Hamade v. Sunoco Inc. (R & M)
| Decision Date | 25 May 2006 |
| Docket Number | Docket No. 265226. |
| Citation | 271 Mich. App. 145,721 N.W.2d 233 |
| Parties | Kheireddin HAMADE, Plaintiff-Appellant, and Nouhad Hamade, Plaintiff, v. SUNOCO, INC. (R & M), John G. Drosdick, Ann C. Mule, Paul A. Mulholland, Robert J. Darnall, Ursula F. Fairbairn, Thomas P. Gerrity, Rosemarie B. Greco, James G. Kaiser, Robert D. Kennedy, Richard H. Lenny, Norman S. Matthews, R. Anderson Pew, G. Jackson Ratcliffe, Larry Wilcox, J. McMahon, Jeff Byard, and Aretha Battle, Defendants-Appellees. |
| Court | Court of Appeal of Michigan — District of US |
Norman Yatooma & Associates, P.C. (by Norman A. Yatooma, Joseph N. Ejbeh, Howard Yale Lederman, and Ryan D. Bobel), Birmingham, and Muawad & Muawad, P.C. (by Elias Muawad), St. Clair Shores, for the plaintiff.
Fischer, Franklin & Ford (by Francis E. Bentley and Troy C. Otto), Detroit, for the defendants.
Before: SMOLENSKI, P.J., and OWENS and DONOFRIO, JJ.
In this dispute arising out of the breakdown in the business relationship between plaintiff, Kheireddin Hamade,1 and defendant, Sunoco, Inc. (R & M) (Sunoco),2 plaintiff appeals as of right the trial court's grant of summary disposition in favor of defendants. We affirm.
In 1986 Hamade purchased an existing gas station with the Sunoco brand from its owner with the approval of Sunoco. At that time, Hamade entered into a dealer supply franchise agreement with Sunoco, which lasted until 1989.3 After the expiration of the first agreement in 1989, Hamade entered into a new dealer supply franchise agreement with Sunoco, which lasted until 1992 (the 1989 Agreement). From 1992 to 1997, Hamade continued operating his station as a Sunoco station by obtaining extensions of the 1989 Agreement.
In 1997 Hamade still had not obtained a new dealer supply franchise agreement with Sunoco. At his deposition, Hamade stated that Sunoco insisted that he make numerous improvements to his station before it would be interested in signing a new agreement. The improvements included enlarging and modernizing the station islands, installing larger fuel tanks, installing a canopy, and remodeling the service station store. In addition, Hamade claimed that Sunoco required him to significantly increase his motor fuel sales. After he completed the improvements and began to negotiate a new agreement with Sunoco, Hamade stated that he asked Sunoco's representative, Jeff Byard, about placing a provision in the contract preventing Sunoco from approving another Sunoco station within a certain distance of his station on the same line of traffic. Hamade testified that Byard responded by saying that he did not need to worry about that because Sunoco would never do that. Hamade said that he took Byard at his word and entered into a new dealer supply franchise agreement (the 1997 Agreement).
In September 2000, Sunoco approved a new Sunoco station at a location that was approximately one mile from Hamade's station on the same road. At his deposition, Hamade stated that, in December 2000, he had problems with customers who experienced engine trouble after purchasing fuel from his station. Hamade claimed that the problems arose from a bad batch of fuel delivered by Sunoco. Hamade testified that his business suffered as a result of the opening of the new Sunoco station and the delivery of bad fuel.
On February 8, 2001, plaintiff filed suit. In the complaint, plaintiff alleged that Sunoco breached its agreement not to approve another Sunoco station within Hamade's exclusive territory, violated Michigan's Franchise Investment Law (MFIL),4 converted Hamade's exclusive territory, and tortiously interfered with his business relations when it deliberately delivered defective fuel in an attempt to induce his customers to switch to the new Sunoco station. Plaintiff also alleged a claim based on promissory estoppel. On April 11, 2002, Sunoco moved for summary disposition. In orders dated July 17 and 29, 2002, the trial court granted summary disposition in favor of defendants on all of plaintiff's claims except the claims of breach of contract and tortious interference with a business relationship.
On July 3, 2003, plaintiff filed an amended complaint with 14 separate counts. Counts I through III were for various violations of the MFIL. Count IV restated plaintiff's original breach of contract claim. Count v. alleged a claim based on promissory estoppel. Count VI alleged a breach of Sunoco's duty to set an open price term in good faith under Michigan's Uniform Commercial Code (MUCC).5 Count VII alleged a breach of the Michigan Antitrust Reform Act.6 Count VIII alleged a claim for unjust enrichment. Count IX restated plaintiff's original claim for conversion. Count X restated plaintiff's original claim for tortious interference with a business relationship. Counts XI through XIII alleged claims based on fraud, and count XIV alleged a civil conspiracy claim. On October 15, 2003, defendants moved for summary disposition of plaintiff's first amended complaint. On May 25, 2004, the trial court granted defendants' motion with respect to counts VII, IX, X, XI, and XIV.
