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STATE OF MICHIGAN
COURT OF APPEALS


LOFGREN CONSTRUCTION, Plaintiff/CounterdefendantAppellee, v GARY E. ISON and SHERYL A. ISON, Defendants/CounterplaintiffsAppellants.

UNPUBLISHED January 27, 1998

No. 195076 Cheboygan Circuit Court LC No. 93-003652 CK

Before: MacKenzie, P.J., and Holbrook, Jr., and Saad, JJ. PER CURIAM. This is a breach of contract action. Following a bench trial, the court entered a judgment in favor of plaintiff and an order requiring defendants to pay plaintiff $37,600 in damages. Defendants appeal as of right. We affirm. The case arises out of defendants' purchase of a modular home from plaintiff pursuant to a $67,400 contract. Defendants made a $7,400 down payment on the contract. They subsequently stopped m aking payments on the contract, however, claiming that the basement plaintiff built for the home did not conform to specifications and that the modular home had been delivered with extensive water damage. Plaintiff sued for the remainder due on the contract and defendants countersued for breach of contract. Before trial, plaintiff made a $40,000 offer of judgment to defendants; defendants made a counteroffer of $37,000. No settlement was reached and the case proceeded to trial. The court found that plaintiff's work was defective, but that defendants impermissibly prevented plaintiff from curing the defects by excluding Lofgren from the job site. Accordingly, the court awarded plaintiff $39,909: the $60,000 remainder owed on the contract, less the damages reasonably incurred by defendants ($14,173) and one-half of defendants' attorney fees ($5,918). The partial award of attorney fees was included as consequential damages caused by plaintiff's breach of its implied warranty of fitness for a particular purpose under the Michigan Uniform Commercial Code, MCL 440.2714; MSA 19.2714 and MCL 440.2715; MSA 19.2715. After considering defendants' motion for a new

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trial, the court concluded that defendants were entitled to a further setoff for repairs and reduced plaintiff's award to $37,600. The court left the prior determination concerning attorney fees undisturbed. The court later denied both parties' requests for attorney fees made under the offer of judgment rule, MCR 2.405. On appeal, defendants first contend that they should have been awarded all of their attorney fees under

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