Snider v. Dunn, Docket No. 2681

• Decision Date: 03 April 1968
• Docket Number: No. 1,Docket No. 2681,1
• Citation: 11 Mich.App. 39,160 N.W.2d 619
• Parties: Norman SNIDER, Plaintiff-Appellant, v. Sonia DUNN, Anna Dunitz and Seymour Dunitz, Defendants-Appellees
• Court: Court of Appeal of Michigan — District of US

Page 619

160 N.W.2d 619

11 Mich.App. 39

Norman SNIDER, Plaintiff-Appellant, v. Sonia DUNN, Anna Dunitz and Seymour Dunitz, Defendants-Appellees.

Docket No. 2681.

Court of Appeals of Michigan, Division No. 1.

April 3, 1968.

Rehearing Denied May 20, 1968.

Released for Publication Sept. 4, 1968.

Allen Zemmol, Dingell, Hylton & Zemmol, Detroit, for appellant. Harold Goodman, Detroit, of counsel.

Harvey F. Tennen, Detroit, for Dunn.

M. H. Shillman, Detroit, for Dunitz.

Before LEVIN, P.J., and GILLIS and QUINN, JJ.

QUINN, Judge.

In reliance on a written offer to purchase real estate in Wayne county and the alleged acceptance thereof by defendant Sonia Dunn as seller and defendants' refusal to perform, plaintiff filed complaint for specific performance or in the alternative for money damages. A nonjury trial resulted in judgment of no cause of action and plaintiff appeals.

Plaintiff was admitted to the practice of law in 1921 and practiced law until 1950, during which time he closed a good many real estate transactions. For reasons of health, he withdrew from the practice of law about 1950 and entered the real estate business, i.e. purchasing residential property to recondition and modernize for resale.

August 21, 1965, through Benjamin Rich Realty Company, plaintiff offered in writing to purchase the property in question for $3,800 and deposited $100 on such offer with the broker. The property was not listed for sale with the broker. On August 25, 1965, acceptance of the offer, amended as to amount to the sum of $4,150, was executed by 'Sonia Dunn P. a. for Anna Dunitz', although Sonia Dunn had no written authority to act for Anna Dunitz. The evening of the same day, plaintiff was notified of such acceptance by the broker. August 28, 1965, plaintiff received a policy of title insurance which disclosed that the State of Michigan was the owner of the premises, subject to the interest of Anna Dunitz, as to a life estate and remainder to Sonia Dunn and Seymour Dunitz. The property had been vacant for some time and had been vandalized. The evening of August 25, 1965, plaintiff was notified of further vandalization to the property, and August 27 or 28, 1965, he commenced repairs to stop further vandalizing. These repairs continued until March 4, 1966.

There were further negotiations to close the transaction, and about 2 weeks after August 21, 1965, plaintiff offered an additional $1,750 to the purchase price. It is disputed on the record whether Sonia Dunn ever unconditionally accepted any of plaintiff's offers, but the sale was never consummated, and October 8, 1965 plaintiff filed the complaint.

On appeal, plaintiff does not question the trial court's denial of specific performance but contends that defendant Sonia Dunn is liable individually for damages on theory of breach of implied warranty of authority by an unauthorized agent. This theory was neither pleaded nor raised below, and it is not before this Court. Dwelley v. Tom McDonnell, Inc. (1952), 334 Mich. 229, 54 N.W.2d 217. If this theory were before this Court, plaintiff could not benefit by it. C.L.1948, § 566.108 (Stat.Ann.1953 Rev. § 26.908) requires that a contract for the sale of land must be signed by one lawfully authorized in writing to do so. It is conceded Sonia Dunn had no such authority from Anna Dunitz or Seymour Dunitz. No inquiry was made as to the authority of Sonia Dunn, and plaintiff was content to rely on the broker's representation that Sonia Dunn had such authority and on the alleged representation by Sonia Dunn that she had such authority. The signature disclosed Sonia Dunn's purported principal; plaintiff knew Sonia Dunn was acting for others and she cannot be personally liable unless she agreed to be. Hall v. Encyclopaedia Britannica, Inc. (1949), 325 Mich. 35, 37 N.W.2d 702. No such agreement appears here.

Plaintiff next claims he is entitled to an equitable lien for the improvements he placed on the premises. With respect to defendants Anna and Seymour Dunitz, such claim is untenable. The record does not disclose that Sonia Dunn ever consulted them about the purchase agreement nor that they acquiesced in the negotiations for purchase. They had no knowledge of the repairs made by plaintiff. There is no equitable basis for granting plaintiff the lien he seeks as to them when plaintiff knew at the time he commenced repairs of the record title interest of Anna and Seymour Dunitz.

