If this opinion indicates that it is “FOR PUBLICATION,” it is subject to 

revision until final publication in the Michigan Appeals Reports.

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S T A T E O F M I C H I G A N

C O U R T O F A P P E A L S

MICHELLE HEYZA and LEONARD HEYZA,

Plaintiffs/CounterdefendantsAppellants,

UNPUBLISHED

August 11, 2022

v No. 357255

Macomb Circuit Court

MCMACHEN BOATING CENTER LLC, LC No. 19-001739-NZ

Defendant/Counterplaintiff/CrossDefendant/Cross-Plaintiff-Appellee,

and

MICHIGAN FIRST CREDIT UNION,

Defendant,

and

MARIE MERRELLI and ROBERT MERRELLI,

Defendants/Cross-Defendants/CrossPlaintiffs.

Before: RIORDAN, P.J., and BORRELLO and LETICA, JJ.

PER CURIAM.

In this dispute arising from their purchase of a boat, plaintiffs/counterdefendants, Michelle

Heyza and Leonard Heyza (individually “Michelle” and “Leonard,” collectively “plaintiffs”), 

appeal as of right the trial court’s judgment in favor of defendant/counterplaintiff, McMachen 

Boating Center, LLC (MBC). We reverse and remand for proceedings consistent with this opinion.
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I. BASIC FACTS AND PROCEDURAL HISTORY

This case arises out of the sale of a boat, a 2001 Cruisers 3076 Express, by MBC to 

plaintiffs. The boat was owned by Marie Merrelli and Robert Merrelli1, and MBC acted as broker 

in the transaction. Plaintiffs signed a purchase agreement indicating the “sale [was] contingent 

upon an acceptable sea trial,” and they paid a $500 deposit. The purchase agreement also contained 

an “as is” clause and warranty disclaimer that stated:

NO VERBAL COMMITMENTS WILL BE HONORED. SELLER MAKES NO 

WARRANTIES OF ANY KIND EXPRESS OR IMPLIED. Purchaser understands 

that Seller’s sole responsibility with regard to any boat, motor, or accessory sold 

herein is to issue buyer the manufacturer’s warranty, if any, Purchaser agrees to 

look for recourse solely to the manufacturer in the event of defect in any such boat, 

motor, or accessories. Purchaser understands that all goods sold herein are being 

sold by Seller “as is.” SELLER EXPRESSLY DISCLAIMS ALL WARRANTIES, 

INCLUDING THE IMPLIED WARRANTIES FOR FITNESS FOR A 

PARTICULAR PURPOSE AND OF MERCHANTABILITY. Seller disclaims the 

representation of any agents, employees or representatives, whether verbal or in 

writing, and Purchaser acknowledges that he has not relied upon any such 

representation in making this purchase other than the terms specifically set forth 

under this Agreement for Sale. THERE ARE NO WARRANTIES WHICH 

EXTEND BEYOND THE DESCRIPTION ON THE FACE HEREOF.

Plaintiffs chose not to obtain a marine survey or inspection, which would have confirmed 

the boat’s seaworthiness, purportedly at the suggestion of an MBC salesperson, who gave plaintiffs 

the impression it would be expensive and unnecessary.2 After a successful sea trial—a test ride 

on the boat accompanied by T.J., the salesperson—plaintiffs decided to purchase the boat. 

Michelle handled the financing paperwork with an MBC employee while Leonard was at work. 

Michelle testified the employee was aware plaintiffs could not pay more than $500 for a down 

payment. Plaintiffs testified the employee had Michelle write a check for $10,570. Michelle wrote 

on the memo line of the check: “Down Payment on Boat.” Plaintiffs understood that was the check 

was being used to verify funds in plaintiffs’ bank account. After Michelle gave the employee the 

 

1 The Merrellis were the prior owners of the boat. MBC filed a Notice of Nonparty at Fault 

identifying them and filed a counter cross-complaint for common law indemnity and implied 

contractual liability. All claims raised against the Merrellis were dismissed by stipulated orders, 

and they are not parties to this appeal.

