Jackson v. Green Estate

Michigan Supreme Court
Lansing, Michigan
Chief Justice: Justices:

Opinion Marilyn Kelly Michael F. Cavanagh
Elizabeth A. Weaver
Maura D. Corrigan
Robert P. Young, Jr.
Stephen J. Markman
Diane M. Hathaway

FILED JULY 30, 2009

JOAN B. JACKSON,

Plaintiff-Appellee,

v No. 136423

ESTATE OF RONALD GREEN,

Defendant-Appellant.

BEFORE THE ENTIRE BENCH

CORRIGAN, J.

We granted leave to appeal to consider whether an action to partition real

estate may go forward when the joint tenant who filed the action died before an

order of partition entered. 1 We would hold that title vested in the surviving joint

tenant on the decedent’s death because the mere filing of a partition action does

not sever a joint tenancy and no order granting partition was entered before the

death. We would thus affirm the trial court’s denial of defendant’s motion for

1
We also granted leave to appeal to consider whether the statute of
limitations bars plaintiff’s claim for breach of contract. That issue is addressed in
separate opinions by Justices Cavanagh, Young, and Markman.
summary disposition and the judgment of the Court of Appeals on the partition

issue.

I. FACTS AND PROCEEDINGS

At issue in this case are two parcels of real estate held by plaintiff and

defendant as joint tenants and a series of oral loans from plaintiff to defendant.2 In

May 1991, defendant negotiated the purchase of a parcel of land on behalf of

plaintiff, and the deed conveyed the land to both parties as joint tenants. In

September 1991, plaintiff purchased a second parcel of property, which was

conveyed to plaintiff and defendant as joint tenants with full rights of

survivorship.

In 2004, plaintiff filed a breach of contract action, alleging that defendant

had failed to repay the loans. Plaintiff also sought to force defendant to relinquish

his right to the two parcels of land. The trial court granted summary disposition

for defendant regarding the deeds for the properties, holding that the deeds were

properly executed and gave defendant valid property interests. Regarding the

loans, the court did not accept defendant’s argument that the statute of limitations

barred plaintiff’s claim. A jury found that each check plaintiff issued to defendant

was a loan, and the court entered judgment on the verdict in plaintiff’s favor.

2
The defendant’s estate was substituted as a party when the original
defendant died, but for ease of reference we will refer to both the original
defendant and his estate as “defendant.”

2
 Defendant then filed a separate action for partition of the parcels. At

plaintiff’s request, the partition action was stayed pending the appeal in this case.

Defendant unexpectedly died while the appeal was pending in the Court of

Appeals. His estate was substituted as the plaintiff in the partition action and as

the defendant in this case.

The Court of Appeals affirmed the trial court’s ruling that defendant

possessed a valid property interest in the two parcels, but held that because no

order severing the joint tenancy had issued in the partition action before defendant

died, defendant’s interests in the parcels reverted to plaintiff upon defendant’s

death. The Court of Appeals further held that the statute of limitations did not bar

plaintiff’s breach of contract action for repayment of the loans because the claim

did not accrue until plaintiff demanded repayment by filing her complaint in

2004.3

We granted defendant’s application for leave to appeal.4

II. STANDARD OF REVIEW

Whether a partition action may go forward if a joint tenant dies before the

joint tenancy is severed is a question of law that we review de novo. Cardinal

3
Jackson v Green Estate, unpublished opinion per curiam of the Court of
Appeals, issued April 1, 2008 (Docket No. 269244).
4
482 Mich 981 (2008).

3
Mooney High School v Michigan High School Athletic Ass’n, 437 Mich 75, 80;

467 NW2d 21 (1991).

III. PARTITION

We agree with the Court of Appeals that defendant’s interest in the parcel
5
of land automatically reverted to plaintiff when defendant died. Thus,

defendant’s estate has no interest in the property, and even if defendant’s partition

action survived his death under Michigan’s survival statute, MCL 600.2921,

nothing remains to partition.

“The principal characteristic of the joint tenancy is the right of

survivorship. Upon the death of one joint tenant, the surviving tenant or tenants

take the whole estate.” Albro v Allen, 434 Mich 271, 274-275; 454 NW2d 85

(1990). An ordinary joint tenancy6 may be severed, and the right of survivorship

thereby destroyed, by an act of the parties, conveyance by either party, or levy and

sale on an execution against one of the parties. Id. at 275.

5
Only the parcel conveyed in the May 1991 deed is currently at issue.
Defendant does not dispute plaintiff’s right of survivorship in the property
conveyed in the September 1991 deed.
6
In addition to an ordinary joint tenancy, Michigan recognizes a distinct
category of joint tenancy known as a “joint tenancy with full rights of
survivorship,” which consists of a joint life estate with dual contingent remainders.
Albro, supra at 275; see also 1 Cameron, Michigan Real Property Law (3d ed), §
9.11, p 322. “While the survivorship feature of the ordinary joint tenancy may be
defeated by the act of a cotenant, the dual contingent remainders of the ‘joint
tenancy with full rights of survivorship’ are indestructible.” Albro, supra at 275-
276. The parcel at issue here, the one conveyed in the May 1991 deed, was held
under an ordinary joint tenancy.

4
 A party can sever a joint tenancy by compelling a partition. Smith v Smith,

290 Mich 143, 155; 287 NW 411 (1939), quoting Midgley v Walker, 101 Mich

583, 584; 60 NW 296 (1894). Until an order of partition has been entered,

however, a partition has not been compelled and, thus, the joint tenancy has not

been severed. See anno: What acts by one or more of joint tenants will sever or

terminate the tenancy, 64 ALR2d 918, 956 (explaining that “[i]t is not the filing of

the partition action which terminates the joint tenancy, but only the judgment in

such action which has that effect”) (quotation marks and citation omitted).

Indeed, the universal rule in the United States is that a pending suit for

partition does not survive the death of one of the joint tenants. See Heintz v

Hudkins, 824 SW2d 139, 142-143 (Mo App, 1992), and cases cited therein. “This

rule is based on two related concepts: First, the theory of survivorship—that at the

moment of death, ownership vests exclusively in the surviving joint tenant or

tenants—and second, the doctrine that severance of the joint tenancy does not

occur until the partition suit reaches final judgment.” Id., citing Cobb v Gilmer,

US App DC 398, 400; 365 F2d 931 (1966).

Accordingly, we would hold that the filing of the partition action did not

sever the joint tenancy because an order effectuating a partition had not entered at

the time of defendant’s death. Therefore, regardless whether defendant’s partition

action survived his death under the survival statute, his interest in the parcel of

land did not.

5
 IV. CONCLUSION

We would hold that defendant’s filing of the partition action did not sever

the joint tenancy because no order granting partition was entered before

defendant’s death. Thus, title vested in plaintiff when defendant died, and nothing

remains to partition. The Court of Appeals correctly analyzed the partition issue,

and we would therefore affirm its judgment on that issue.

Maura D. Corrigan
Robert P. Young, Jr.
Stephen J. Markman

6
 STATE OF MICHIGAN

SUPREME COURT

JOAN B. JACKSON,

Plaintiff-Appellee,

v No. 136423

ESTATE OF RONALD GREEN,

Defendant-Appellant.

YOUNG, J.

I agree with the analysis set forth in Justice Corrigan’s opinion, which

affirms the Court of Appeals on the partition issue. I would further hold that the

statute of limitations does not bar plaintiff’s claim for breach of contract on the

series of oral agreements for loans. Because the loans were made with no fixed

time of repayment, they were payable on demand. The period of limitations

would not begin to run on such a claim until either a demand was made, expressly

or by filing a complaint, or a reasonable amount of time had elapsed without a

demand. In this case, no demand was made until the action was filed.

