Lorimer ex rel. Estate of Lorimer v. Berrelez

• Decision Date: 18 August 2004
• Docket Number: No. CIV. 02-40345.,CIV. 02-40345.
• Citation: 331 F.Supp.2d 585
• Parties: Susan J. LORIMER, individually and as Executor of the ESTATE OF Mary Katherine LORIMER, Plaintiff, v. Carlos BERRELEZ, Doranne Wunderlich-Berrelez, and Comerica Bank, Defendants.
• Court: U.S. District Court — Eastern District of Michigan

331 F.Supp.2d 585

Susan J. LORIMER, individually and as Executor of the ESTATE OF Mary Katherine LORIMER, Plaintiff, v. Carlos BERRELEZ, Doranne Wunderlich-Berrelez, and Comerica Bank, Defendants.

No. CIV. 02-40345.

United States District Court, E.D. Michigan, Southern Division.

August 18, 2004.

COPYRIGHT MATERIAL OMITTED

Susan J. Lorimer, San Ramon, CA, pro se.

N. Scott Stensaas, Flint, MI, for Plaintiff.

John A. Gyorgy, William J. DeBiasi, P.C., Taylor, MI, for Defendants.

OPINION AND ORDER

GADOLA, District Judge.

Before the Court is a dispositive motion filed by Carlos Berrelez and Doranne Wunderlich-Berrelez in this diversity action. See 28 U.S.C. § 1332. The motion attacks the complaint on three grounds: (1) subject matter jurisdiction, (2) statute of frauds, and (3) statute of limitations. The Court held hearing on the motion on July 15, 2004. For the reasons set forth below, the Court will grant the motion in part and deny the motion in part.

I. BACKGROUND

This action concerns a family dispute over a parcel of property located at 16800 Strong Drive, Taylor, Michigan (hereinafter "the property"). Prior to April 17, 1989, Mary Katherine Lorimer owned the property. Mary Katherine Lorimer is the mother of Susan Lorimer, plaintiff. In 1989, Carlos Berrelez and Doranne Wunderlich-Berrelez, defendants, then husband and wife, expressed an interest in the property. Susan Lorimer is married to Doranne Wunderlich-Berrelez's father, Jack Wunderlich. On April 17, 1989, Mary Katherine Lorimer executed a quitclaim deed transferring the property to Carlos Berrelez and Doranne Wunderlich-Berrelez.

According to the complaint, this deed was part of an oral contract: Mary Katherine Lorimer agreed to convey the property in exchange for the execution of a note from Carlos Berrelez and Doranne Wunderlich-Berrelez for $50,000.00 plus interest with monthly payments. However, according to Susan Lorimer's declaration, which was submitted with her response to the pending motion, the purported oral contract called for a note totaling $55,000.00 at ten percent interest with monthly payments. Further, according to the complaint, the purported oral contract was entered into in May 1989, after Mary Katherine Lorimer executed the quitclaim deed. Nevertheless, according to Susan Lorimer's subsequent declaration, the purported oral contract was entered into before the quitclaim deed was executed in April 1989. Susan Lorimer maintains that she negotiated this purported oral contract on behalf of her mother.

In their respective affidavits attached to their motion, Carlos Berrelez and Doranne Wunderlich-Berrelez state that, while some discussions were held at the time of the conveyance, "at no time was any discussion held or agreement entered into where myself or my former [spouse] agreed to repayment of $50,000.00 to Mary Katherine Lorimer for the purchase price of the house. We had agreed to take over all responsibility on bringing the delinquent real property taxes current. This was our sole agreement as to consideration for granting of the title of the property to us." Berrelez Aff. at ¶¶ 4-6; Wunderlich-Berrelez Aff. at ¶¶ 4-6. In their motion, Carlos Berrelez and Doranne Wunderlich-Berrelez further state that, with respect to the oral discussions about the transfer of the property, "nothing was ever reduced to writing" save for the quitclaim deed. Def. Mot. at 5. This deed, as is typically the case, states the consideration for the conveyance was one dollar; the deed does not mention any other consideration nor any additional oral or written agreements with respect to the conveyance.

In support of her theory of events, Susan Lorimer heavily relies on a document entitled "Installment Note — Interest Included." Lorimer Decl. Ex. A. According to her declaration, she prepared this note in April 1989 to reflect the purported oral contract. This note, however, is dated August 1992. Further, according to a letter from Susan Lorimer to Carlos Berrelez and Doranne Wunderlich-Berrelez dated July 28, 1992, Susan Lorimer sent this note to Carlos Berrelez and Doranne Wunderlich-Berrelez for their signatures on July 28, 1992.

