Michigan provides immunity defense to community associations for COVID-19 lawsuits
On October 22, 2020, Governor Whitmer signed HB 6030, which was given immediate effect via 2020 PA 236. 2020 PA 236 will provide Michigan condominium and homeowners associations with an immunity defense if a co-owner, tenant or invitee files a civil lawsuit, alleging a tort claim that arises out of COVID-19.
When can a community association assert an immunity defense to a COVID-19 claim?
Section 2(c) of 2020 PA 236 identifies the type of claims in which a community association could assert an immunity defense as follows:
“COVID-19 claim” means a tort claim or tort cause of action for damages, losses, indemnification, contribution, or other relief arising out of, based on, or in any way related to exposure or potential exposure to COVID-19, or to conduct intended to reduce transmission of COVID-19. COVID-19 claim also includes a tort claim made by or on behalf of an individual who has been exposed or potentially exposed to COVID-19, or any representative, spouse, parent, child, member of the same household, or other relative of the individual, for injury, including mental or emotional injury, death, or loss to person, risk of disease or other injury, costs of medical monitoring or surveillance, or other losses allegedly caused by the individual’s exposure or potential exposure to COVID-19. COVID-19 claim does not include an administrative proceeding or civil action brought by a state or local government prosecutor or agency to enforce state statutes and regulations, executive orders, or state agency orders applicable to COVID-19.
Accordingly, immunity for COVID-19 claims only applies to civil actions alleging tort claims, such as negligence, gross negligence or intentional infliction of emotional distress. 2020 PA 236 does not appear to apply to claims for breach of contract or breach of covenant. Similarly, 2020 PA 236 does not apply to civil actions or administrative proceedings brought by the state or a local government prosecutor. As such, community associations should be aware that 2020 PA 236 does not provide blanket immunity.
It is also noteworthy that Section 10 of 2020 PA 236 states that, “This act applies retroactively to any claim or cause of action that accrues after March 1, 2020.” Accordingly, community associations should be aware that 2020 PA 236 would likely be applicable to any pending demands or claims related to exposure to COVID-19, potential exposure to COVID-19 or conduct intended to reduce the transmission of COVID-19.
What must a community association prove in order to successfully assert an immunity defense to a COVID-19 claim?
Condominium and homeowners associations should be aware that an immunity defense is available to corporate entities and individual directors. However, immunity is not automatic. Section 5 of the 2020 PA 236 defines the requirements that must be established to assert an immunity defense as follows:
A person who acts in compliance with all federal, state, and local statutes, rules, regulations, executive orders, and agency orders related to COVID-19 that had not been denied legal effect at the time of the conduct or risk that allegedly caused harm is immune from liability for a COVID-19 claim. An isolated, de minimis deviation from strict compliance with such statutes, rules, regulations, executive orders, and agency orders unrelated to the plaintiff’s injuries does not deny a person the immunity provided in this section.
In order to qualify for an immunity defense, a community association must be able to establish that it was in compliance with all federal, state, and local statutes, rules, regulations, executive orders, and agency orders related to COVID-19 that had not been denied legal effect. Accordingly, demonstrating compliance with Governor Whitmer’s former executive orders, which were ruled unconstitutional by the Michigan Supreme Court, would not establish an immunity defense. Similarly, while the statute does not require strict compliance with the law, there are likely to be factual issues in litigation as to what constitutes a “de minimis deviation” from COVID-19 regulations under federal, state and local law.
2020 PA 236 is certainly helpful to Michigan condominium and homeowners associations as it potentially provides them with liability protection if they “do the right thing” in operating their community association during the COVID-19 pandemic. However, community associations must be aware that 2020 PA 236 is not an absolute shield to all liability related to COVID-19. Specifically, 2020 PA 236 is limited to tort claims. Moreover, community associations should be aware that immunity is not automatic and that an association would need to establish that they substantially complied with federal, state and local law laws in order to establish an immunity defense.
Kevin Hirzel is the Managing Member of Hirzel Law, PLC and concentrates his practice on commercial litigation, community association law, condominium law, Fair Housing Act compliance, homeowners association and real estate law. Mr. Hirzel is a fellow in the College of Community Association Lawyers, a prestigious designation given to less than 175 attorneys in the country. He is also a member of the Community Associations Institute’s (“CAI”) National Board of Trustees. Mr. Hirzel has been a Michigan Super Lawyer’s Rising Star in Real Estate Law from 2013-2020, an award given to only 2.5% of the attorneys in Michigan each year. Mr. Hirzel has been named a Leading Lawyer in Condominium & HOA law by Leading Lawyers Magazine from 2018-2020, an award given to less than 5% of the attorneys in Michigan each year. He represents community associations, condominium associations, cooperatives, homeowners associations, property owners and property managers throughout Michigan. He may be reached at (248) 478-1800 or [email protected].