The issue of when a period of limitations begins to run on an oral

agreement for a loan that has no fixed date of payment is a question of law that we

review de novo. Collins v Comerica Bank, 468 Mich 628, 631; 664 NW2d 713

(2003).
 The applicable limitations period for plaintiff’s breach of contract claim is

six years. MCL 600.5807(8). The central issue here is when the limitations

period began to run. “Except as otherwise expressly provided, the period of

limitations runs from the time the claim accrues.” MCL 600.5827. Moreover, a

claim generally accrues when the wrong is done. Boyle v Gen Motors Corp, 468

Mich 226, 231; 661 NW2d 557 (2003).

The general rule governing the commencement of the running
of the statute of limitations is that the statutory period is computed
from the time when the right of action that the plaintiff seeks to
enforce first accrued; ordinarily, in an action based on a contract,
accrual occurs as soon as there is a breach of contract, with some
courts qualifying this by stating that accrual occurs when the
promisee discovers or should have discovered the breach, and others
stating that accrual occurs upon breach, whether or not the promisee
is then aware of the breach. [31 Williston, Contracts (4th ed), §
79:14, pp 303-307 (emphasis added).]

In determining when the period of limitations begins to run on a loan that has no

repayment term, we must therefore necessarily determine when a breach of

contract occurs.

The oral loan agreements in this case did not set a time for repayment.

There is no controlling caselaw that establishes when a borrower is in breach of an

oral loan agreement that is silent concerning when repayment must occur. Thus,

this Court should articulate a rule of law to determine when a breach occurs under

the circumstances in this case.

We do have some established bedrock principles to guide us in formulating

such a rule. A loan made with no fixed time of repayment is payable on demand.

2
Colburn v First Baptist Church & Society of Monroe, 60 Mich 198, 200; 26 NW

878 (1886). As a general matter, because no terms of repayment were specified in

the contracts, the oral loan agreements could not have been breached until

payment was demanded and the demand was rebuffed.

Nevertheless, the absence of a specific time for repayment does not allow a

creditor to withhold this demand for an indefinite period of time. In the absence of

an agreement to the contrary, we presume that the parties intended plaintiff’s

demand for repayment to occur within a reasonable amount of time. See Duke v

Miller, 355 Mich 540, 542-543; 94 NW2d 819 (1959) (“[W]hen a contract is silent

as to time of performance or payment, absent any expression of a contrary intent,

the law will presume a reasonable time.”); Pierson v Davidson, 252 Mich 319,

324; 233 NW 329 (1930) (“It is a general rule of law that where no time is

stipulated, a reasonable time will be presumed. Reasonable time depends upon the

facts and circumstances of each case.”). 1 Determining what constitutes a

reasonable amount of time to request repayment of a loan is necessarily a factual

question properly decided by the jury.

1
Although Justice Cavanagh criticizes my citation of Pierson, this
proposition is a well-established tenet of Michigan’s contract law. Indeed, Smith v
Smith Estate, 91 Mich 7; 51 NW 694 (1892), which Justice Cavanagh applies to
the instant case, established the very principle he criticizes in this opinion. Smith
explained that a demand for payment “should, upon principle and the best
authority, have been made within a reasonable time . . . .” Id. at 11.

3
 Ultimately, a breach is the sine qua non of any contract dispute regarding

repayment. Justices Markman and Cavanagh provide alternative theories of when

a breach occurs if the parties failed to supply a repayment term. Justice Markman

determines that a breach occurs immediately on payment of the loan principal.

Justice Cavanagh determines that a breach occurs exactly six years after payment

of the loan principal. Neither theory comports with the practice of parties,

especially in a case like this, which involved a series of loans made over a period

of eight years.

Justice Markman would extend the rule articulated in Palmer v Palmer, 36

Mich 487 (1877). In Palmer, this Court held that “a note payable on demand is

payable at once and without demand, so that the statute runs from its delivery.”

Id. at 491. The central rationale of the Palmer rule was to prevent a creditor from

keeping a debt alive by declining to make a demand until evidence grew stale,

thereby defeating the statute of limitations. “If a creditor has the means at all

times of making his cause of action perfect, it would be unjust and oppressive to

hold that he could postpone indefinitely the time for enforcing his claim by failing

to present it.” Id. at 494.2

2
See also Citizens’ Savings Bank v Vaughan, 115 Mich 156, 159; 73 NW
143 (1897) (“[T]he universal rule is that [a demand] note is due at once, and that
no demand is necessary before bringing suit.”); Taylor v Rugenstein, 245 Mich
152, 154; 222 NW 107 (1928) (“The general rule is that suit may be brought on a
demand note immediately after delivery, and therefore the statute of limitations
begins to run from the day of delivery.”).

4
 Palmer and its progeny thus recognized an implied demand for repayment

of written demand notes. This Court has not applied the Palmer holding to oral

loan agreements. I can discern no reason to extend what is essentially a legal

fiction—that a breach occurs immediately upon the making of a loan even though

no actual demand was made—to oral loan agreements.

I believe that the principle of law articulated in Palmer, which presumes a

demand for repayment—and therefore a breach—immediately upon payment of

the loan principal, is illogical and entirely inconsistent with contracting parties’

intent. I suspect that no one making or receiving a loan believes that the recipient

is automatically in breach of the loan as soon as the principal is paid. However,

this is the “logic” of the Palmer rule. For this reason, I would not extend Palmer

beyond its facts.

Justice Cavanagh would extend the mechanical rule established in Smith v

Smith Estate, 91 Mich 7; 51 NW 694 (1892), to bar recovery on any loan made

more than 12 years before the plaintiff filed her complaint. Smith concluded that,

when no express demand for payment has been made, “a demand should be

presumed at the expiration of the time when an ordinary money claim would be

barred by the statute [of limitations],” id. at 11, that is, six years. A breach would

then automatically occur after six years, and the creditor would then have an

additional six years to bring a cause of action for payment. In this respect, Smith

suffers from the same wooden approach as Palmer in determining when a breach

of a contract occurs if the parties have not supplied a term for repayment. Why,

5
given all the variables in a contractual relationship, is six years ineluctably a

“reasonable” time in which to make a demand? In this very case, the lender

continued to make a series of new loans—a fact that would seem to undermine

either the Palmer “breach on payment of the loan” or the Smith “six years equals a

breach” theory.

Smith is distinguishable from the instant case because it involved not a

monetary loan, but a sale of logs. “[W]e have no doubt that the transaction was a

sale . . . .” Id. Although the Smith Court would have applied this rule to loans, see

id. at 12, that discussion was dictum. I would not extend this strict rule to the

context of a loan, as the rule fails to take into account the particular circumstances

of a given loan. Instead, I would leave the question whether a plaintiff waited an

unreasonable amount of time before demanding repayment to the wisdom of a

jury.

Plaintiff here did not demand repayment until filing this action. In the

absence of a demand for repayment, defendant could not have breached the loan

agreements until a reasonable time in which to have made a demand had elapsed.3

3
Under the rule established in Brion v Kennedy, 47 Mich 499; 11 NW 288
(1882), if no demand for repayment is made before the filing of the complaint, the
filing of the complaint is considered to be the demand. The central inquiry in this
type of case is whether the plaintiff’s demand for repayment occurred within a
reasonable period following the loan or whether that reasonable period elapsed—
and therefore the period of limitations began to run—before the express demand
for repayment.

6
Any breach of contract claim would need to have been filed within six years of

that time because the limitations period would not have begun to run until that

time. I agree with the Court of Appeals that “it was not error for the [circuit] court

to determine that the nature of the disbursements, and consequently whether

plaintiff’s claims regarding the alleged loans were barred by the applicable statute

of limitations, was a question of fact that was properly decided by a jury.”

