1031 Lapeer LLC v. Rice

810 N.W.2d 293, 290 Mich. App. 225
CourtMichigan Court of Appeals
DecidedAugust 5, 2010
DocketDocket No. 290995
StatusPublished
Cited by26 cases

This text of 810 N.W.2d 293 (1031 Lapeer LLC v. Rice) is published on Counsel Stack Legal Research, covering Michigan Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
1031 Lapeer LLC v. Rice, 810 N.W.2d 293, 290 Mich. App. 225 (Mich. Ct. App. 2010).

Opinion

Per Curiam.

Defendant appeals as of right a trial court order granting partial summary disposition in [227]*227plaintiffs’ favor and denying defendant’s motion for partial summary disposition. Because the trial court properly found the lease at issue void, and because defendant was not entitled to partial summary disposition in his favor, we affirm.

In May 2006, plaintiffs and defendant entered into a lease agreement whereby plaintiffs were to lease a gas station from defendant for a period of 10 years. Apparently, the site of the gas station had been found to be a site of environmental contamination in 1996 — a fact known by defendant but not disclosed to plaintiffs at the time of the lease. Plaintiffs contacted the Michigan Department of Environmental Quality (MDEQ) in late 2007 and were advised of the contamination. They thereafter initiated the instant lawsuit, alleging that defendant had violated his statutory duty to inform them of the property’s status as a site of environmental contamination. Plaintiffs’ specific causes of action included silent fraud, fraudulent misrepresentation, and breach of the lease. Plaintiffs sought damages as well as rescission of the lease.

Plaintiffs moved for partial summary disposition pursuant to MCR 2.116(C)(10), contending that the lease at issue was void and that they had established the elements of their claims against defendant, leaving only the issue of damages for trial. Defendant also moved for partial summary disposition in his favor asserting, among other things, that plaintiffs had failed to exhaust their administrative remedies under the former Michigan Environmental Response Act, that plaintiffs’ claims were barred by the statute of frauds, and that plaintiffs had not reasonably relied on any alleged written or oral representation.

The trial court granted plaintiffs’ motion for partial summary disposition and denied defendant’s motion for partial summary disposition, ruling:

[228]*228The first portion of Plaintiffs’ Motion for Summary Disposition based on MCL 324.20116(1) on the grounds that subject lease for 1031 Lapeer Road was prohibited because of Defendant’s failure to disclose to Plaintiffs the fact that the site was contaminated, is granted and the subject lease is determined to be void. Consequently, Defendant’s Motion for Partial Summary Disposition seeking a determination of liability under the subject lease is denied, with prejudice.
The second portion of Plaintiffs [sic] Motion for Summary Disposition regarding Plaintiffs [sic] fraud counts is denied, without prejudice.

Plaintiffs’ fraud claims proceeded to trial, and the jury ultimately found in plaintiffs’ favor. Judgment was accordingly entered against defendant in the amount of $83,000 plus interest and costs. This appeal followed.

On appeal, defendant challenges the trial court’s order declaring the lease at issue void, granting plaintiffs’ motion for partial summary disposition, and denying defendant’s motion for partial summary disposition. We review de novo a trial court’s decision on a motion for summary disposition. Ardt v Titan Ins Co, 233 Mich App 685, 688; 593 NW2d 215 (1999). A motion brought under MCR 2.116(C)(10) tests a claim’s factual support. “In reviewing a motion under MCR 2.116(C)(10), this Court considers the pleadings, admissions, affidavits, and other relevant documentary evidence of record in the light most favorable to the nonmoving party to determine whether any genuine issue of material fact exists to warrant a trial.” Walsh v Taylor, 263 Mich App 618, 621; 689 NW2d 506 (2004). Summary disposition may be granted under MCR 2.116(C)(10) when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Steward v Panek, 251 Mich App 546, 555; 652 NW2d 232 (2002). “Additionally, we review de novo issues of statutory [229]*229interpretation.” Universal Underwriters Ins Group v Auto Club Ins Ass’n, 256 Mich App 541, 544; 666 NW2d 294 (2003).

On appeal, defendant first asserts that partial summary disposition in plaintiffs’ favor was inappropriate because a failure to disclose to a tenant that property has been determined to be a site of “environmental contamination,” as defined in MCL 324.20101(l)(o), does not void the parties’ commercial lease. We disagree.

Part 201 of the Natural Resources and Environmental Protection Act (NREPA), MCL 324.20101 et seq., was enacted by 1994 PA 451 as part of the repeal and reenactment of numerous environmental statutes. Part 201 was the reenactment of the former Environmental Response Act, MCL 299.601 et seq. Cairns v East Lansing, 275 Mich App 102, 108; 738 NW2d 246 (2007). MCL 324.20102 includes the following among the express purposes of part 201 of NREPA:

(c) That it is the purpose of this part to provide for appropriate response activity to eliminate unacceptable risks to public health, safety, or welfare, or to the environment from environmental contamination at facilities within the state.
(d) That there is a need for additional administrative and judicial remedies to supplement existing statutory and common law remedies.
(h) That this part is intended to provide remedies for facilities posing any threat to the public health, safety, or welfare, or to the environment, regardless of whether the release or threat of release of a hazardous substance occurred before or after October 13,1982, the effective date of the former environmental response act, Act No. 307 of the Public Acts of 1982, and for this purpose this part shall be given retroactive application. However, criminal and [230]*230civil penalties provided in this part shall apply to violations of this part that occur after July 1, 1991.

Consistently with those purposes, part 201 provides for certain penalties for violations of specific provisions within the act. For example, MCL 324.20107a(l)(a) states that a person who owns or operates property that the person knows is a facility containing hazardous substances shall, among other things, undertake measures that are necessary to prevent exacerbation of the existing contamination. MCL 324.20107a(2) provides, “Notwithstanding any other provision of this part, a person who violates subsection (1) is liable for response activity costs and natural resource damages . . . .” There is no specified remedy, however, for a violation of MCL 324.20116(1).

MCL 324.20116(1), a component of part 201 of NREPA, provides:

A person who has knowledge or information or is on notice through a recorded instrument that a parcel of his or her real property is a facility shall not transfer an interest in that real property unless he or she provides written notice to the purchaser or other person to which the property is transferred that the real property is a facility and discloses the general nature and extent of the release.

“Facility,” for purposes of MCL 324.20116(1), is defined as

any area, place, or property where a hazardous substance in excess of the concentrations which satisfy the requirements of [MCL 324.20120a(l)(a)] or (17) or the cleanup criteria for unrestricted residential use under part 213 [MCL 324.21301 et seq.] has been released, deposited, disposed of, or otherwise comes to be located.

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Bluebook (online)
810 N.W.2d 293, 290 Mich. App. 225, Counsel Stack Legal Research, https://law.counselstack.com/opinion/1031-lapeer-llc-v-rice-michctapp-2010.