In Huntington National Bank v. Daniel J. Aronoff Living Trust
, the Michigan Court of Appeals heard an appeal regarding whether the trial court erred in granting the plaintiff’s motion for summary disposition notwithstanding the defendant’s lender liability defense. Holding that there was no legally enforceable agreement that satisfied the statute of frauds, the Court held that the defendants’ lender liability defense did not defeat plaintiff’s claims, and affirmed the trial court’s grant of summary disposition in favor of the plaintiff.
The dispute in question arose because the defendants obtained several loans from the plaintiff and defaulted on their payments. After the plaintiff’s demand for payments failed, they sued. In response to the plaintiff’s complaint, the defendants alleged several affirmative defenses, including a “lender liability” defense premised on the plaintiff’s refusal to close a loan with the defendants in 2007. In response, the plaintiff moved for summary disposition. The defendants responded, but rather than dispute the underlying claims, the defendants argued that they should not be required to pay because the lender liability defense defeated the plaintiff’s right to recover. The court granted summary disposition in favor of the plaintiff, and the defendants moved for reconsideration, claiming that the grant of summary disposition was premature and that the trial court failed to include a provision to adjust the interest in the judgment. Though the court initially granted the motion for reconsideration in part, it eventually denied the remainder of the claims, except those regarding attorney’s fees, which were later settled by the parties. The defendants appealed.
In affirming the trial court’s grant of summary disposition, the Court of Appeals explained that in order to assert a lender liability defense, the defendants needed to prove that the loan discussions in 2007 amounted to a legally enforceable agreement and that the promise or commitment complied with the statute of frauds. Because the plaintiff refused to close the loan in 2007, the commitment was not in writing or signed by an authorized entity, as required by MCL 566.132(2). Thus, the lender liability defense was barred. Further, the Court held that even if the commitment was in writing based on a proposed checklist offered by the defendant, this checklist did not contain essential terms, and accordingly, did not satisfy the statute of frauds.
Further, in response to the defendants’ claim that the trial court’s grant of summary disposition was premature, the Court held that additional time for discovery would not have benefited the defendants because the discovery of internal documents to support its lender liability claim would not have satisfied the “promise or commitment” requirement under MCL 566.132(2). Additionally, the Court explained that even if the trial court failed to include a provision to adjust the interest in the judgment, this failure did not prejudice the defendants, and thus, there was no abuse of discretion. Finally, the Court held that the defendants’ due process claim had been abandoned because the defendants failed to properly address this issue by not fully discussing appropriate authority in its brief.