In conclusion, I would hold that the statute of limitations did not bar

plaintiff’s breach of contract claim because plaintiff did not make a demand for

repayment until she filed this lawsuit and no breach of contract could have

occurred unless and until a demand was made and refused or a reasonable amount

of time had elapsed without a demand. I agree with the Court of Appeals that the

finder of fact properly decided this case.

Robert P. Young, Jr.
Maura D. Corrigan

7
 STATE OF MICHIGAN

SUPREME COURT

JOAN B. JACKSON,

Plaintiff-Appellee,

v No. 136423

ESTATE OF RONALD GREEN,

Defendant-Appellant.

MARKMAN, J.

I agree with Justice Corrigan’s opinion, which would affirm the Court of

Appeals on the partition issue. I agree that title vested in the surviving joint tenant

on the decedent’s death because the mere filing of a partition action does not sever

a joint tenancy when no order granting partition was entered before the death.

However, I would reverse the judgment of the Court of Appeals on the statute of

limitations issue. I disagree that the statute of limitations does not bar recovery on

any of the loans. Instead, I would hold that the statute of limitations bars recovery

on all but the last loan made because it is the only one to fall within the six-year

limitations period. MCL 600.5807(8).

Plaintiff filed this action, claiming that she gave defendant’s decedent a

series of checks as loans totaling more than $50,000, for which the parties did not

have written contracts. Rather, defendant’s decedent allegedly asked to borrow

money at various times over a period of years. Defendant moved for summary
disposition, arguing that the statute of limitations barred the claim, and the trial

court denied the motion. A jury found that all the checks were loans, all but one

of which had not been repaid. The Court of Appeals upheld the denial of

summary disposition on the statute of limitations issue, Jackson v Green Estate,

unpublished opinion per curiam, issued April 1, 2008 (Docket No. 269244),1 and

this Court granted leave to appeal, 482 Mich 981 (2008).

I would hold that the period of limitations expired for all but the last loan.

The Court of Appeals correctly observed that if no time is set for the repayment of

borrowed money, the loan is impliedly payable on demand. See Colburn v First

Baptist Church & Society of Monroe, 60 Mich 198; 26 NW 878 (1886).2 But

1
Decedent died while the appeal was pending. His estate was substituted
as the defendant.
2
Justice Young’s “reasonable time” approach is inconsistent with Colburn,
60 Mich at 200, because Colburn held that a loan made with no fixed time for
repayment is payable on demand. That is, such a loan is “impliedly payable on
demand,” id., not after some “reasonable time.” Moreover, his reliance on Pierson
v Davidson, 252 Mich 319, 324; 233 NW 329 (1930), for the proposition that
“where no time is stipulated, a reasonable time will be presumed,” is misplaced
because this language was clearly dictum, since Pierson immediately thereafter
held, “However, it does not even become necessary for us to determine what was
the reasonable time, for the parties themselves stipulated that the title should be
cleared by February 1, 1929 . . . .” I believe his reliance on Duke v Miller, 355
Mich 540; 94 NW2d 819 (1959), is also misplaced because, unlike the instant
case, Duke did not involve when a period of limitations begins to run; instead, it
only addressed whether a memorandum that does not specify the time for payment
is sufficient under the statute of frauds as evidence of an agreement to sell land.
Incidentally, I am also perplexed by Justice Cavanagh’s position because, although
he criticizes Justice Young at length for adopting the “reasonable time” approach,
post at 12-14, he then appears to adopt it himself, post at 20.

2
when does the period of limitations begin to run on a loan that is payable on

demand? Does it begin running when the loan is made, when payment is

demanded, or at some other time? This Court answered that question in Palmer v

Palmer, 36 Mich 487, 491 (1877):

It is now well settled that a note payable on demand is
payable at once and without demand, so that the statute runs from its
delivery. And this rule has been applied where from the form of the
contract it is manifest that immediate payment was not expected.

Palmer proceeded to explain the rationale for this rule:

For if the debt did not become payable until fixed by demand,
and the demand was optional with the creditor, no tender could be
made which would bind him, and he could keep the debt alive in
spite of the debtor, for an indefinite period. If there was any
infirmity in the consideration, or any defect in the binding character
of the obligation, he might retain it until all testimony was lost, and
defeat the defense. This is the mischief which the statutes of
limitation were intended to remedy . . . .

***

We cannot but think this to be sound doctrine; whatever may
have been the ancient prejudice against statutes of limitation they are
now regarded as just and entitled to be fairly construed. If a creditor
has the means at all times of making his cause of action perfect, it
would be unjust and oppressive to hold that he could postpone
indefinitely the time for enforcing his claim by failing to present it.
He is really and in fact able at any time to bring an action, when he
can by his own act fix the time of payment. It is no stretch of
language to hold that a cause of action accrues for the purpose of
setting the statute in motion as soon as the creditor by his own act,
and in spite of the debtor, can make the demand payable. It may be
otherwise, possibly, where delay is contemplated by the express
terms of the contract, and where a speedy demand would manifestly
violate its intent.[3] But where no delay is contemplated the rule is
3
In Smith v Smith Estate, 91 Mich 7, 9; 51 NW 694 (1892), the decision on
which Justice Cavanagh primarily relies to conclude that the period of limitations

3
did not begin to run until six years after the loans were made, delay was
contemplated by the express terms of the contract, i.e., “when Armstrong came to
him to request a loan of the logs to Eugene, Abram said to him, in substance, that
he might have them, as he had more than he needed at that time, but they must be
returned to him when he demanded them”; “it was contemplated between the
parties that logs of like kind and quality should be returned as soon as Eugene’s
logs . . . came down the stream and into the St. Clair river.” By contrast, the
express terms of the instant contracts no more contemplated delay than did the
express terms of the contract in Palmer. Given that Justice Cavanagh concedes
that the only “express term” of the instant contracts is that “defendant asked to
borrow money from plaintiff,” post at 15, I am not quite sure why he disagrees
with my conclusion that the express terms of the contracts did not contemplate
delay any more than the Palmer contract. He appears to suggest that the fact that
“there were no ‘express terms’ of the contracts that contemplated immediate
payment,” post at 20, is the equivalent of meaning that the express terms
contemplated delay. However, the express terms in these contracts simply did not
address whether delay was or was not contemplated, because, as Justice Cavanagh
earlier explained, the only express term of the contracts was that defendant
“borrow[ed]” money from plaintiff. Post at 15. In addition, it is noteworthy that,
although Justice Cavanagh criticizes Justice Young for relegating to a jury the
determination whether claims are barred by the statute of limitations, post at 12-
14, he nevertheless relies on the jury’s alleged conclusion that the parties did
“contemplate delay in repayment,” post at 15 n 11, to conclude that the period of
limitations did not begin to run immediately. Would Justice Cavanagh leave the
statute of limitations issue up to the jury or not? Contrary to Justice Cavanagh’s
contention, post at 15 n 11, the mere fact that the jury concluded that “repayment
is now owed” does not necessarily mean that the jury either concluded that
repayment was not owed as soon as the money was borrowed or that the parties
did “contemplate delay in repayment.” Further, Smith limited its holding to cases
in which “a demand is necessary,” 91 Mich at 12, and, as discussed earlier, a
demand was not necessary in this case. Palmer, 36 Mich at 491 (stating that “a
note payable on demand is payable at once and without demand”) (emphasis
added). For these reasons, I believe that Palmer, rather than Smith, is controlling
in this case.

Moreover, extending Smith to the instant circumstances would anomalously
provide those parties who never make a timely demand with a longer period in
which to bring an action than those parties who do make a timely demand. Justice
Cavanagh claims that we “simply disagree on when accrual should occur.” Post at
17. Although this is correct, the accrual date makes all the difference. Under
Justice Cavanagh’s position, if a demand is made immediately after the loan is

4
 just and reasonable; and the presentment should be reasonably
prompt, or the creditor should be subjected to the operation of the
statute. [Id. at 491, 494.]

