Hetrick v. Rahilly

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DONALD E. HETRICK, Plaintiff-Appellant, v. PETER D. RAHILLY, JR., and LORI RAHILLY, Defendants-Appellees.

No. 360148

Court of Appeals of Michigan

July 27, 2023

UNPUBLISHED

Luce Circuit Court LC No. 2020-006507-CH

Before: RIORDAN, P.J., and MARKEY and YATES, JJ.

PER CURIAM.

Plaintiff Donald Hetrick, brought claims of quiet title, acquiescence unjust enrichment, and promissory estoppel against defendants, Peter Rahilly, Jr., and Lori Rahilly. Following a one-day bench trial, the trial court issued an opinion and order finding no-cause of action with respect to plaintiff's claims. On appeal, plaintiff challenges the court's ruling only in regard to the quiettitle and unjust-enrichment claims. For the reasons set forth in this opinion, we affirm.

I. FACTUAL BACKGROUND

This case arises out of a real-property dispute between defendants and plaintiff, who is the uncle of defendant Lori Rahilly. Many facts in this case are not in dispute. Plaintiff and defendants entered into an oral agreement in 1999 regarding a parcel of land owned by defendants. The parties agreed that plaintiff could build a home on a small portion of defendants' 40-acre parcel and live in the home after it was constructed for the remainder of his life. Plaintiff obtained a building permit, constructed the house at his own expense, maintained insurance on the home, and continuously lived in the house following its construction. Defendants paid the property taxes on the entire parcel without fail since it was purchased in 1993. Defendants' 40-acre parcel was split into a 37-acre parcel and a 3-acre parcel, on which plaintiff's home is situated, in approximately 2017. Despite the split, defendants were listed as the legal owners of the properties, and defendants paid and continue to pay property taxes for both parcels.

The litigation concerned the anticipated disposition of plaintiff's house, and the 3-acre parcel on which it sits, upon plaintiff's death. Plaintiff testified that he understood the terms of the oral agreement to be that defendants gifted him the real property and that he could dispose of the property in any fashion he desired, including devising the property to his children upon his death. Defendants testified that they understood the terms of the oral agreement to be that plaintiff was to construct the home and live in it for the rest of his life but that defendants remained the legal owners of the land and the home and would take possession when plaintiff died. Plaintiff filed a complaint against defendants in February 2020, alleging counts sounding in quiet title, acquiescence, unjust enrichment, and promissory estoppel.

After a one-day bench trial in December 2021, the trial court issued a written opinion and order detailing its findings of fact and conclusions of law. The trial court found that plaintiff had not provided any written documentation indicating that defendants had gifted him the property or intended to do so, or that he had a superior interest to that of defendants. The trial court further found that defendants had established that they alone had title because they provided a copy of the warranty deed that clearly identified them as the legal owners of the property and a copy of tax documents demonstrating that they had paid the taxes on the property since they purchased it in 1993. The trial court also noted that there was testimony by several witnesses who indicated that plaintiff knew that he did not have title to the property, that he did not want the property to go to his children upon his death, and that he and defendants agreed that the house would go to defendants upon his passing. The trial court ruled that the evidence and testimony supported defendants' understanding of the terms of the oral agreement. The trial court concluded that while defendants will be enriched at the time of plaintiff's death, the future benefit would not be unjust because plaintiff was obligated to give his home to defendants pursuant to the terms of the agreement. The trial court found that plaintiff failed to prove all of his claims by a preponderance of the evidence. This appeal followed.

II. ANALYSIS

Plaintiff argues on appeal that the trial court erred by dismissing his claim to quiet title and his claim of unjust enrichment because he had adequately proven both claims by a preponderance of the evidence at trial. We disagree.

A. STANDARD OF REVIEW

In general, we review a trial court's factual findings in a bench trial for clear error, and its conclusions of law are reviewed de novo. MCR 2.613(C); Alan Custom Homes, Inc v Krol, 256 Mich.App. 505, 512; 667 N.W.2d 379 (2003). Actions to quiet title and claims of unjust enrichment are equitable in nature, and this Court reviews equitable decisions de novo, but the trial court's underlying factual findings are reviewed pursuant to the clearly-erroneous standard. Karaus v Bank of NY Mellon, 300 Mich.App. 9, 22; 831 N.W.2d 897 (2012); Gorte v Dep't of Transp, 202 Mich.App. 161, 171; 507 N.W.2d 797 (1993). "A finding is clearly erroneous where, after reviewing the entire record, this Court is left with a definite and firm conviction that a mistake has been made." Alan Custom Homes, 256 Mich.App. at 512. We give due regard to the trial court's superior ability to judge the credibility of witnesses who appeared before it. MCR 2.613(C); In re Clark Estate, 237 Mich.App. 387, 395-396; 603 N.W.2d 290 (1999).

B. QUIET TITLE

In Michigan, quiet-title actions are governed by MCL 600.2932, which provides, in relevant part:

(1) Any person, whether he is in possession of the land in question or not, who claims any right in, title to, equitable title to, interest in, or right to possession of land, may bring an action in the circuit courts against any other person who claims or might claim any interest inconsistent with the interest claimed by the plaintiff, whether the defendant is in possession of the land or not.

MCR 3.411 governs the procedure in civil actions to determine interests in land, and it provides that "[a]fter evidence has been taken, the court shall make findings determining the disputed rights in and title to the premises." MCR 3.411(D)(1).

In a quiet-title action, the plaintiff bears "the initial burden of establishing a prima facie case of title[.]" Special Prop VI LLC v Woodruff, 273 Mich.App. 586, 590; 730 N.W.2d 753 (2007). A plaintiff establishes a prima facie case of title by presenting sufficient evidence demonstrating that he or she acquired and currently possesses a legal or equitable interest in the property. Beulah Hoagland Appleton Qualified Personal Residence Trust v Emmet Co Rd Comm, 236 Mich.App. 546, 550; 600 N.W.2d 698 (1999). If a plaintiff establishes a prima facie case of title, "the defendant then has the burden of proving superior right or title in itself." Fed Home Loan Mtg Corp v Werme, 335 Mich.App. 461, 470; 966 N.W.2d 729 (2021).

A review of the record reveals that plaintiff failed to present sufficient evidence that he held title to the property, let alone title that was superior to defendants' interest. There was no dispute that defendants permitted plaintiff to construct a home on their 40-acre parcel, that plaintiff did, in fact, construct a home on defendants' land, and that plaintiff had been living in the home since its construction. Plaintiff, however, provided no documentation showing that defendants had actually sold, gifted, deeded, or otherwise conveyed the property to him or intended to do so. Indeed, there are no documents reflecting that plaintiff owned the property. Several witnesses testified that plaintiff knew that he did not have title to the property, and plaintiff testified that he never received a deed from defendants. Defendants introduced a copy of the warranty deed to the 40-acre parcel, which showed that they held legal title to the property, including the portion that plaintiff lived on. Although a three-acre parcel-on which plaintiff lived-was split from the 40-acre parcel, defendants paid the property taxes on all of the property since they purchased it in 1993. Plaintiff conceded that he never paid property taxes. The county assessor testified that defendants were still listed as the legal owners of the three-acre parcel and that while plaintiff alleged that he owned the parcel, he never submitted any documents to prove ownership.

Furthermore with respect to the oral communications, plaintiff testified that defendants promised to give him title to the property after he constructed his home. But plaintiff's son testified that plaintiff never mentioned "anything about an agreement or ownership" until only a few years before the trial. And several members of the extended family testified that plaintiff told them that he was going to build and live in a house on defendants' property and that the house would go to defendants after he passed away because t...