2 Leonard testified that the salesperson, “T.J.,” indicated that a marine survey was unnecessary 

because the boat was “still floating,” and “still driving,” and a marine surveyor was only an 

additional person trying to “get their hands in getting money.” T.J. also allegedly represented that 

there were other offers on the boat, he did not know how long the boat would be available, and a 

marine survey would cost between $1,200 and $1,600. According to Leonard, plaintiffs could not 

afford the high cost of the survey at that time.
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check, the employee “went in the back and did something,” then returned the check to Michelle 

uncashed.

Plaintiffs averred that they did not intend to use the $10,570 check as the down payment 

for the boat. Nevertheless, plaintiffs signed a subsequent purchase agreement3and a financing 

contract indicating plaintiffs paid $10,570 as down payment on the $49,290 boat. The financing 

contract reflected the total financed amount was $38,895 after the down payment. Plaintiffs were 

responsible for 240 payments of $301.32, due monthly beginning on March 14, 2017, at 6.99% 

annual interest. The financing contract was assigned to Michigan First Credit Union (MFCU),4

per an existing agreement between MFCU and MBC. Plaintiffs did not dispute the documents 

they signed incorrectly indicated a down payment of $10,570, but maintained that MBC wrongly 

made it appear plaintiffs paid that amount to obtain the necessary financing. MBC claimed

plaintiffs knowingly and fraudulently signed the contract, including the misrepresentation of the 

down payment amount, to finance the boat at the lower price.

Plaintiffs operated the boat on the water without any issues during the summer of 2017, 

and stored it at their personal dock when not in use. In October 2017, plaintiffs brought the boat 

to MBC to be stored over the winter. When plaintiffs retrieved the boat in May 2018, they 

discovered the boat was taking on water and needed to be removed from the canal. Plaintiffs 

initially brought the boat back to MBC to be stored, but later moved it to a different location.

Plaintiffs’ insurance company, Farm Bureau, contracted with Davis & Company Limited 

(Davis), a marine surveyor and consultant, to determine the extent of the damage. A Davis 

representative determined the boat’s hull was rotten and fiberglass bottom was cracked, allowing 

the boat to slowly take on water over the previous three or four years. After multiple experts 

inspected the boat, it was determined the boat was a total loss and no longer insurable, even if the 

costly repairs were completed.

In April 2019, MBC agreed to buy back the financing contract from MFCU and became 

first lien holder. A letter dated May 17, 2019, from MBC’s counsel, sent to plaintiffs informed 

 

3 There are actually two purchase agreements submitted in the lower court record. On April 6, 

2017, plaintiffs signed an invoice and purchase agreement (invoice number 2910) stating: “Sale is 

contingent upon an acceptable sea trial (April).” According to that invoice, the sale price of the 

boat was $37,000, $2,220 for tax, $175 for registration, and plaintiffs paid a $500 deposit, making 

the total financed amount $38,895. Also dated April 6, 2017, a second purchase agreement 

(invoice number 2780) lists the selling price as $46,500, plus $2,790 in tax, $175 for title and 

registration, and a down payment of $10,570; thus, the total financed cost equaled $38,895. 

Plaintiffs contend invoice no. 2910 was the controlling invoice, and during a trial court hearing, 

plaintiffs’ counsel represented that Michigan First Credit Union was unhappy with the original 

price of the boat on invoice no. 2910, so MBC wrote up the subsequent invoice for the higher boat 

price. MBC does not offer any explanation for the two invoices.

4 The claims by plaintiffs and MBC raised against MFCU were dismissed by stipulated orders. 

MFCU is not a party to this appeal.
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them to make all future loan payments to MBC. Plaintiffs began withholding payments in 

April 2019.

Plaintiffs filed a complaint5in May 2019, against MBC6alleging various claims of breach 

of warranty, revocation of acceptance and damages, violation of Michigan Consumer Protection 

Act, MCL 445.901 et seq., fraud in the inducement, negligence, and conspiracy. In August 2019, 

MBC filed a counterclaim against plaintiffs, alleging plaintiffs failed to make any payments on the 

contract since it was reassigned to MBC, resulting in the unpaid loan balance being accelerated 

and due in full. MBC requested $36,439.63 plus interest, court costs, and attorney fees.

