Michigan Condo & HOA Law

While speaking at a seminar a few weeks ago, a real estate agent, who happens to be heavily involved in the foreclosure market, approached me during the break and we began to discuss the current housing crisis in the State of Michigan. She stated that based on the number of homes in default that were yet to enter the foreclosure market, the current housing conditions were only going to get worse due to the large amount of inventory. I know many real estate experts feel that Michigan has not seen the bottom of the foreclosure tumult. With this thought in mind, it is imperative that home owners and buyers be on the lookout for mortgage fraud.

The FBI reports that mortgage fraud remains a very real problem as new scams involving “foreclosure rescue” are being offered on a daily basis. While not all foreclosure rescue programs are scams, you can avoid becoming a victim by following the five tips below:

1. Be wary of unsolicited contacts and pressure sales techniques.
2. Be wary of what you are signing.
3. Check the licenses of the people involved, making sure they are qualified.
4. If it sounds too good to be true, it probably is.
5. See a real estate lawyer before you sign anything.

Posted by Robert Meisner at 5:43 PM | Permalink

I recently heard of an incident where a section of fence area fell from a roof at a condominium injuring two persons who were on a public sidewalk in front of the condo unit. The injured persons are suing the Association and its Board of Directors for negligent failure to maintain the common elements including a roof top security fence. They are also claiming damages in excess of the amount of the insurance and are suing individual co-owners of the condominium. A co-owner recently asked me what liability I thought co-owners would have in such an instance.

The answer, of course, depends upon the state in which the association is located but in a case of first impression in New York, the Court held that the unit owners did not have statutory liability for safe maintenance of the building because the nature of the unit owners interest in the common elements is "materially dissimilar to the free hold interest" normally held by owners of multiple dwellings. The Court also indicated in that case that vicarious liability for unit owners was inappropriate because the common elements were solely under the control of the board of managers. It would appear, therefore, that the individuals may have some immunity from liability since it should be a corporate obligation, namely that of the Association.

Posted by Robert Meisner at 1:47 PM | Permalink