The full economic impact of COVID-19 and its related “stay at home” orders cannot be measured right now. Anecdotal evidence suggests that widespread delinquencies and defaults have begun. Condominium and homeowner associations are not immune and can rightly expect negative consequences. As homeowners struggle with job disruptions and loss of income, the likelihood of delay or default in payment of assessments becomes a stark reality. And the association’s ability to collect past due assessments is substantially affected by unpaid property taxes, by delinquent mortgages having priority over assessments and by homeowner bankruptcies. This environment poses unique challenges for associations to continue services uninterrupted, especially when vendors and employees expect timely payment. Read more
Category Archives: Michigan Real Estate Law
Buying a new home can be a stressful, frustrating experience – buying a home during the COVID-19 pandemic may be even worse. By the time you have found the perfect home, you may just want to sign all the papers put in front of you; however, whether buying a condominium unit during a pandemic or not, you should carefully review these documents and ensure you have been provided with all the information you need to make an informed purchase.
Quit Puttering Around – Slow Property Owner Loses Land to Jack Nicklaus Signature Championship Golf Course
On March 17, 2020, the Michigan Court of Appeals approved for publication its December 19, 2019 opinion in New Products Corporation v Harbor Shores BHBT Land Development, LLC, __ Mich App __; __ NW2d __ (2019) (Docket No. 344211), holding that a property owner abutting a Jack Nicklaus Signature championship golf course lost its rights to a disputed parcel of land when it did not object during construction of the golf course’s 18th hole in the disputed area. The Michigan Court of Appeals determined the golf course’s potential loss of status as a Jack Nicklaus Signature championship golf course outweighed the property owner’s rights in the disputed parcel in light of the fact the property owner did not object to the construction until the golf course was completed and open to the public.
On February 12, 2020, the Ottawa County Circuit Court issued a decision in the consolidated cases Duke, et al v Wittenbach, et al, Case No 19-5989-CH and Wittenbach v Duke, et al, Case No 19-5995-CH. The Duke cases are interesting because at first glance they appear to arise out of the intersection of riparian rights and property owner rights but are ultimately resolved through the application of the ordinary easement principles described in more detail below. Nonetheless, given the increase in Great Lakes water levels, the issues presented in the Duke cases may resurface in future cases, and the Court’s means of resolving the dispute could be applied in any such future cases.
Locked Out? The Court of Appeals Decides Whether an Unlocked Gate Can Be Installed Within an Easement
On January 28, 2020, the Michigan Court of Appeals issued a published opinion in Smith v Straughn, __ Mich App __; __ NW2d __ (2020) (Docket No. 345391), holding that a landowner can install a gate across an easement so long as the gate is not erected for the purpose of interfering with another’s use of the easement and the gate does not actually interfere with the use of the easement. The Michigan Court of Appeals utilized a reasonableness-under-the-circumstances test that will be relied on in future disputes between fee owners and easement holders as to whether a fee owner’s use of the easement interferes with the easement holder’s use.
There are several ways in which property can be held by multiple owners. For married couples, one of the most commonly used estates is the tenancy by the entireties. It provides a right of survivorship that enables a surviving spouse to hold property without having to proceed with probate. In Michigan, this estate is only available to married couples. In some instances, parties may seek to mimic the right of survivorship contained in a tenancy by the entirety by holding property as joint tenants with a full right of survivorship. Similar to a tenancy by the entireties, this estate cannot be unilaterally severed by the act of one of the parties, and it provides an indestructible right of survivorship to the surviving joint tenants. This may make it appear to be a more attractive option, in some circumstances, to a tenancy in common which is the presumptive estate for unmarried individuals in Michigan. However, parties seeking to utilize a joint tenancy with full right of survivorship should be aware of the risks that come with such an estate.
Aimee Stephens worked as a funeral director for R.G. and G.R. Harris Funeral Home in Garden City, Michigan for several years. Throughout that time, she struggled with her gender identity and, in 2013, she began dressing as a woman at work. The funeral home’s dress code was strictly gender-based and Stephens’ refusal to dress as a man, in compliance with the gender-based dress code, resulted in her termination (see more information here). Aimee Stephens filed a complaint with the Equal Employment Opportunity Commission (the “EEOC”), alleging her termination was the result of unlawful sex discrimination. The EEOC brought a lawsuit against the funeral home in the Eastern District of Michigan and the case is now in front of the United States Supreme Court, with oral arguments recently heard on October 8, 2019 (see more information here). Read more
In Michigan, a significant portion of commercial and residential real estate development occurs through the creation of either subdivisions or condominiums. Typically, an owner of a large parcel of land will establish a condominium or subdivision as a means of dividing the land into various smaller lots (called “units” in a condominium) that can be individually sold. Although the more recent trend, particularly in residential developments, is to create condominiums, most older developments were done through creating platted subdivisions under the Michigan Land Division Act, MCL 560.101, et seq., or one of its predecessor statutes.
Restrictive covenants in Michigan are valuable property rights and have been effectively used to assist in the orderly development of Michigan communities. The rights contained in restrictive covenants are used by developers to implement their community visions and by property owners to protect and enhance the value of their homes. Once adopted these provisions often require unanimous consent to change or modify by default, however, in many cases the original declarant includes an amendment provision to permit a stated percentage of lot owners (or other interested parties), less than all, to adopt an amendment. The effective date of an amendment, even if validly adopted, may be subject to interpretation if the restrictive covenant creates successive terms. Any party seeking to adopt an amendment to its declaration should be aware of these risks and the potential impact of the expiration of a period of time contained in their declaration. Read more
MICHIGAN COURT OF APPEALS RULES IN FAVOR OF TOWNSHIP IN ZONING ORDINANCE DISPUTE OVER SHORT-TERM RENTALS
On October 25, 2018, the Michigan Court of Appeals issued an unpublished opinion in the matter of Concerned Property Owners of Garfield Township, Inc v Charter Township of Garfield, unpublished per curiam opinion of the Court of Appeals, issued October 25, 2018 (Docket No. 342831). The Garfield case involved the interpretation of a zoning ordinance that addressed short-term rentals of residential properties in certain districts. In Garfield, a number of homeowners frequently rented out their homes for short-term intervals, usually for about one week in duration. In September 2013, the Garfield Township Zoning Administrator expressed an opinion that the zoning ordinance then in effect, called “Ordinance 10”, permitted short-term rentals.