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CONTRACTS 10: The bankruptcy court order did not require the trial court to do anything.

The parties entered into a contract for plaintiff to repair fire and water damage to defendant’s home. Defendant was dissatisfied with plaintiff’s work and terminated the contract. Plaintiff filed a breach of contract action to recover $13,580.08 that it believed it was owed. Four months later, defendant filed for bankruptcy and this action was stayed.

Plaintiff initiated an adversary proceeding in the bankruptcy court, and the bankruptcy court subsequently entered an order (the bankruptcy court order) against Defendant and in favor of Plaintiff.

The bankruptcy court order reflected that it was entered “upon stipulation of the parties” and provided in relevant part that judgment shall enter against Defendant in the amount of $29,000 if the Oakland County Circuit Court case settles; or $35,000 if the case has to go to trial.

The bankruptcy court also lifted the stay in this case to allow Plaintiff to proceed with prosecution of its claim.

This case then was reopened, and plaintiff filed a Motion for Entry of Judgment. The motion represented that the bankruptcy court had signed an order that settled the case and entered a judgement against Defendant in favor of Plaintiff. It further represented that defendant had signed a stipulation to the order and judgement.  And on that basis plaintiff requested that the trial court enter the $29,000 judgement against Defendant and close circuit court case. Plaintiff attached the bankruptcy court order as the sole exhibit in support of its motion.

Defendant argued in part that the bankruptcy court order was not for defendant to pay a judgment in the trial court, but merely ordered that the case pending in the trial court should proceed, and provided for a judgment to be entered in the bankruptcy court’s adversary proceeding, contingent upon the outcome of proceedings in the trial court.

The bankruptcy court is a division of the federal district court. Although state courts are bound by the decisions of the United States Supreme Court construing federal law, there is no similar obligation with respect to decisions of the lower federal courts.

The trial court therefore was not bound by the bankruptcy court order. Moreover, the bankruptcy court order did not require the trial court to do anything; it merely provided for a future judgment in the bankruptcy court as informed by later results in the trial court proceeding.

The language of the order explicitly lifted the stay in the trial court so that plaintiff could proceed with the prosecution of its claim against defendant. Read as a whole, it is clear that the parties did not agree to the entry of a judgment in the trial court, but instead agreed to the entry of a judgment in the bankruptcy court, with the amount contingent on the outcome of future proceedings in this case in the trial court.

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MICHIGAN REAL ESTATE 95: Property owners did not place a condition upon the delivery of the deed; rather, they delivered the deed to themselves.

When the delivery of a deed is contingent upon the happening of some future event, title to the subject property will not transfer to the grantee until the event has occurred. However, in this case A and J did not place a condition upon the delivery of the deed; rather, they delivered the deed to themselves, then deposited the deed with their attorney with the instruction to record the deed only upon the happening of a future event, thereby placing a condition only upon the recording of the deed.

MICHIGAN PROBATE 57: Brother granted permanent guardianship of siblings.

At a multiday hearing to address the extension of the guardianship, the eldest children, the mother’s relatives and friends, and school personnel testified regarding the mother’s care of the children, appellant’s treatment of and interaction with the children, and the eldest siblings’ role in aiding the mother to raise the children.

FAMILY LAW 88: The trial court found that the children did not have an established custodial environment with defendant because, before the separation, he did not have a large role in the children’s lives.

The trial court credited plaintiff’s testimony that, before the parties’ separation, defendant spent minimal time helping to care for the children, so its finding that the children would not have looked to defendant for guidance, discipline, the necessities of life, and parental comfort during that time was not against the great weight of the evidence.

REAL ESTATE 89: RM had not included any language in the deed providing that the property was a joint tenancy with full rights of survivorship, the property instead became a tenancy in common.

RM drafted the deed without seeking counsel and mistakenly believed that, if either she or FK died, the property would fully pass to the surviving tenant. FK’s will provided that if his wife predeceased him—which she did—the personal representative of his estate should sell any residual property that he owned and divide the cash proceeds equally among his surviving children.

FAMILY LAW 83: A trial court can terminate a parent’s rights and permit a stepparent to adopt a child.

A trial court has discretion to terminate a parent’s rights and permit a stepparent to adopt a child when the conditions of MCL 710.51(6) are met. MCL 710.51(6)(b) requires the petitioner to establish that the other parent had the ability to visit, contact, or communicate with the children, and substantially failed or neglected to do so for a period of two years.

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