McComb v. McComb
| Decision Date | 06 December 1967 |
| Docket Number | No. 3,Docket No. 2303,3 |
| Citation | 155 N.W.2d 860,9 Mich.App. 70 |
| Parties | Eva Minnie McCOMB, Plaintiff-Appellee and Cross-Appellant, v. Ronald McCOMB, Sr. and Cut-Rate Food Market, Inc., a Michigan corporation, Defendants-Appellants and Cross-Appellees |
| Court | Court of Appeal of Michigan — District of US |
Bernard Bocknek and A. Albert Sugar, Sugar, Schwartz & Silver, Detroit, for appellant.
Paul Sislin, Detroit, for appellees.
Before GILLIS, P.J., and McGREGOR and THORBURN, * JJ.
After approximately 25 years of marriage, a divorce action was filed in 1962 by the wife, plaintiff-appellee and cross-appellant in this suit. The years of marriage, while they were on occasion very stormy, had been especially fruitful from the economic standpoint. From a humble beginning in the retail grocery business in 1937, the parties had built a large and profitable supermarket with their joint labors. The record shows that both parties had worked long hours at the store, with both doing such tasks as butchering, dressing chickens, cleaning up, etc. Success in the grocery business had led to a more complex operation and in the mid-1940's, the market business was incorporated, and a separate corporation was formed to hold the real estate which housed the market. These separate corporations were owned equally by the parties and any distinctions between the corporations is of little importance for our purposes until the divorce action. Nominally, the market corporation paid a percentage rental to the real estate corporation, but in fact, the corporations were 'two pockets' of the family fortune.
As the marriage relationship degenerated, the parties became extremely concerned about what would become of their valuable supermarket assets as the result of a seemingly inevitable separation and divorce. The supermarket was grossing well in excess of $3,000,000 per year and because of its uniqueness, the supermarket would retain its full value only if it continued as an active business. Disposition of this major business asset was the most important issue in the divorce proceedings. An agreement was reached between the parties and formalized in a property settlement, whereby the husband received the supermarket corporation and the plaintiff received the real estate corporation. A lease agreement was attached as a rider to the property settlement, whereby the supermarket would lease the real estate for a term of 10 years at a guaranteed minimum rental of $30,000 for each lease year, plus 1% Of the supermarket's annual 'gross sales' in excess of $3,000,000.
The term 'gross sales' was defined in the lease agreement as:
'The entire amount of the actual sales price, whether for cash or otherwise, of all sales of merchandise, service and other receipts whatsoever, of all business conducted in or from the premises, * * * and sales by any sub-lessee, concessionaire or licensee on the premises * * * however * * * (excluding) * * * sales made on the premises by the Goode's pastry shop (a sub-lessee).'
Another issue which concededly was of importance to the parties and was not added routinely or as an after-thought, was the medical coverage provision. The plaintiff had a history of hospitalization for serious illnesses and was over-weight. The property settlement required the defendant to continue medical insurance coverage of the wife under two separate insurance policies then in force:
'Provided, however, in event that either of said policies cannot continue in existence said Ronald McComb, Sr. shall provide for equivalent coverage at equivalent monthly premiums, the policy to be selected by said Eva Minnie McComb.'
This appeal is from a supplemental hearing concerning the property settlement. The areas of dispute can be simply stated. The parties dispute the meaning of 'gross sales' in the lease agreement and 'equivalent coverage' in the medical insurance provisions.
While the lower court considered 'gross sales' in relation to several items, such as vending machine receipts and bottle deposit refunds, on appeal the gross sales dispute has narrowed to a consideration of what portion of the intake of more than $100,000 annually for travelers' checks sold in the store can be considered 'gross sales.' The plaintiff insists that the total face value of the travelers' checks, plus the commission paid the store for handling the checks, constitutes gross sales upon which her percentage rental should be based. The defendant husband, on the other hand, advances the theory that the money received for the face value of the checks is 'trust money' and that 'gross sales' is the small commission paid to the store for handling each check. The trial court ruled that the entire monies received for the travelers' checks, regardless of whether the monies were labelled 'trust funds' or how they were handled, are a measure of 'gross sales' under the lease agreement. The defendant husband here appeals the trial court's ruling on 'gross sales.'
As the case was presented, it is in the nature of a declaratory judgment. While this Court, in such cases, reviews the entire record de novo, Theater Control Corporation v. City of Detroit (1962), 365 Mich. 432, 113 N.W.2d 783, we do not reverse the findings of the lower court unless they are clearly erroneous. Coffee-Rich, Inc. v. Michigan Department of Agriculture (1965), 1 Mich.App. 225, 135 N.W.2d 594.
The term 'gross sales' is imprecise and its definition in a given case depends mainly upon the wording established by the parties in the contract. See 52 C.J.S. Landlord and Tenant § 502, at p. 284; Annot. 38 A.L.R.2d 1113, 1114 (1954). The precedents offered by the parties in this case do little but illustrate that there is not a definitive judicial definition of gross sales. The defendant-appellee supports his...
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...on the elements requisite to enforcement of the agreement. We review a declaratory judgment proceeding De novo. McComb v. McComb, 9 Mich.App. 70, 155 N.W.2d 860 (1967). However, the trial judge's findings of facts in these cases are examined pursuant to the standard of review elicited in GC......
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...power. The general rule does not mean that this Court must accept the lessee's theory of what the lease means. McComb v. McComb, 9 Mich.App. 70, 155 N.W.2d 860 (1967). We do not agree with plaintiffs that the increase in question is for an illegal The University of Michigan is a corporation......
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