Court Opinion

ID: 9741742
Source: CourtListenerOpinion
Date Created: 2023-08-26 21:01:11.969547+00
Date Added: 2024-06-11T07:24:24.624265
License: Public Domain

Blair Moody, Jr., J.
(dissenting). The question presented is whether the summary proceedings to recover possession of realty act, 1972 PA 120, MCL 600.5701 et seq.; MSA 27A.5701 et seq., has altered the common-law rule that a vendor’s forfeiture of a defaulted land contract constitutes an election of remedies which precludes a subsequent foreclosure and deficiency judgment based upon the contract.
I
Plaintiffs Myron, Ellen, Ben and Frances Grus-kin, and Joan H. Volin entered into a land contract in 1969 to sell an apartment building in Detroit to Marshall Fisher and Charles Burger. The consideration for the conveyance was the promise of the vendees to remedy a list of municipal code violations and pay $40,000 plus interest in installment payments. Before he died, Marshall Fisher transferred his interest in the land contract to an inter vivos trust, and the co-executors of his estate, defendants Irene R. Fisher and Gordon L. Fisher, were also the successor trustees of that trust.
On September 19, 1972, when the vendees had *72been in default on their payments for almost a year, the vendors sent the vendees a formal notice of intention to forfeit the land contract, demanding payment of the money then due ($4,800) or surrender of the premises. Notice of forfeiture was served ten days later, after the vendees failed to cure their default. That notice stated that the vendors elected to:
"declare said land contract forfeited, effective in 15 days after service of this notice; and you are hereby further notified that unless the money required to be paid is paid and any other alleged material breaches of the contract are cured, that you are to yield, surrender and deliver up possession of the premises. * * *
"You are further notified that from and after the service of this notice, you will be liable for damages which the undersigned may suffer by reason of your continued possession of said premises.”
In response to the notice, the vendees executed a quitclaim deed which was hand-delivered with a cover letter to the vendors’ attorney on September 29, 1972. However, the vendors returned the deed because it had not been delivered within the 15 days specified in the notice of forfeiture and because the vendees had failed to correct the building and health code violations as agreed in the land contract.1 Subsequent to service of the notice of forfeiture, the building in question was condemned by the City of Detroit and demolished in 1974.
The vendors never initiated summary proceedings for possession in district court to complete the *73forfeiture process under the summary proceedings act. Instead, they brought this action in circuit court to foreclose the land contract and to obtain a deficiency judgment. Defendant vendees answered claiming that plaintiff vendors’ forfeiture of the agreement was an election of remedies barring the foreclosure action on the contract. The trial court granted summary judgment for the plaintiffs. The trial court found that MCL 600.5750; MSA 27A.5750, changed the common-law rule of election of remedies so that the initiation of forfeiture does not bar alternative relief procedures until the land contract vendor has obtained a judgment for possession in district court.
The Court of Appeals determined that the statute in question did not abrogate the common-law rule and reversed the judgment of the circuit court. 70 Mich App 117; 245 NW2d 427 (1976). We granted leave to appeal. 399 Mich 885 (1977).
II
None of the parties disputes the long-established and well-settled common-law rule that a vendor’s forfeiture of a defaulted land contract constitutes an election of remedies which precludes subsequently seeking a foreclosure and deficiency judgment based upon the contract. See Goodspeed v Dean, 12 Mich 352 (1864); Balesh v Alcott, 257 Mich 352; 241 NW 216 (1932); Chicago Boulevard Land Co v Apartment Garages, 245 Mich 448; 222 NW 697 (1929).
The rationale supporting this rule is the legal inconsistency of extinguishing the contract through forfeiture and then attempting to resurrect and enforce that contract through foreclosure.
"Having elected to exercise his option to declare the *74contract at an end, the vendor cannot thereafter change his position and hold the purchaser liable to complete the purchase or pay any part of the unpaid purchase money. The remedy of the vendor by way of a rescission or forfeiture of the contract and the continued liability of the purchaser for the purchase money are totally inconsistent, and the exercise of the former terminates any further liability of the purchaser for the purchase money.” 77 Am Jur 2d, Vendor and Purchaser, § 602, p 732.
Therefore, the only question presented is whether the summary proceedings to recover possession of realty act (hereinafter the Summary Proceedings Act), MCL 600.5701 et seq.; MSA 27A.5701 et seq., has altered or abrogated that long-established common-law rule.
The Summary Proceedings Act, while most specifically directed at landlord-tenant relations, provides a procedure to recover possession of premises in various situations, including forfeitures of executory land contracts. MCL 600.5701(a); MSA 27A.5701(a).
In a land contract setting, a forfeiture of the contract is a prerequisite to use of summary proceedings to regain possession of the premises. MCL 600.5726; MSA 27A.5726. Additionally, the statute requires that the vendor give notice of forfeiture and provides a 15-day period in which the vendee can cure the default. MCL 600.5728; MSA 27A.5728.
These provisions differ substantially from the land contract foreclosure provisions of Chapter 31 of the RJA. MCL 600.3101 et seq.; MSA 27A.3101 et seq. Under the foreclosure provisions the vendee has at least three months to cure the default. See MCL 600.3110-600.3115; MSA 27A.3110-27A.3115. Furthermore, the vendee is entitled to possession *75of the premises until the actual foreclosure sale. MCL 600.3150; MSA 27A.3150.
The key provision of the Summary Proceedings Act in question in the instant case is MCL 600.5750; MSA 27A.5750 which states:
