Vergote v. K Mart Corp.
| Decision Date | 06 May 1987 |
| Docket Number | Docket No. 91003 |
| Citation | 404 N.W.2d 711,158 Mich.App. 96 |
| Parties | Leo VERGOTE and Elizabeth Vergote, Plaintiffs-Appellees, v. K MART CORPORATION, Defendant-Appellant. 158 Mich.App. 96, 404 N.W.2d 711 |
| Court | Court of Appeal of Michigan — District of US |
[158 MICHAPP 98] Richard A. Smith, Cheboygan, for plaintiffs-appellees.
Faintuck, Schwedel & Wolfram by William G. Wolfram, Franklin, for defendant-appellant.
Before MacKENZIE, P.J., and ALLEN and SHAMO, * JJ.
[158 MICHAPP 99] ALLEN, Judge.
This action for damages and specific performance arising from defendant's breach of contract to purchase twenty-three acres of a 101-acre parcel of land owned by plaintiffs in Macomb County returns to us pursuant to Vergote v. K Mart, 125 Mich.App. 48, 336 N.W.2d 229 (1983), lv. den. 417 Mich. 1100.39 (1983). That opinion held that evidence of oral statements was admissible to determine the threshold question of whether p 10 of the original contract to purchase, as amended following a closing meeting February 1, 1978, was or was not a complete and accurate expression of the agreement reached between the parties. The grant of summary judgment for defendant was revised and the matter was remanded for trial at which the parties' prior oral statements would be admissible.
On remand to the trial court, the parties stipulated that in lieu of presenting proofs in open court the case would be decided upon the pleadings, exhibits, depositions, and briefs as authorized under MCR 2.517. The matter was so decided by the trial court which, in a written opinion issued October 21, 1985, held that defendant had breached the contract to purchase twenty-three acres of plaintiffs' lands. Defendant appeals as a matter of rights. Three claims of error are raised, the first being an issue of first impression. We affirm.
The central issue on remand and on appeal to us is the intent of the parties as expressed in the February 1, 1978, amendment to p 10 of the original purchase agreement. 1 As initially written, p 10 read:
After negotiations at the February 1, 1978, closing meeting, closing p 10 was amended to read:
On remand to the trial court, defendant argued [158 MICHAPP 101] that the purpose of the February 1, 1978, amendment was to relieve K Mart from the obligation of paving the in-between road but at the same time guaranteeing the seller that all of the roads including the in-between roads, would be dedicated. When Macomb County refused to accept dedication of all of the road without the in-between roads also being paved, K Mart refused to spend the estimated $92,000 necessary to pave the in-between roads and thus assure dedication.
Plaintiff Leo Vergote argued that in the negotiations leading to the February 1, 1978, amendment, he insisted that dedication of the entire loop road was imperative since it would provide plaintiffs frontage for the acreage not sold to K Mart. Vergote stated that he so informed James Schmidt, purchaser's agent, and further told Schmidt that he did not believe Macomb County would accept the entire ring road for dedication without the in-between roads being paved, and that Schmidt then assured plaintiffs that K Mart would do "whatever was necessary" to assure dedication of the entire ring road. When K Mart refused to go ahead with the deal, Vergote and his wife filed the instant suit for breach of contract.
After reviewing the pleadings, exhibits, depositions and briefs as stipulated by the parties, the trial court issued a written opinion October 21, 1985, holding in plaintiffs' favor. The court found that the amended purchase agreement bound defendant to improve the property by constructing the two side arms of the original loop road. Although defendant was no longer required to improve the in-between road of the loop road, the amended purchase agreement expressly required defendant to purchase and dedicate the connecting road as a road and right-of-way. Dedication of both the improved and unimproved portions of the road [158 MICHAPP 102] would occur upon completion of the roads and written notice from plaintiffs. The court found that defendant was required to dedicate the roads "as is," viz.: without changing the improvements or utilities that defendant had installed.
The court further found that defendant did not make any inquiries into Macomb County's requirements for acceptance of lands involved for public use. The court noted that p 9 of the purchase agreement provided both the time and opportunity to do so. The court noted that plaintiff had told defendant that his experience with Macomb County led him to believe that they would not accept the dead-end roads for dedication. The court found that defendant did not attempt to look into the accuracy or inaccuracy of plaintiff's statement. The court found that defendant agreed to dedicate the whole road. The court found that defendant's efforts to have the entire road dedicated were not successful since Macomb County would not accept the entire road for public use without the side roads being connected.
The court found that although the amendment negotiated relieved defendant of the obligation to improve the link connecting the two side roads, it also continued defendant's obligation to dedicate the entire road and right-of-way. The court found that defendant's failure to achieve dedication was a breach of contract unless excused. The court rejected defendant's defense of impossibility, stating that defendant knew that acceptance was required to effect the dedication but made no effort to determine the requirements of Macomb County.
The court found that the phrase "acceptance as is" was not a condition precedent to defendant's duty to dedicate the road. The court found that there was no term in the amendment which relieved defendant of its duty to dedicate the road if [158 MICHAPP 103] the county found the road to be unacceptable. The court noted that the testimony of Schmidt indicated that the phrase "acceptance as is" referred to improvements and utilities which defendant had installed. The court noted that this phrase was included to assure that defendant would not have to incur additional costs due to subsequent changes in dedication standards respecting the roads on which defendant installed utility uses. From these findings and conclusions of law, defendant appeals raising three issues.
The parties disagree upon the applicable standard of review to be employed by this Court. Not surprisingly, plaintiffs claim that the appropriate standard of appellate review is the "clearly erroneous" standard. The instant action is a suit in equity. A trial court's decision in an equity action will not be reversed unless the findings are clearly erroneous or that the reviewing court is convinced that it would have reached a different result had it occupied the position of the trial court. Calvary Presbyterian Church v. Presbytery of Lake Huron of the United Presbyterian Church in the United States of America, 148 Mich.App. 105, 384 N.W.2d 92 (1986), lv. den. 425 Mich. 863 (1986). Equity actions are reviewed de novo, examining the entire record, weighing all the evidence and subjecting the trial court's findings to closer scrutiny than would be employed in the review of a jury verdict. Considerable weight is accorded in such cases to the lower court's findings of fact in light of its special opportunity to hear the evidence presented and to see the witnesses before it. In re Conant Estate, 130 Mich.App. 493, 343 N.W.2d 593 (1983).
[158 MICHAPP 104] In response, defendant contends that where, as here, a case is heard upon a stipulated record and the court does not see and hear the witnesses and the evidence consists mainly of deposition testimony, the reviewing court may make an independent evaluation of the sufficiency of the evidence. In such instances, the "clearly erroneous" standard is not applicable. The issue raised is of first impression in Michigan.
Other jurisdictions confronted with appellate review of a trial court's findings of fact upon a settled record in equity cases have rejected the "clearly erroneous" test. In Orvis v. Higgins, 180 F.2d 537 (CA 2, 1950), cert. den. 340 U.S. 810, 71 S.Ct. 37, 95 L.Ed. 595 (1950), the ...
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