MBC moved for summary disposition on its counterclaim, arguing it was entitled to 

judgment as a matter of law because the evidence was undisputed that plaintiffs failed to make 

payments on the financing contract after April 2019. In response, plaintiffs moved for leave to file 

a third amended complaint to add a claim that MBC violated the Retail Installment Sales Act 

(RISA), MCL 445.853 et seq., when it included the incorrect down payment of $10,570 on the 

financing contract. Plaintiffs also answered they were entitled to summary disposition under 

MCR 2.116(I)(2), because RISA precludes MBC’s enforcement of the contract against plaintiffs 

because MBC was, at least, complicit in the misrepresentation.

The trial court heard oral argument on the motions. During a hearing, it advised that it did 

not believe the testimony offered by plaintiffs and found their testimony to be “preposterous.” The 

trial court indicated that it would refer the matter to the court’s research division for a written 

opinion granting summary disposition in favor of MBC. However, the trial court also predicted 

that it could compose the opening paragraphs of the Court of Appeals’ opinion reversing its 

decision. As promised, the trial court issued an opinion and order granting MBC’s motion for 

summary disposition under MCR 2.116(C)(10), denying plaintiffs’ motion to amend their 

complaint, and dismissing plaintiffs’ complaint in its entirety. The trial court’s decision rested on 

its finding plaintiffs knew of, and participated in, the misrepresentation of the down payment 

amount, and sua sponte concluded the unclean-hands doctrine barred the equitable relief of 

rescission that plaintiffs sought. Plaintiffs’ motion for reconsideration of the trial court’s opinion 

was also denied. This appeal followed.

II. STANDARD OF REVIEW

A trial court’s ruling on a motion for summary disposition is reviewed de novo. Houston 

v Mint Group, LLC, 335 Mich App 545, 557; 968 NW2d 9 (2021). Summary disposition is 

appropriate pursuant to MCR 2.116(C)(10) where there is “no genuine issue as to any material 

fact, and the moving party is entitled to judgment or partial judgment as a matter of law.” 

 

5 Plaintiffs twice amended their complaint, a first-amended complaint on August 22, 2019, and a 

second-amended complaint was filed in November 22, 2019, but is erroneously titled “First 

Amended Complaint.” The claims here are from plaintiffs’ November 22, 2019 amended 

complaint.

6 Plaintiffs initially also included claims against MFCU and the Merrellis in their prior complaints, 

but claims against those parties were dismissed by stipulated order.
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MCR 2.116(C)(10). When reviewing a motion for summary disposition challenged under 

MCR 2.116(C)(10), the court considers the affidavits, pleadings, depositions, admissions, and 

other admissible documentary evidence then filed in the action or submitted by the parties in the 

light most favorable to the nonmoving party. MCR 2.116(G)(4), (G)(5); Buhl v City of Oak Park, 

507 Mich 236, 242; 968 NW2d 348 (2021). “A genuine issue of material fact exists when the 

record, giving the benefit of reasonable doubt to the opposing party, leaves open an issue upon 

which reasonable minds might differ.” West v Gen Motors Corp, 469 Mich 177, 183; 665 NW2d 

468 (2003). Additionally, under MCR 2.116(I)(2), a court may enter judgment in favor of the 

opposing party when “the opposing party, rather than the moving party, is entitled to judgment.”

III. UNCLEAN HANDS AND CREDIBILITY

Plaintiffs submit the trial court erroneously applied the unclean-hands doctrine solely to 

plaintiffs, despite the fact that MBC represented that plaintiffs made the $10,570 deposit to MFCU 

but returned the check to plaintiffs. Further, they allege that the trial court improperly assessed 

their credibility. We agree.

When ruling on a motion for summary disposition, the court does not engage in an 

assessment of the credibility of the witnesses. White v Taylor Distrib Co, 482 Mich 136, 142-143; 

753 NW2d 591 (2008). “Summary disposition is suspect when motive and intent are at issue or 

where the credibility of a witness is crucial.” Foreman v Foreman, 266 Mich App 132, 135-136; 

701 NW2d 167 (2005). When the truth of a material fact assertion is premised on witness 

credibility, summary disposition should not be granted. Id. at 136. If presented with conflicting 

evidence, the court may not make factual findings, and summary disposition is improper. Piccione 

v Gillette, 327 Mich App 16, 19; 932 NW2d 197 (2019). Rather, application of disputed facts to 

the law present proper questions for the jury or trier of fact. White, 482 Mich at 143.