On July 25, 2005, defendants again moved for summary disposition of plaintiff's first amended complaint. The trial court held a hearing on this motion on August 15, 2005. At the hearing, the trial court granted defendants' motion for summary disposition of plaintiff's claims based on the MUCC and unjust enrichment. The trial court also granted defendants' motion for summary disposition of plaintiff's MFIL claims. The trial court reasoned that summary disposition of the MFIL claims was appropriate because plaintiff failed to show that Hamade paid a fee for the privilege of entering into business under a franchise agreement and therefore, the 1997 Agreement was not subject to the requirements imposed by the MFIL.
The trial court continued the hearing on defendants' motion for summary disposition on August 16, 2005. At the continuation of the hearing, the trial court determined that in light of the written agreement, Hamade's reliance on any representation made by Sunoco was not reasonable as a matter of law and, therefore, there could be no promissory estoppel claim. The trial court also noted that the agreement disclaimed any warranties on the part of Sunoco regarding present or future competitive activities. Because the agreement also contained an integration clause, the trial court concluded that the parol evidence rule barred plaintiff's attempts to present evidence to contradict the terms of the written agreement. Therefore, the trial court concluded that plaintiff's contract claim and claims based on fraud must also fail.
The trial court entered an order dismissing plaintiff's case in its entirety on August 26, 2005. This appeal followed.
On appeal, plaintiff first argues that summary disposition of the MFIL claims was inappropriate because plaintiff presented sufficient evidence before the trial court to either establish that the 1997 Agreement constituted a "franchise" for purposes of the MFIL or to create a factual question on that issue.7 We disagree.
This Court reviews de novo the trial court's decision to grant summary disposition. Moore v. Cregeur, 266 Mich.App. 515, 517, 702 N.W.2d 648 (2005). A motion for summary disposition under MCR 2.116(C)(10) tests the factual sufficiency of a claim. Dressel v. Ameribank, 468 Mich. 557, 561, 664 N.W.2d 151 (2003). Summary disposition is appropriate under MCR 2.116(C)(10) if "there is no genuine issue as to any material fact, and the moving party is entitled to judgment or partial judgment as a matter of law." When determining whether there is a genuine issue regarding any material fact, the trial court must consider the evidence presented by the parties in the light most favorable to the party opposing the motion. Smith v. Globe Life Ins. Co., 460 Mich. 446, 454-455, 597 N.W.2d 28 (1999). "A genuine issue of material fact exists when the record, giving the benefit of reasonable doubt to the opposing party, leaves open an issue upon which reasonable minds might differ." West v. Gen. Motors Corp., 469 Mich. 177, 183, 665 N.W.2d 468 (2003), citing Shallal v. Catholic Social Services of Wayne Co., 455 Mich. 604, 609, 566 N.W.2d 571 (1997), and Quinto v. Cross & Peters Co., 451 Mich. 358, 369, 547 N.W.2d 314 (1996). "Where the proffered evidence fails to establish a genuine issue regarding any material fact, the moving party is entitled to judgment as a matter of law." Maiden v. Rozwood, 461 Mich. 109, 120, 597 N.W.2d 817 (1999).
This Court also reviews de novo the proper interpretation of a statute. Macomb Co. Prosecutor v. Murphy, 464 Mich. 149, 157, 627 N.W.2d 247 (2001). This Court begins the interpretation of a statute by examining the language of the statute itself. If the language is not ambiguous, the Court shall not construe it, but will enforce it as written. Id. at 158, 627 N.W.2d 247.
Under MCL 445.1502(3), a "franchise" is defined as
a contract or agreement, either express or implied, whether oral or written, between 2 or more persons to which all of the following apply:
(a) A franchisee is granted the right to engage in the business of offering, selling, or distributing goods or services under a marketing plan or system prescribed in substantial part by a franchisor.
(b) A franchisee is granted the right to engage in the business of offering, selling, or distributing goods or services substantially associated with the franchisor's trademark, service mark, trade name, logotype, advertising, or other commercial symbol designating the franchisor or its affiliate.
(c) The franchisee is required to pay, directly or indirectly, a franchise fee.
Defendants did not contest the existence of...
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