Opinion
Docket No. 68783.
Decided May 15, 1984.
Schlussel, Lifton, Simon, Rands, Kaufman, Galvin Jackier (by Joseph F. Galvin and Daniel D. Swanson), for plaintiff.
Honigman, Miller, Schwartz Cohn (by Stephen Wasinger), and Nansi Rowe Associates (by Clarise Larkins), for defendants.
This case arose from efforts to secure additional financing for a development project to renovate and lease five buildings in Detroit known as "Trappers Alley". Among the original financial backers of the project was defendant Detroit Economic Growth Corporation (DEGC). Seeking a method to attract additional funds for the financially troubled project, DEGC contacted a group of investors, including plaintiff Gary Edidin. Edidin and Farbman/Stein Company formed a partnership known as "Trappers Associates"; plaintiffs concede that the proposed limited partnership to be known as "Trappers Alley Associates", the other plaintiff in this case, was never formed.
In a May 11, 1982, letter to defendant Stonehaven Associates (a partnership formed by defendant Americal Development Corporation, owner of the property, defendant Stonehaven Enterprises, Inc., a wholly owned subsidiary of defendant DEGC, and the City of Detroit), Edidin and his partner, Farbman/Stein, agreed to secure additional investors for the project. Then, together with Stonehaven Associates, they would purchase the property and become owners and operators of the development project. The May 11 agreement also contemplated additional financing and changes in management as the project progressed and was made contingent on obtaining a mortgage and extending lines of credit.
DEGC immediately began obtaining loan extensions from its corporate lenders and also consulted with the United States Department of Housing and Urban Development about possible ways of incorporating an Urban Development Action Grant into the project. On June 14, 1982, a HUD consultant advised DEGC that the project could not succeed unless financing in addition to that contemplated by the May 11, 1982, agreement were obtained. On June 25, 1982, DEGC informed plaintiff Edidin that conditions had changed and that defendants were awaiting a HUD review of the project. Edidin immediately sent defendants a telegram that they had breached the agreement, and filed this action on October 14, 1982.
Plaintiffs' complaint included three counts for damages for breach of the May 11 agreement and for negligent misrepresentation. The fourth and final count alleged that plaintiff lacked "an adequate remedy at law since the Trappers Alley land, building and improvements were unique properties". Plaintiffs, therefore, prayed the court to order defendants to enter into a lease with plaintiffs and to transfer title to the property to plaintiffs.
Defendants moved for summary judgment on Count IV, the prayer for equitable relief, pursuant to GCR 1963, 117.2(3). Counsel for plaintiffs told the court that plaintiffs were seeking specific performance of the May 11 agreement. The court granted defendants' motion, finding that the May 11 agreement was not a final agreement which the court could order the parties to enter into and that the agreement contained "too many executory things" for the court to ever say it would consider granting specific performance of the agreement. The court noted that plaintiffs might be entitled to damages if they could prove that there actually was an agreement with defendants. From the trial court's order, plaintiffs appeal as of right.
Before addressing plaintiffs' concerns on appeal, we note that defendants' argument that this Court lacks jurisdiction to review the trial court's ruling is without merit. Defendants suggest that the trial court's partial order of summary judgment is not a final order, since Count IV is merely an alternative theory of recovery. However, the trial court expressly complied with the requirements of GCR 1963, 518.2 regarding motions for partial summary judgment and termed its partial summary judgment a final order. It is, therefore, proper for us to review the decision.
Plaintiffs attack the summary judgment on Count IV by saying that genuine issues of material fact still exist as to whether the agreement was final, whether contingencies had been fulfilled which made it capable of being specifically performed, and whether plaintiffs were the proper parties to request specific performance. The trial court had answered each of these in the negative.
Under GCR 1963, 117.2(3), a grant of summary judgment is proper only when there are no material issues of fact and the trial court may determine as a matter of law the appropriate disposition of the claim. Reeder v Hammond, 125 Mich. App. 223, 227; 336 N.W.2d 3 (1983). The court should give the benefit of any reasonable doubt to the nonmoving party, and must be satisfied that no factual development is possible which would support the nonmoving party's claim. Anderson v Kemper Ins Co, 128 Mich. App. 249, 252; 340 N.W.2d 87 (1983).
In this case, even when the alleged factual issues are resolved in favor of plaintiffs, the trial court could still have properly concluded that, as a matter of law, plaintiffs were not entitled to specific performance of the May 11 agreement. This is because of the nature of specific performance.
Specific performance is an equitable remedy which may not be claimed as a matter of right. Lamar v Detroit Apartments Corp, 237 Mich. 206, 213; 211 N.W. 643 (1927); Goldman v Cohen, 123 Mich. App. 224, 228; 333 N.W.2d 228 (1983). "Specific performance of contracts must always rest in the sound discretion of the court, to be decreed or not, as shall seem just and equitable under the peculiar circumstances of each case." Waller v Lieberman, 214 Mich. 428, 443; 183 N.W. 235 (1921); Derosia v Austin, 115 Mich. App. 647, 652; 321 N.W.2d 760 (1982). This Court will "sustain the findings of the trial court unless convinced, on review of the evidence, that [it] would have reached a contrary result". Goldman, supra, p 228.
Specific performance will not be decreed where enforcement of the decree would require continuous judicial supervision, or where there is an adequate remedy at law. Laker v Soverinsky, 318 Mich. 100, 104; 27 N.W.2d 600 (1947); Goldman, supra, p 230. Furthermore, the material terms of the agreement must be sufficiently certain so as to ensure that the court can "proceed intelligently and practically in carrying into execution the very things agreed on and standing to be performed". Czeizler v Radke, 309 Mich. 349, 358; 15 N.W.2d 665 (1944), citing Blanchard v Detroit, L L M R Co, 31 Mich. 43, 52-53 (1875).
The agreement in this case contemplated not simply an agreement to convey real estate, as plaintiffs contend, but an ongoing partnership between the parties. Both plaintiffs and defendants would have been involved in management of the project, both before and after construction was complete. To enforce a decree of specific performance would require continuous, long-term judicial supervision. To order the parties to engage in a cooperative venture of this nature could pose great difficulties for the circuit court.
Additionally, the May 11 agreement presupposed future agreement on such particulars as the terms and conditions under which the managing agent of the project, Farbman/Stein, would be employed. Specific performance would necessarily require resolution of these uncertainties, yet "the court will not make a contract for the parties or supply any material stipulation thereof". Czeizler, supra, p 358.
Finally, plaintiffs advance no argument as to the inadequacy of their remedy at law. Indeed, the amount of expenses incurred in reliance upon the May 11 agreement, and loss of income resulting from the alleged breach, should be readily ascertainable. Cf. Ruegsegger v Bangor Twp Relief Drain, 127 Mich. App. 28; 338 N.W.2d 410 (1983).
The trial court's grant of defendants' motion for summary judgment on plaintiffs' Count IV requesting specific performance is affirmed.
Costs to be assessed.