In re Duke Estate
| Decision Date | 13 October 2015 |
| Docket Number | Docket No. 321234. |
| Citation | 312 Mich.App. 574,887 N.W.2d 1 |
| Parties | In re DUKE ESTATE. |
| Court | Court of Appeal of Michigan — District of US |
Julia Blakeslee, Bloomfield Hills for petitioners.
Anthony J. Garczynski, PLC, Plymouth (by Anthony J. Garczynski ), for respondent.
Before: WILDER, P.J., and SHAPIRO and RONAYNE KRAUSE, JJ.
Respondent Robert Duke appeals as of right a probate court order granting the petition filed by petitioners Crystal Clark, Charles Franklin Duke (Frank), and Marega Delizio, to determine title to real estate located in Huron Township, Michigan, and to set aside the quitclaim deed that allegedly conveyed the property at issue in this case. We reverse and remand for further proceedings consistent with this opinion.
Before his death, decedent Charles E. Duke (decedent) executed a quitclaim deed that conveyed approximately 40 acres of land on Inkster Road in Huron Township, Michigan (Inkster Road property), to his sons, Frank and respondent. According to the notations on the document, the deed was acknowledged by decedent, petitioner Frank, and respondent on May 14, 2007, before “EA Labadie,” a notary public whose commission was to expire on December 30, 2014. On September 23, 2009, decedent passed away. In January 2010, respondent recorded the quitclaim deed with the Wayne County Register of Deeds. On April 28, 2010, respondent was appointed personal representative of decedent's estate. When respondent filed his initial inventory of the estate on September 7, 2011, he did not include the Inkster Road Property.1
On January 9, 2014, petitioners filed a petition to determine title to the Inkster Road property and to set aside the quitclaim deed, arguing that the Inkster Road property was property of decedent's estate. Petitioners first argued that the quitclaim deed was fraudulent and void under MCL 565.46 and MCL 565.47 because it was improperly notarized and, as a result, could not be validly recorded as a conveyance of real estate under MCL 565.201(1)(c). Petitioners contended that the alleged notary, E. A. Labadie, was not a notary public as of May 14, 2007. Petitioners provided printouts from the Michigan Department of State website indicating that Labadie became a notary public on October 15, 2008. Next, petitioners argued that respondent procured the “notarization” of the quitclaim deed to benefit himself because Labadie was an employee of respondent. Finally, petitioners argued that there was no evidence that the deed was actually delivered, as the deed was not recorded during decedent's lifetime and, instead, was hidden away until respondent recorded the deed after decedent's death. Thus, because a court may invalidate under MCL 55.307(2) any notarial act that is not performed in compliance with the Michigan Notary Public Act, petitioners requested that the probate court order that the quitclaim deed was void, and therefore, that it did not transfer title of the Inkster Road property from decedent to respondent and Frank. Additionally, petitioners asserted that respondent “must be charged with knowledge of the falsity of the notarization of the quit-claim deed” because Labadie was respondent's employee, and because respondent authorized Labadie to use respondent's business address and phone number in her application to become a notary public in 2008.
On February 10, 2014, Labadie executed an affidavit averring that she witnessed decedent execute the quitclaim deed “on or about April 13, 2009,” and that the date written and printed on the deed was incorrect. She also stated “[t]hat following execution of the deed, at the direction of [decedent], I made two copies of the deed and delivered the original to [respondent], and gave the copies to [petitioner Frank] and [decedent].”
On or about February 14, 2014, petitioners filed a brief in support of their petition. Petitioners raised the same arguments as those discussed in their initial petition and supporting brief, but they also argued, inter alia, that the deed constituted a gift because it was not supported by consideration. Petitioners asserted that the deed should be governed by the law applicable to gifts, not by the more lenient standards for real estate conveyances that are supported by paid consideration. Additionally, petitioners asserted that the deed was not a valid gift under Michigan law.
Finally, petitioners argued that the deed was statutorily defective and that the “savings statute,” MCL 565.604, was not applicable because the statute only applies when a conveyance is “made in good faith and upon a valuable consideration.” Specifically, petitioners contended that, despite the fact that Labadie was a notary public, the circumstances in which respondent arranged to have his employee sign the quitclaim deed, when no consideration was given to decedent, was evidence that the deed was executed in bad faith.
