summary disposition under MCR 2.116(C)(8) is tested by the pleadings alone in order to determine the legal basis of the complaint and may be granted only when the claim is so clearly unenforceable as a matter of law that no factual development could possibly justify a right to recover. Harrison Twp. v. Calisi, 121 Mich.App. 777, 781-782, 329 N.W.2d 488 (1982). See also Allinger v. Kell, 102 Mich.App. 798, 806-807, 302 N.W.2d 576 (1981), modified on other grounds 411 Mich. 1053, 309 N.W.2d 547 (1981). Here, defendants' counterclaim was so clearly unenforceable as a matter of law that no factual development could possibly have justified a right to recover. Hence it was Briarwood, not defendants, which was entitled to summary disposition, and the trial court did not err in so holding.
The public policy of Michigan is to construe leases as not granting a right of renewal; a lease will not confer such right absent specific language to this effect. DNR v. Board of Trustees of Westminster Church of Detroit, 114 Mich.App. 99, 105, 318 N.W.2d 830 (1982). Defendant Robert Faber alleged that Briarwood led him to believe that so long as defendant Faber's Fabrics was a good tenant, the only limitation on renewal was renegotiation of rent and incidentals. However, defendants produced no evidence of these representations or of a tacit agreement. Newspaper clippings and affidavits of Ann Arbor zoning commission members say nothing of the right to renew a lease; but, even if a tacit agreement did exist between Briarwood and the zoning commission, it was superseded by express provisions of the lease agreement signed by the parties. See Mid America Management Corp. v. Dep't of Treasury, 153 Mich.App. 446, 459, 395 N.W.2d 702 (1986). The lease unambiguously specified a term of years and contained no provision granting a right of renewal. Defendant Robert Faber testified in deposition that the parties never discussed renewal. Hence the trial court properly dismissed defendants' counterclaim for lack of legal basis and for lack of a genuine issue except as to damages.
Briarwood argues that the trial court erred in failing to award its reasonable expenses pursuant to MCR...
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