Preview:

STATE OF MICHIGAN COURT OF APPEALS

TALISHA R. REID, Plaintiff-Appellee, v JUDITH D. THOMAS, Defendant-Appellant, and TAMARA NANCE and JERLENE M. THOMPSON, Defendants.

UNPUBLISHED February 12, 2009

No. 280920 Oakland Circuit Court LC No. 2006-074992-CZ

Before: Saad, C.J., and Davis and Servitto, JJ. PER CURIAM. Defendant1 appeals by right from the bench trial judgment in favor of plaintiff in this real property action. We affirm. I. Background This case involves a title dispute over a single-family residence in Pontiac, Michigan. In April 2003, plaintiff moved into the residence with her daughter. Instead of entering into a traditional lease, she signed a purchase option agreement with the owner of the property, Jerlene Thompson. Under the terms of the Option to Purchase, plaintiff agreed to pay Thompson $675 each month. Once plaintiff paid $30,000, Thompson promised to transfer the deed to plaintiff. The parties agreed that Thompson would apply 100 percent of plaintiff's payments toward the

1

Of the three named defendants, only Judith D. Thomas appealed the bench trial judgment. Therefore, this Court refers to Thomas individually as defendant.

-1-

purchase price. Plaintiff never recorded her interest in the house, but she made uninterrupted payments to Thompson until March 15, 2006. Although Thompson testified that she never sold the property, defendant claimed that she purchased the house from defendant for $30,000 on January 5, 2004. Defendant did not request a receipt for her purchase. She claimed to have purchased the house with cash and intended for the deed to be in the name of her niece, Tamara Nance, to help her build credit. Also on January 5, 2004, Thompson executed the first of three quitclaim deeds on the property, altering her sole interest in the property to a joint interest between Thompson and Nance. Thompson explained that she did so because of her health problems and with the expectation that Nance would sign over the deed to plaintiff if Thompson died before plaintiff paid in full. Nance admitted that she did not witness defendant purchase the house, but asserted that defendant placed Nance's name on the deed to help her credit. On April 16, 2004, a second quitclaim deed, conveying sole interest in the property to Nance, was executed. Thompson testified that she knew nothing about this second deed and that someone forged her signature. In contrast, Nance testified that Thompson had knowledge of the second quitclaim deed because both Nance and defendant witnessed Thompson sign it. On March 13, 2006, defendant visited the house, claimed to have title to the home and demanded that plaintiff cease paying rent to Thompson and begin paying rent to her. Both Thompson and Nance told plaintiff that defendant lied about having title and to continue making payments to Thompson, as was her usual practice. On March 17, 2006, a third quitclaim deed granting full title to defendant was recorded. Defendant returned to the home on the same date with a deed purporting to transfer the property to her. Plaintiff contacted Thompson, who arrived at plaintiff's house and asked to examine the deed. Defendant refused to let Thompson examine it and left the house. Soon thereafter, defendant filed an eviction action against plaintiff for nonpayment of rent. The 50th District Court enforced the third quitclaim deed and granted defendant's request to evict plaintiff. Because of those proceedings, plaintiff filed the present complaint, seeking an injunction to halt eviction proceedings against her and for the trial court to determine the rights that the various parties had in the property. After a bench trial, the trial court ruled in favor of plaintiff. Of the interested parties, the trial court considered only plaintiff's testimony to be 100 percent credible. The trial court also found that both Nance and defendant had actual notice of plaintiff's interest in the property. Thus, as a matter of law, neither Nance nor defendant qualified as a bona fide purchaser. On appeal, defendant raises three arguments. First, she argues that the trial court improperly determined that Nance was not a bona fide purchaser, as the evidence indicated that Thompson intended to transfer ownership to Nance, regardless of plaintiff's tenancy. Second, defendant similarly argues that the trial court erred when it found that defendant herself had actual notice of plaintiff's interest and that she too, was not a bona fide purchaser. Third, defendant contends that plaintiff's option to purchase the property was insufficient to trigger the notice provisions on which the trial court relied.

-2-

II. Nance as Bona Fide Purchaser We review a trial court's decision in an equitable action to quiet title de novo. Deutsche Bank Trust Co Americas v Spot Realty, Inc, 269 Mich App 607, 612; 714 NW2d 409 (2005); Webb v Smith (After Remand), 204 Mich App 564, 568; 516 NW2d 124 (1994). We review findings of fact supporting the decision for clear error. Id. "Clear error exists when some evidence supports a finding, but a review of the entire record leaves the reviewing court with the definite and firm conviction that a mistake has been made." Sinicropi v Mazurek, 279 Mich App 455, 462; ___ NW2d ___ (2008). Defendant, citing MCL 565.29,2 argues that title vested in Nance because she was a good-faith purchaser without notice of plaintiff's interest. Under MCL 565.29, the holder of a real estate interest who first records generally has priority over subsequent purchasers. Richards v Tibaldi, 272 Mich App 522, 539; 726 NW2d 770 (2006). Michigan is a race-notice state, and owners of interests in land can protect their interests by properly recording those interests. Id. A bona fide purchaser is a party who acquires a property interest for consideration and without notice of a third party's claimed interest in the property. Id.; 1 Cameron, Michigan Real Property Law (3d ed),

Download TALISHA R REID V JUDITH D THOMAS.pdf

Michigan Law