Although neither party invoked the unclean-hands doctrine, the trial court determined 

plaintiffs’ conduct constituted unclean hands, and therefore, found that plaintiffs were precluded 

from the equitable relief of rescission of the purchase agreement and financing contract. “Since 

the clean hands maxim is designed to preserve the integrity of the judiciary, courts may apply it 

on their own motion even though it has not been raised by the parties or the courts below.” 

Stachnik v Winkel, 394 Mich 375, 382-383; 230 NW2d 529 (1975). “It is well settled that one 

who seeks equitable relief must do so with clean hands.” Atty Gen v PowerPick Players’ Club of 

Mich, LLC, 287 Mich App 13, 52; 783 NW2d 515 (2010). However, a defendant with unclean 

hands may not defend by asserting that a plaintiff also has unclean hands. Id. at 53. “To permit a 

defendant with unclean hands to defend on such a ground would contravene the ancient rule that 

‘[h]e who hath committed iniquity shall not have equity . . . .’ ” Id. (citation omitted).

“When a plaintiffs’ action is based, in whole or in part, on its own illegal conduct, a 

fundamental common-law maxim . . . known as the ‘doctrine of in pari delicto’ generally applies 

to also bar the plaintiff’s claim.” Orzel v Scott Drug Co, 449 Mich 550, 558; 537 NW2d 208 

(1995). That is, when two parties are equally in the wrong, the law will not afford one party relief 

over the other, but will leave them as it finds them. Id. “The rationale that Michigan courts have 

used to support the wrongful-conduct rule are rooted in the public policy that courts should not 

lend their aid to a plaintiff who founded his cause of action on his own illegal conduct.” Id. at 559.
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“In determining whether the plaintiffs come before this Court with clean hands, the primary 

factor to be considered is whether the plaintiffs sought to mislead or deceive the other party not 

whether that party relied upon plaintiffs’ misrepresentations.” Stachnik, 394 Mich at 387. The 

trial court faulted plaintiffs for presenting a $10,570 deposit check when never intending on 

making such a deposit. The trial court’s characterization and blame placed on plaintiffs while 

essentially forgiving MBC’s actions are puzzling and contrary to the rules governing summary 

disposition and credibility determinations. Plaintiffs alleged that their presentation of such a 

deposit check and its return was at the behest of MBC’s employee, and MBC failed to present 

evidence to the contrary.7 Further, it is difficult to discern how plaintiffs would have volunteered 

such a course of action, but rather seemingly had to be apprised by MBC’s employee on how to 

proceed. Moreover, when the degree of impropriety is examined, plaintiffs submitted a check to 

MBC. However, MBC purportedly submitted a copy of the check to the lending institution MFCU, 

but then returned the check to plaintiffs. Further, there is no indication that the documentation 

evidencing the cost of the boat and the deposit was prepared by anyone other than MBC

employees. MBC failed to definitively establish that plaintiffs intended to defraud MBC or 

MFCU, and in any event, the issue of intent presented a question for the jury. The reasons the trial 

court gave for precluding plaintiffs from collecting any judgment because of their unclean hands 

may similarly be applied to MBC. Plaintiffs wrote the $10,570 check, but MBC’s employee sent 

the check to MFCU and returned it uncashed to plaintiffs; plaintiffs signed two contracts that 

misrepresented the down payment, but MBC executed the same documents; plaintiffs benefited 

from lower monthly payments, but MBC wrote up the financing contract as if plaintiffs paid the 

$10,570 down payment. Because of MBC’s actions and the testimony regarding MBC’s 

directives, plaintiffs sufficiently presented documentary evidence to create a factual issue 

regarding whether any signed contract was induced by fraud, and the trial court erred in applying 

the doctrine of unclean hands solely to plaintiffs. Further, the trial court improperly assessed the 

credibility of plaintiffs, contrary to the rules governing summary disposition decisions.8

 

7 MBC alleged that the trial court assessed competing facts in evidence to determine whether 

plaintiffs were barred from recovery and no genuine issue of material fact existed because plaintiffs 

failed to dispute their participation in the $10,570 false deposit. However, plaintiffs do dispute 

they knowingly participated in any fraudulent activity, and presented their deposition testimony to 

support this assertion. In that testimony, plaintiffs stated they were unaware of any knowing 

misrepresentation involving the down payment, and were taken advantage of by the more 

experienced and knowledgeable boat broker, MBC. Giving the benefit of the doubt to plaintiffs, 

reasonable minds may differ on whether plaintiffs were complicit in the misrepresentation. Even 

if it is unlikely plaintiffs did not understand the ramifications of writing the check in question, it 

was not a determination for the trial court to render. Further, MBC did not present documentary 

evidence opposing plaintiffs’ position they were unaware. In MBC’s motion for summary 

disposition, it relied only on the purchase agreement, the financing contract, and MFCU’s 

assignment of the loan back to MBC.