Palmer was followed in later cases. See, e.g., Beardsley v Webber, 104 Mich 88,

89; 62 NW 173 (1895) (“No demand is necessary on a demand note . . . .”);

Citizens’ Savings Bank v Vaughan, 115 Mich 156, 159; 73 NW 143 (1897)

(“[T]he universal rule is that [a demand] note is due at once, and that no demand is

necessary before bringing suit.”); Peninsular Savings Bank v Hosie, 112 Mich

351, 355; 70 NW 890 (1897) (“‘If the instrument be payable on demand, the

statute begins to run immediately.’”) (citation omitted); Taylor v Rugenstein, 245

made, the claim will accrue immediately and the period of limitations will expire
in 6 years from the date of the loan; however, if no demand is ever made, the
claim will not accrue until 6 years have passed, and the period of limitations will
not expire until 12 years after the loan was made. How can this be characterized
as anything but an anomalous result? Justice Cavanagh asserts that he is
“perplexed” about why I believe this to be an anomalous result. Post at 17 n 13. I
believe this to be so because, under Justice Cavanagh’s approach, the plaintiff has
complete control over when his action accrues, and thus when the period of
limitations begins to run. What concerns me is not the fact alone that the plaintiff
would get more time; rather, it is that the plaintiff would get to choose exactly how
much time he would have to bring an action. If the plaintiff wanted to file his
action immediately, he could do so; if, on the other hand, he wanted to wait 10 or
11 or 12 years, he could do that as well. Contrary to Justice Cavanagh’s
contention, post at 17 n 13, Colburn provides the plaintiff with such unfettered
authority only if one ignores Palmer, which held that because no demand is
necessary, the period of limitations begins to run immediately. Thus, my
“consternation” is not caused by Colburn, but by Justice Cavanagh’s disregard of
Palmer. Post at 18 n 13. Finally, contrary to Justice Cavanagh’s contention, my
“insistence . . . that accrual must occur at the loan’s inception” is not “contrary to
the general rule,” post at 17; rather, it is, in fact, in accord with the general rule
both in Michigan, see Palmer, and in a vast majority of other jurisdictions, see n 5
of this opinion.

5
Mich 152, 154; 222 NW 107 (1928) (“The general rule is that suit may be brought

on a demand note immediately after delivery, and therefore the statute of

limitations begins to run from the day of delivery.”).

In light of these authorities, the Court of Appeals erred, in my judgment,

when it stated that “the statute of limitations would not begin to run on such a

claim until a demand for repayment was made . . . .” Jackson, unpublished

opinion at 5.4 Palmer and its progeny established that the period of limitations

begins to run from the day that a demand note is delivered, unless a contrary

intention is apparent. While those cases addressed written demand notes, there is

no apparent reason why Palmer should not equally apply to an oral contract.5 In

4
Likewise, Justice Young errs by reaching the same conclusion because
Palmer specifically rejected this. In Palmer, this Court explained:

The [lower] court found that the suit was not barred. This
conclusion was based on the theory that until demand [was] made no
action accrued; and that as the time limited by the statute runs from
the time when action accrues, it did not begin to run until thirty days
after [the demand was made].” [Palmer, 36 Mich at 490.]

Palmer, however, rejected this analysis, reversed the lower court’s judgment, and
held that the period of limitations began running immediately upon delivery. In
addition, Justice Young’s conclusion that there is no breach, and thus that the
action does not accrue until a demand has been made is inconsistent with the
undisputed fact that, once money is borrowed, an action seeking repayment can be
brought at any time. Because an action cannot be brought until it has accrued, it
necessarily follows that once money is borrowed, the action accrues immediately
and, thus, the period of limitations begins to run immediately. For this reason, I
disagree with Justice Young that the Palmer rule is “illogical” and “inconsistent
with contracting parties’ intent.” Ante at 5.
5
Indeed, the majority of other jurisdictions have held that the period of
limitations begins to run from the date the borrowed money is given to the

6
fact, the policies underlying statutes of limitations are implicated even more

strongly in the latter circumstances because it is more difficult to produce evidence

to defend against a stale claim of an oral agreement.6

borrower under an unwritten or verbal agreement to repay. See anno: When
statute of limitations begins to run against action based on unwritten promise to
pay money where there is no condition or definite time for repayment, 14 ALR4th
1385, 1388 (“Reasoning that oral loans without any due date or provision for
repayment occupy the same legal status as obligations due on demand, the court
said that the statute of limitations period begins to run against suits based on
demand obligations, and consequently against suits based on loans without
repayment provisions, from the time the obligations or loan agreements are
entered into by the parties.”), citing Gentry v Gentry, 59 NM 395; 285 P2d 503
(1955). Justice Cavanagh would reach another anomalous result in which,
although the period of limitations would start running under Palmer immediately
with regard to written contracts, the period of limitations would not start running
with regard to oral contracts until either a demand was made or six years had
elapsed. That is, according to Justice Cavanagh, the period of limitations should
be longer for oral contracts than for written contracts, despite the fact that it is
often considerably more difficult to establish the terms of an oral contract, as
demonstrated by this very case.
6
Unlike Justice Young, I would not leave it to a jury to determine when a
“reasonable” time to make a demand has elapsed. I cannot think of a procedure
more likely to undermine one of the principal purposes of a statute of limitations,
namely, to establish at least some modicum of certainty with respect to the period
within which a lawsuit can be brought in response to allegedly wrongful conduct.
Not only is Justice Young’s rule inconsistent with Palmer, 36 Mich at 491, and
Colburn, 60 Mich at 200, as discussed earlier, I do not believe that he has
demonstrated why stare decisis should not be followed with regard to these
decisions, which have adequately served this state for well over a century. See
Robinson v Detroit, 462 Mich 439, 466; 613 NW2d 307 (2000) (observing that
before reversing a precedent, “the Court must ask [inter alia] whether the previous
decision has become so embedded, so accepted, so fundamental, to everyone’s
expectations that to change it would produce . . . practical real-world
dislocations”). In particular, with regard to this Court’s development of the
common law, at least some compelling argument must be offered in support of
altering the law, and I have heard no such argument raised here by either party.

7
 Thus, I would reverse the Court of Appeals on this issue and hold that all

the alleged loans other than the last one fall outside the period of limitations. That

is, because plaintiff waited more than six years to demand payment on all the

loans but one, all her claims but one are barred by the statute of limitations.

Stephen J. Markman

8
 STATE OF MICHIGAN

SUPREME COURT

JOAN B. JACKSON,

Plaintiff-Appellee,

v No. 136423

ESTATE OF RONALD GREEN,

Defendant-Appellant.

CAVANAGH, J.

I disagree with the separate opinions of Justices Corrigan, Young, and

Markman. On the partition issue, I would allow the merits of defendant’s partition

action to be heard because it comes within the purview of the survival statute. See

MCL 600.2921. Regarding the statute of limitations issue, I find Smith v Smith

Estate, 91 Mich 7; 51 NW 694 (1892), to be controlling, and I would apply its rule

here to hold that all the claims were timely made except those that related to the

first two loans. Accordingly, I would reverse the judgment of the Court of

Appeals on both issues.

I. PARTITION

In Michigan, there are two forms of joint tenancies. Albro v Allen, 434

Mich 271, 274; 454 NW2d 85 (1990). The first is the standard form in which,

upon the death of a joint tenant, the entire estate transfers to the surviving joint

tenant or tenants. Id. at 274-275. In the standard joint tenancy, one joint tenant
can unilaterally destroy the right of survivorship by severing the joint tenancy. Id.

One way to sever the joint tenancy is a partition action. Smith v Smith, 290 Mich

143, 155; 287 NW 411 (1939), quoting Midgley v Walker, 101 Mich 583, 584; 60

NW 296 (1894).

