Opinion ID: 2972197
Heading Depth: 4
Heading Rank: 1

Heading: The Assignment Agreement Recitals

Text: Recital B to the Assignment Agreement states that Digital requested Nextel’s consent to assign the ISP Agreement to BearCom “in furtherance of an acquisition of all of [Digital’s] assets and liabilities by [BearCom].” [J.A. 248] (emphasis added). Digital views the recital as evidence that BearCom and Digital had an oral agreement for BearCom to purchase all of Digital’s assets and assume all of Digital’s liabilities. But for Recital B, the Assignment Agreement indicates that BearCom would acquire only Digital’s assets and liabilities that arose out of the Nextel ISP Agreement. BearCom argues that the recital does not reflect an express agreement to acquire all of Digital’s assets and liabilities. Under Michigan law, recitals “serve as a preface or preliminary statement introducing the subject in relation to which the parties contract, indicating to a greater or less[er] degree the reasons for and intent of what follows.” Acme Cut Stone Co. v. New Center Dev. Corp., 274 N.W. 700, 705 -9- No. 04-1107 Digital 2000 v. Bear Communications (Mich. 1937) (citation omitted). Recitals may be either general or particular. Particular recitals involve statements of fact and are “treated as conclusive evidence of the facts stated,” while “general recitals may not be. ” Id. (citation omitted). In Acme, the Michigan Supreme Court characterized contract recitals such as “it was agreed in said contracts,” and “the parties have agreed” as particular recitals. The district court characterized Recital B as a general recital, and thus not conclusive evidence of the facts stated. The Plaintiffs ask that we view Recital B as a particular recital. We agree with the district court that Recital B is a general recital, and is insufficient evidence of any oral contract. Unlike the particular recital language in Acme, Recital B does not say that the parties had reached an agreement for BearCom to acquire all of Digital’s assets and liabilities. In the absence of particular language reflecting a completed oral acquisition agreement, Recital B is general. Even if we characterize Recital B as a particular recital, it does not help the Plaintiffs. Recital B only states that the parties formed the Acquisition Agreement “in furtherance of” BearCom’s acquisition of all Digital assets and liabilities. The Oxford English Dictionary defines “furtherance” as “the fact or state of being furthered or helped forward; the action of helping forward; advancement, aid, assistance.” The use of the term “in furtherance of” indicates that the parties had not yet finalized an oral acquisition agreement. At most, it suggests the parties were still negotiating. This interpretation is supported by Plaintiff Popa’s testimony that certain details of the oral contract remained unresolved after November 1, 1999.