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Can IV Packard Square, LLC v. Packard Square, LLC

Court of Appeals of Michigan

June 18, 2019

CAN IV PACKARD SQUARE, LLC, Plaintiff-Appellee,
v.
PACKARD SQUARE, LLC, Defendant-Appellant, and BELDEN BRICK SALES CO., C.E. GLEESON CONSTRUCTORS, INC., CITY ELECTRIC SUPPLY COMPANY, QUANDEL CONSTRUCTION SERVICES OF MICHIGAN, INC., also known as QUANDEL CONSTRUCTION GROUP, INC., JOHN DOES 1-100, and GAYLOR ELECTRIC, INC., Defendants.

          Washtenaw Circuit Court LC No. 16-000990-CB

          Before: Meter, P.J., and Jansen and M. J. Kelly, JJ.

          PER CURIAM.

         Defendant-appellant, Packard Square, LLC (Packard Square), appeals as of right a judgment of foreclosure in this action filed by plaintiff, Can IV Packard Square, LLC (Can IV), to foreclose a mortgage on a mixed-use commercial development construction project with respect to which Packard Square was the borrower and Can IV was the lender. Although Packard Square challenges the merits of the trial court's decision, we are constrained to dismiss this appeal as moot because Packard Square failed to redeem the property as provided in MCL 600.3140.

         I. PROCEDURAL HISTORY

         In October 2016, Can IV filed suit against Packard Square, alleging that Packard Square was in default of a loan agreement it had with Can IV and seeking a judicial foreclosure on a mortgage securing the loan. Shortly after Can IV filed its claim, on a motion from Can IV, the trial court appointed a receiver for the property.[1] The case proceeded with discovery, and Can IV eventually moved for summary disposition, which the trial court granted on September 20, 2018. The court entered a judgment of foreclosure authorizing the sale of the property at a sheriff's sale.

         The foreclosure sale was scheduled for November 15, 2018. On October 15, 2018, Packard Square filed a motion to stay the foreclosure sale and the enforcement of the foreclosure judgement entered against it. Packard Square asserted that there was good cause to grant a a stay because the trial court erred by granting summary disposition in Can IV's favor and entering a judgment of foreclosure. Packard Square also contended that a stay was warranted because the trial court failed to make any specific ruling on Packard Square's affirmative defenses and its counterclaims. Finally, Packard Square asserted that the failure to stay the proceedings "pending reconsideration and appeal" would result in "irreparable harm which will be caused should the project be sold at a Sheriff's Sale prior a final ruling . . . ." The trial court denied the motion on October 16, 2018.

         Thereafter, on November 1, 2018, Packard Square filed a claim of appeal in this Court, raising challenges to the trial court's decision. On November 14, 2018-one day before the property was to be sold at the sheriff's sale-Packard Square filed a motion in this Court to stay the judicial foreclosure sale. Packard Square, however, did not file a motion for immediate consideration, [2] and the motion for a stay was denied on November 30, 2018.[3]

         On December 18, 2018, Packard Square filed a motion in this Court to stay the effect of MCL 600.3140[4] during the pendency of its appeal or, alternatively, to expedite its appeal. Packard Square also filed a motion for immediate consideration. Packard Square, however, failed to cure defects with its December 18, 2018 motion, so this Court entered an order striking the motion.[5]

         On January 15, 2019, Packard Square filed a motion to expedite its appeal, arguing that if a decision by this Court was not issued before May 15, 2019, the issues it was raising on appeal would "in essence, become moot." On January 22, 2019, this Court granted Packard Square's motion to expedite its appeal.[6]

         On May 10, 2019, Packard Square filed a motion to stay transfer of the property. Packard Square noted that the statutory redemption period provided by MCL 600.3140 was set to expire on May 15, 2019, and it argued that after the redemption period expired Can IV would be free to transfer title of the property to any third party, which would result in material prejudice to Packard Square. The motion, however, was stricken by this Court because Packard Square failed to cure defects with it.[7]

         II. EXPIRATION OF REDEMPTION PERIOD

         A. STANDARD OF REVIEW

         In a supplemental brief, Can IV argues that the issues raised by Packard Square on appeal are moot because the six-month redemption period in MCL 600.3140 expired on May 15, 2019. In response, Packard Square contends that it has standing to challenge the foreclosure proceedings. "The applicability of a legal doctrine, such as mootness, is a question of law which this Court reviews de novo. TM v MZ, 501 Mich. 312, 315; 916 N.W.2d 473 (2018) (quotation marks, alterations, and citation omitted). And, because "Michigan Courts exist to decide actual cases and controversies," "[t]he question of mootness is a threshold issue that a court must address before it reaches the substantive issues of a case." In re Tchakarova, ____Mich App___, ____;___ N.W.2d___ (2019) (Docket No. 345739); slip op at 3. "[A]s a general rule, this Court will not entertain moot issues or decide moot cases." East Grand Rapids Sch Dist v Kent Co Tax Allocation Bd, 415 Mich. 381, 390; 330 N.W.2d 7 (1982). "Whether a party has standing is a question of law subject to review de ...


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