VICTOR CORDOBA V CITY OF DETROIT
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STATE OF MICHIGAN
COURT OF APPEALS
VICTOR CORDOBA,
UNPUBLISHED
September 4, 2001
Plaintiff-Appellant,
v
No. 221391
Wayne Circuit Court
LC No. 98-813104-CK
CITY OF DETROIT,
Defendant-Appellee.
Before: Bandstra C.J., and Whitbeck and Owens, JJ.
PER CURIAM.
Plaintiff appeals as of right an order granting defendant’s motion for summary disposition
pursuant to MCR 2.116(C)(10). We affirm.
On May 5, 1993, plaintiff and defendant entered into a land development agreement.
Defendant agreed to convey certain Detroit real estate to plaintiff in exchange for plaintiff ’s
development of the real estate into a commercial property called “Plaza Mexico.” The agreement
specified that construction on the project “shall be completed within 48 months of the date of
delivery of the Deed.” The agreement also provided that the conveyance was a fee simple
determinable, pending defendant’s determination that the project was substantially complete.
The agreement provided that, in the event of plaintiff ’s default, the property would revert to
defendant. The agreement also contained a force majeure provision which provided that, in the
event of unforeseeable delays beyond either party’s control, a party could seek an extension by
written notice within ten days of the beginning of the delay. This provision dictated that
defendant’s determination of what constitutes a force majeure would be controlling.
After defendant notified plaintiff that he was in default for failing to substantially perform
his obligations within forty-eight months of delivery of the deed, plaintiff filed a complaint
seeking declaratory and injunctive relief, to determine title to the property, and seeking time,
pursuant to the force majeure provision, to complete Plaza Mexico. Defendant moved for
summary disposition pursuant to MCR 2.116(C)(10), contending that plaintiff had breached the
agreement, that the force majeure provision was not operative under the circumstances, and that
collateral estoppel precluded litigation on the matter. The trial court granted defendant’s motion.
Plaintiff argues that the court erred in granting summary disposition. We review de novo
a trial court’s ruling on a motion for summary disposition. Maiden v Rozwood, 461 Mich 109,
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118; 597 NW2d 817 (1999). A motion for summary disposition under MCR 2.116(C)(10) is
properly granted if there is no genuine issue of material fact and the moving party is entitled to
judgment as a matter of law. Id. at 120. A court must consider the pleadings, affidavits,
depositions, admissions, and other documentary evidence. Id. at 119-120. Only proffered,
substantively admissible evidence is considered, although this evidence is reviewed in a light
most favorable to the non-moving party. Id. at 120-121.
Plaintiff argues that the court erred in granting summary disposition because there was a
genuine issue of fact concerning whether plaintiff substantially performed his contractual
obligations. We disagree. In regard to Michigan’s adoption of a substantial performance of
contract rule, we have opined as follows:
A contract is substantially performed when all the essentials necessary to the full
accomplishment of the purposes for which the thing contract has been performed
with such approximation that a party obtains substantially what is called for by the
contract.
Generally speaking, deviations from the absolute terms of a contract do not
necessarily cause a failure of performance, but may entitle a party to extra
compensation or damage. Imperfections in the matters of details which do not
constitute a deviation from the general plan do not prevent the performance from
being regarded as substantial performance. On the other hand, where the
deviations or alterations are such as would essentially change the terms of
performance, they will be considered as a failure of performance. [Gibson v
Group Ins Co, 142 Mich App 271, 275-276; 369 NW2d 484 (1985) (quoting 6A
Michigan Law & Practice, Contracts, § 314 pp 315-316).]
Generally, the question whether a party has substantially complied with an agreement is a
question for the jury. Franzel v Kerr Mfg Co, 234 Mich App 600, 619; 600 NW2d 66 (1999).
The trial court found that plaintiff failed to substantially complete the project within forty-eight
months of delivery of the deed as required by the contract. On appeal, plaintiff argues that this
finding was an improper resolution of a factual question.
Plaintiff notes that, in his answers to defendant’s first set of interrogatories, he stated that:
(i) the 64-space paved parking lot was substantially completed by October 1, 1996, at a cost of
more than $120,000; (ii) although the agreement required construction of a 6,300 square foot
structure, he constructed an 8,277 structure at a cost of more than $390,000; and (iii) in 1997, he
applied for, but has yet to receive, approval from defendant to vacate the requisite alleys and
street rights-of-way necessary to complete the project. However, we note that plaintiff was
contractually obligated to construct a 6,300 square foot retail building, but instead constructed a
building that, despite being larger, did not meet the contractual requirements. We believe that
this difference certainly constituted a deviation from what was required by the agreement. At the
very least, we do not believe that reasonable minds could conclude that defendant received
“essentially” what it was entitled to under the contract.
It is also undisputed that plaintiff failed to plant the deciduous trees, as required by the
contract. Along the same lines, plaintiff did not request approval from defendant to vacate the
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requisite alleys and street rights-of-way before May 1997. Thus, we believe that the facts,
viewed in a light most favorable to plaintiff, fail to create a genuine issue of material fact as to
whether plaintiff substantially completed his contractual obligations.