The second form of joint tenancy is one that has “express words of

survivorship in the granting instrument in addition to those creating a joint

tenancy, such as . . . ‘with full rights of survivorship.’” Albro, 434 Mich at 275

(citation omitted). In contrast to the standard joint tenancy, it is well settled in

Michigan that the survivorship quality of this type of joint tenancy cannot be

unilaterally severed by the act of one cotenant. Id. at 275-276. Thus, the

survivorship right of this type of joint tenancy is indestructible and is not affected

by a partition action.

The deeds in this case created both forms of joint tenancies. The

September 1991 deed created the second, indestructible variety; thus, the

defendant’s partition action had no effect on the joint tenancy’s survivorship

quality, and the land automatically transferred to plaintiff upon defendant’s death.

The May 1991 deed, however, created a standard joint tenancy, which therefore

could be affected by a partition action. Thus, the issue in this case is what effect

defendant’s death had on his pending partition action regarding the property

covered by the May 1991 deed.

This Court’s pronouncements regarding the absolute right of a cotenant to

partition, coupled with the plain language of Michigan’s survival statute, MCL

2
600.2921, demand that defendant’s death not abate his partition action. Partition

actions are governed by two sections of the Revised Judicature Act: MCL

600.3304 and MCL 600.3308. MCL 600.3304 states that “[a]ll persons holding

lands as joint tenants . . . may have those lands partitioned.” In addition, MCL

600.3308 states that “[a]ny person who has an estate in possession in the lands of

which partition is sought may maintain a claim for partition of those lands . . . .”

This Court has made strong statements about facially valid partition actions and

the right of a joint tenant to compel partition in a standard joint tenancy: “The

right of a cotenant to partition is absolute, not a mere matter of grace, within the

discretion of the court, regardless of the motives of the parties entitled to

partition.” Henkel v Henkel, 282 Mich 473, 482; 276 NW 522 (1937) (quotation

marks and citations omitted; emphasis added). Moreover, partition is mandatory

“unless there is some paramount or controlling equity which warrants the court in

refusing to act . . . .” Id.

When interpreting a statute, the primary goal is to give effect to the intent

of the Legislature. Frankenmuth Mut Ins Co v Marlette Homes, Inc, 456 Mich

511, 515; 573 NW2d 611 (1998). When the language of the “statute is clear and

unambiguous, judicial construction is precluded.” Id. (quotation marks and

citation omitted).

Michigan’s survival statute provides:

All actions and claims survive death. Actions on claims for
injuries which result in death shall not be prosecuted after the death
of the injured person except pursuant to the next section. If an

3
 action is pending at the time of death the claims may be amended to
bring it under the next section. A failure to so amend will amount to
a waiver of the claim for additional damages resulting from death.
[MCL 600.2921 (emphasis added).]

The plain language of the statute is clear and unambiguous and therefore in need

of no interpretation—all actions survive a claimant’s death.

Not only is this interpretation consistent with the plain language of the

statute, it is also consistent with the legislative history of the statute. This Court

examined the lengthy history of the survival statute in Hardy v Maxheimer, 429

Mich 422; 416 NW2d 299 (1987). “‘Early in its history, Michigan adopted a

rather liberal “survival act” to preserve causes of action which, under common

law, were terminated by the death either of the person injured or the tortfeasor.’”

Id. at 436, quoting Hawkins v Regional Med Laboratories, PC, 415 Mich 420,

428-429; 329 NW2d 729 (1982). The statute was later amended to “expand[] the

number of causes of action which survived a claimant’s death,” but “in [the

Revised Judicature Act], the Legislature abandoned its restrictive ‘laundry list’

approach to the survival act” and amended it to its present form. Hardy, 429 Mich

at 437. This Court then emphasized that the bill analysis accompanying the act

clearly showed the Legislature’s intent. Id. The relevant portions quoted were as

follows:

“This section drastically changes the present law . . . . At
common law, personal rights of action died with the person. This
seemed manifestly unfair in certain cases, so Survival Acts were
written to allow certain actions to survive. There is no good reason
for allowing some actions to survive, and not others, apart from
cultural inertia. . . .

4
 ***

“This section is a logical advance in the legislation in this
area. That it has not been made earlier may be due to the
unfortunate approach of the statutes in listing those actions which do
survive, and thus overlooking those which the statute failed to cover.
This section has the added advantage of simplicity in application.”
[Id. at 437-438.]

While the survival statute is commonly applied to tort actions, the history

of and comments on the statute clearly illustrate the Legislature’s intent to make

all claims immune from attacks based on a claimant’s death. The statute clearly

abrogates the harsh common-law rule that pending actions die with the death of a

party. 1 In fact, after reviewing the history of and comments on the statute in

Hardy, this Court described the language of the statute as “sweeping and

unambiguous” and declared that the statute is “universally applicable to all actions

and claims which arise under the Revised Judicature Act.” Id. at 438. A partition

action is one of the actions included in the Revised Judicature Act. Given the

survival statute’s unqualified language and this Court’s prior examination of the

statute, I would hold that because defendant was alive when he filed his action for

partition, the action survives and should be heard on its merits. To hold otherwise

would frustrate the clear intent of the Legislature and would be inconsistent with

1
In Michigan, the common law governs unless it has been abrogated by
statute. Albro, 434 Mich at 286 n 6, citing Myers v Genesee Co Auditor, 375 Mich
1; 133 NW2d 190 (1965), and Bugbee v Fowle, 277 Mich 485, 492; 269 NW 570
(1936).

5
this Court’s prior declarations regarding the applicability of the survival statute to

actions arising under the Revised Judicature Act.2

Moreover, partition actions are equitable in nature. MCL 600.3301. Thus,

this Court has broader authority to inject fairness and render a fair judgment.

Brown v Fletcher’s Estate, 146 Mich 401, 417-420; 109 NW 686 (1906)

(acknowledging a softening of the common-law rule of abatement for a deceased

party’s claim when the claim is based in equity). In this case, notions of equity

strongly support allowing the merits of defendant’s partition action to be heard.

After defendant filed an action for partition, his case sat idle for more than a year

while plaintiff appealed the trial court’s earlier ruling regarding the validity of the

deeds. Eventually, the Court of Appeals summarily and correctly affirmed the

validity of the deeds. Nonetheless, the Court of Appeals, without citing any

supporting authority, held that because defendant had died before an order of

partition was entered, his claim was moot. Given the validity of the May 1991

deed and defendant’s absolute right to partition, I would allow defendant’s action

to continue. But for plaintiff’s lengthy, unmeritorious, and collateral appeal and

defendant’s untimely death, the merits of defendant’s claim would certainly have

2
Justice Corrigan’s opinion cites a section from the American Law Reports
Annotated 2d to support its position that a judgment granting partition must be
entered before a joint tenant’s death in order to sever the joint tenancy. Ante at 5.
The quotation used by her opinion, however, cites California law and therefore
ignores the effect that Michigan’s survival statute has on actions that arise under
the Revised Judicature Act, such as the partition action here.

6
been heard. To hold otherwise would not only ignore notions of equity and this

Court’s pronouncements that the right to partition is absolute, but would also

frustrate our Legislature’s intent to make claims that arise under the Revised

Judicature Act immune from attacks based on a claimant’s subsequent death. See

Hardy, 429 Mich at 436-438.3

II. STATUTE OF LIMITATIONS

“[T]he period of limitations runs from the time the claim accrues,” which

occurs “at the time the wrong upon which the claim is based was done . . . .”

