Rhonda Davis v. Bee Property Management

CourtMichigan Court of Appeals
DecidedJanuary 25, 2024
Docket364221
StatusUnpublished

This text of Rhonda Davis v. Bee Property Management (Rhonda Davis v. Bee Property Management) 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
Rhonda Davis v. Bee Property Management, (Mich. Ct. App. 2024).

Opinion

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to revision until final publication in the Michigan Appeals Reports.

STATE OF MICHIGAN

COURT OF APPEALS

RHONDA DAVIS, UNPUBLISHED January 25, 2024 Plaintiff-Appellee,

v No. 364221 Wayne Circuit Court BEE PROPERTY MANAGEMENT, LC No. 20-013023-CH

Defendant-Appellant,

and

CAROLYN Y. WILLIAMS, HOWARD L. WILLIAMS, THE BANK OF NEW YORK TRUST COMPANY, NA, JP MORGAN CHASE, NA, and RESIDENTIAL FUNDING COMPANY, LLC, formerly known as RESIDENTIAL FUNDING CORPORATION,

Defendants.

Before: CAVANAGH, P.J., and RICK and PATEL, JJ.

PER CURIAM.

Defendant, Bee Property Management (Bee), appeals as of right an order quieting title in favor of plaintiff. We affirm.

I. FACTUAL BACKGROUND

Plaintiff has resided at 17313 Ilene Street in Detroit, Michigan (the property), since 2009, first as a renter, and then as the property owner. The house was previously owned by plaintiff’s uncle. After he passed away, the property was transferred from plaintiff’s aunt to plaintiff via quitclaim deed in April 2013. Plaintiff later lost the property to tax foreclosure. On December 1, 2014, Bee purchased the home from the Wayne County Treasurer for $6,000. Bee is a business

-1- that buys, sells, and rents real estate. It is solely owned by Michael Baumhaft. Baumhaft also owns Michigan Vanguard Properties (Vanguard).1

On November 26, 2014, plaintiff and Vanguard entered into an agreement titled “Option Agreement,” which states, in pertinent part:

2. Term of Option. This Option agreement shall exist and be exercisable from the date on which the Parties complete execution of this agreement and the Agreement between them, throughout the term of the Agreement, including any extension term thereof, or the date of proper exercise, whichever is sooner, subject only to limitations on its exercise that are specified herein. As long as Buyer shall not have been at any time in material breach of the Agreement between the Parties, Buyer may exercise the option at any time during the effective term of this agreement by giving Owner written notice of their election to exercise it. Notwithstanding anything else herein to the contrary, Buyer must exercise the option, and close the sale thereunder, no later than sixty-six (66) months following execution of this Agreement.

* * *

4. Purchase price. If the option is exercised during the first sixty (66) months of the Agreement, the purchase price of the option property shall be $17,000.00. The price of this Option to Purchase is $550.00 per month for a period of sixty (66) months, payable at the date on which monthly installments are due under the Agreement. On the 66th payment Michigan Vanguard Properties will deed the property over to the Buyer for $1.00.

7. Taxes. All real estate taxes for all years billed before the closing date shall be fully paid by Buyer. Real estate taxes billed after the closing date shall also be paid by Buyer. If taxes are not paid on time by Buyer, Owner may pursue legal remedies or may cancel the contract.

10. Default. If Buyer defaults, Owner may pursue legal remedies or may cancel the contract and initiate eviction proceedings.

13. Exercise of option. Before expiration of the option, Buyer may exercise this option by giving Owner written notice, signed by Buyer and delivered personally or by certified mail. Notice shall be given at Owner’s address set forth above or at

1 Neither Baumhaft nor Vanguard are named as defendants in this case.

-2- any subsequent address that Owner may provide to Buyer in writing. Upon exercising the option and closing the purchase, Buyer agrees to accept the property in “as is” condition.

Plaintiff did not have the opportunity to consult a lawyer about the terms of the agreement before signing, and was informed that if she did not agree to the terms of the option agreement, she would be forced to leave the property.

There is no dispute that plaintiff did not timely remit all of her monthly payments. Consequently, in March 2019, plaintiff received a letter from Bee, stating: “As of the date of this letter, the option agreement is in default . . . . Please accept this letter as formal notice that Bee Property Management, Inc. has elected to exercise its right to terminate the Option Agreement as a result of your default.” However, plaintiff never received a notice of default, notice to quit, or complaint to recover possession from Vanguard, with whom she signed the original option agreement. Over the following nine months, Bee brought multiple district court proceedings against plaintiff for unpaid rent, none of which resulted in eviction.

The option period ended on or about May 26, 2020. Plaintiff continued to live in the home after the close of the option period. On September 11, 2020, plaintiff sent a letter to Bee, stating that she made $6,600 in monthly payments each year from 2015 through 2019, as well as $4,400 in monthly payments in 2020. Plaintiff also claimed that she paid $1,897.41 in property taxes in 2015, $1,721 in taxes per year from 2016 through 2019, and $860.05 in taxes in 2020. She went on to explain:

To date I have paid, $37,400 in rent payments and $11,363.00 in property taxes. According to the original agreement the cost of the property [is] $17,000.00[.]

I have exceeded the cost in the original agreement, and my expectations are to receive a Quit Claim Deed to the property as owner.

Believing that she complied with the terms of the option agreement, plaintiff stopped making monthly payments. Bee refused to provide the deed.

Plaintiff subsequently filed suit against Bee and a number of other involved parties,2 seeking to quiet title under MCL 600.2932. A bench trial was held. Plaintiff argued that Bee did not have authority to terminate the option agreement, because Vanguard, not Bee, was party to the agreement. Plaintiff also argued that according to the terms of the agreement, she was entitled to ownership of the property because she paid more than the required purchase price of the property through her monthly payments.

In response, Bee argued that plaintiff was mischaracterizing the agreement as an installment contract, rather than an option agreement. Bee explained that plaintiff could not quiet

2 Although a number of other parties were named as a defendants, Bee is the sole party participating as a defendant on appeal.

-3- title to the land because she never exercised the option to purchase it in accordance with the terms outlined in the agreement. Bee also argued that any ignorance of the agreement terms claimed by plaintiff did not absolve her of her obligations under the agreement. Bee contended that it had properly terminated the agreement for plaintiff’s failure to make some monthly payments and pay the property taxes.

During trial, plaintiff and Baumhaft testified regarding the formation of the agreement, their understanding of its terms, and the monthly payment and tax payment history. Plaintiff explained how Vanguard came to own her home, as well as her understanding of the terms of the option agreement, as follows:

Q. Can you tell the Court what happened?

A. Well, I believe a woman—a lady knocked on my door and say I lost the property and she didn’t explain to me. She just—her name was Karen. I remember her name now. Her name was Karen and she talked to me—wanted to talk to me about purchasing the house back but I didn’t know what to do at the time.

Q. So, Karen comes to your home and says that they have your property, they own your home from a tax auction. What happens next?

A. She gave me a building to meet, in Southfield.

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Rhonda Davis v. Bee Property Management, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rhonda-davis-v-bee-property-management-michctapp-2024.