MacKe Laundry Service Co. v. Overgaard

173 Mich. App. 250 (1988) 433 N.W.2d 813

MACKE LAUNDRY SERVICE COMPANY
v.
OVERGAARD

Docket No. 94107.

Michigan Court of Appeals.

Decided May 18, 1988.

Mager, Monahan, Donaldson & Alber (by Lawrence M. Scott and Jeffrey A. Supowit), for plaintiff.

Goldstein, Serlin, Eserow & Steinway, P.C. (by Barry M. Rosenbaum), for defendant.

Before: GILLIS, P.J., and GRIBBS and SAWYER, JJ.

PER CURIAM.

In this contract action, defendant John P. Overgaard appeals by leave granted from a February 12, 1986, Oakland Circuit Court order denying his motion for summary disposition. We reverse.

French Quarter Apartments was a Michigan general partnership which owned some apartments. On May 17, 1982, French Quarter entered into a five-year agreement, which was termed a lease, with United Coin Meter Company (plaintiff Macke Laundry Service Company's predecessor in interest). Under the provisions of the agreement, French Quarter "leased" to United and United "hired" from French Quarter "all the laundry space" in French Quarter's apartment buildings for the purpose of United's "running an automatic coin-operated laundry business." The agreement provided that United would pay French Quarter monthly "rent" based upon either the total number of apartment units or the total number of occupied units, if the vacancy level of apartment units rose above five percent.

In January, 1984, French Quarter sold its interest in the apartments to Financial Heritage Property Management Company, of which defendant is a general partner. United then sent the "rent" payments to Financial Heritage, but, on June 21, 1984, Financial Heritage advised United that it was cancelling the agreement upon thirty days' notice. Financial Heritage continued to receive payments from United until August 1984, when Financial Heritage removed the laundry machines. At an unspecified point in time, plaintiff Macke became United's legal successor in interest.

Plaintiff subsequently filed the complaint on February 27, 1985, seeking damages for breach of the lease, returned possession of the leased premises, injunctive relief and treble damages for forcible ejectment.

Defendant Overgaard moved for summary disposition under MCR 2.116(C)(10), claiming that the May 17, 1982, United-French Quarter agreement was a license, not a lease, granted by defendant's predecessor in title, giving plaintiff permission to use the laundry area in the apartment buildings. Defendant also argued that French Quarter's conveyance of the land to defendant was, ipso facto, a revocation of the license.

The trial court denied defendant's motion for summary disposition, ruling that defendant's reference to "lease" in the June 21, 1984, letter to United was an admission that the agreement was a lease. The trial court subsequently denied defendant's motion for rehearing or reconsideration of his motion for summary disposition. We then granted defendant's application for leave to appeal.

First, we find that defendant's reference, in the letter, to the agreement as a "lease" clearly does not operate as an admission. A statement is a judicial admission only if it is a statement made by a party or his attorney during the course of trial. The statement must be a distinct, formal, solemn admission made for the express purpose of dispensing with formal proof of a particular fact. Moreover, an admission on a point of law is not binding on a court. Michigan Health Care, Inc v Flagg Industries, Inc, 67 Mich. App. 125, 129-130; 240 NW2d 295 (1976).

Furthermore, we find that the agreement was not specific enough to be a lease. A lease gives the tenant possession of the property leased and exclusive use or occupation of it for all purposes not prohibited by the terms of the lease. United Coin Meter Co v Gibson, 109 Mich. App. 652, 655-656; 311 NW2d 442 (1981), lv den 414 Mich. 898 (1982). A license, on the other hand, gives permission to do an act or series of acts on the property without any permanent interest in the land. Gibson, supra at 655. For an agreement to be a valid lease, it must contain the names of the parties, an adequate description of the leased premises, the length of the lease term and the amount of the rent. Brodsky v Allen Hayosh Industries, Inc, 1 Mich. App. 591, 596; 137 NW2d 771 (1965), lv den 377 Mich. 702 (1966).

The agreement in this case is vague in that it does not specify the number of machines to be placed in the laundry area. Moreover, although the agreement purports to lease "all the laundry space," it permitted defendant's predecessor to choose the area designated as a laundry area. Finally, the agreement did not give plaintiff exclusive possession or control of the area, since it required defendant's predecessor to clean and safely maintain the premises. The agreement only gave plaintiff permission to use the laundry area and was therefore a license. See Gibson, supra at 657-658. Since the agreement was a license, conveyance of the apartments by French Quarter operated as a revocation of the license previously granted to United. Burkhart v Zimmerman, 239 Mich. 491, 493; 214 N.W. 406 (1927); Gibson, supra at 658.

Plaintiff argues that if the agreement is a license, then defendant ratified the agreement subsequent to the conveyance by receiving payments from plaintiff and by his failure to cancel the agreement until six months later. Hence, plaintiff contends, defendant was bound by the agreement, which was irrevocable for a specified term. Plaintiff did not file a cross appeal and does not cite any authority to support its argument that the agreement was ratified. Accordingly, the issue is not properly before us. Michigan Ass'n of Administrative Law Judges v Personnel Director of the State of Michigan, 156 Mich. App. 388, 395; 402 NW2d 19 (1986); Williams v City of Cadillac, 148 Mich. App. 786, 792; 384 NW2d 792 (1985).

The question whether defendant created a new implied license by continuing the agreement after purchasing the property was not presented to the trial court, presumably because the trial court ruled that defendant was precluded from arguing that the agreement was a license. However, since the question is one of law, and all of the facts necessary for its resolution have been presented, this Court may review the claim. Balogh v City of Flat Rock, 152 Mich. App. 517, 520; 394 NW2d 1 (1985). A license may be implied from the relations of the parties or from the conduct of the property owner, as when he assents to the doing of certain acts on his land. See 15 Callaghan's Michigan Civil Jurisprudence, Licenses to Enter, § 4, p 559. We believe that, by accepting payments and permitting plaintiff to continue to use the laundry areas for six months before notifying plaintiff that he was cancelling the "lease," defendant probably established an implied license. However, that license was subject to revocation by the licensor defendant. Stewart v The Cincinnati, W & M R Co, 89 Mich. 315, 320-321; 50 N.W. 852 (1891); Sweeney v Hillsdale Co Bd of Road Comm'rs, 293 Mich. 624, 630; 292 N.W. 506 (1940).

We find that the lower court erred by denying defendant's motion for summary disposition. The agreement was a license which was revoked upon the conveyance of the apartments and, if a new implied license subsequently arose, defendant was entitled to revoke it.

Reversed.