Yamaoka v. Sun Cmtys.

TIMOTHY YAMAOKA, JOE BURGETT, and TINA PHILLIPS, Plaintiffs/Counterdefendants-Appellants, v. SUN COMMUNITIES, INC., and SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP, Defendants-Appellees, and ASPEN-TOWN & COUNTRY ASSOCIATES II, LLC, Defendant/Counterplaintiff/Third-Party Plaintiff-Appellee, and APPLE-CARR VILLAGE MOBILE HOME PARK, LLC, Defendant/Counterplaintiff-Appellee, and ANA SIEKIERK and GABRIEL KOEWERS, Third-Party Defendants.

No. 355446

Court of Appeals of Michigan

December 28, 2021

UNPUBLISHED

Muskegon Circuit Court LC No. 19-000585-CZ

Before: Gadola, P.J., and Swartzle and Cameron, JJ.

PER CURIAM.

Plaintiffs filed a class-action lawsuit, claiming conversion and unjust enrichment on the basis that defendants violated the Mobile Home Commission Act, MCL 125.2301 et seq., by applying for title to plaintiffs' mobile homes. The trial court: (1) denied plaintiffs' motion for class certification; (2) granted summary disposition to defendants under MCR 2.116(C)(10) with regard to the individual claims by Joe Burgett and Tina Phillips; and (3) granted summary disposition to defendants on jurisdictional grounds under MCR 2.116(C)(4) on the only remaining claims-Timothy Yamaoka's individual claims-because the amount in controversy did not exceed $25, 000. Plaintiffs appeal as of right. As we explain in this opinion, we affirm.

I. BACKGROUND

Defendants are interrelated corporate entities that own and operate mobile-home parks in Michigan. The named plaintiffs are former mobile-home owners, who each once lived in one of defendants' mobile-home parks. Specifically, Yamaoka owned a 1970 Vindale mobile home, and he rented a mobile-home lot from Aspen-Town & Country Associates II, LLC in Traverse City, Michigan.^[1] Burgett and Phillips owned a 1974 Schult mobile home, and they rented a mobile-home lot from Apple-Carr Village Mobile Home Park, LLC in Muskegon Michigan.

In 2016, Burgett and Phillips failed to make their rental payments under the terms of their lease and, as a result Apple-Carr filed a district-court action against them for nonpayment of rent. Apple-Carr terminated the lease after Burgett and Phillips defaulted based on Paragraph 20, which states in full:

20. Default. If the Resident should default under this Lease or the Management's Rules and Regulations, or if Resident's statements in the rental application are false, Management shall have the right, among others, to terminate this Lease and to repossess the premises and cause the Resident to vacate the premises in the manner provided by law. If this should occur, Resident shall pay Management the expenses incurred in obtaining possession of the premises and all other damages sustained by Management to the extent permitted by law.

The district court entered a judgment in Apple-Carr's favor and when Burgett and Phillips failed to pay the past-due rent, an order of eviction was entered against them. Burgett and Phillips vacated their mobile-home lot at Apple-Carr; they did not remove their mobile home from the site when they left.

Relying on Paragraph 28 of the lease, Apple-Carr treated the mobile home as "abandoned" by Burgett and Phillips. The paragraph states in full:

28. Notice of Intention to Vacate or Renew. At least thirty (30) days before the end of this Lease, Resident shall notify Management in writing that (1) Resident desires to sign a new Lease or (2) Resident and/or his or her home will be vacating the premises or (3) Resident wishes to continue possession of the premises as a month to month tenant under the terms and rest established by Management and allowed by law. In the event that the resident desires to sign a new Lease or desires a month to month tenancy, the Resident's written notice shall indicate the names and relationships of each of the occupants. Notwithstanding anything herein to the contrary, Management shall not be obligated to enter into a new lease with the Resident or to agree to the continuation of possession on a month to month tenancy except as required by law. Any of the Resident's property at or about the premises at the time the Resident vacates the premises shall be deemed to be abandoned by the Resident, and Resident hereby authorizes Management to dispose of the same as abandoned property.

Apple-Carr applied for title to the mobile home, using what has been referred to as the "surety-bond method" of obtaining title. At the time, this method had been endorsed by the Secretary of State as one of three methods for obtaining title to an abandoned mobile home.^[2] Apple-Carr submitted an application for title accompanied by a surety bond and a certification statement regarding the abandonment of the mobile home. Thereafter, Apple-Carr was issued a Certificate of Manufactured Home Ownership. Apple-Carr later transferred the mobile home to a third party.

