The BUSKLAW May Newsletter: Oh, Fudge! Famous Interior Designer Sues Mackinac Island's Famous Grand Hotel

As reported by MLive and ABC 12 News, famous interior designer Carleton Varney has sued the new owners of Mackinac Island's famous Grand Hotel. (Mackinac Island is also famous for its fudge, a guilty pleasure.)

You would expect the lawsuit to be for breach of contract, i.e., the Grand Hotel's owners failed to pay Mr. Varney for his interior design services rendered. His relationship with the Hotel goes back about 43 years, and the Hotel was recently sold by its long-time family owners, the Mussers, to an international investment firm, KSL Capital Partners.   

But there will be no pondering of any design contract's terms, no assessment of facts that may or may not constitute breach of contract, no rumination over contractual issues. Because Varney's lawsuit is for damages arising from first, age discrimination, and second, conversion of his personal property. Although Varney's Complaint isn't available online (and a trip to the Washtenaw County Circuit Court Clerk for a copy is impractical), let's discuss what facts we do know - and the elements of both legal theories - with the goal of providing an armchair assessment of his case. 

Mr. Varney is 83 years old, and while federal and state laws prohibit age discrimination, they do so only in the context of an employment relationship, so the Grand Hotel must have discharged Varney as an employee on the basis of his age. But there's no evidence (and apparently no allegation) that Varney was ever employed by the Grand Hotel. Assuming that Varney was an independent contractor with the Hotel (the most likely scenario), the Hotel could refuse to do business with him for any reason. That refusal could well be a breach of contract, but it isn't age (or any other) discrimination prohibited by law, even if the Hotel wanted a younger interior designer (which apparently is the case). So Varney's age discrimination claim appears fanciful.   

The personal property conversion claim is more interesting and probably fact-intensive. Varney alleges that over the years, he placed signed irreplaceable presidential and celebrity photos and other memorabilia (such as a framed dress that once belonged to actress Joan Crawford) in many of the Hotel's suites to give them his "personal touch." But when the Hotel was sold to KSL, this property wasn't returned to him.

Michigan recognizes both common law and statutory conversion. The Michigan Supreme Court has recognized common law conversion as “any act of dominion wrongfully exerted over another’s personal property in denial of, or consistent with his (or her) rights therein.” If Varney can prove common-law conversion, he may recover the value of the property converted, plus statutory interest. 

But there's also a Michigan statute on conversion, MCL § 600.2919a. As discussed in this 2014 Michigan Bar Journal article, a plaintiff prevailing on a statutory conversion claim may recover treble damages (plus legal fees and court costs) if the person buying the converted property either knew that the property was converted or that the property was converted to the buyer's "own use." Based on rules of statutory interpretation, Defendant KSL can hardly maintain that Varney's property wasn't converted to their own use. So whether there was conversion depends on whether Varney ever intended to convey these photos and memorabilia to the Hotel or were they just "on loan." You would look for a bill of sale, purchase agreement, or some other tangible evidence proving the parties' intent. However, since these items appear to have been placed in the Hotel's suites a long time ago, this may be a daunting task. It may well come down to Varney's recollection against the recollection of Musser family members, assuming that any are left to testify about the circumstances surrounding Varney's placement of the items. And then a jury deciding who is more credible. 

This case will be an interesting one to watch if it goes to trial. But since famous reputations are at stake, I'm betting on an out-of-court settlement sooner rather than later.

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