ABC BARREL & DRUM SITES V DETREX CORP
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STATE OF MICHIGAN
COURT OF APPEALS
ABC BARREL & DRUM SITES, ETHONE OMI,
INC., FORD MOTOR COMPANY, GENERAL
MOTORS COMPANY, HENKEL
CORPORATION, PVS NOLWOOD
CHEMICALS, INC., and VAN WATERS &
ROGERS, INC.,
UNPUBLISHED
February 19, 2002
Plaintiff/CounterdefendantsAppellees/Cross-Appellants,
v
No. 220784
Oakland Circuit Court
LC No. 96-526357 CK
DETREX CORPORATION,
Defendant/CounterplaintiffAppellant/Cross-Appellee.
Before: Bandstra, C.J., and Doctoroff and White, JJ.
WHITE, J. (concurring).
The issues of the nature of Kohl’s representations to Gleason and Currie, and whether
such representations were breached, were fully litigated at trial. The jury heard extensive
evidence regarding the alleged representations and was instructed that it could consider Kohl’s
representations in interpreting the agreement if it concluded that the representations were
consistent with or explained the agreement. Two of the asserted representations - - that there
were strong defenses available that would be vigorously litigated, and that third-party PRPs
would be vigorously pursued - - were consistent with the terms of the written agreement. By its
verdict, the jury determined that no promises were made in this regard that were breached. The
third asserted representation - - that Detrex’ liability would not exceed $100,000 - - could be
viewed as consistent with or inconsistent with the contract. It is clear that if this promise was
made, it was breached. Thus, the jury either concluded that it was not made or that, if made, it
was inconsistent with the terms of the agreement. If the jury concluded it was not made,
defendant suffered no prejudice by the dismissal of its fraudulent inducement claim. If the jury
concluded it was made but was inconsistent with the agreement, the propriety of the court’s
dismissal of the fraudulent inducement claim regarding this alleged representation is implicated.
The circuit court focused on the requirement that the misrepresentation regarding future
conduct be reasonably expected to be relied on, and appears to have concluded that in the face of
the actual terms of the agreement, representations regarding a $100,000 limitation on defendant’s
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exposure under the agreement could not reasonably be expected to be relied on as a matter of
law. I agree. The representation was made to two attorneys. It was made in the face of a
contract that mentioned the possibility of settlement, provided for a procedure that permitted one
participant to be bound to a settlement notwithstanding its disagreement, provided no escape
mechanism, and allocated a set percentage (27.78%) of any settlement to Detrex. Further,
Detrex was aware that, although Detrex had only committed $100,000 to the effort, the group
had already offered to settle with the EPA for $1.5 million. Additionally, another attorney at
Kohl’s firm, who had been representing Detrex directly, had recently sent Detrex a memo
discussing the agreement and outlining Detrex’ exposure, mentioning a range of $550,600 to
$1.25 million. Under the circumstances, any representations regarding Detrex’ exposure under
the agreement could only be understood as a possible scenario, and could not reasonably be
expected to be relied on as a promise that notwithstanding the terms of the agreement, in no
event would Detrex be expected to contribute more than $100,000.
I find no error requiring reversal.
/s/ Helene N. White
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