Godwin v. Lindbert

• Decision Date: 29 October 1980
• Docket Number: Docket No. 47766
• Citation: 101 Mich.App. 754,300 N.W.2d 514
• Parties: Paul K. GODWIN and Carol C. Godwin, Plaintiffs-Appellees, v. Thomas D. LINDBERT, Defendant, and Mary C. Lindbert, Defendant-Appellant. 101 Mich.App. 754, 300 N.W.2d 514
• Court: Court of Appeal of Michigan — District of US

Page 514

300 N.W.2d 514

Paul K. GODWIN and Carol C. Godwin, Plaintiffs-Appellees, v. Thomas D. LINDBERT, Defendant and Mary C. Lindbert, Defendant-Appellant.

Docket No. 47766.

101 Mich.App. 754, 300 N.W.2d 514

Court of Appeals of Michigan.

Oct. 29, 1980.

Released for Publication Jan. 29, 1981.

[101 MICHAPP 755] Richard D. Mintz, Madison Heights, William O. Lynch, Bloomfield Hills, for Lindbert.

Robert S. Tomak, Mount Clemens, for the Godwins.

[101 MICHAPP 756] Before J. H. GILLIS, P. J., and V. J. BRENNAN and MILLER ^*, JJ.

PER CURIAM.

This case is an appeal from the circuit court's judgment of specific performance and damages against the sellers of certain real estate in Oakland County.

The case primarily concerns the propriety of the trial judge's September 25, 1979, order that plaintiffs were entitled to supplemental damages of the difference between the mortgage rate of 81/2% in effect at the time plaintiffs procured a commitment to buy the property and defendants refused to convey and the 111/4% interest rate in effect when the trial court awarded specific performance. We affirm.

Seeking to purchase the home of the defendants, Thomas and Mary Lindbert, plaintiffs, Paul and Carol Godwin, executed and submitted an offer to purchase which contemplated a cash sale with a conventional mortgage in the amount of $59,000. Defendants accepted the offer on March 13 1977, and the closing was scheduled at the offices of the mortgagee bank for April 12, 1977. Plaintiff Paul Godwin attended the closing, bringing with him a power of attorney signed by his wife. Thomas Lindbert did not attend the closing because his wife had obtained an injunctive order in connection with their pending divorce restraining and enjoining him from contacting plaintiffs. Mrs. Lindbert did not attend, but was represented by her attorney, who advised Mr. Godwin that there would be no closing as Mrs. Lindbert had moved back into the house and was not going to sell the house.

At the time of the scheduled closing, plaintiffs [101 MICHAPP 757] were ready and able to pay the agreed upon purchase price of $74,000. Fifteen thousand dollars was to be paid in cash, and the $59,000 balance was to be mortgaged. At that point, plaintiffs had received a home mortgage bearing an interest rate of 83/4%. Because of the inability to close on the scheduled date, this mortgage commitment subsequently lapsed. Plaintiffs filed this action seeking specific performance of the contract and damages sustained by virtue of defendants' failure to sell pursuant to the contract. At the conclusion of the nonjury trial, the judge entered a judgment of specific performance in favor of the plaintiffs. ¹ On September 5, 1979, the trial court issued an opinion which granted damages to plaintiff in an amount equal to the difference between the payments on the original mortgage at 83/4% and the payments based on the interest rate of 111/2%. The trial court discounted this 30-year mortgage by five percent per year to obtain the present value thereof.

Defendant appeals, raising an issue of first impression. Did the trial judge abuse his discretion in granting plaintiffs supplemental damages equalling the difference between the original mortgage interest rate and the mortgage interest rate prevailing at the date of judgment? We answer the question in the negative, and affirm.

Michigan courts have long recognized that a trial court in equity has the power to protect all of the equities of the parties. Lutz v. Dutmer, 286 [101 MICHAPP 758] Mich. 467, 282 N.W. 431 (1938). The court, in equity, may grant complete relief to a party in the form of specific performance, including an award of damages. Reinink v. Van Loozenoord, 370 Mich. 121, 121 N.W.2d 689 (1963); Frank v. Coyle, 310 Mich. 14, 16 N.W.2d 649 (1944); Fleischer v. Buccilli, 13 Mich.App. 135, 163 N.W.2d 637 (1968). In granting specific performance, a trial court may award in its decree such additional or incidental relief as is necessary to adequately sort out the equities of the parties. Brotman v. Roelofs, 70 Mich.App. 719, 246 N.W.2d 368 (1976). A trial court should enforce the equities of the parties in such a manner as to put them as nearly as possible in the position that they would have occupied had the conveyance of the real property occurred when required by the contract. Meyering v. Russell, 53 Mich.App. 695, 220 N.W.2d 121 (1974); rev'd on other grounds, 393 Mich. 770, 224 N.W.2d 280 (1974).

In the instant case, the trial court clearly had within its discretion the authority to grant such additional or incidental relief as it thought necessary. In awarding plaintiffs the difference in the increase of the mortgage interest rates, we find no abuse of that discretion.

The trial court relied heavily on Reis v. Sparks, 547 F.2d 236 (C.A.4, 1976), as support for its award of the difference in mortgage interest rates. Reis allowed the increase in mortgage interest rates as a proper item for compensating the injured parties for the delay in conveying property. In explaining its rationale, the Reis opinion cited Bernardini v. The Stefanowicz Corp., 29 Md.App. 508, 349 A.2d 287 (1975) " 'The result (of awarding specific performance with...