New Prods. Corp. v. Harbor Shores BHBT Land Dev., LLC

331 Mich.App. 614

953 N.W.2d 476

NEW PRODUCTS CORPORATION, Plaintiff/Counter Defendant-Appellant,

v. HARBOR SHORES BHBT LAND DEVELOPMENT, LLC, Defendant/Counter Plaintiff/Third-Party Plaintiff-Appellee,andHarbor Shores Golf Course, LLC, Defendant/Counter Plaintiff-Appellee,andWhirlpool Corporation, Cornerstone Community Asset Fund, Inc., City of Benton Harbor, Benton Charter Township, and Horizon Bank, Defendants-Appellees,andMichigan Magnet Fund E, LLC, Horizon Bancorp, and PNC Bank, Defendants,andLarry Allen Heald and Heidi Heald, Third-Party Defendants.

No. 344211

Court of Appeals of Michigan.

Submitted December 3, 2019, at Grand Rapids.

Decided December 19, 2019

Approved for publication March 17, 2020, 9:05 a.m.

Demorest Law Firm, PLLC (by Mark S. Demorest, Stephen D. Kursman, Royal Oak, Michael K. Hayes, Cadillac, and Lisa Okasinski, Royal Oak) for New Products Corporation.

Dickinson Wright PLLC (by John G. Cameron, Jr., Grand Rapids, K. Scott Hamilton, Detroit, Scott R. Knapp, Lansing, and Christina K. McDonald, Grand Rapids) for Harbor Shores BHBT Land Development LLC; Harbor Shores Golf Course LLC; Cornerstone Community Asset Fund, Inc.; and Whirlpool Corporation.

Plunkett Cooney, Bloomfield Hills (by Jeffrey C. Gerish ) for the city of Benton Harbor.

Jessica A. Fette for Benton Charter Township.

Kreis, Enderle, Hudgins & Borsos, PC, Battle Creek (by Mark E. Kreter and Stephen L. Simons ) for Horizon Bank.

Before: Meter, P.J., and O'Brien and Tukel, JJ.

Per Curiam.

In this action to quiet title, plaintiff appeals as of right the trial court's order quieting title in defendants’ favor under multiple theories. We affirm, albeit on narrower grounds than those underlying the trial court's order.

I. BACKGROUND

This action concerns a strip of land that now comprises the 18th hole of the Harbor Shores Golf Course—a Jack Nicklaus Signature championship golf course at which the Senior Professional Golf Association (PGA) Tour Championship Tournament is held biennially. The disputed parcel sits along the relocated Paw Paw River to the north. To the south, the disputed parcel is bordered by a parcel on which plaintiff, New Products Corporation, operates a large factory producing automobile and machine parts; there is no dispute that plaintiff holds title to this southernmost parcel. In its natural state, the disputed parcel consisted mostly of marshland, suitable mainly for river-adjacent recreation or as a floodplain. With the approval of the National Parks Service and other governmental entities, the wetland has now been filled to create land suitable for golfing.

Ownership of the disputed parcel can be traced back to a parent parcel owned in 1950 by Elwood and Evelyn McDorman. Since then, however, ownership of the disputed parcel has been less than clear. As described by this Court in an opinion resolving an interlocutory appeal:¹

In 1950, Elwood and Evelyn McDorman owned a 250-foot-wide parcel of land running south from Higman Park Road to the then existing channel of the Paw Paw River, which served as the boundary between the city of Benton Harbor (Benton Harbor) and Benton Charter Township (the Township). At around that time, engineers relocated the river approximately 500 feet north. To facilitate the relocation, Benton Harbor purchased a right of way over the McDormans’ land for the new channel and transferred to them a 250-foot-wide parcel located to the south of their existing parcel. After that transfer, the McDormans owned a 250-foot-wide strip of land extending from Higman Park Road in the north to Klock Road in the south. The parcel in dispute is that part of the McDormans’ land that was located in the Township before the relocation of the river, but which is now south of the relocated river.

New Products owns and operates a manufacturing facility in Benton Harbor along Klock Road. In 1955, New Products acquired the parcel that Benton Harbor transferred to the McDormans as part of the project to relocate the river along with the disputed parcel. [The parcel was first transferred from the McDormans to John Crow and Barbara Crow, who conveyed the property to New Products by quitclaim deed in 1955.] Benton Harbor taxed both parcels and New Products paid the taxes. However, the Township continued to tax the disputed parcel and listed the taxpayer of record as Frank Hoffman. [ New Prod. Corp. v. Harbor Shores BHBT Land Dev., LLC , 308 Mich. App. 638, 641-642, 866 N.W.2d 850 (2014).]

