Stanton v. Dachille

• Decision Date: 17 December 1990
• Docket Number: Docket No. 112249
• Citation: 186 Mich.App. 247,463 N.W.2d 479
• Parties: Joseph E. STANTON, Individually and on behalf of a Partnership to be formed, Wolf Chayt, Individually and on behalf of a Partnership to be formed, and Thomas S. Werthmann, Individually and on behalf of a Partnership to be formed, Plaintiffs-Counter-Defendants-Appellants-Cross-Appellees, v. Mary E. DACHILLE, Independent Personal Representative of the Estate of Harry Dachille, Deceased, and Rochester Hills Corporate Center Associates, Inc., a Michigan corporation, Defendants -Counter-Plaintiffs-Appellees-Cross-Appellants. 186 Mich.App. 247, 463 N.W.2d 479
• Court: Court of Appeal of Michigan — District of US

Page 479

463 N.W.2d 479

Joseph E. STANTON, Individually and on behalf of a Partnership to be formed, Wolf Chayt, Individually and on behalf of a Partnership to be formed, and Thomas S Werthmann, Individually and on behalf of a Partnership to be formed Plaintiffs-Counter-Defendants-Appellants-Cross-Appellees, v. Mary E. DACHILLE, Independent Personal Representative of the Estate of Harry Dachille, Deceased, and Rochester Hills Corporate Center Associates, Inc., a Michigan corporation Defendants -Counter-Plaintiffs-Appellees-Cross-Appellants.

Docket No. 112249.

186 Mich.App. 247, 463 N.W.2d 479

Court of Appeals of Michigan.

Submitted Feb. 20, 1990.

Decided Nov. 19, 1990.

Released for Publication Dec. 17, 1990.

[186 MICHAPP 249] Gordon & Green, P.C. by Richard A. Green, Birmingham, for plaintiffs-counter-defendants-appellants-cross-appellees.

Jaffe, Snider, Raitt & Heuer by Thomas J. Tallerico and Eric A. Linden, Detroit,for defendants-counter-plaintiffs-appellees-cross-appellants.

Before NEFF, P.J., and MacKENZIE and JANSEN, JJ.

NEFF, Presiding Judge.

In this breach of contract case, plaintiffs appeal as of right from a judgment entered by the circuit court in favor of plaintiffs and against defendants. Plaintiffs claim that the trial court erred in refusing to admit certain evidence and in finding that defendant Rochester Hills Corporate Center, Associates, Inc., (RHCCA) did not tortiously interfere with plaintiffs' contract to purchase real estate.

Defendants cross appeal, claiming that the trial court erred in finding the existence of a valid contract and of a breach thereof. Defendants also cross appeal the trial court's finding that defendants could not rescind the contract, as well as the trial court's finding of damages and the dismissal of their slander of title claim.

We reverse in part, affirm in part, and remand for further proceedings consistent with this opinion.

I

The property at issue was owned at one time by Harry Dachille, deceased. His daughter, the personal representative of the estate, is Mary Dachille (Dachille). In 1985, Dachille's son, Gary Sorge, assumed primary responsibility for the management of the property. Harry Dachille had attempted to sell the property as a whole prior to [186 MICHAPP 250] his death, and Sorge continued these efforts, equally unsuccessfully.

In April 1985, plaintiffs entered into three separate purchase agreements with Dachille respecting three parcels denoted on a preliminary plat. The agreements were drafted by Kent Clarke, an attorney and real estate broker acting for plaintiffs, with the assistance of Ron Wonboy, a real estate broker employed by Industrial Commercial Realty (ICR), who was acting as a broker for Dachille.

The terms and conditions of the three agreements were virtually identical with respect to all relevant matters. Each called for a cash sale at a price of $1.65 per square foot. Each provided that the closing take place after delivery of a title commitment by Dachille, but not sooner than ten days prior to the commencement of construction and after approval of EDC financing. The agreements listed as additional conditions the following:

a) Subject to soil boerings [sic] and conditions acceptable to buyer for construction of 20,000 sq. ft. building without special foundations.

b) Subject to obtaining a letter of inducement and EDC approved financing from the City of Rochester Hills.

c) Subject to final plat and survey.

Plaintiff Chayt's agreement also stated that the purchaser shall not be required to close until roads and utilities are to the lot and that the agreement was subject to the developer installing roads and utilities to the lot.

The agreements were signed by the individual plaintiffs on behalf of partnerships in formation, accepted by Dachille, and then signed by plaintiffs acknowledging receipt of the accepted offers.

The lots referred to in the agreements were as [186 MICHAPP 251] laid out on a preliminary plat prepared for Dachille in approximately 1982. In August or September 1985, Dachille revised the preliminary plat, and changes were made in the size, numbering, and location of the lots, and in the location of the access road planned for the subdivision. There were several intermediate preliminary plats drawn up between August and October 1985. Plaintiffs were aware at the signing of the agreements that boundaries, acreage, road location, and other factors might change somewhat, and all plaintiffs accepted the changes made.