On February 26, 2014, Labadie's affidavit was recorded with the Wayne County Register of Deeds. Also on or about February 26, 2014, respondent filed a brief in response to petitioners' petition. Respondent asserted that decedent had signed a preprinted deed prepared by attorney Renee Schattler Burke in 2007. According to respondent, the deed was dated May 14, 2007, but it was actually executed on or about April 13, 2009. Additionally, respondent claimed that when the deed was signed on or about April 13, 2009, Labadie was, at that time, a notary public, the deed was signed in Labadie's presence, and Labadie erroneously conformed the date in her notary block to the date printed on the deed. Furthermore, respondent indicated “[t]hat upon realizing [that] the date on the notary block (and the deed itself) was incorrect, Ms. Labadie prepared and recorded an [a]ffidavit of correction, as allowed by MCL 565.202, correcting the date of the deed ... and her notary block to April 13, 2009.” Respondent attached a copy of the recorded affidavit to his response. Respondent also argued that the burden of proof with regard to delivery had shifted to petitioners based on the contents of Labadie's affidavit. Finally, respondent argued that the court should hold the deed valid, even if the affidavit of correction was insufficient to correct the defects in the acknowledgment, because the only evidence presented to the court indicated that decedent intended to convey the property through the deed, and the deed was sufficient to provide notice of the conveyance. Respondent further noted that Michigan courts seek to carry out the parties' intentions, even if a deed is incomplete or ambiguous, and he provided a business letter from attorney Daniel Keith to demonstrate that decedent had intended to transfer the property to respondent and petitioner Frank as early as 2001.
On March 5, 2014, the probate court held a hearing on the petition, and the parties presented arguments consistent with those raised in their briefs. In addition, petitioners contested respondent's claim that petitioner Frank was present when the deed was purportedly executed in April 2009, indicating that petitioner Frank was present and willing to testify that he was not present when the deed was executed. Although the court did not ask him to testify, petitioner Frank—who was sworn as a witness at the beginning of the hearing but was never examined by petitioners' or respondent's counsel—briefly confirmed on the record that he was not present in April 2009. Regarding recordation under MCL 565.46, respondent argued that there is a difference between executing a valid conveyance and making a deed eligible for recording, arguing that there is no dispute that a valid conveyance occurred in the instant case. The probate court stated that an affidavit filed by the attorney who prepared the deed (Burke) was not “particularly persuasive” or “clear and convincing” as to the date on which the deed was actually executed, and that it did not believe that Labadie notarized the deed in April 2009. Instead, the court stated that it believed that the deed was actually executed on May 14, 2007, in light of its disbelief that a notary would sign the deed while ignoring, and failing to correct, the numerous places on the deed that included the May 14, 2007 date. Accordingly, the probate court set aside the deed and held that the Inkster Road property was property of decedent's estate. The probate court indicated that it would issue a written order and opinion with its reasoning for the holding.
On March 17, 2014, the probate court entered an opinion and order consistent with its statements on the record. The court set aside the quitclaim deed based on its authority to invalidate a notarial act under MCL 55.307(2), noting that a deed must be acknowledged before a notary public in order to be validly recorded, and finding that the deed was not properly notarized given the uncontroverted evidence that Labadie was not a notary public on May 14, 2007. Additionally, the court indicated that it gave no credence to Burke's affidavit, and that because respondent procured her as a notary, he cannot now claim that he was unaware of Labadie's credentials. Furthermore, the court noted there was some question regarding whether the deed was properly delivered, but it declined to rule on this issue given its decision to set aside the quitclaim deed on the basis that the deed's notarization was invalid.
This Court reviews de novo a probate court's conclusions of law. In re Kostin Estate, 278 Mich.App. 47, 53, 748 N.W.2d 583 (2008). Likewise, “[t]his Court reviews de novo equitable actions to quiet title.” Special Prop. VI LLC v. Woodruff, 273 Mich.App. 586, 590, 730 N.W.2d 753 (2007). When a probate court sits without a jury, this Court reviews its factual findings for clear error. In re Bennett Estate, 255 Mich.App. 545, 549, 662 N.W.2d 772 (2003). “A finding is clearly erroneous when a reviewing court is left with a definite and firm conviction that a mistake has...
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