Plaintiff further argues that there was a genuine issue of material fact as to whether
defendant’s notice of default was premature. Plaintiff specifically argues that the agreement
required completion of the project forty-eight months from the date of delivery of the deed, and
plaintiff did not physically receive the deed until September 1993. Defendant sent notice of
default on June 25, 1997, which was less than forty-eight months after the deed was delivered
under plaintiff’s theory.
Generally, “[t]he purpose of the delivery requirement is to show the grantor’s intent to
convey the property described in the deed.” Energetics v Whitmill, 442 Mich 38, 53; 497 NW2d
497 (1993). The test for determining whether there has been a delivery of the deed is whether the
grantor’s “words and actions” demonstrate an intent to convey a present interest in the land.
Litner's Estate v Meier, 344 Mich 119, 123-124; 73 NW2d 205 (1955).
In this case, the parties signed the agreement and the deed on May 5, 1993. By this act,
defendant showed an intention to surrender the instrument to plaintiff and to convey a present
interest in the land. More importantly, there is no evidence that defendant did not intend to
surrender possession on May 5, 1993, nor is there any evidence that defendant actually interfered
with plaintiff ’s possession before the date the deed was physically received by plaintiff. Plaintiff
argues that there is a question of fact whether the parties, by the term “delivery,” intended a
meaning other than the ordinary meaning of the term. However, plaintiff submitted no evidence
suggesting that term was ambiguous or should be construed contrary to its ordinary meaning.
Thus, in light of the evidence presented, and giving the benefit of reasonable doubt to plaintiff,
reasonable minds could not differ as to the meaning of the term “delivery” as used in the
agreement. Therefore, the trial court did not err to the extent that it granted summary disposition
on this basis.
Plaintiff also contends that there was a genuine issue of material fact regarding whether
the force majeure provision of the contract should have operated to extend his time of
performance. We disagree.
In Erickson v Dart Oil, 189 Mich App 679, 686; 474 NW2d 150 (1992), we noted that
“force majeure” is a term that is “virtually unknown” in Michigan common law. Turning to
other jurisdictions for guidance, we further noted that a force majeure clause may not be invoked
to excuse performance where the delaying condition was caused by the party invoking it or could
have been prevented by exercise of prudence, diligence, and care. Id. at 688, citing Edington v
Creek Oil Co, 690 P2d 970 (Mont, 1984)). A party’s “failure to explore or utilize available
options to overcome the delaying condition can constitute lack of due diligence.” Erickson,
supra at 688, citing Woods v Ratliff, 407 So 2d 1375, 1378-1379 (La App, 1981). We recognized
that the purpose of a force majeure clause is to relieve a party from termination of the agreement
“due to circumstances beyond its control that would make performance untenable or impossible.”
Erickson, supra at 689, citing Edington, supra at 119. Nevertheless, a party may not invoke a
force majeure clause to excuse performance where that party created the force majeure.
Erickson, supra at 689, citing Edington, supra at 120.
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The alleged force majeure in this case was a legal action initiated by Tres Galanes
Corporation in 1996. A 1992 lawsuit by Tres Galanes sought ownership of the property from
defendant, but was ultimately dismissed. On November 22, 1996, Tres Galanes filed another
lawsuit, this time against both plaintiff and defendant, seeking a preliminary injunction in regard
to construction that plaintiff had begun on parking spaces located adjacent to their restaurant. On
May 29, 1997, plaintiff and Tres Galanes agreed to a mutual restraining order regarding the lots.
On November 14, 1997, after continued disputes between plaintiff and Tres Galanes, the trial
court ordered plaintiff to stop construction and remove barricades on the property.
Defendant argues that plaintiff cannot enforce the force majeure provision because these
events were not beyond his control, nor were they unforeseeable. However, it is not evident from
the facts that plaintiff caused the Tres Galanes litigation, nor is there any indication that plaintiff
could have foreseen further litigation. Defendant also argues that plaintiff could have begun
work on another part of the project in order to avoid the litigation. However, plaintiff’s
contractual obligations included completion of the areas in dispute; thus, a determination of
whether plaintiff “substantially completed” his contractual obligations would necessarily include
the work done in these disputed areas.
Nevertheless, § 25.10 of the agreement requires a party requesting a time extension based
on a force majeure to provide notice to the other party within ten days of the event’s occurrence.
The record contains no evidence that plaintiff provided written notice that a time extension was
necessary for any reason during the forty-eight month period. Instead, all of plaintiff’s written
requests for an extension were during or after the ninety-day cure period that defendant provided
to plaintiff, which followed the expiration of the forty-eight month period for completing the
project. To the extent that plaintiff even notified defendant that he was delayed by the earlier
litigation, these notices were not accompanied by a request for a time extension, nor were they
sent within ten days of the purported events. Therefore, we do not believe that plaintiff is
entitled to rely on the force majeure provision of the agreement. Consequently, we conclude that
the trial court correctly granted defendant’s motion for summary disposition.
Finally, plaintiff contends that the trial court erred to the extent that it granted summary
disposition based on the doctrine of collateral estoppel. However, having already concluded that
the trial court properly granted summary disposition based on its resolution of the other issues,
we need not address this issue.
Affirmed.
/s/ Richard A. Bandstra
/s/ William C. Whitbeck
/s/ Donald S. Owens
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