Nonetheless, this note is unsigned: the lines calling for the signatures of Carlos Berrelez and Doranne Wunderlich-Berrelez are blank. According to her response to the pending motion, Susan Lorimer believes that this note is signed and that Carlos Berrelez and Doranne Wunderlich-Berrelez have neglected to return a signed copy to Susan Lorimer; however, she has no proof to support this belief. The principal amount of this unsigned note is $50,000.00 not $55,000.00. Further, the casual and informal circumstances surrounding the unsigned note is exhibited in one line of Susan Lorimer's letter of July 28, 1992, in which she told Carlos Berrelez and Doranne Wunderlich-Berrelez: "If you don't like the note, you can do one yourselves [and] send [it] to us; we don't care." Lorimer Decl. Ex. D.

This unsigned note calls for a ten percent rate of interest. It also calls for monthly principal-and-interest payments of $416.67 beginning on June 1, 1989. Despite the plain text of the unsigned note, Susan Lorimer maintains in her declaration that this $416.67 amount is an interest-only payment. Her aforementioned letter of July 28, 1992, recites this same understanding that it is an interest-only payment.

This unsigned note also states that should Carlos Berrelez and Doranne Wunderlich-Berrelez "fail to pay for [nine] consecutive months, the [beneficiaries] of this note have the right to repossess the subject property." Lorimer Decl. Ex. A. According to Susan Lorimer's declaration, this repossession language was part of the purported oral contract.

Further, the unsigned note includes an award-of-attorneys-fees clause for any such fees incurred in litigation under the note. The unsigned note also includes an acceleration clause which states: "Should default be made in payment of any installment when due, the whole sum of principal and accrued interest shall become immediately due, without notice, at the option of the holder of this note." Id. The Court has not been provided with any evidence indicating that these clauses were part of the purported oral contract.

In addition to the unsigned note, Susan Lorimer relies upon a document that is purported to be a schedule of payments made by Carlos Berrelez and Doranne Wunderlich-Berrelez. This document does not identify the names of the parties, nor does it identify the property. The document is a form prepared by the Lawyers Title Insurance Company. Susan Lorimer has provided three copies of this form to the Court: the copy with the most payment entries is difficult to read and the copy with the fewest payment entries is the easiest to read.

At the top of the form, the following printed words appear: "Received Payment on the within Contract as follows." Lorimer Decl. Ex. B. Below those words appear payment entries starting in May 1989 and ending in November 1995. None of the amounts total $416.67, as called for in the unsigned note; rather, most of the amounts range from $400.00 to $600.00.

The opening balance on this schedule is $52,502.79. According to Susan Lorimer's declaration, this amount represented the principal amount of $55,000.00 less a $2,497.21 credit for delinquent taxes. Additionally, at the top left corner of this schedule appears the following markings: "10% interest [;] 15 days late $10.00[;] 55,000 — 2497.21 taxes[;] 4-19-89[;] downpmt[.]" Id. Susan Lorimer argues that these markings, along with the recorded payments, demonstrate the existence of a contract.

In support of her claims, Susan Lorimer also relies on a number of checks and wire transfers in 1994 and 1995 from Carlos Berrelez and Doranne Wunderlich-Berrelez to Susan Lorimer and Jack Wunderlich. According to Susan Lorimer's declaration, these checks and wire transfers, most of which ranged from $400.00 to $600.00, were note payments.

The last purported payment occurred in November 1995. At about this time, Carlos Berrelez and Doranne Wunderlich-Berrelez divorced. Doranne Wunderlich-Berrelez resides on the property to this day. Mary Katherine Lorimer died on June 12, 2001, and Susan Lorimer is the representative of the estate. On November 7, 2001, Susan Lorimer summarized her version of the state of affairs at that juncture in a letter to Doranne Wunderlich-Berrelez. This letter states in pertinent part:

Doranne, your father as you know is soon to be seventy-three years old and he and I are desperately trying to re-arrange our business and social lives, and are presently attempting to retire or at least semi-retire in the very near future.

As I'm sure you are aware, we can't sell the property we currently own due to the current terrorist threat and people's negativism toward purchasing anything. The condo in Hawaii is now rented, but up for sale with no buyers on the horizon. Our stock holdings have taken a terrible hit, and quite frankly, we're hurting!

Doranne, in view of our currently negative financial circumstances, it would be appreciated if you could start to make timely mortgage payments plus interest on the Strong Drive property, perhaps in the amount of $400.00 to $500.00 a month.

Your last payment on the contract was six years ago in November of 1995. Your not paying on the house was all right with us during your divorce transition, and when we didn't particularly need the money, but now with our current upside down financial circumstances we really need the income to fiscally survive at this time of our lives.

Doranne, in closing, please let me hear from you as soon as possible regarding your resumption of payments on the property, as we are, as explained, trying to get our budget, finances, and estate together in the very near future.

Lorimer Decl. Ex. D.

On February 11, 2002, Susan Lorimer filed suit against Carlos Berrelez, Doranne Wunderlich-Berrelez, and Comerica Bank....