In Pakulski v. Ludwiczewski (1939), 291 Mich. 502, 289 N.W. 231, the Supreme Court stated the basis for an equitable lien:

'An equitable lien for improvements placed on another's property by fraud, accident or mistake is given only under compelling circumstances to avoid unjust enrichment of the true owner by the person innocently making the improvements.'

The record before us establishes neither accident nor mistake and the arguable fraud of Sonia Dunn is not established by clear, satisfactory, and convincing proof. Youngs v. Tuttle Hill Corporation (1964), 373 Mich. 145, 128 N.W.2d 472. In addition, the record does not establish that plaintiff innocently made the improvements.

Affirmed, with costs to defendants. Plaintiff's motion to amend to conform to proofs is denied.

LEVIN, Presiding Judge (dissenting).

The property was owned by Anna Dunitz (life tenant) and her children, Seymour Dunitz and Sonia Dunn (remaindermen). Plaintiff agreed to buy the property under an agreement of sale which was signed for the seller:

'Sonia Dunn P. a. for Anna Dunitz.'

Plaintiff's complaint sought specific performance and, if that failed, damages. Plaintiff was unable to prove that Sonia Dunn had been authorized to sell the property for the other owners, and specific relief was, therefore, denied. Plaintiff then sought to impose an equitable lien or constructive trust in aid of his claim that the defendants were obliged to reimburse him for the amount the value of their property had been enhanced by plaintiff's expenditures in repairing their property. The plaintiff asserted that the defendants had been unjustly enriched in that amount.

Following the conclusion of the proofs, the trial judge wrote the parties stating his then view of the matter:

'To allow the parties to remain where they are now would be unjust to the plaintiff who, though not innocent, was encouraged to believe by Sonia Dunn and Benjamin Rich that the transaction would be consummated. Accordingly, money damages will be given as against all defendants who will receive a benefit from the improvements made by the plaintiff. The measure of damages is not the cost of the repairs and improvements to the plaintiff, but the enhancement of the value of the property, that is, the difference between the value of the property after the improvement and the value of the property before the improvement.'

The trial was reopened and evidence was introduced concerning the enhancement in value of defendants' property resulting from plaintiff's repairs. The trial judge found the enhancement in value was $5,500. However, he declined to allow plaintiff relief, not because of any fact finding adverse to the plaintiff, but because he concluded, as a matter of law, plaintiff had not shown himself entitled to restitutionary relief. This Court affirms for reasons in part the same and in part dissimilar to those advanced by the trial judge.

The trial judge found by and large for the plaintiff, viz.,

--the agreement under which plaintiff agreed to purchase and Sonia Dunn for the seller agreed to sell the property was entered into after lengthy negotiations;

--a few days after agreeing to purchase the property, plaintiff entered the premises and caused extensive repairs to be undertaken in an effort to stop further vandalizing of the property he had obligated himself to purchase; ¹

--within a few days after the repairs were started a title commitment was received showing title in the State of Michigan for default of taxes and showing the interests of Anna and Seymour Dunitz and Sonia Dunn;

--Sonia Dunn refused to close. The broker arranged for a meeting of the parties. Sonia Dunn failed to appear as promised. Another meeting was arranged which she did attend. She had learned of the repairs made by the plaintiff; she asserted that the repairs adversely affected her ability to settle a claim arising out of a fire which, prior to the execution of the agreement of sale, had damaged part of the property. After extended negotiations plaintiff agreed to pay, in addition to the $4,150 purchase price stated in the agreement of sale, an additional $1,750; ²

--Sonia Dunn had not 'tricked' the plaintiff into making and completing the improvements. However, at no time during these 'difficult negotiations' did Sonia Dunn tell the plaintiff to discontinue the repairs. She gave permission to heat the premises to prevent pipes from freezing. At least two different dates were set for closing with plaintiff or his representatives appearing and with defendant Sonia Dunn failing to do so. Plaintiff's expectation that he would close the transaction satisfactorily and take title was 'genuine and sincere';

--all parties to this litigation are sophisticated in business matters. Plaintiff is an attorney actively engaged in the purchase and sale of real estate. Sonia Dunn deals in real estate and has acted for herself and her mother on a number of transactions. Sonia Dunn had operated and managed this property. Sonia Dunn was not authorized in writing to sell the property for her mother and brother;

--the repairs undertaken by the plaintiff cost $4,500.14.

I.

Plaintiff knew within a few days after he started repairs that Seymour Dunitz, Sonia Dunn and the State of Michigan had interests in the property and that the record title was not vested in Anna Dunitz alone. There is not, however, any record evidence for the trial judge's finding that plaintiff Knew Sonia Dunn acted without authority in selling the property.

Not infrequently...