On January 24, 1986, Dachille's attorney sent a letter to ICR and to Kent Clarke in which Dachille repudiated the agreements. The letter stated that the City of Rochester Hills had rejected the proposed plat upon which the agreements were based and that a complete revision had been made. The letter further stated that Dachille had chosen not to complete platting the property and had decided to sell the property as a whole. Prior to the letter of rejection, Dachille had already contracted to sell the property to RHCCA.

In February 1986, plaintiffs filed "claims of interest" as to portions of the land.

Dachille conveyed title to the property to RHCCA on May 6, 1986. RHCCA continued platting the land and, on May 9, 1987, the Rochester Hills City Council approved the plat for the property. The final plat was recorded in August 1987.

II

Plaintiffs first contend that the trial court erred in refusing to allow them to present evidence regarding the value of the property after January 24, 1986, and, in particular, as of August 1987. We agree.

[186 MICHAPP 252] The facts of this case closely parallel those in Solomon v. Western Hills Development Co., 88 Mich.App. 254, 276 N.W.2d 577 (1979); (After Remand ), 110 Mich.App. 257, 312 N.W.2d 428 (1981), and we find the reasoning employed in that case persuasive. Although the plaintiff in Solomon did not treat the repudiation as an anticipatory breach as did plaintiffs in this case, we find that distinction to be irrelevant in applying the principles announced in Solomon.

Generally, in order to give the buyer in a breach of contract action the benefit of the bargain, damages are measured by the difference between the agreed price and the value at the time of breach. 110 Mich.App. at 266-267, 312 N.W.2d 428. The tender of an anticipatory breach of contract does not affect this general rule of damages. 25 C.J.S., Damages, Sec. 74, p. 850. Anticipatory repudiation creates an immediate right of action even though it takes place long before the time prescribed for the performance and before conditions have occurred. 4 Corbin, Contracts, Sec. 959, p. 853.

An "anticipatory breach" does not refer to the duty not to repudiate a contract. Rather, it refers to the duty of rendering a performance for which the nonbreaching party bargained and which the breaching party has specifically promised. 5 Corbin, Contracts, Sec. 1053, p. 309. The measure of damages is the same whether the defendant's breach is or is not anticipatory. 5 Corbin, supra, p. 310. Therefore, the value of the promised performance is to be determined at the time when performance was to be rendered. 5 Corbin, supra, pp. 311-312. Damages for an anticipatory repudiation are to represent full compensation for the loss caused by depriving the plaintiff of the benefit of the bargain. 25 C.J.S., supra, pp. 850-851.

[186 MICHAPP 253]

A

In Solomon, the plaintiff entered into a purchase agreement for the sale of a building lot in a proposed subdivision. The agreement was to be consummated with an exchange of the deed and the purchase price at the time the plat was recorded. The developer later decided to abandon the project and attempted to return the plaintiff's deposit. The property was then conveyed to third parties who subdivided it and conveyed the plaintiff's lot to a good-faith purchaser who built a house on it. A suit for specific performance of the purchase agreement or, in the alternative, for damages, followed.

The trial judge in Solomon found the purchase agreement unenforceable because it did not specify a time for performance other than "when the plat is recorded." On appeal, this Court reversed and remanded, holding that there was a valid, enforceable agreement which required the seller to record the plat within a reasonable time. 110 Mich.App. at 261-262, 312 N.W.2d 428; 88 Mich.App. at 258, 276 N.W.2d 577. On remand, a bench trial was held which resulted in a damage award, since specific performance was impossible. 110 Mich.App. at 262, 312 N.W.2d 428. The trial court held that breach of the agreement had occurred when the still unplatted land was sold to the third parties who later platted the property and sold off the lots.

The case returned to this Court after remand, and one of the questions for decision was the proper measure of damages. The Court on remand held that the plaintiff was entitled to the benefit of her bargain. The bargain was a platted lot in exchange for the purchase price. 110 Mich.App. at 267, 312 N.W.2d 428. Most importantly, the Court held that, even though the land was not platted at the time of breach, the value of the land at the time of [186 MICHAPP 254] breach was to be determined as though it were platted for purposes of determining damages in order to give the plaintiff the benefit of her bargain, if any, placing her in as good a position as she would have enjoyed had the defendants not breached the agreement. 110 Mich.App. at 267-268, 312 N.W.2d 428.

B

Solomon is good law which applies to the facts of this case. We are also satisfied that the date of performance was sufficiently definite to avoid the rule that, where the date of performance is uncertain, the date for delivery will be assumed to be the date of repudiation. See McJunkin Corp. v. North Carolina Natural Gas Corp., 300 F.2d 794, 801 (CA4, 1961), cert. den. 371 U.S. 830, 83 S.Ct. 43, 9 L.Ed.2d 68 (1962). Plaintiffs are entitled to introduce evidence of the value of the property...