At the time, Frank Hoffman was the owner of the parcel of land situated north of the Paw Paw River, which was previously owned by the McDormans. The McDormans transferred this northernmost parcel to Glenlord Realty in 1961 via a deed that stated that land south of the relocated Paw Paw River was not included in the sale, as it was otherwise previously conveyed. Glenlord Realty subsequently transferred the northernmost parcel to Frank Hoffman, whom the township taxed both for the northernmost parcel and the disputed parcel. The township did not assess taxes against plaintiff for the disputed parcel. In 1968, plaintiff recorded its deed to the southernmost parcel and the disputed parcel. Then, in 1970,

the Township foreclosed against Hoffman's property for unpaid taxes. The state acquired the property, but transferred it back to Hoffman in 1973 [via redemption deed]. Larry and Heidi Heald acquired the property from Hoffman and his co-owners in 1991. Harbor Shores Development then purchased the disputed parcel from the Healds in 2007. As part of a large development project, Harbor Shores Development conveyed a portion of the disputed parcel to Benton Harbor and a portion to defendant Harbor Shores Golf Course, LLC[.] [ New Prod. Corp. , 308 Mich. App. at 642, 866 N.W.2d 850.]

When the Healds purchased the property in 1991, their realtor contacted plaintiff's then president, Stanley Miller, to clarify ownership of the now-disputed parcel, indicating that the Hoffmans had paid taxes on the parcel for 38 years, although, "unknown to them, it was not legally theirs." There is no indication in the record that Miller ever took any action with regard to this correspondence. In 2005, Chicago Title investigated the chain of title regarding the disputed parcel and was unable to determine who, in fact, owned the property.

Sometime in 2006 or 2007, plaintiff's now president, Cheryl Miller, became aware that Harbor Shores BHBT Land Development LLC and Harbor Shores Golf Course LLC (the Harbor Shores defendants) planned to use the disputed parcel for part of its golf course and surrounding residential improvements. In 2007, Miller² retained a land-surveying firm to survey plaintiff's property, which resulted in the firm posting "no trespassing" signs on the disputed parcel. Also in 2007, Miller contacted the Michigan Department of Environmental Quality regarding the Harbor Shores defendants’ application for a permit to fill wetlands and floodplains on the disputed parcel, indicating that defendants were not the rightful owners of the property.

Sometime in 2008, Miller saw plans for the proposed development in the Herald Palladium , which indicated that a golf-course hole would be placed on the disputed parcel. In March 2008, she contacted a trustee of Harbor Shores requesting a final version of the plans. In April 2008, Harbor Shores’ counsel sent Miller a letter arguing that plaintiff's assertion of ownership over the disputed parcel was incorrect, stating:

While I have not had an opportunity to review the vesting deed by which New Products took title to its portion of the property in question, the tax description of that property on file with Berrien County purports to run to the center of the Paw Paw River. If the New Products property in fact extended to the center of the Paw Paw River as it exists today, then New Products would own a great deal more property than it originally acquired, the Heald's [sic] would not have owned the property they sold Harbor Shores, and the conclusions set forth in New Products’ letter would be correct. But, of course, this cannot be, and there is an explanation.

The bed of the Paw Paw River was physically moved some years ago from its former location to a place considerably north of that. Moving a monument that demarks a property boundary does not, of course, actually extend the property's area. Instead, one seeking to ascertain the actual boundaries of the property must reestablish the original location of the boundary. A river, like a tree, a pile of stones, or a concrete post, is nothing more than a monument. When the river was moved north, the boundary of the New Products property did not follow it.

Instead, that boundary remained the same, and its location can be ascertained through proper surveying techniques.

Plaintiff responded to the letter through its own legal counsel, who emphasized that plaintiff's deed referenced the Paw Paw River "as relocated" and indicated that any future encroachment on the disputed parcel would be considered a trespass. In turn, Harbor Shores’ counsel sent plaintiff a final letter dated July 1, 2008, stating that if plaintiff held an interest in the disputed parcel, it was divested of any title to the property by its failure to pay property taxes. Harbor Shores’ counsel attached to the letter a copy of the 1973 redemption deed and reiterated Harbor Shores’ position that the boundary of plaintiff's property was south of the original river channel. Harbor Shores’ counsel invited further communication with plaintiff, stating, "To the extent it would be helpful, I would be pleased to discuss this matter with you by telephone or in person." Plaintiff's counsel did not respond to this last letter.

For her part, Miller attended a meeting with Harbor Shores representatives in September 2008, at which the parties discussed potential conflicts between the disputed parcel's use as a golf course and plaintiff's factory operation. Before the meeting, Miller had sent Harbor Shores’ counsel a letter...