PHILLIP L BOWERS V JOHN A SHORTER
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STATE OF MICHIGAN
COURT OF APPEALS
PHILIP L. BOWERS and ALEDA G. BOWERS,
UNPUBLISHED
April 27, 2001
Plaintiffs-CounterdefendantsAppellants, Cross-Appellees,
v
No. 221617
Cass Circuit Court
LC No. 97-000037-CH
JOHN A. SHORTER,
Defendant-Counterplaintiff-CrossPlaintiff, Cross-Defendant,
and
KEY BANK, f/k/a SOCIETY NATIONAL BANK
INDIANA, f/k/a AMERITRUST NATIONAL
BANK, f/k/a FIRST NATIONAL BANK
ELKHART and NATIONSBANC MORTGAGE
CORPORATION,
Defendants-Cross-PlaintiffsAppellees, Cross-Appellants,
and
JOHN D. RIGGS and NANETTE K. RIGGS,
Defendants-CounterplaintiffsCross-Plaintiffs-Appellees.
Before: Saad, P.J., and Fitzgerald and O’Connell, JJ.
PER CURIAM.
Plaintiffs appeal as of right the order granting summary disposition pursuant to MCR
2.116(C)(10) in favor of defendants Key Bank and NationsBanc Mortgage Corporation and
dismissing the claims against defendants John D. Riggs and Nanette K. Riggs. Plaintiffs also
challenge the denial of leave to amend their complaint. Defendants Key Bank and NationsBanc
cross-appeal the dismissal of their cross-claims. We affirm
-1-
Plaintiffs entered an agreement to purchase property from defendant John A. Shorter
pursuant to a land contract. The property was subject to a mortgage held by Key Bank.
NationsBanc first acted as servicing agent for Key Bank on the mortgage, and then acquired the
mortgage outright. The mortgage required that liability insurance be maintained on the property,
naming the mortgagor as a loss payee, and that the mortgagor be provided with proof of the
mortgage. Plaintiffs did not assume the mortgage, but rather made payments into a collection
account from which payments were made in Shorter’s name on the mortgage. The only signature
appearing on the agreement creating the collection account is that of Shorter, affixed by his
brother Terry Shorter pursuant to a power of attorney.
After the land contract was signed, Shorter ceased to regard himself as the owner of the
property. Plaintiffs failed to read the mortgage and, consequently, the obligation to provide
insurance naming the mortgagor as a loss payee and to give the mortgagor a copy of the policy
was overlooked. Key Bank, and subsequently NationsBanc, obtained insurance on the property
and debited the collection account (as the source of mortgage payments) for the insurance
premiums as permitted by the mortgage. A dual default on the mortgage thereafter occurred, as
they were insufficient funds to cover the payments due, and the failure to maintain insurance in
the form required by the mortgage was itself a default.
Defendant NationsBanc then took steps to foreclose on the property by advertisement as
authorized by MCL 600.3201 et seq.; MSA 27A.3201 et seq. It sent notices to Shorter, placed an
advertisement in the local newspaper giving notice of the foreclosure, recorded the assignment of
the mortgage to it, and contacted law enforcement officials to post a copy of the foreclosure
notice on the property as required by MCL 600.3208; MSA 27A.3208, which requires that “a
true copy [of the notice of foreclosure] shall be posted in a conspicuous place upon any part of
the premises described in the statute.”
Following the posting, foreclosure occurred and the property was sold at auction.
Defendants John D. and Nanette K. Riggs bought the property at the foreclosure sale. Plaintiffs
brought this suit seeking to set aside the foreclosure sale and alleging that Shorter had violated
his obligations under the land contract, that Shorter and Key Bank had violated the terms of the
payment collection agreement, that Key Bank had converted funds (presumably by using them
for insurance payments), and that Key Bank and NationsBank had slandered plaintiffs’ title by
instituting foreclosure proceedings.1 Following a hearing on defendants’ motion for summary
disposition, the trial court granted summary disposition in favor of defendants Key Bank and
NationsBanc, and dismissed the claims against the Riggses, finding that there was no genuine
issue of material fact regarding the validity of the mortgage foreclosure sale or regarding any of
the claims against Key Bank. In light of this finding, the trial court held that the claims against
the Riggses could not proceed. The trial court denied plaintiffs’ motion to amend the complaint
as “futile and untimely.” The court subsequently dismissed the cross-claims of Key Bank and
NationsBank, who had sought contribution or indemnity from the other defendants in the event
they were found liable.
1
Plaintiffs subsequently settled with Shorter, and Shorter is not a party to this appeal.
-2-
Plaintiffs first argue that summary disposition was improperly granted because there was
a genuine issue of material fact regarding whether a copy of the foreclosure notice was “posted in
a conspicuous place upon any part of the premises described in the notice” as required by MCL
600.3208; MSA 27A.3208. This Court reviews a trial court’s decision on a motion for summary
disposition under MCR 2.116(C)(10) de novo, viewing the documentary evidence in the light
most favorable to the nonmoving party to determine whether a genuine issue of material fact
exists on which reasonable minds could differ. Nesbitt v American Community Mutual Ins Co,
236 Mich App 215, 220, 225; 600 NW2d 427 (1999).
Plaintiffs argument is premised on the deposition testimony of the tenants of the property
that they did not see the notice. However, Sergeant Ronald Cruzan of the Cass County Sheriff’s
Department testified in his deposition that he made great effort to determine the location of the
specific residence and that “there was no doubt in my mind that I did post it.” When asked if
there was any doubt in his mind that he posted the right house, Cruzen responded, “No sir.” The
fact that plaintiffs’ tenants did not see the notice is insufficient to create a genuine issue of
material fact in light of Sgt. Cruzan’s absolute testimony that he posted the notice.
Plaintiffs also contend that the trial court abused its discretion by denying their motion to
amend their complaint. This Court reviews a trial court’s decision whether to allow amendment
of the pleadings under MCR 2.118 for an abuse of discretion. In the Matter of the Dissolution of
F Yeager Bridge & Culvert Co, 150 Mich App 386, 397; 389 NW2d 99 (1986). In civil cases, an
abuse of discretion is found only in extreme cases in which the result is so palpably and grossly
violative of fact and logic that it evidences a perversity of will, a defiance, or the exercise of
passion or bias. Dep’t of Transportation v Randolph, 461 Mich 757, 768; 610 NW2d 893
(2000).
Here, plaintiffs waited until after summary disposition had been entered against them
before filing for leave to amend the complaint. No proposed amended complaint was filed, and
there was a great deal of confusion regarding what plaintiffs wanted to plead. To the extent that
plaintiffs did suggest a theory, it is clear from a review of the arguments at the hearing on the
motion that the trial court did not abuse its discretion in holding that an amendment would have
been futile. Lane v Kindercare Learning Centers, Inc, 231 Mich App 689, 697-698; 588 NW2d
715 (1998).2
Affirmed.
/s/ Henry William Saad
/s/ E. Thomas Fitzgerald
/s/ Peter D. O’Connell
2
In light of our resolution of this matter, the cross-appellants’ appeal is moot.
-3-
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