8 We question other rulings rendered by the trial court. It does not appear that MBC employees 

“T.J.” and “Joann” were deposed. Nonetheless, plaintiffs opposed summary disposition by 

presenting answers to interrogatories from the prior boat owners, the Merrellis, regarding the work 
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Accordingly, the trial court erred because its decision to grant summary disposition was 

essentially premised on a finding that plaintiffs lacked credibility. The trial court erroneously 

accepted MBC’s version of events, finding plaintiffs’ explanation “preposterous.” The case should 

not have been disposed of in a motion for summary disposition when it essentially reached the 

issue of the credibility of plaintiffs’ assertions. Thus, a question of fact remained whether plaintiffs 

knowingly participated in the down payment misrepresentation and whether they reasonably relied 

on fraudulent statements or omissions made by MBC to enter into the purchase agreement. The 

trial court erred in granting summary disposition in favor of MBC under the circumstances.

IV. JUDICIAL NOTICE

Plaintiffs contend the trial court erred when it refused to take judicial notice of RISA. We 

conclude that this issue is moot.

“Judicial notice is discretionary, MRE 201(c), and we review for an abuse of that discretion 

a trial court’s decision whether to take judicial notice.” Lenawee Co v Wagley, 301 Mich App 

134, 149; 836 NW2d 193 (2013). “An abuse of discretion occurs when a court selects an outcome 

that is not within the range of reasonable and principled outcomes.” Id. (quotation marks and 

citation omitted). This Court reviews the interpretation of statutes de novo. Estes v Titus, 481 

Mich 573, 578-579; 751 NW2d 493 (2008).

Plaintiffs submit the trial court was required to take judicial notice of the RISA in light of 

MRE 202(b). That rule of evidence states: “A court shall take judicial notice of [statutes] if a party 

requests it and (1) furnishes the court sufficient information to enable it properly to comply with 

the request and (2) has given each adverse party such notice as the court may require to enable the

adverse party to meet the request.” Plaintiffs then assert there is no question that RISA applies to 

the present case because the financing contract at issue is an installment transaction under RISA.

However, the trial court did consider whether RISA could apply to this transaction, but

refused to apply it contending plaintiffs waived the issue by not raising RISA in their first 

responsive pleading and because plaintiffs’ motion to amend the complaint to include the RISA 

claim was futile. Moreover, it does not appear that a failure to take judicial notice had any effect 

on the trial court’s decision. Specifically, the trial court did not fail to take judicial notice, but 

merely refused to allow plaintiffs’ arguments under RISA.

 

that was performed on the boat, when it occurred, and the information that was conveyed to MBC’s 

employees. The trial court concluded that the information was hearsay without addressing whether 

it qualified as an exception to the rules or whether it constituted an admission in light of the 

Merrellis’ prior status as parties to the litigation. However, the trial court judge that presided over 

this litigation has since retired. A circuit court judge is required to follow published decisions of 

the Court of Appeals and Michigan Supreme Court. People v Hunt, 171 Mich App 174, 180; 429 

NW2d 824 (1988). There is no requirement that one circuit court judge follow the decision of 

another. Id. Accordingly, the successor trial judge is not bound by the trial court’s conclusion in 

this regard.
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In any case, this issue is moot because, as explained below, the trial court should have 

allowed plaintiffs to amend their complaint to include the claims under RISA. This Court does 

not consider moot issues, which “present[] nothing but abstract questions of law which do not rest 

upon existing facts or rights.” TM v MZ, 501 Mich 312, 317; 916 NW2d 473 (2018) (quotation 

marks and citation omitted); see also Gleason v Kincaid, 323 Mich App 308, 314-315; 917 NW2d 

685 (2018).

V. AMENDING COMPLAINT

Plaintiffs allege that the trial court erred in failing to allow them to amend their complaint. 

