Michigan Supreme Court 

# Order

Lansing, Michigan

January 12, 2007 Clifford W. Taylor,
Chief Justice

130585 Michael F. Cavanagh
Elizabeth A. Weaver Marilyn Kelly Maura D. Corrigan Robert P. Young, Jr. MICHAEL FRANCIS SPITZLEY, Personal Stephen J. Markman, Representative of the ESTATE OF DAVID A. Justices SPITZLEY, Plaintiff-Appellee,

v SC: 130585 COA: 255345 Clinton CC: 03-009578-CZ THOMAS P. SPITZLEY and KIMBERLY S. SPITZLEY, Defendants-Appellants.

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On November 15, 2006, the Co urt heard oral argument on the application for leave to appeal the December 1, 20 05 judgment of the Court of A ppeals. On order of the Court, the application is again consid ered, and it is DENIED, because we are not persuaded that the question presented should be reviewed by this Court.

Y OUNG , J., concurs and stat es as follows:

I concur in the Court’s decision to deny leave to appeal in this case. This case

arises from the sale of a home and land from the estate of plaintiff’s father. Plaintiff, in his capacity as personal represen tative of his father’s estate, sold the home and land to his relatives by personal representative deed. In this action, plain tiff claims that the personal representative deed mi stakenly included 40 acres of plai ntiff’s own property along with the estate’s property. Thus, the prim ary issue was wheth er the 40-acre parcel was included in the deed mistakenly or intentiona lly. The trial court found that “[d]efendants have not presented an offer to purchase or any documentary evidence that supports their position. Overwhelming evidence persuades th e Court that the personal representative’s deed included the farmland legal description by mistake. Defendants simply tried to take advantage of the mistake after it occurred .” (Emphasis added.) Justice Markman cites the deed as factual support fo r defendants’ claim that the 40 acres were intentionally

included in the deed and assert s that “it was hardly frivolous for defendants to rely upon [the deed] to identify the extent of the property that ha d been purchased. ” However, the deed itself does not refute pl aintiff’s claim that the deed contained a mistake, and2

defendants have simply not provided any evidence to show that the description was anything other than a mistak e. Justice Markman also cite s a July 2001 letter from the estate’s attorney indicating that those 40 acres were estate property to be given to plaintiff after the mortgage was satisfie d. However, the parties di d not enter a purchase agreement until September 2002. In the in terim, the quitclaim deed fro m the father to plaintiff was recorded on December 26, 2001. After the deed was recorded, it was wholly

unreasonable for defendants to rel y on the clearly erroneous letter. 1

Therefore, the trial court co rrectly found that there was overwhelming evidence

that the deed contained a mist ake and that defendants simply tried to take advantage of that mistake. This point is made emphati c by the fact that plaintiff had received his property from his father by inter vivos gift and did not take under his father’s will. Defendants, relatives of plai ntiff, fully knew this fact a nd the only argument justifying enforcing the deed is th at plaintiff intended to donate his land as a gift to the estate in

which he had no interest. Th e trial court was thus fully ju stified in finding defendants’ claim frivolous because they “had no reasonable basis to believe that the facts underlying [their] legal position were in fact true.” MCL 600.2591(3)(a)(ii) (emphasis added).

Because there has been no sh owing that the trial court clearly erred in finding that

the defendants had no evidence to support their position that the description in the deed was not a mistake, sa nctions are appropriate.

M ARKMAN , J., dissents and states as follows:

I respectfully dissent. Plaintiff, as a re presentative of an esta te, sold a house and

40 acres to defendants. Plaintiff later file d suit to reform the deed because the 40 acres had been owned personally by plaintiff, not the estate. After granting summary disposition to plaintiff, the tr ial court imposed sanctions on defendants for filing frivolous counterclaims, and the Court of Appeals affirmed.