MCL 600.5827.4 In contract claims, the time of the wrong is the moment that the

contract is breached. AFSCME v Highland Park Bd of Ed, 457 Mich 74, 90; 577

NW2d 79 (1998) (opinion by Cavanagh, J.). This case involves oral loans with no

terms expressing a time for repayment. Repayment of this type of loan is due

upon a demand. Colburn v First Baptist Church & Society of Monroe, 60 Mich

198, 200; 26 NW 878 (1886). Hence, a claim for nonpayment of such a loan

3
Justice Corrigan’s opinion ignores both the language of and this Court’s
pronouncements regarding Michigan’s survival statute. It merely points to a
“universal rule” that was pronounced by a Missouri court to explain why
defendant’s interest in the land did not survive his death. Ante at 5. I query why
her opinion cites a Missouri case for its “universal rule,” yet fails to cite a single
case from this Court. Certainly, the Missouri court was not considering the effect
of Michigan’s survival statute when analyzing the partition claim before it. It
belies logic and the intent of our Legislature to interpret the survival statute as
allowing a deceased claimant’s claim to survive under Michigan’s survival statute,
yet terminate the action on the basis of the claimant’s death.
4
The period of limitations for a contract claim is six years from the accrual
date. MCL 600.5807(8).

7
accrues when a demand for repayment is made. However, this Court has held that

accrual cannot be left to the whim of the lender because, if it were, the lender

could wait in near perpetuity until demanding payment, which would contravene

the venerable aims of statutes of limitations. Indeed, in Smith Estate, 91 Mich at

11, this Court held that if a demand is necessary for accrual of the claim, it should

be made within a reasonable time, and if the demand is not made within a

reasonable time, then accrual occurs and the period of limitations begins to run at

the end of the period that would have been a reasonable time in which to make the

demand.

In Smith Estate, the plaintiff sued to enforce a claim for the value of logs

that were loaned to the defendant after the defendant failed to either return the logs

or pay the plaintiff their value. Id. at 8-11. The Court, after reviewing testimony

regarding the terms of the oral contract, held that the transaction was a sale and the

claim was barred by the statute of limitations because the plaintiff failed to bring

suit within six years after a reasonable time to demand payment had passed. Id. at

11-12.5 The Court held that if a plaintiff failed to make a demand for repayment

within a reasonable time, we should presume that a demand was made at the

5
The facts of the contractual relationship in Smith Estate are very similar to
those in the instant contractual relationship. In both cases, the parties orally
agreed that one party would loan personal property to the other party. In both
cases, the party loaning the property kept a ledger or list of the separate loans
made throughout a period of years. In both cases, neither party expressly
contemplated when the loans would be due for repayment.

8
expiration of the reasonable time to begin the running of the period of limitations.

The Court defined a reasonable time as equivalent to the six-year period of

limitations for an ordinary money claim, thus giving a party six years to make a

demand and six years to bring suit after having made the demand. Id. The Court

adopted this rule from Keithler v Foster, 22 Ohio St 27 (1871). Smith Estate, 91

Mich at 12.6 Moreover, the Court reasoned that its rule was driven by the purpose

of the statute of limitations: “The object of the statute of limitations is a beneficial

one; and it is a salutary protection against fraudulent and stale claims, which

without it might purposely be postponed for enforcement until the lapse of time

had destroyed the proofs of their falsity.” Id. at 11.

In essence, Smith Estate gives a plaintiff 12 years to bring a contract action

on an oral loan that specified no time for repayment. The plaintiff has a

reasonable time in which to make a demand, which Smith Estate held is six years

as a matter of law. If no demand is made within six years, then the court will

“presume” that a demand was made for the purposes of the statute of limitations.7

6
See Keithler, 22 Ohio St at 32 (stating that “where no demand is shown to
have been made within the statutory period for bringing the action, . . . for the
purpose of setting the statute in operation, a demand will be presumed at the
expiration of that period, from which time the statute will begin to run”).
7
Intuitively, if an actual demand occurred before the presumed demand,
accrual would occur at the time of the actual demand.

9
Then, under the statute of limitations, the plaintiff has six years from the date of

this presumed demand to bring a claim.8

In this case, consistently with the rule of Smith Estate, I would hold that the

July 1991 and September 1992 oral loans between plaintiff and defendant are

barred by the statute of limitations. Because plaintiff failed to make a demand for

repayment within a reasonable time, I would presume that a demand was made at

the expiration of the reasonable time and thus measure the period of limitations

from the date of the presumed demand. There were 11 oral loans, which were

made between July 1991 and February 1999. Plaintiff made no demand for

payment until she filed her complaint covering all these loans in November 2004.

Thus, for any loan made more than 12 years earlier, i.e., before November 1992,

plaintiff’s claim would be untimely.9 Plaintiff’s claims included two such loans,

8
Smith Estate held that

[t]his rule gives the party six years in which to make his demand,
and six years in which to commence his suit after demand, in all
cases where a demand is necessary before suit. See Keithler v.
Foster, 22 Ohio St. 27 [1871]; Massie v. Byrd, 87 Ala. 672 (6 South.
Rep. 145) [1889]; Thrall v. Mead’s Estate, 40 Vt. 540 [1868];
Codman v. Rogers, 10 Pick. 119 [27 Mass 112 (1830)]; Mitchell v.
McLemore, 9 Tex. 151 [1852]; Eborn v. Zimpelman, 47 [Tex] 503
[1877]; Morrison’s Adm’r v. Mullin, 34 [Pa] 12 [1859]; Ball v.
[Keokuk & N W R] Co., 62 Iowa, 751 (16 N. W. Rep. 592) [1883];
Lower v. Miller, 66 [Iowa] 408 (23 N. W. Rep. 897) [1885]; Ang.
Lim. § 96; Bus.Lim. § 159. [Smith Estate, 91 Mich at 11-12.]
9
This is because the latest reasonable time for plaintiff to make a demand
on an oral loan made in November 1992 would be six years later—November
1998. And each of the claims on the pre-November 1992 loans would be time-

10
which originated in July 1991 and September 1992. Thus, her claims on those

loans were barred by the statute of limitations in July 2003 and September 2004.

In contrast, the claims relating to the remaining nine loans, which were made

between March 1994 and February 1999, were timely under the November 2004

complaint.10

barred because plaintiff filed her complaint covering all the loans in November
2004.
10
Justice Young contends that Smith Estate is distinguishable and, as a
result, I am incorrectly extending that case by applying it here. Smith Estate dealt
with the claim that the trial court wrongly precluded a certain witness’s testimony.
Smith Estate, 91 Mich at 8-9. That testimony would have been used to support the
plaintiff’s claim that the contract was a loan, rather than a sale. Id. at 9. It is true
that Smith Estate concluded that the contract at issue was one for a sale, rather
than a loan. But the Court went on to clearly explain that, if the testimony had
been wrongly rejected, and if the contract was a loan, the error would have been
harmless because the plaintiff’s claim would have been untimely under the
presumed-demand rule. Id. at 11-13. In fact, the unanimous Smith Estate Court
expressly adopted the rule from the Ohio decision Keithler v Foster for the exact
issue that is presented in the instant case. Id. at 12. The Keithler court clearly
noted that

the statute [of limitations] begins to run, in cases like this, from the
time of demand, [and] it would be but reasonable to hold, in the
absence of other special circumstances, where no demand is shown
to have been made within the statutory period for bringing the
action, that, for the purpose of setting the statute in operation, a
demand will be presumed at the expiration of that period, from
which time the statute will begin to run. [Keithler, 22 Ohio St at 31-
32.]

Thus, Smith Estate held that if the testimony had been admitted, and the
contract had been seen as an oral loan with no specified time for repayment, this
rule would apply. Thus, I find Smith Estate to be directly on point and persuasive.
Further, to the extent that this portion of Smith Estate was dictum, I would adopt it
as the controlling rule on this issue, which is exactly what our colleagues in Smith
Estate unanimously said that they would do.

