Lspv Minges LLC v. McM II LLC ( 2016 )

STATE OF MICHIGAN
COURT OF APPEALS
LSPV MINGES LLC, UNPUBLISHED
July 28, 2016
Plaintiff-Appellant,
v No. 327016
Calhoun Circuit Court
MCM II LLC, LC No. 14-003056-CH
Defendant-Appellee.
Before: STEPHENS, P.J., and SERVITTO and GLEICHER, JJ.
PER CURIAM.
Plaintiff appeals as of right the trial court order granting summary disposition in favor of
defendant pursuant to MCR 2.116(C)(10) on plaintiff’s claim for declaratory relief regarding the
usage of property in a shopping center. We affirm.
The shopping center was created in 1986 and is governed by a document titled
“Declaration of Easements, Restrictions, and Operating Agreements.” This declaration provides
three property classifications: “Building Areas,” “Outlots,” and “Common Areas.” The original
signatories to the Declaration were “Kmart” and “Developer.” Plaintiff is Developer’s successor
in interest, and defendant is Kmart’s successor. In 2014, plaintiff desired to create a new
“outlot” in a portion of the Common Areas and construct a building for restaurant use thereon.
Plaintiff requested defendant’s consent to pursue this course of action. Defendant refused.
Plaintiff sued, requesting that the trial court compel defendant’s consent based on the language
of the declaration or, alternatively, because defendant did not possess a good-faith basis for
denying consent. The trial court granted summary disposition in favor of defendant.
This Court reviews de novo a trial court’s grant of summary disposition under MCR
2.116(C)(10). Ernsting v Ave Maria College, 274 Mich App 506, 509; 736 NW2d 574 (2007).
“Summary disposition is proper under MCR 2.116(C)(10) if the documentary evidence shows
that there is no genuine issue regarding any material fact and the moving party is entitled to
judgment as a matter of law.” Id. at 509-510. “A genuine issue of material fact exists when the
record, giving the benefit of any reasonable doubt to the opposing party, leaves open an issue
upon which reasonable minds could differ.” Id. at 510. Likewise, the interpretation of a
restrictive covenant presents a question of law reviewed de novo. See Bloomfield Estates
Improvement Ass’n, Inc v Birmingham, 479 Mich 206, 212; 737 NW2d 670 (2007).
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Michigan law supports “the right of property owners to create and enforce covenants
affecting their own property.” Terrien v Zwit, 467 Mich 56, 71; 648 NW2d 602 (2002). If such
a covenant is unambiguous, it will be enforced as written. Bloomfield Estates Improvement
Ass’n, Inc, 479 Mich at 214. Generally, restrictive covenants “are to be strictly construed against
the would-be enforcer . . . [and] in favor of the free use of property.” Stuart v Chawney, 454
Mich 200, 210; 560 NW2d 336 (1997). However, where the covenant is unambiguous, this
general rule does not apply. Brown v Martin, 288 Mich App 727, 731; 794 NW2d 857 (2010).
The trial court did not err in granting summary disposition in favor of defendant because
the unambiguous language of the declaration provided defendant the right to refuse consent to
plaintiff’s proposed creation of an outlot and construction thereon.
Section (2)(a) of the declaration provides in relevant part: “No structures, buildings,
fences or barriers shall be erected on any portion of the Common Areas, without the prior written
approval of [defendant] and [plaintiff] . . . .” This language is plain and unambiguous. No
building, such as plaintiff’s proposed restaurant building, may be built on any part of the
Common Areas without the prior written approval of defendant. Defendant chose not to give
that approval. There is nothing in the declaration that conditions defendant’s right to refuse
consent or requires a good-faith basis for such a refusal. Plaintiff argues that its proposed
construction should be allowed to go forward based on the general principle that restrictive
covenants should be interpreted narrowly and in favor of the free use of property. Stuart, 454
Mich at 210. However, where there is no ambiguity, as here, the covenant is enforced as written
with no regard given to this general rule of construction. Id.; Brown, 288 Mich App at 731.
Accordingly, the trial court did not err in granting summary disposition in favor of defendant on
plaintiff’s claim for declaratory relief.
Plaintiff’s arguments to the contrary are unpersuasive. Plaintiff urges this Court to imply
a good-faith requirement to defendant’s decision to refuse consent. However, Michigan law will
not imply a good-faith requirement to restrict a party’s express contractual right. See Eastway &
Blevins Agency v Citizens Ins Co of America, 206 Mich App 299, 303; 520 NW2d 640 (1994).
Moreover, the authority cited by plaintiff concerns the manner of performance of an obligation in
a contract, not the exercise of an express contractual right. Because the declaration provides
defendant the express contractual right to refuse consent, no good-faith requirement will be
implied. Id.Plaintiff also bases its good-faith argument on an inapplicable provision in the
declaration. Section (6)(a) provides: “[Defendant] shall not withhold its consent for construction
of improvements on the outlots if the planned improvements are compatible with the businesses
conducted in the Shopping Center and attractive to customers and retail trade.” (Emphasis
added.) The term “outlots” is defined in the declaration as two parcels known as “Pad A” and
“Pad B.” It is undisputed that plaintiff’s proposed outlot and construction is not located in whole
or in part on Pad A or Pad B. Moreover, this section concerns the “construction of
improvements” on the outlots. Plaintiff’s request is for the creation of an outlot, upon which it
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would construct improvements, rather than a request to conduct construction on an existing
outlot. Accordingly, plaintiff’s reliance on § (6)(a) is misplaced.1
Affirmed.
/s/ Cynthia Diane Stephens
/s/ Deborah A. Servitto
/s/ Elizabeth L. Gleicher
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Having reached this conclusion, we need not address the trial court’s alternative ground for
granting defendant’s motion, i.e., that the proposed outlot and construction would violate a city
zoning ordinance concerning parking requirements. Further, because the trial court did not err in
granting defendant’s motion for summary disposition, it necessarily did not err in denying
plaintiff’s request for summary disposition under MCR 2.116(I)(2).
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