Dumas v. Helm

• Decision Date: 23 December 1968
• Docket Number: Docket No. 4350,No. 2,2
• Citation: 166 N.W.2d 306,15 Mich.App. 148
• Parties: Joseph E. DUMAS, Jr., and Dorothea Dumas, his wife, and Mary Dumas, Plaintiffs-Appellants, v. Carl H. HELM and Helen I. Helm, his wife, jointly and severally, Defendants-Appellees
• Court: Court of Appeal of Michigan — District of US

Page 306

166 N.W.2d 306

15 Mich.App. 148

Joseph E. DUMAS, Jr., and Dorothea Dumas, his wife, and Mary

Dumas, Plaintiffs-Appellants, v. Carl H. HELM and Helen I. Helm, his wife, jointly and severally, Defendants-Appellees.

Docket No. 4350.

Court of Appeals of Michigan, Division No. 2.

Dec. 23, 1968.

Released for Publication April 9, 1969.

Leave to Appeal Denied June 10, 1969.

Alan G. Greenberg, Pontiac, for appellants.

W. E. C. Huthwaite, Pontiac, for appellees.

Before LESINSKI, C.J., and ROBERT B. BURNS and FENLON, ^* JJ.

LESINSKI, Chief Judge.

On March 25, 1965, defendants entered into a land contract with plaintiffs for the purchase of property in Oakland county, Michigan. The total purchase price under the contract was $5,500, of which $500 was paid immediately. Defendants defaulted in making certain monthly payments of principal and interest provided for in the contract.

Prior to the default which occasioned this suit, defendants fell behind often. There were several circuit court commissioners' forfeiture actions, but defendants redeemed in each case. In addition, plaintiffs had instituted an earlier equity foreclosure action in circuit court but had allowed defendants to redeem by making up the payments which were in default.

Plaintiffs commenced this action on April 10, 1967, having last received payment of monthly installments on January 27, 1967. Defendants admitted in sworn answers to interrogatories that plaintiffs' complaint listed all payments made by them.

Paragraph 3g of the land contract provides as follows:

'If default is made by purchaser and such default continues for a period of forty-five days or more, and the seller desires to foreclose this contract in equity, then the seller shall have at his option the right to declare the entire unpaid balance hereunder to be due and payable forthwith, notwithstanding anything herein contained to the contrary.'

In paragraph 9 of their complaint filed in this cause, plaintiffs exercised their option under paragraph 3g of the contract, declaring the entire unpaid balance due and payable forthwith. Unquestionably, defendants had been in continuous default for more than 45 days.

Plaintiffs moved for summary judgment which was denied by the circuit judge upon defendants' agreeing to bring the monthly installments up to date and pay $50 court costs, which they did. The court also denied plaintiffs' motion for rehearing and granted an oral motion by defendants to dismiss the cause.

The issues on appeal are whether plaintiffs may accelerate the payments due according to paragraph 3g of the contract; whether they may exercise that provision of the contract in the complaint for foreclosure without prior notice to defendants; whether the trial court erred in dismissing plaintiffs' action upon payment by defendants of the then outstanding monthly payments and court costs; and whether the trial court should have granted summary judgment for plaintiffs.

In this State acceleration clauses such as that in paragraph 3g of the land contract, even when harsh, are enforceable. Brody v. Crozier (1928), 242 Mich. 660, 219 N.W. 643; Young v. Zavitz (1961), 365 Mich. 354, 112 N.W.2d 493.

The right of plaintiffs to use their foreclosure complaint to declare the unpaid balance due pursuant to paragraph 3g is likewise upheld by clear precedent. Bedford v. Tetzlaff (1953), 338 Mich. 102, 61 N.W.2d 60.

Defendants insist that the circuit court acted within its discretion as a court of equity in dismissing plaintiffs' action after payment into court of the missed monthly payments and $50 costs, citing their uncontested affidavit claiming to have invested $2,000 in materials alone in the property and their present willingness to pay past installments as the basis of their entitlement to equitable relief.

The discretion of equity courts 'is not an arbitrary one, but must be exercised in accordance with the fixed principles and precedents of equity jurisprudence.' Youngs v. West (1947), 317 Mich. 538, 545, 27 N.W.2d 88, 91. In Wood v. Button (1919), 205 Mich. 692, 703; 172 N.W. 422, 425, the Supreme Court said:

'The case presented is not one to be determined upon some notation of general equities. The parties have a right to stand upon the law. Carlisle v. Dunlap, 203 Mich. 602, 169 N.W. 936. The right to redeem from a foreclosure at law is a legal right, is created by the statute, and can neither be enlarged nor abridged by courts.'

See, also, Heimerdinger v. Heimerdinger (1941), 299 Mich. 149, 299 N.W. 844.

The statute suggested by defendant as a basis for the trial court's actions, C.L.S.1961, § 600.3110 (Stat.Ann.1962 Rev. § 27A.3110), does not apply where an acceleration clause has been properly invoked, as in the case at bar. It reads:

'Whenever a...