Greenbrier Homes v. Cook , 1 Mich. App. 326 ( 1965 )

1 Mich. App. 326 (1965) 136 N.W.2d 27

GREENBRIER HOMES
v.
COOK.

Docket No. 248.

Michigan Court of Appeals.

Decided July 19, 1965.

Miles E. Brasch, for plaintiff.

Bush, Luce, Henderson & Black (Douglas M. Black, of counsel), for defendant St. Onge.

QUINN, J.

Appellant St. Onge appeals from the trial court's denial of his motion for summary judgment made under GCR 1963, 117. The motion resembles former motion for judgment on the pleadings under 1945 Court Rule 17, § 7. Well-pleaded facts are accepted as true for purpose of decision. Weinhardt v. Addison Community Schools (1957), 347 Mich. 683.

June 8, 1961, plaintiff entered into an executory land contract with Wallace H. Cook and Ronald St. Onge, doing business as C. & W. Construction Company, whereby it agreed to sell and convey to the latter 18 lots in Marysville Estates Subdivision No. 2 for $54,000; $315 down and balance within one year from date. A rider, dated the same day as the contract, disclosed the lots were subject to a mortgage and provided:

"And seller shall not be liable to purchaser by virtue of any damage that might result from said mortgage."

August 10, 1961, Cook and St. Onge executed the following:

"AGREEMENT TO DISSOLVE PARTNERSHIP.

"On this tenth day of August, 1961, we, the undersigned partners of C. & W. Construction Company, formed on April 7, 1961, agree to dissolve such partnership and divide the assets and liabilities as follows:

To Wallace H. Cook —

Marysville Estates Subdivision No. 2 Spruce St. House

To Ronald St. Onge —

Money for all jobs done after June 25, 1961, viz:

(1) Remodeling house at 820 Sanborn

(2) Addition to Marysville fire hall

(3) Work on 19th avenue house

(4) Work on house on lot #32 in Marysville Estates #2

(5) Mortgage money on lot #43

Wallace H. Cook and Ronald St. Onge — Share equally debts on lots #32 and 43

Witness Signed /s/ JAMES T. SCHULTZ /s/ WALLACE H. COOK Wallace H. Cook Witness Signed /s/ PAUL MELLY /s/ RONALD ST. ONGE Ronald St. Onge"

This instrument was filed with St. Clair county clerk September 11, 1961. August 25, 1961, plaintiff, at the request of Cook, conveyed 2 of the 18 lots to Cook and Lynch. Defendant purchasers did not pay the contract, and plaintiff filed suit for this breach March 25, 1963. The mortgage mentioned in the rider was foreclosed and the equity of redemption expired August 8, 1963. The balance due on the contract exceeded the amount required to redeem the mortgage.

Appellant relies on Hornbeck v. Midwest Realty. Inc. (1938), 287 Mich. 230, to support his view that conveyance to Cook and Lynch amounted to a rescission on the part of plaintiff. In Hornbeck, the vendor conveyed to a third-party stranger to the contract, accepted and retained full purchase price from the vendee and served the latter with notice of forfeiture. Here, the conveyance was to a party to the contract and a stranger, at the request of the party, and the purchase price was never paid. In spite of these factual differences, it is this Court's opinion that Hornbeck would control except for one fact, viz, the agreement of August 10, 1961, between Cook and St. Onge; this was 15 days before the conveyance relied on by appellant to establish rescission by the vendor. This agreement effected a dissolution of the partnership. CL 1948, § 449.31 (Stat Ann 1964 Rev § 20.31); Posner v. Miller (1959), 356 Mich. 6; Atha v. Atha (1942), 303 Mich. 611. It was effective August 10, 1961. See Posner, supra. The agreement also divested appellant of his interest in the land contract. The general provision of CL 1948, § 449.25(2)(b) [Stat Ann 1964 Rev § 20.25(2) (b)], which reads as follows:

"A partner's right in specific partnership property is not assignable except in connection with the assignment of the rights of all the partners in the same property,"

must yield to the specific provision found in CL 1948, § 449.41(1) and (2) [Stat Ann 1964 Rev § 20.41(1) and (2)]. See 39 A.L.R. 2d 1365. At the time of the conveyance of August 25, 1961, appellant had no interest in the land conveyed and cannot claim this conveyance amounted to rescission by the vendor.

Unfortunately, the agreement of August 10, 1961, did not affect appellant's obligation to the vendor under the land contract. Without novation, the assignment by St. Onge to Cook did not release St. Onge from the obligation in the land contract. Barnard v. Huff (1930), 252 Mich. 258 (77 A.L.R. 259).

Appellee's suit was for damages for breach of contract; it was not for balance of purchase price. No tender of deed was necessary; no showing of ability to perform was required. McColl v. Wardowski (1937), 280 Mich. 374; Stewart v. McLaughlin's Estate (1901), 126 Mich. 1.

The trial court properly denied the motion for summary judgment. In its brief, appellee asks for summary judgment under GCR 1963, 117.3. This is denied. Each party is entitled to amend, GCR 1963, 117.3, supra; the evidence may disclose controlling facts not pleaded; damages must be determined pursuant to rule in McColl and Stewart, supra.

The trial court is affirmed. No costs are allowed, neither party having prevailed.

J.H. GILLIS, P.J., and T.G. KAVANAGH, J., concurred.