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Business Law Update: In Commercial Leases Courts Will Enforce the Plain Meaning

December 18, 2015 1 comment

Happy Friday all!

 

I read an unpublished court of appeals decision from November 17, 2015 – Mandre Properties LLC v Darren R. Marsh DDS No 322633

The opinion was brief and to the point. It is an easy read

Facts (straight forward):

The parties entered into a commercial lease.

Tenant vacated the premises before the lease expired.

As a result, Tenant breached the lease.

Landlord claimed it was owed $41,661.55

The trial court ordered tenant to pay $6,768.00.

Why the trial court reduced the amount, is unclear from the opinion.

Landlord appealed.

The Court of Appeals reversed the trial court – “you got the amount owed wrong”

COURTS WILL ENFORCE A LEASE THIS IS CLEAR IN ITS MEANING

The Court of Appeals held that the language in the commercial lease was plain and unambiguous – therefore the circuit court should have enforced the lease to its terms.

As the Court of appeals held: “The circuit court was required to enforce the unambiguous contract as written.” citing In re Smith Trust, 480 Mich 18, 24 (2008).

Lesson:

In commercial leases if the language that the parties agreed to is clear the court’s job is to enforce the lease.

As a landlord or tenant to commercial leases, you have a particularly vested interest in making sure that:

  1. The language in your lease is clear;
  2. That you understand what it is you binding your business to.

If a Court is doing its job, it will simply enforce whatever you agreed to.

 

 

 

 

 

 

 

 

Categories: Uncategorized

U.S. Supreme Court’s Latest Ruling – Businesses and Arbitration Clauses

December 14, 2015 Leave a comment

As the USA Today article put it:

“Score one for business over consumers at the Supreme Court this term”

“The justices ruled 6-3 Monday that California customers cannot band together against satellite TV provider DIRECTV because a federal law favoring dispute resolution by individual arbitration trumps a state law that once protected such class actions.”

Also see Yahoo.com –  U.S. top court rules for DirecTV in arbitration case

The Court’s ruling is consistent with Michigan law.

Michigan law favors upholding arbitration clauses in contracts.

Under Michigan law, arbitration clauses are to be liberally construed with any doubts to be resolved in favor of arbitration. Amtower v William C. Roney & Co., 232 Mich App 226,233 (1998).

A few years back I wrote a post about the benefits of arbitration clauses in contracts. You can check out the full article here. a few highlights:

Benefits

Arbitration clauses have the benefit that they are usually most cost-effective, quick, and they are private (as opposed to court cases which are public filings).

Considerations

Some of the high points to consider:

1. Where is the Other Party located?

For a client who engages in business over state lines, an arbitration clause might not be effective if you are trying to quickly collect a debt that is owed to you.  Instead, you  might want a “Jurisdiction and Venue Selection Clause

This clause would include language indicating that no matter where the dispute occurred, the contract will be interpreted under Michigan law, and the parties agree that any dispute shall only be resolved in _______ County (Typically,  Kent County, Michigan, for my clients.) Therefore, if your contract contains a jurisdiction and forum selection clause, and you are owed money by a company in Florida, you would not need to retain a Florida attorney to try and collect.

2. Is the Arbitration Agreement between the company and consumers? If so, companies need to be aware of consumer protection rights, and AAA rules regarding dispute resolutions with consumers.

The AAA has ruled that any company that wants to incorporate their services in its arbitration contract must follow their policies:

“The American Arbitration Association’s policy on consumer arbitration is guided by the state of existing law, as well as its obligation to act in an impartial manner. The Association supports the principles of the Consumer Due Process ProtocolAll cases involving a consumer where the claim is under $10,000 will be administered under the Consumer Rules and the fee schedule for those rules, without regard to the rules or fees that may be incorporated in the arbitration clause.” See, Consumer Due Process Protocol: http://ftc.gov/os/comments/debtcollectroundtable1/542930-00017.pdf

3. Arbitration can be a gamble.

Businesses should realize that if you elect to arbitrate a matter and you do not like what the arbitrator finds – your rights to appeal may be severely limited.

Questions? Comments?

e-mail: Jeshua@dwlawpc.com

www.dwlawpc.com

Non-Profit Leaders: Creating Entrepreneurial Organizations and Engaging Millennials

December 7, 2015 Leave a comment

Last week MIBiz handed out its Best-Managed Nonprofits Awards

As part of the award ceremony some of the non-profit executives shared their insights “into creating entrepreneurial organizations. Check that MIBiz article outhere.

One observation by Michael Merren, executive director of The Pantry in Grand Rapids:

“I find that (millennials) are very interested in working in the community and are very community-minded,” Merren said. “It’s important that you give them opportunities where they can apply their talent how they want instead of how you think they should.” 

I’m sure non-profit leaders in West Michigan would agree with Michael’s observation.

This really is a good follow up to my last post. It is a call to Non-profits to find better ways to engage Millennials in serving.

Non-profits in West Michigan need to continue to find better ways to engage Millennials in meaningful ways.

Millennials: You just need to show up*. Let non-profits in your community know you are there and how you want to serve.

 

*I was encouraged after writing this blog post this morning to hear this point  emphasized at the Grand Rapids Economic Club‘s luncheon today through guest presenter – Neil Pasricha author of “1000 Awesome Things

To paraphrase – don’t wait until you feel “motivated”, or “competent”-

Just do it. 

 

E-mail: Jeshua@dwlawpc.com

http://www.dwlawpc.com

 

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