"The remedy provided by summary proceedings is in addition to, and not exclusive of, other remedies, either legal, equitable or statutory. A judgment for possession under this chapter does not merge or bar any other claim for relief, except that a judgment for possession after forfeiture of an executory contract for the purchase of premises shall merge and bar any claim for money payments due or in arrears under the contract at the time of trial and that a judgment for possession after forfeiture of such an executory contract which results in the issuance of a writ of restitution shall also bar any claim for money payments which would have become due under the contract subsequent to the time of issuance of the writ. The plaintiff obtaining a judgment for possession of any premises under this chapter is entitled to a civil action against the defendant for damages from the time of forcible entry or detainer, or trespass, or of the notice of forfeiture, notice to quit or demand for possession, as the case may be.”
The trial court, reading the first two sentences together, held that the initiation of forfeiture proceedings does not bar the land contract vendor from initiating foreclosure proceedings in the circuit court until the vendor has obtained a judgment for possession in district court. We disagree.
The first sentence merely states that the remedy provided by the statute to recover possession through summary proceedings does not eliminate any other remedy available to the land contract vendor, but exists as a separate remedy for obtaining possession of real property. The traditional remedies available to a vendor under a defaulted land contract including action for breach of con*76tract, rescission, specific performance and foreclosure have not been eliminated. Thus, the first sentence reaffirms well-established law that the vendor may select from among the traditional remedies when seeking redress on a defaulted contract.
The second sentence states the consequences of selecting forfeiture and summary proceeding as the method for obtaining possession. After forfeiture of an executory land contract, a judgment for possession or the issuance of a writ of restitution merges and bars any claim for money payments due or in arrears under the contract at the time of trial.2 However, according to the second sentence, a judgment for possession or the issuance of a writ of restitution after a judgment for possession does not bar any other claim for relief permitted under the Summary Proceedings Act.
Section 5739 of the Summary Proceedings Act delineates the claims for relief which are available in an action for summary possession:
"Except as provided by court rules, a party to summary proceedings may join claims and counterclaims for money judgment for damages attributable to wrongful entry, detainer or possession, for breach of the lease or contract under which the premises were held or for waste or malicious destruction to the premises, but the court may order separate summary disposition of the claim for possession, without prejudice to any other claims or counterclaims. A claim or counterclaim for *77money judgment shall not exceed the amount in controversy which otherwise limits the jurisdiction of the court.” MCL 600.5739; MSA 27A.5739.
Therefore, in an action for summary possession a vendor may join a claim for money damages, but is precluded from claiming any amount due under the contract.
Support for this interpretation can be found in the comments issued by the Michigan Law Revision Commission in a 1970 report which recommended the adoption of the then proposed 1972 amendments. The commission comment on § 5750 is as follows:
"The first sentence is intended to state explicitly the intent of the present statute. The second sentence is intended to make clear that in land contract cases the plaintiff cannot recover the premises under this chapter and then maintain a separate claim for payments due or to become due under the contract. If the plaintiff prefers to have money damages under the contract, he should be required to elect that remedy or to foreclose in the circuit court where the defendant will receive credit for the proceeds of the foreclosure sale.” Michigan Law Revision Commission, Fifth Annual Report (1970), p 36.
Ill
We agree with the Court of Appeals that § 5750 of the Summary Proceedings Act does not evince a clear and plainly expressed legislative intention to abrogate the common-law rule. Accordingly, we hold that when a vendee defaults on a land contract, the vendor may still pursue any of the traditional remedies, including forfeiture and obtaining possession of the premises through the *78new Summary Proceedings Act. Additionally, a vendor who chooses summary proceedings may obtain incidental money damages through claims for relief listed in §5739. However, once having elected the remedy of forfeiture and having made a claim for possession through notice of forfeiture, a land contract vendor is barred from pursuing any other inconsistent remedy which would resurrect the contract and would seek damages under it.
Plaintiff vendors’ foreclosure action is barred. The Court of Appeals is affirmed. Costs to appellees.
JWilliams, J., concurred with Blair Moody, Jr.,

 The vendors’ claim that the deed had to be delivered within the 15-day period, in order for the forfeiture to be complete, is invalid. The 15-day period is a statutory notice provision enacted in 1972 to provide a vendee with a specified period of time within which the forfeiture may be avoided by payment of the amount then in arrears. MCL 600.5728; MSA 27A.5728. See Michigan Law Revision Commission, Fifth Annual Report (1970), pp 29-30.

 A judgment for possession constitutes a bar to any claim for money payments due under the contract at the time of trial because the contract is terminated by the notice of forfeiture. The vendor is not entitled to payments under the contract, unless the vendee chooses to make the payments and thereby reinstates the contract. The issuance of the writ of restitution bars a claim for money payments due under the contract subsequent to the issuance of the writ for the same reason: the contract has been terminated by the forfeiture. The vender is not entitled to have both the money under the contract and possession of the property.