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A Better Partnership
May 19, 2017

COA: Unrefined - but unambiguous - contract terms do not create a ripe judicial controversy

A plaintiff’s misunderstanding of unambiguous contractual terms, which may lack technical refinement, is not sufficient to create a controversy between contracting parties, said the court of appeals in Van Buren Charter Township v. Visteon Corporation, No. 331789.  In this case, the parties' contract clearly stated that there were two conditions that must be met before the defendant was obligated to perform. The court further stated that even though a contract may not be “particularly strong, or overly beneficial to [a] plaintiff,” courts do not have the authority to “modify unambiguous contracts or rebalance the contractual equities struck by contracting parties.”  As defendant had not yet breached its conditional performance obligation, the Court found that (1) it was proper for the trial court to decline to issue a declaratory judgment regarding the parties' rights under the contract; (2) plaintiff may not recover in contract law for possible future harm and hypothetical damages; and (3) plaintiff's claim for anticipatory repudiation of the contract cannot be sustained without sufficient evidence of defendant's unequivocal declaration of an intent not to perform.

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