Michigan Condo & HOA Law

I recently heard from a co-owner who is being foreclosed upon by his condominium association for nonpayment of assessments. The individual stated that he has tried to work it out with the Association’s attorney but the attorney is steadfast in pursuing the matter. This co-owner asked what he could do to eliminate the problem.

Co-owners must understand that when they are dealing with the association attorney that the give and take is a two way street. It all depends on how reasonable co-owners are in working it out payment plans with the Association’s attorney, and, of course, whether the Association’s attorney has communicated the information to the Association that ultimately makes the decision as to what payment plan or other type of resolution will be acceptable. If co-owners find themselves in this position, they are best advised to retain their own attorney to negotiate with the Association’s attorney so that he or she is on an even playing field.

Posted by Robert Meisner at 7:49 PM | Permalink

I recently heard from an individual who lives in a condominium complex that is over 20 years old, and this person has lived there for many years. The unit next door was sold and the new owner has made extensive changes that have affected the units because now this individual who spoke with me is hearing sounds of running water that they have never heard over the past twenty years. This person has not had any luck in trying to discuss this with the new neighbor. Furthermore, they have had an outside consultant come in to try to see about adding insulation. The association board advised her that the problem had to be addressed through and between the two neighbors although the bylaws state that the water distribution system is a common element. Ultimately, this person is concerned about what rights she might have to resolve this issue.

There are two elements to look at here. First off, she may have recourse against the association if, in fact, the sound conditioning situation is such that it exceeds reasonable code requirements. Secondly, if, in fact, circumstances have changed in the water distribution system because of any alteration in the neighbor’s unit, she also may have recourse against the neighbor, particularly if he or she caused changes to the common elements without association approval and/or the change has exacerbated the sound transmission problem. One should consult with a community association attorney who has knowledge of condominiums in order to develop a strategic approach.

Posted by Robert Meisner at 8:54 AM | Permalink

This economic downturn has especially hit hard in the development community with many developers going the way of the dodo bird. I recently heard from an individual who purchased a conversion condominium and then the developer abandoned most of the project. Those who had purchased in the development were stuck with only a relatively few number of units with no one to help them since the management company deserted after having not been paid.

If you find that your newly built development is heading in a similar situation, it is imperative that you seek council from a Community Association lawyer to ascertain whether or not someone is taking the place of the developer and how to organize your Association in order to function even though the developer is no longer involved. You may have recourse against the developer and/or the successor developer if there is one. In any event, you need to ensure that you are operating the association in a proper fashion, including the collection of assessments, etc. The sooner you get good help, the better.

Posted by Robert Meisner at 12:29 PM | Permalink

In this foreclosure laden economy, Is your association considering restrictions on the number of rental units allowed within the complex? I recently heard from an association that passed an amendment to place the following limits in regard to rental units: No more than 20% of the units can be rented at any given time, the unit has to be owner occupied or vacant before renting, and any owner could rent no more than three (3) units. They also included a hardship provision. While the Amendment was approved by a two-thirds vote, there are certain co-owners claiming that the provision is unenforceable.

While each case must depend on its own considerations and merits, in a similar case in California, the Court upheld that type of provision and generally, restraints on restrictions are enforced since they are not deemed a restraint on alienation. However, associations that are considering restrictions on rental units should consult with their attorney with respect to the particular merits of their situation.

Posted by Robert Meisner at 7:35 AM | Permalink

I was recently approached by a property owner regarding whether or not an easement that the property owner has over an adjacent property can be extinguished by adverse possession

In such a case, it is reasonably clear that the owner of a servient estate (the property burdened by an easement) may extinguish the easement held by the owner of the dominant estate (the property benefitted by an easement) if the holder of the servient estate acts openly, exclusively, continuously, and uninterrupted to exclude use of the easement by the holder of the dominate estate for the statutorily established period of time, which is fifteen (15) years in Michigan. While there are a number of evidentiary hurdles that must be established, it is possible for that easement to be extinguished, but one is best advised to consult with a knowledgeable real estate lawyer regarding the matter.

