Zaschak v. Traverse Corp.

123 Mich. App. 126 (1983) 333 N.W.2d 191

ZASCHAK
v.
TRAVERSE CORPORATION

Docket No. 61506.

Michigan Court of Appeals.

Decided February 9, 1983.

Noel D. Culbert, for plaintiffs.

Thompson, Zirnhelt, Bowron, Senger & Rosi, P.C. (by Peter J. Zirnhelt and John N. Seaman, Jr.), for defendants.

Before: R.B. BURNS, P.J., and MacKENZIE and T.L. BROWN,^[*] JJ.

R.B. BURNS, P.J.

Plaintiffs appeal from the trial court's granting of summary judgment, pursuant to GCR 1963, 117.2(1) and (3). Specifically, the trial court found that no action for fraud was properly alleged in the pleadings, plaintiffs had failed to state a claim upon which relief could be granted, and there was no genuine issue as to material fact based upon the pleadings and affidavits. We hold that no error occurred under the facts of this case.

This action originally was filed on July 22, 1974, against Shell Oil Company and George Francisco, Jr. Defendants named in this appeal were not joined until April, 1975. After numerous amendments to the pleadings, Shell Oil and Francisco settled with plaintiffs. Summary judgment was granted to the remaining defendants just before the cause was scheduled for trial.

A motion for summary judgment based upon GCR 1963, 117.2(1) tests the legal sufficiency of the pleadings. Demido v Attorney General, 100 Mich. App. 254; 299 NW2d 43 (1980); Todd v Biglow, 51 Mich. App. 346; 214 NW2d 733 (1974). The trial court, when ruling on the motion, must accept as true all well-pleaded facts in the complaint. Abel v Eli Lilly & Co, 94 Mich. App. 59; 289 NW2d 20 (1979), relying upon Lompre v Venetjoki, 76 Mich. App. 521; 257 NW2d 151 (1977).

However, a mere statement of conclusions, without factual allegations to support them, will not suffice to state a cause of action or survive a motion for summary judgment. Demido v Attorney General, supra; Central Advertising Co v Novi, 91 Mich. App. 303; 283 NW2d 730 (1979).

A meticulous review of the voluminous pleadings filed in the instant case reveals that plaintiffs, despite numerous amendments, failed to state a factual basis to support the assertion that defendant Robert Faith had a duty to disclose certain alleged information regarding the potential productivity of plaintiffs' property. Although this Court has recognized a cause of action for fraudulent concealment under certain circumstances, see Fassihi v Sommers, Schwartz, Silver, Schwartz & Tyler, PC, 107 Mich. App. 509; 309 NW2d 645 (1981); Williams v Benson, 3 Mich. App. 9; 141 NW2d 650 (1966), it is clear that "an action in fraud must definitely and issuably set forth the facts complained of and relied upon for recovery". Dutkiewicz v Bartkowiak, 372 Mich. 386, 389; 126 NW2d 705 (1964). Because plaintiffs failed to adequately set forth facts supporting the allegation that Robert Faith had a duty to disclose certain information, the trial court properly granted summary judgment pursuant to GCR 1963, 117.2(1).

Next, plaintiffs claim that the trial court erred in finding that no genuine issue of material fact existed on the record. We disagree.

The trial court's determination was based not on whether plaintiffs have developed a case sufficient to go to the jury but rather on whether they have produced enough evidence to permit them to go to trial. See Rizzo v Kretschmer, 389 Mich. 363; 207 NW2d 316 (1973). Plaintiff Robert Zaschak testified by deposition that defendant Faith, in response to questioning regarding the property, told plaintiffs that he was unaware of any oil and gas exploration activity in the area. Because Faith possesses a graduate degree in geology and undoubtedly had information regarding oil and gas exploration in the area of plaintiffs' land, we have little doubt that Faith could have concealed material facts from plaintiff. However, Michigan law dictates that a prospective purchaser is under no duty to disclose facts or possible opportunities within his knowledge which materially affect the value of the property. Furman v Brown, 227 Mich. 629; 199 N.W. 703 (1924); Stuart v Dorow, 216 Mich. 591; 185 N.W. 662 (1921), see also Williams v Spurr, 24 Mich. 335 (1872) (no duty by purchaser to disclose the extent and value of iron deposits on the property). Michigan courts have not yet recognized a duty on the part of a vendee to disclose facts relevant to the value of the real estate in question even when specifically asked. We decline to promulgate such a duty on the facts of this case. Although plaintiffs claim that they would not have sold the mineral rights absent Faith's alleged concealment of facts, the record discloses that plaintiffs received what was then the accepted value for the rights, $200 per acre. Moreover, rather than obtain an independent appraisal of the property's mineral potential, plaintiffs relied upon Francisco, with whom they have previously settled, who assured them that $200 per acre was the going rate for mineral rights.

Even though a question of fact possibly could exist on whether defendant Faith misrepresented the value of the mineral rights, summary judgment was properly granted, because under any development of the facts, Faith had no recognized duty to disclose his alleged knowledge of the potential oil and gas activity in the area of plaintiffs' land. Although the trial court did not need to decide defendants' motion based upon GCR 1963, 117.2(3), because plaintiffs had failed to state a claim upon which relief could be granted and thus their claim was subject to summary judgment pursuant to GCR 1963, 117.2(1), employing the proper standard, the motion should have been granted anyway. Albro v Total Petroleum, Inc, 108 Mich. App. 1; 310 NW2d 252 (1981).

Affirmed.

NOTES

[*] Circuit judge, sitting on the Court of Appeals by assignment.