We agree.

A trial court’s decision to grant or deny a motion to amend pleadings is reviewed for an 

abuse of discretion. Weymers v Khera, 454 Mich 639, 654; 563 NW2d 647 (1997). An abuse of 

discretion occurs when a trial court’s decision falls outside the range of reasonable and principled 

outcomes. In re Kostin Estate, 278 Mich App 47, 51; 748 NW2d 583 (2008).

MCR 2.118(A)(2) allows a party to amend a pleading “by leave of court or by written 

consent of the adverse party,” and states: “Leave shall be freely given when justice so requires.” 

“An amendment is generally a matter of right rather than of grace.” Kostin, 278 Mich App at 52. 

Leave to amend is generally granted liberally, and is only denied for a few specific reasons. “Leave 

to amend should ordinarily be denied only for particularized reasons such as undue delay, bad faith 

or dilatory motive, repeated failures to cure by amendments previously allowed, or futility.” Id.; 

see also Lane v KinderCare Learning Ctrs, Inc, 231 Mich App 689, 697; 588 NW2d 715 (1998).

After MBC moved for summary disposition under MCR 2.116(C)(10), plaintiffs attempted 

to add three new claims in their motion to amend the complaint: (1) an additional claim for 

violation of RISA; (2) a claim under the Michigan collection practices act, MCL 445.251 et seq., 

and (3) a claim under the occupational code, MCL 339.901 et seq. On appeal, plaintiff only 

challenges the trial court’s denial of the claim related to RISA. The trial court found the claim 

under RISA would be “redundant and futile” because the “allegations in support of their proposed 

RISA claim are identical to those they alleged in response to [MBC]’s motion for summary 

disposition.” The trial court is required to give parties an opportunity to amend their pleadings, 

under MCR 2.118, in response to a motion for summary disposition under MCR 2.116(C)(10), 

unless the amendment would be futile. Weymers, 454 Mich at 658. “An amendment is futile if it 

is legally insufficient on its face” and merely restates the allegations already made. Wormsbacher 

v Phillip R Seaver Title Co, 284 Mich App 1, 8-9; 772 NW2d 827 (2009).

In the present case, plaintiffs’ proposed amendment under RISA did not “simply restate” 

allegations already pleaded. Wormsbacher, 284 Mich App at 9. Plaintiffs proposed amendment 

added allegations and defenses under RISA not included in previous complaints. For example, 

while plaintiffs’ earlier allegations depend on MBC’s alleged fraudulent activity, the RISA 

allegation includes a statutory violation for improperly identifying the retail price in the installment 

contract.

The trial court also determined plaintiffs’ allegations under RISA were not allowed 

because, as affirmative defenses, plaintiffs’ failure to raise RISA in their first responsive pleading 
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effectively waived any defense under RISA. Plaintiffs submit the trial court erred when it 

characterized the statute as an affirmative defense that must be raised in plaintiffs’ first response 

to MBC’s counterclaim because application of RISA denies MBC the existence of their prima 

facie claim and is not an affirmative defense. Further, plaintiffs allege the trial court erred in 

holding plaintiffs’ proposed amendment to the pleading would be futile because, even if plaintiffs 

acquiesced to MBC’s misconduct, RISA specifies a buyer cannot waive any remedies under RISA. 

MCL 445.866 states:

No act or agreement of the retail buyer before or at the time of the making 

of a retail installment contract, retail charge agreement or purchase thereunder shall 

constitute a valid waiver of any of the provisions of this act or of any remedies 

granted to the buyer by law.

The plain language of MCL 445.866 states, when RISA applies, a buyer cannot waive any 

part of, or remedy under, the statute. “When the language is clear and unambiguous, we will apply 

the statute as written and judicial construction is not permitted.” Driver v Naini, 490 Mich 239, 

247; 802 NW2d 311 (2011). In light of the statutory language, the trial court erred when it found 

plaintiffs waived their defense by not including the RISA claims in their first responsive pleading, 

and it should have allowed plaintiffs to amend the complaint to add claims under RISA.

Reversed and remanded for proceedings consistent with this opinion. We do not retain 

jurisdiction.

/s/ Michael J. Riordan

/s/ Stephen L. Borrello

/s/ Anica Letica