11
 As noted, I agree with Justice Young’s statement that “the absence of a

specific time for repayment does not allow a creditor to withhold this demand for

an indefinite period of time.” Ante at 3. However, I do not agree with the

construct that Justice Young develops to address this concern. He institutes a rule

that allows the jury to decide when a presumed demand should occur, which is set

at what the jury determines to be a reasonable time. Justice Young bases this

construct on the idea “that the parties intended plaintiff’s demand for repayment to

occur within a reasonable amount of time.” Ante at 3. I decline to accept this

construct for several reasons.

First, there is little precedential support for this construct. Justice Young

relies on Pierson v Davidson, 252 Mich 319; 233 NW 329 (1930), to support his

construct. But Pierson is both factually and legally distinguishable from the

present case. Factually, Pierson involved a written oil and gas lease agreement.

Id. at 320-321. Thus, unlike the present case, Pierson did not deal with an oral

loan. And legally, Pierson dealt with the contractual requirement that the lessor

clear a cloud on the title to the real property or the lease would “‘be voided and

extinguished, and shall become null and void . . . .’” Id. at 321. Pierson did not

deal with the question of when payment on an oral promise to repay, which hinges

on a demand, was due. In contrast, Smith Estate dealt with this Court’s unanimous

statement that, in the case of an oral loan with no time set for repayment, a

demand is to be presumed six years from the loan’s inception and accrual occurs at

that time. In light of Justice Young’s refusal to rely on Smith Estate (a case that is

12
factually and legally exactly on point), I question his reliance on Pierson because

that case seems much less applicable here than Smith Estate. It is unclear why

Justice Young finds Smith Estate too dissimilar for application here, while

concomitantly finding the much more distinguishable Pierson case to be

controlling.

Second, I believe that Justice Young’s construct overly diminishes the

statute of limitations. Justice Young puts no restriction on how long a reasonable

amount of time may extend. Instead, he would allow a reasonable amount of time

to go on indefinitely. I think that this eviscerates the statute of limitations and

undermines its purposes in this context, as Smith Estate clearly discussed. See

Smith Estate, 91 Mich at 11-12. In contrast to Justice Young’s construct, the

Smith Estate construct presents a better balance between the rationales supporting

the statute of limitations and the legal precepts pertaining to oral contracts. The

Smith Estate construct gives definite answers. Under no circumstances may a

plaintiff carry out his claim more than 12 years past the time of the oral loan that

has no time set for repayment. As noted, this Court lauded the stability and

predictability of this construct in Smith Estate because it reduces fraud and the

litigation of stale issues. See Smith Estate, 91 Mich at 11. Justice Young’s

construct does not protect against these problems. The Smith Estate construct also

honors the concepts that an oral loan is not due until a demand is made and a claim

does not accrue until a demand (presumed or actual) occurs. In contrast, under

Justice Young’s construct, a plaintiff need only convince a jury that it was

13
reasonable to delay the demand for payment for any number of years in order to

bring claims on loans that originated, conceivably, decades in the past.

Both Justice Young’s construct and the Smith Estate construct presume a

demand at some point after the oral loan was made. I find the Smith Estate

construct’s method of determining when that presumption occurs to be more

closely tied to the purposes of the limitations period, while honoring basic contract

tenets. Further, Smith Estate provides the most applicable standard for the facts

and issues in the present case; therefore, I would apply it in place of Justice

Young’s construct. Under the Smith Estate construct, I would hold that only the

claims on the first two loans (those arising before 1992) were time-barred.

I note that Justice Markman questions my reliance on Smith Estate. He

argues that the contract in Smith Estate contemplated a delay in repayment,

whereas the “express terms of the instant contracts” did not contemplate any such

delay. Ante at 3 n 3. I respectfully disagree. I question whether Justice Markman

can opine on the “express terms” of the instant contract with any specificity, given

that the parties litigated the very existence of any oral contract. Indeed, the trial

court discussed this case’s facts as follows when reviewing a motion for summary

disposition:

The loans—or the distribution of money . . . is a close
question, but there is some testimony that [Green] made a request to
borrow, which I think impliedly includes a promise to repay, and
while [Jackson] said [in her deposition] there was no specific
agreement or promise to repay . . . , which certainly hurts her case,
she did say that there was a request to borrow and, therefore, that’s
what caused the advance of monies.

14
 So I think that there is a factual question as to whether these
advances were gifts, whether they were, in fact, loans, as [Jackson]
now claims, or whether they were, in fact, compensation as [Green]
claims at least part of the advances were for.

Thus, while the jury eventually decided that there were enforceable oral contracts,

I do not believe that the facts of this case support Justice Markman’s assertion that

the contracts’ express terms did not contemplate a delay in repayment. 11 The

record only supports the fact that defendant asked to borrow money from plaintiff

and that plaintiff responded by writing numerous checks. Moreover, the parties’

actions actually indicated that they did contemplate a delay in repayment because

plaintiff continually made numerous loans to defendant over a term of years. It

strains reason to conclude, as Justice Markman does, that the parties expected

11
In fact, the jury’s own words belie Justice Markman’s contention that the
parties did not contemplate delay in repayment. The jury stated that the oral loans
were due at the time plaintiff’s claim was filed, which was years after the loans
were consummated. The jury answered a special interrogatory form regarding
each loan as follows: “[Plaintiff] established . . . that there was an enforceable
contract between [plaintiff] and [defendant], that this check was a loan expected to
be repaid and [that] repayment is now owed to [plaintiff].” The jury did not
conclude that payment was owed upon delivery. Justice Markman disagrees
because he thinks that “the mere fact that the jury concluded that ‘repayment is
now owed’ does not necessarily mean that the jury either concluded that
repayment was not owed as soon as the money was borrowed or that the parties
did ‘contemplate delay in repayment.’” Ante at 4 n 3. I disagree. The jury was
tasked to decide whether the claims were timely. The jury decided that all of
plaintiff’s claims were timely and that payment was “now” due. “Now” could
only mean at the time the jury made its decision because, if “now” also applied to
when the loans were created, many of the claims would have been untimely
because they came into existence more than six years before the claims were filed.
Thus, the jury’s conclusions do not support Justice Markman’s supposition that the
parties did not contemplate delay in payment.

15
payment immediately yet, despite never receiving any such immediate payment,

plaintiff continued to make additional loans over several years.12

Justice Markman also argues that Smith Estate limited its holding to cases

in which a demand is necessary. Assuming that he is correct, I do not see how this

precludes the application of Smith Estate in this case. As Justice Markman notes,

if “no time is set for the repayment of borrowed money, the loan is impliedly

payable on demand.” Ante at 2, citing Colburn. It is uncontested that this case

involves loans that set no time for repayment of the borrowed money. Hence, I

think Smith Estate applies.

12
I do not point to these possible interpretations of the instant agreements’
terms to definitively say what the parties intended regarding delay in payment.
Justice Markman mistakes my point if that is what he sees as motivating my
reference to them. Instead, I simply note that these facts undercut Justice
Markman’s assertion that “the express terms of the instant contracts no more
contemplated delay than did the express terms of the contract in Palmer [v Palmer,
36 Mich 487 (1877)].” Ante at 4 n 3. This is important because Justice
Markman’s position depends on equating Palmer’s demand note with the instant
oral contracts. Thus, I merely note that Justice Markman’s link of the two
disparate types of agreements is not supported by their facts. Justice Markman
also asks whether I would leave the statute of limitations issue to the jury. Ante at
4 n 3. He seems to think that my references to this case’s facts and the jury’s
conclusion undercut my adoption of the Smith Estate construct. I think that this
opinion plainly notes that I conclude that, under Smith Estate, the statute of
limitations issue for an oral loan having no specified time for repayment is a
question of law for the court. That conclusion is not undermined by my pointing
out that Justice Markman’s position of applying Palmer by analogy, which relies
on the facts, is not supported by the facts of this case. Moreover, the “express
terms” debate that Justice Markman and I are engaged in shows how foolhardy
undertaking such an endeavor is for this type of oral loan. Yet that endeavor is
required for Justice Markman to link Palmer to this case, whereas my approach
requires no such legal groping.