A party’s claim is “frivolous” if that part y “had no reasonable ba sis to believe that the facts underlying that part y’s legal position were in fact true” or “[t]he party’s legal position was devoid of arguabl e legal merit.” MCL 600. 2591(3)(a)(ii) and (iii). Defendants’ claims, in my judgment, were not “devoid of arguable le gal merit.” Indeed no Michigan case expressly cont rols the precise issue presen ted: whether a representative of an estate is estopped from asserting a personal interest in rea l property which that representative has convey ed in his or her cap acity as representative. In the absence of dispositive authority, defendants cited 23 Am Jur 2d, Deeds, § 289, p 264, as well as

1 I am uncertain how the sibling’s (Mark Spit zley) “understanding” of the transaction is relevant because he is not a p arty to the transaction and hi s affidavit does not show that he was privy to any relevant negotiations.3

foreign cases, see, e.g., Bliss v Tidrick , 25 SD 533 (1910), in supp ort of their contention that plaintiff should be precluded from reasserting an interest in the property in this case.

Moreover, defendants arguably possessed a “reasonable basis to believe that the facts underlying [their] legal position were in fact true.” The d eed itself explicitly

included the 40 acres within its language. Although the deed may have granted the 40 acres by mistake, it was hardly frivolous for defendants to rely upon it to identify the extent of the property that had been purchased.

Defendants also presented ev idence that all of the partie s initially assumed that the land did not automatically pass to plaintiff upon his father’s death. A July 18, 2001, letter from the first probate a ttorney, Gary Ka senow, stated:

The 40 acres of farmland and farm bu ildings . . . shall be given to Michael Spitzley but he must pay off 1⁄2 of the mortgage balance owed, [2]
the other 1⁄2 would be paid off by the other beneficiaries.

Some time later, a second attorney, Wi lliam Jackson, was retained by personal representatives plaintiff and Lisa Klein. In a letter dated November 12, 2002, Jackson

stated:

Apparently, the entire real estate holdings of th e decedent were

included in the inve ntory of the estate. Unfort unately, this was incorrect, as the farm land has been prev iously deeded by the decedent to himself and to Michael Spitzley as joint tenants with fu ll rights of survivorsh ip . . . . This means that upon the deat h of the decedent, the title to this property passed to the survivor, Michael Spitzley, by op eration of law, with out the need of further probate. Therefore, it was error to include this land in the inventory

of the estate.

Although plaintiff asserts in his brief that this letter is dated two days prior to the execution of the personal rep resentative’s deed, and therefo re that the parties were aware of any mistake, defendants cl aimed they were not informed of the error until after the closing. The letter provides a reasonable ba sis for defendants’ claim, since it was dated November 12, 2002, but there is no evidence that defendants received it before the closing. Other defense evid ence, in addition to defendants’ own testimony, included the affidavit of another sibling, M ark Spitzley, stating that “[h is] understanding was that Tom and Kimberly Spitzley were purchas ing the disputed 40 acres,” a nd that plaintiff told him “that [plaintiff] was unhappy about the debt [plaintiff] had inherited by way of the mortgage.” The two letters and the affidavi t of Mark Spitzley are relevant because they

Defendants specifically argue d that plaintiff, acting as the estate’s personal representative, eventu ally agreed to transfer the 40 acres, in part, b ecause he did not wish to pay off his portion of the mortgage. 2_______________________________________ __ 4

suggest that the parties to the estate, including defendants, understood the estate to possess the 40 acres. In accordan ce with this understanding, the defendants could have reasonably believed that the plaintiff, as personal representative, intended to convey the 40 acres. Therefore, in my ju dgment the trial court clearl y erred when it found that “[d]efendants have not presented . . . any documentary evidence that supports their position .” (Emphasis added.)

While defendants’ argument may not ha ve deserved to p revail, defendants nonetheless presented a good faith argument in support of their legal position and they possessed a deed that explicitly purported to grant them the pr operty at issue. Because I

do not believe that defendants’ defenses and countercl aims were frivolous under MCL 600.2591, I would reverse the judgment of the Court of Appeals and strike the sanctions.

K ELLY and C ORRIGAN

, JJ., join the statement of M ARKMAN , J.

s0109 I, Corbin R. Davis, Clerk of the Mi chigan Supreme Cour t, certify that the foregoing is a true and complete copy of the order entered at the direction of the Court.

January 12, 2007

Clerk