Posted by Robert Meisner at 8:57 AM | Permalink

I recently heard from a co-owner who was concerned regarding his neighbor allowing a group of high school students to hold a party on his premises despite knowing that they were involved in underage drinking. The homeowners allowed the party to take place on their property knowing that underage party guests were consuming alcohol, but they stated that they did not supply the alcohol and did not supervise or prevent its consumption. The co-owner questioned if the association or the homeowners involved have any liability.

Not long ago, there was a case out of Wisconsin wherein the court held that it was reasonably foreseeable that permitting underage high school students to legally drink alcohol on the homeowner’s property would result in harm to some person or something; thus, the court held that the homeowners had a duty to refrain from knowingly permitting underage high school students to engage in illegal alcohol consumption on their property. To the extent that the Association’s property is in any way involved and/or condoned such conduct, it may also be liable. Associations are best advised to consult with an attorney in regard to their liability.

Posted by Robert Meisner at 8:47 PM | Permalink

In a recent Court of Appeals decision, additional liability was imposed on tenants and co-signers of a lease for fire damages to an apartment caused while the tenant was occupying the unit and may have been negligent.

Because the lease agreement executed between the tenant, co-signer and the landlord contained a clause imposing liability on the tenant for any damage to the premises or the landlord’s other property caused by the acts or omissions of tenant or tenant’s guests, the court held that the tenant must reimburse the landlord for all damages caused by, in that case, a kitchen fire. Moreover, the court held that because the lease agreement imposed joint and several liability upon the co-signer for any breach of contract caused by the tenant, the co-signer was deemed liable for all related fire damages. The impact of the case is simply that a tenant who causes fire damage to a unit in an apartment building may be held liable for all damages, including structural repairs, under a breach of contract theory.

Posted by Robert Meisner at 10:59 AM | Permalink

With their use and popularity growing, frequently I have been asked to define Mixed Use Condominium Projects. Here is a brief description of their purpose.

Mixed use condominium projects feature a combination of retail establishments, offices, or other commercial uses, along with the traditional elements of a residential condominium development. A number of factors are responsible for the surge in popularity, as well as the complexity of these projects. These factors increase the popularity of residential condominium homes in general. Additionally, many residential condominium purchasers are seeking not only the carefree lifestyle afforded by condominium ownership in some instances, but also the conveniences often available in urban mixed use projects, such as accessibility to mass transit and adjacent retail establishments. Increasing scarcity of land, urban revitalization, and the increased focus on smart growth also make the combination of higher density residential condominiums and integrated retail and commercial uses a very efficient solution for an enlightened developer.

Posted by Robert Meisner at 8:38 AM | Permalink

Many co-owners and association board members do not understand the law as it relates to satellite dishes within the community association. For the benefit of condominium and community associations, here is a brief description of the law regarding satellite dishes as it relates to community associations.

Under the law, a member has a right to install a satellite dish (one meter in diameter or less) on property that the member owns or which the member has exclusive use or control. This includes condominiums, cooperatives and homeowners associations. In the case of condominiums and cooperatives, the rules apply to “exclusive use” areas, such as terraces, balconies or patios. In the areas shared with others or accessible without your permission, it is not considered under exclusive use and is off-limits for satellite dish installation. However, a cooperative or a community association can deny such installations if they can show that the decision is necessary to prevent danger to the building or common elements, as long as the argument is reasonable. Also, an association can impose certain restrictions when safety is a concern or where an historic site is involved. Association boards are best advised to consult with their attorney regarding the FCC regulations and cases in that regard.

Posted by Robert Meisner at 9:04 AM | Permalink

An association recently came to me with a fair housing issue. There is a disabled co-owner who is asking the association to assign him a handicapped parking space. This is the first time that the association has had to deal with complaints or requests from a disabled member. The board has gathered information on whether there are other disabled members who are also seeking handicapped parking spaces, and the association has hired engineers to evaluate whether the new handicapped spaces can be created. They have found two other members who are requesting handicapped spaces. The board has decided to give priority to one of the other members who has lived in the community longest and they are questioning whether or not they can avoid liability in a fair housing suit by their decision making process.

