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Michigan Court of Appeals Rules that a Governmental Entity is Not Liable for Condominium Assessments After Tax Foreclosure

In Harbor Watch Condominium Association v Emmet County Treasurer, the Michigan Court of Appeals recently ruled that the Emmet County Treasurer was not obligated to pay $97,366.09 in condominium assessments, late fees and interest to the Harbor Watch Condominium Association.  In 2011, the Emmet County Treasurer acquired 37 units in Harbor Watch after foreclosing on the units due to unpaid taxes.  The Court of Appeals upheld the trial court’s ruling that the County Treasurer was not responsible for the payment of assessments under the Michigan Condominium Act and the Michigan General Property Tax Act, even though it was a co-owner, as it did not voluntarily acquire the units.  Specifically, the Court of Appeals held that the Emmet County Treasurer could not be held liable for the payment of assessments after it had fulfilled its statutory obligation to foreclose on the units under the Michigan General Property Tax Act.  While not raised in this case, the logic applied by the Court of Appeals would also presumably absolve a governmental entity from successor developer responsibility under MCL 559.235 as well.
Please click here to read the full text of the opinion.

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kevin@hirzellaw.com

Kevin Hirzel is the Managing Member of Hirzel Law, PLC. Hirzel Law has offices in Farmington, Grand Rapids, Sterling Heights, and Traverse City, Michigan with a fifth office location in Chicago, Illinois. Mr. Hirzel focuses his practice on condominium law, homeowners association law, and real estate law. He is a fellow in the College of Community Association Lawyers (“CCAL”), a prestigious designation given to less than 175 attorneys in the country. Mr. Hirzel formerly served on the CCAL National Board of Governors and is a former member of the Community Associations Institute’s (“CAI”) Board of Trustees, an international organization with over 40,000 members worldwide that is dedicated to improving community associations. Mr. Hirzel has been recognized as a Leading Lawyer in Michigan by Leading Lawyers, a distinction earned by fewer than 5% of all lawyers licensed in Michigan. He has been named a Michigan “Rising Star” and "Super Lawyer" in real estate law by Super Lawyers Magazine, a designation is given to no more than 2.5% of the attorneys in Michigan each year. Mr. Hirzel was also named as a “Go-To-Lawyer” in condominium and real estate law by Michigan Lawyer’s Weekly. Hirzel Law was also voted the best law firm in Metro Detroit in the Detroit Free Press Best of the Best awards. He is the Co-Chairman of the State Bar of Michigan’s Real Property Law Section Committee for Condominiums, PUDs & Cooperatives. Mr. Hirzel has authored numerous articles on community association law for publications such as the Michigan Community Association News, Michigan Real Property Review, Macomb County Bar Briefs and the Washington Post. He is also the author of the first and second editions of “Hirzel’s Handbook: How to operate a Michigan Condo or HOA”, which is available for purchase on amazon.com. Mr. Hirzel has been interviewed on community association legal issues by various media outlets throughout the country, such as CBS, CNBC, Common Ground Magazine, Community Association Management Insider, the Dan Abrams Show on SiriusXM Radio, the Detroit News, Dr. Drew Midday Live on KABC Radio, Fox Business News, Fox News, HOALeader.com, the Law & Crime Network, Michigan Lawyer’s Weekly, NPR, WWJ News Radio and WXYZ. Mr. Hirzel is a dynamic speaker and frequently lectures on community association law throughout Michigan, as well as nationally at the CAI National Law Seminar, and is a two-time winner of the best manuscript award at the CAI National Law Seminar.

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