Derosia v. Austin

321 N.W.2d 760, 115 Mich. App. 647
CourtMichigan Court of Appeals
DecidedApril 23, 1982
DocketDocket 56150
StatusPublished
Cited by20 cases

This text of 321 N.W.2d 760 (Derosia v. Austin) 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
Derosia v. Austin, 321 N.W.2d 760, 115 Mich. App. 647 (Mich. Ct. App. 1982).

Opinion

Per Curiam.

Plaintiff sued defendants Austin for breach of contract regarding a land sales agreement and also sued defendant Gallatin for intentional interference with plaintiff’s contractual relationship with defendants Austin. Plaintiff sought specific performance of his contract with defendants Austin and punitive damages from defendant Gallatin. Following a bench trial, plaintiff was awarded $1 in damages as a result of the court’s finding that defendants Austin had committed an anticipatory breach of the contract with plaintiff. Both parties appeal by right.

Defendants Austin were land contract purchasers of property which consisted of two buildings with a common wall. In one of the buildings, plaintiff operated his business. Plaintiff’s lease gave him the right of first refusal to purchase both the premises in which his business was located as *650 well as the adjoining building. When defendants Austin decided to sell the property, plaintiff was informed of such decision and given 15 days in which to exercise his right of first refusal. Negotiations between the two parties resulted in a signed land sales agreement which provided that closing would take place in 30 days. The agreement did not provide that time was of the essence and, subsequently, both parties agreed to a closing date of February 15, 1979. Two days prior to that date, plaintiffs attorney realized that a mortgage survey had not been ordered for the property and that mortgage funds would not be dispensed without such a survey. Plaintiffs attorney ordered the mortgage survey and called defendants’ attorney to inform him that the transaction could not be closed on the appointed date. Plaintiff’s attorney suggested February 22, 1979, as a new date for closing and was under the impression that defendants’ attorney had agreed to such a date. Although this agreement was disputed by defendants’ attorney, the trial court found that an agreement to close on February 22, 1979, had been reached. However, because of difficulties in procuring the mortgage survey, plaintiffs attorney informed defendants’ attorney that the closing would have to be postponed until February 27, 1979. There was no response from defendants’ attorney regarding this postponement. On February 21, 1979, defendants Austin sold the property to defendant Gallatin Realty Company. This suit resulted.

The case was assigned to visting Judge Roy J. Daniel in the Washtenaw Circuit Court. The court ruled that there was a contract between plaintiff and defendants Austin, that the date of closing was not a material element of the contract, and that the parties through their counsel had agreed *651 to close on February 22, 1979. The court also held that there was no agreement to extend the date of closing to February 27, 1979, and that such an extension would have been unreasonable. Plaintiffs request for specific performance was denied, as the court found that defendants Austin were in no position to convey the property since they no longer had any interest in it. The court ruled that defendants Austin committed an anticipatory breach of the contract with plaintiff by selling the property to defendant Gallatin Realty Company on February 21, 1979, but that since defendants Austin knew that plaintiff could not perform on February 22, 1979, they were free to make other arrangements. The court stated that because plaintiff could not perform on the due date he was not entitled to the benefit of his bargain but was entitled to damages for the one day anticipatory breach committed by defendants Austin. The resulting order awarded plaintiff $1 in damages plus costs from defendants Austin. Finally, the trial court ruled that defendant Gallatin did not intentionally interfere with plaintiff’s contractual relationship with defendants Austin.

Plaintiff moved for a new trial and the case was assigned to Judge Edward D. Deake. Judge Deake issued a ruling that the trial court was correct in dismissing plaintiff’s tortious interference claim against defendant Gallatin. However, Judge Deake ruled that plaintiff was entitled to specific performance of his contract with defendants Austin. Plaintiff moved to enter an order in conformity with this ruling, but defendants objected on the ground that Judge Deake did not have jurisdiction to decide the motion for a new trial. Judge Deake concurred, finding that under GCR 1963, 529.2 the motion for a new trial should have been decided *652 by Judge Daniel, and he withdrew his opinion in the case. Judge Daniel heard the motion for a new trial, denied the motion, and affirmed his earlier ruling in all respects. The appeal by both parties is now before us.

Plaintiffs first issue on appeal is whether the trial court erred in holding that plaintiff is not entitled to specific performance of the contract. Plaintiff argues that he had secured a mortgage commitment and was prepared to close the deal on February 27, 1979, and that these actions constituted a tender of performance.

The granting of specific performance lies within the discretion of the court and whether or not it should be granted depends upon the particular circumstances of each case. MacGlashan v Harper, 299 Mich 662, 667; 1 NW2d 30 (1941), Mowat v Walsh, 236 Mich 391, 392-393; 210 NW 233 (1926). We agree with the trial court’s decision not to grant specific performance in favor of plaintiff. Plaintiff never tendered performance under the contract. The general rule is that a court of chancery will not grant specific performance unless the party seeking the decree has tendered full performance. McWilliams v Urban American Land Development Co, 37 Mich App 587, 592; 194 NW2d 920 (1972), Sterling v Fisher, 356 Mich 634, 640; 97 NW2d 64 (1959). Plaintiffs argument that he tendered performance by securing a mortgage commitment and informing defendants that he was prepared to close on February 27, 1979, is unpersuasive. An offer to close, unaccompanied by the necessary payment, does not constitute legal tender. McWilliams v Urban American Land Development Co, supra, Nedelman v Meininger, 24 Mich App 64, 75; 180 NW2d 37 (1970). Since plaintiffs offer of tender was insufficient, he was not entitled to specific performance.

*653 Plaintiffs second issue on appeal is that the trial court erred in applying the measure of damages. The trial court found as a matter of fact that the parties agreed to close the sale on February 22, 1979. Since plaintiff could not perform on that date, the court ruled that he was not entitled to the benefit of his bargain. Plaintiff failed to offer evidence of any incidental expenses incurred by him so the court awarded him nominal damages of $1, along with costs.

Generally, when a plaintiff is unable to perform he suffers no loss through the defendant’s default. Brunswick-Balke-Collender Co v Foster Boat Co, 141 F2d 882, 884 (CA 6, 1944), Hill v Mathews, 78 Mich 377, 385; 44 NW 286 (1889). We find that since plaintiff was unable to perform on the final date set for closing he is precluded from being awarded the benefit of his bargain. Since plaintiff failed to offer evidence of any incidental damages, the trial court’s judgment awarding nominal damages, along with costs, is affirmed.

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Bluebook (online)
321 N.W.2d 760, 115 Mich. App. 647, Counsel Stack Legal Research, https://law.counselstack.com/opinion/derosia-v-austin-michctapp-1982.