While each case is judged by its individual merits and facts, a recent New Jersey court ruled that the Board on similar facts had provided reasonable accommodations to the member who sued to provide him an equal opportunity to enjoy his dwelling. The court reasoned that the decision to assign him his handicapped space was not arbitrary. In considering the limited number of handicapped parking spots, the court thought seniority was a rational method of determining priority between two disabled members. When faced with such a decision, associations should document the rationale of their decision as well as consult with a knowledgeable condominium attorney.

Posted by Robert Meisner at 7:15 PM | Permalink

I was recently asked if I had any suggestions or guidelines that will help reduce an association’s chances of facing a discrimination complaint regarding requested modifications. My answer is simple: Adopt a clear policy on modifications. If a disabled member wants to make a modification to a common element or to her unit that is necessary to afford such person full enjoyment of the premises, that modification must be permitted if it is reasonable. The law in Michigan even goes as far to state that if someone who regularly visits the unit is disabled, the modifications must also be permitted to accommodate the disabled visitor, if said modifications are reasonable.

In my opinion, Association boards should adopt a policy that allows disabled members to make reasonable modifications that are necessary to the members’ full enjoyment of the premises. A refusal to permit a reasonable modification amounts to discrimination on the basis of a disability in violation of Fair Housing laws and perhaps the Condo Act of the state in which you may be involved. Basically, the law says that community associations must permit “reasonable modifications of existing premises” if such modifications are necessary for a disabled person’s full enjoyment of the premises. Modifications affecting the structural integrity of the building might not be considered reasonable; it depends on the circumstances. An association’s policy should state that each modification request must be evaluated on a case-by-case basis. Association Boards are best advised to consult with a community association attorney who, hopefully, has knowledge of the law in this area.

Posted by Robert Meisner at 11:43 AM | Permalink

I recently heard from a co-owner of a condo association that is preparing to take over control of the association from the developer, but the developer has refused to meet with the advisory committee. The co-owner was wondering what their approach should be.

The developer’s unwillingness to meet with the advisory committee is an indication that the developer is not willing to cooperate or even live by its own documents. This may be the tip of the iceberg in terms of what the developer should be doing for the association. The association should retain a knowledgeable community association lawyer as soon as possible and raise sufficient funds among the co-owners to retain the attorney to assist in the turnover process and to otherwise negotiate with the developer to insure that the co-owners are protected and are knowledgeable about the turnover.

Posted by Robert Meisner at 2:21 PM | Permalink

Even in this uncertain economy, associations may want to reevaluate their collection policy. While each Association must adopt its own collection policy in accordance with its bylaws, association boards must be resolute in ensuring that they have an aggressive and uniform collection policy that ensures the board is taking the maximum steps necessary to collect the assessments for the benefit of the Association as a whole. In short, the longer the Association delays in taking aggressive action to collect the assessment that is delinquent, the longer it will take to collect the assessment and, indeed, the Association may lose out on its secured interest in being able to force the payment of the assessment. It is probably a good idea, therefore, for your Association to re-evaluate its collection policy with the benefit of good legal advice.

Posted by Robert Meisner at 11:00 AM | Permalink

I recently heard from a co-owner who is concerned about a neighbor who walks his dog at various evening times using the grassy areas between the buildings and sometimes behind and around those buildings. This neighbor’s walk is very disturbing since it results in a person suddenly appearing outside of the co-owner’s window and behind his unit. These walks can be later than 10:00 p.m. when it is very dark alongside the buildings. The co-owner wondered if restrictions could be enforced that would prohibit co-owners walking in these common elements since there are other open areas in the condominium that might be used for walking.

I have not seen such a restriction in the typical condominium documents other than the fact that no one shall engage in any obnoxious or offensive activity. The fact that a co-owner is walking on the common elements, even late at night, may not be a violation of any restriction, and it would be hard to enforce such a restriction in any event. I suggested to the co-owner that he speak directly to his neighbor about the situation and attempt to resolve the issue between them. This may be the best solution rather than attempting to impose potentially unenforceable restrictions.

Posted by Robert Meisner at 1:38 PM | Permalink