16
 Justice Markman also suggests that applying Smith Estate here

“anomalously provide[s] those parties who never make a timely demand with a

longer period in which to bring an action than those parties who do make a timely

demand.” Ante at 4 n 3. I disagree that following Smith Estate’s general rule that

a demand is necessary to trigger accrual causes anomalous results. Under Smith

Estate, the period in which to bring a claim is always six years—after accrual of

the claim. Justice Markman and I simply disagree on when accrual should occur.

His insistence (contrary to the general rule) that accrual must occur at the loan’s

inception is what causes his perception of anomalous results. Under Smith Estate,

every claimant has six years to bring his claim after it accrues, which is triggered

by a demand or the presumed demand, whichever happens first. While I accept

that Justice Markman disagrees with this legal construct, I disagree with his

assertion that it causes anomalous results, especially in light of his counterintuitive

position that parties make oral loans to each other and expect payment

immediately. 13

13
Justice Markman accepts that oral loans are impliedly due on demand
and that accrual occurs on that demand. Noting his acceptance of this, I am
perplexed about why Justice Markman finds it anomalous that some oral loans
accrue later than other oral loans. His example shows that he thinks it is
inappropriate that a lender who makes an immediate demand has less time to bring
a claim than a lender who never makes a demand. Despite Justice Markman’s
aversion to it, this dynamic does not contravene the theory that an oral loan is due
on demand and accrual occurs at demand. It seems that Justice Markman’s
perception of an anomalous result is caused by something he already accepts: if
“no time is set for the repayment of borrowed money, the loan is impliedly
payable on demand.” Ante at 2, citing Colburn. Indeed, Colburn’s holding

17
 Finally, Justice Markman adopts his immediate-accrual construct by

incorporating the holding from Palmer v Palmer, 36 Mich 487 (1877). While

conceding that Palmer and its progeny “addressed written demand notes,” Justice

Markman concludes that “there is no apparent reason why Palmer should not

equally apply equally to an oral contract.” Ante at 6. I respectfully note several

reasons why Palmer should not apply to oral contracts like those in this case.

Palmer, a case concerning a promissory note, held that “a note payable on

demand is payable at once and without demand, so that the statute [of limitations]

runs from its delivery.” Palmer, 36 Mich at 491 (emphasis added). This Court

has defined a promissory note as “a written unconditional promise by one person

to pay to another person therein named . . . a fixed sum of money . . . .” Parker v

necessarily puts the lender in a position to set when payment is due. Thus, Justice
Markman is correct to note that this rule can conceivably lead to an oral loan being
due in any length of time, as set by the lender. If this is what concerns Justice
Markman, it is Colburn that causes his consternation, not my application of Smith
Estate. Nonetheless, I can sympathize with him because I too sense a conflict
between the statute of limitations and a lender being free to harbor his claim
indefinitely by not making a demand. Yet I do not think that the solution to this
concern is to force the oral-loan square peg into the demand-note round hole. But
that is what Justice Markman does by insisting, against reason, that an oral loan is
legally the same as a “demand note,” which by its mere name indicates a demand
upon delivery. See the discussion later in this opinion. Instead, I find the Smith
Estate construct to be much more applicable here because it was actually espoused
to deal with this very issue. It handles the concern that Justice Markman and I
share because it precludes lenders from extending accrual of their claims
indefinitely by only allowing such an extension for up to six years. Moreover, it
avoids having the necessity of accepting the illogical premise that, when an oral
request to borrow money is accepted, repayment is due at the instant the lender
hands the money over to the borrower.

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Baldwin, 216 Mich 472, 474; 185 NW 746 (1921) (emphasis added). Further,

“[n]o contract or agreement is a promissory note which does not provide for the

payment of money, absolutely and unconditionally.” Id. (emphasis added). Thus,

a promissory note is more than a contract to repay a loan: it is a written instrument

that embodies a formal promise to repay. See MCL 440.9102(1)(uu) and (mmm);

MCL 440.3104. The case at hand, however, involves informal oral contracts,

which do not meet the strict formalities of a promissory note. Therefore, in

determining when the period of limitations begins to run on an oral contract that

does not specify the terms for repayment, this Court should apply caselaw dealing

with general breach of contract actions, such as Smith Estate, rather than those

cases that deal with the hypertechnical code of negotiable instruments.

In addition, the only justification that Justice Markman gives for applying

Palmer is that doing so is supported by the policies that underlie the statute of

limitations. While I agree with Justice Markman that those policies are strongly

implicated when dealing with an oral agreement, Smith Estate properly addressed

this issue without subjecting informal oral agreements to the more stringent rules

regarding promissory notes. See Smith Estate, 91 Mich at 11-12.

Also, unlike the parties in Palmer, the parties here did not formulate a

written unconditional promise to repay within 30 days after demand. See Palmer,

36 Mich at 490. In contrast, here there were merely oral requests to borrow

money, which prompted plaintiff to write 11 checks over a span of several years.

While plaintiff expected that she would be repaid, there were no specific

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agreements about repayment or promises to repay the borrowed funds. Thus, as

noted, in contrast to Justice Markman’s assertion, there were no “express terms” of

the contracts that contemplated immediate payment.

Finally, applying Palmer’s view that the period of limitations begins to run

on the date of delivery, and therefore no demand is necessary, is inconsistent with

this Court’s declarations regarding basic contract principles. In essence, Palmer

puts the oral-contract borrower in immediate breach of the contract and thus

makes a loan that had no specified time set for repayment due immediately. This

conflicts with our pronouncement that “when a contract is silent as to time of

performance or payment, absent any expression of a contrary intent, the law will

presume a reasonable time.” Duke v Miller, 355 Mich 540, 543; 94 NW2d 819

(1959). Moreover, application of Palmer here contravenes common sense:

informal oral loans are handshake agreements that intuitively are not breached at

the time of the handshake. It would be nonsensical to assume that informal loans

that consisted of thousands of dollars would be due immediately, as they would be

under Palmer. My application of Smith Estate does not subject informal oral

handshake-type agreements to the strict formalities of promissory notes, and it is

consistent with this Court’s pronouncements regarding basic contract principles.

In sum, Justice Markman’s construct represents one end of the spectrum on

this issue. He would have accrual occur at the inception of the loan, which I think

would prematurely trigger the running of the period of limitations because it

contradicts both the facts of this case and this Court’s general pronouncements on

20
oral contracts. In essence, Justice Markman gives the interests supporting the

statute of limitations too much weight. Justice Young, in contrast, represents the

other end of the spectrum. Under his construct, the purposes of the statute of

limitations are given too little respect because a claimant can extend the accrual of

his claim indefinitely. I recognize that both constructs represent good-faith

attempts to balance the tenets of statutes of limitations with the countervailing

principles of contract law. However, I find them both to be out of balance. I think

that applying Smith Estate to this issue achieves the best balance between the

concern of ensuring that contracts will be enforced and the competing concern that

claims will not become stale.

III. CONCLUSION

For all these reasons, I would reverse the judgment of the Court of Appeal

on both issues.

Michael F. Cavanagh
Marilyn Kelly

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 STATE OF MICHIGAN

SUPREME COURT

JOAN B. JACKSON,

Plaintiff-Appellee,

v No. 136423

ESTATE OF RONALD GREEN,

Defendant-Appellant.

WEAVER, J.

I believe that leave to appeal was improvidently granted in this case

because the result reached by the Court of Appeals in this case is correct.

Elizabeth A. Weaver
Diane M. Hathaway