The basic facts are similar with regard to Yamaoka and Aspen-Town. In the amended complaint, Yamaoka alleges that he purchased his mobile home in April 2016 for $10, 000. In support, however, he points to a certificate of assignment that indicates that he only paid $5, 000 for the mobile home. In any event, by the fall of 2016, Yamaoka and his roommates had failed to make their rent payments, resulting in summary proceedings in district court and eventually an order of eviction. Yamaoka and the others vacated the premises. When he left, Yamaoka did not remove his mobile home, but he did attempt to sell it. Unlike Burgett and Philips's lease with Apple-Carr, Yamaoka's lease with Aspen-Town did not contain a provision regarding whether property left behind would be deemed abandoned, i.e., there was no provision materially similar to the other lease's Paragraph 28. Instead, Yamaoka's lease had the following provision:

REMOVAL OF HOME BY LANDLORD. If LANDLORD is required to remove TENANT'S manufactured home from the lease site for any reason, including but not limited to, TENANT'S abandonment of the home or LANDLORD'S right to remove the home pursuant to a Writ of Restitution, TENANT shall be responsible for any and all expenses incurred in removing the manufactured home or other property from the leased site.

Aspen-Town treated the mobile home as abandoned. Using the surety-bond method, Aspen-Town applied for, and obtained, a certificate of title for the mobile home. Aspen-Town later transferred the mobile home to a third party.

In February 2019, Yamaoka, Burgett, and Phillips filed a class-action complaint against defendants, alleging statutory conversion, common-law conversion, and unjust enrichment. Briefly stated, plaintiffs allege that, in violation of the Mobile Home Commission Act, defendants had an ongoing practice of converting former tenants' mobile homes by claiming ownership of a mobile home on grounds of abandonment after the owner left the mobile-home park without removing the mobile home from the park. Plaintiffs assert that the surety-bond method is not a permissible means of obtaining title to a mobile home.

Plaintiffs accompanied their complaint with a motion for class certification. In their brief in support of their motion for class certification, plaintiffs define the proposed class as:

All mobile home owners throughout Michigan who have rented lots in mobile home parks owned or operated by defendants . . . and whose title to their mobile homes were unlawfully converted by Defendants, and will be unlawfully converted by Defendants in the future, through mobile home title applications that contained materially false information that Defendants submitted to the Michigan Department of State, and through surety bonds that Defendants obtained from insurance companies through false pretenses.

On the basis of a search of public records involving mobile-home applications by defendants, plaintiffs estimated a class of 183 members.

The trial court denied the motion for class certification, concluding that plaintiffs failed to demonstrate commonality. Following motions by defendants, the trial court also granted summary disposition to defendants under MCR 2.116(C)(10) with regard to the claims by Burgett and Phillips, concluding that the undisputed facts established that they had abandoned their mobile home. Defendants also sought summary disposition under MCR 2.116(C)(10) with regard to Yamaoka's individual claims, but the trial court denied the motion, concluding that material questions of fact remained regarding whether he intended to abandon the mobile home. With Yamaoka's individual claims the only remaining claims, the trial court granted summary disposition to defendants under MCR 2.116(C)(4) because Yamaoka failed to establish that the amount in controversy exceeded $25, 000. Plaintiffs now appeal to this Court.

I. ANALYSIS

A. CLASS CERTIFICATION

On appeal, plaintiffs first argue that the trial court erred by concluding that plaintiffs failed to show commonality and by denying their motion for class certification. A decision whether to certify a class involves both questions of fact and discretionary determinations. Henry v. Dow Chem Co, 484 Mich. 483, 496; 772 N.W.2d 301 (2009). We review the trial court's factual findings for clear error and the trial court's discretionary decisions for an abuse of discretion. Id.

Under MCR 3.501(A)(1), one or more members of a class may sue as representative members on behalf of all members in a class action only if five prerequisites-often referred to as numerosity, commonality, typicality, adequacy, and superiority-are established. Id. at 488. The party seeking class certification bears the burden of establishing each of these prerequisites. Id. at 500. When ruling on a motion for class certification, "[a] court may base its decision on the pleadings alone only if the pleadings set forth sufficient...