Boundary Line Disputes and Automatic Easements under the Michigan Condominium Act

In today’s day and age, it is almost unheard of to own a parcel of real estate that is not encumbered by an easement. An easement is an interest in real property that grants the holder of the easement the right to use another’s property for a limited purpose. For example, most parcels of real estate are encumbered with easements in favor of utility companies. These easements grant the utility companies the right to enter onto the property for limited purposes, such as maintaining and repairing equipment, or the right to maintain a pole or utility meter on the property. Other common easements include easements allowing access to a shared parking facility or parking lot, access to and from a common driveway, or an easement to gain access to a road.

If you live in a condominium, there will likely be several additional easements that your property is subject to. In Michigan, all condominiums are required to have certain easements outlined by the Michigan Condominium Act and Administrative Rules. Some examples of these mandatory easements are set forth in Michigan Administrative Rule 301(5), which provides as follows:

(5) Pursuant to sections 35, 40, and 44 of the act, a master deed shall provide for the following easements:

(a) Reciprocal easements for a change of boundaries of units due to shifting, settling, or moving of a building in the condominium project.

(b) Easements for the installation, maintenance, and service for all utilities, including light, heat, power, sewer, water, and communications.

(c) If the project is not served by an existing municipal water and sewage system, and any component of the system is not located on property to be owned by the condominium, an easement shall be obtained, or other suitable arrangement made, for the repair and maintenance of such components, so long as the system continues to be used by the project.

(d) Such other easements as may be necessary for continued use and enjoyment of the project.

All of these easements must be provided for in the master deed of the condominium, which will likely also include other easements in addition to those outlined above.

Under MCL 559.140, a mandatory easement exists as a matter of law when a portion of a condominium unit, or a common element, encroaches upon another unit. This statute was amended on January 2, 2001, however, the prior version of MCL 559.140 stated as follows:

To the extent that a condominium unit or common element encroaches on any other condominium unit or common element, whether by reason of any deviation from the plans in the construction, repair, renovation, restoration, or replacement of any improvement, or by reason of the settling or shifting of any land or improvement, a valid easement for the encroachment shall exist.

Although a plain reading of the statute indicates that these easements exist automatically, a condominium association may want to record an express easement with the county register of deeds office in certain situations when the association is aware that one unit is encroaching upon another unit.

A condominium association’s right to record this type of an easement was the subject of a lawsuit in Rossow v Brentwood Farms Dev, Inc, 251 Mich App 652; 651 NW2d 458 (2002). In Rossow, a co-owner built a home on his unit with a side-entry garage and driveway. After a survey was performed, it was discovered that the driveway leading to the side-entry garage encroached upon the neighboring plaintiff co-owner’s unit by approximately 9 feet. The condominium association recorded an easement over the unit owned by the plaintiff in favor of the neighboring unit permitting the neighboring co-owner to gain access to and maintain the driveway leading to his unit. The Association did not seek or obtain the consent of the owners of the plaintiffs’ unit before recording the easement.

The plaintiffs filed a lawsuit against the condominium’s developer, the condominium association, and the owners of the neighboring unit alleging slander of title, violations of the Michigan Condominium Act, and seeking to quiet title by removing the easement. The Court relied on the prior version of MCL 559.140, as well as a corresponding provision in the master deed, and the Court held that the association had the right to record the easement without the consent of the owners of the burdened unit. Importantly, MCL 559.140 was amended on January 2, 2001, after the facts of the Rossow case had occurred. The amended statute adds one sentence at the end, which reads as follows:

This section shall not be construed to allow or permit any encroachment upon, or an easement for an encroachment upon, units described in the master deed as being comprised of land and/or airspace above and/or below said land, without the consent of the co-owner of the unit to be burdened by the encroachment or easement.

The added language appears to limit the ability of a condominium association to record such an easement upon its own volition. While there is no published case law addressing this situation under the new statute, there are two more recent cases addressing this issue.

In Pond v Habian, unpublished per curiam opinion of the Court of Appeals, issued April 13, 2010 (Docket No. 289290), the Michigan Court of Appeals held in favor of a co-owner whose driveway encroached upon an adjacent co-owner’s unit. The Pond Court relied on the prior version of MCL 559.140 because the encroachment occurred prior to the amendment of the statute. Specifically, the Pond Court held:

While the encroachment was not discovered until 2007, the developer recorded the master deed for Golf View Lake Estates on May 24, 1989, and the residential structures were constructed on their respective units by April 2000. Because both events occurred before the effective date of the 2001 amendment of MCL 559.140, the original statute applies to the facts of this case.

Both the Pond and Rossow opinions indicate that they may have had a different outcome had the new statute been in effect at the time the pertinent events occurred.

On September 17, 2020, the Michigan Court of Appeals issued an Opinion in the matter of Carney v Haskell, unpublished per curiam opinion of the Court of Appeals, issued September 17, 2020 (Docket No. 349204). In Carney, the co-owner plaintiff sued a neighboring unit owner alleging that the defendant’s driveway and landscaping encroached upon the plaintiff’s property. Importantly, the garage and the house on the defendant’s unit were constructed in 1997-1998, before the January 2, 2001 amendment of MCL 559.140. The Court ruled that MCL 559.140 must be read together with other related sections in the Condominium Act, including MCL 559.148 (discussing the relocation of boundaries between adjoining condominium units), and with the master deed for the project. The Carney Court held that as follows:

As the foregoing illustrates, the Condominium Act and the relevant master deed provide specific instructions for co-owners who wish to adjust adjacent boundaries. Neither the Condominium Act nor the master deed provides express authority for a co-owner to unilaterally change the boundary between his or her condominium unit and that of an adjacent neighbor, nor to encroach on that neighbor’s exclusive right to his or her condominium unit.

No appellate court has held that the purpose of MCL 559.140 is to correct errors made during the developmental phase of a condominium project or during the condominium association’s subsequent “repair, renovation, restoration, or replacement of any improvement” initially installed during the developmental phase of the project. Nevertheless, such an interpretation makes sense, given that errors may occur, and some deviations from the plan may be impossible to control, e.g., those arising from the “settling or shifting of any land or improvement.” Further, the scant caselaw applying this statute has applied it to encroachments caused by developers’ deviations from the plan. …

By reasoning that MCL 559.140 provided defendant with an automatic easement, regardless of who created the encroachment, i.e., the deviation from the planned boundary, the trial court neglected to interpret the statute in pari materia with those statutes in the Condominium Act establishing a co-owner’s right to his or her condominium unit, MCL 559.163, setting forth precise procedures to follow when adjusting boundaries between adjacent condominium units and incorporating related procedures in the condominium documents, MCL 559.148, and requiring co-owners to comply with the Condominium Act and the condominium documents, MCL 559.165. The result of the court’s application of the statute in this situation was to potentially reward with an easement a co-owner who encroached on the adjacent condominium unit, inadvertently or otherwise.

This is not to say that MCL 559.140 does not apply. However, without first determining who created the encroaching driveway, landscaping, and underground fence encroachments, application of the statute was error. In addition, even if the developer did create the encroachments, if the encroachments were created on or after January 2, 2001, the amendment to MCL 559.140 would apply, and a statutory easement would not exist automatically. Accordingly, we vacate the trial court’s order denying summary disposition to plaintiffs and granting summary disposition to defendant and remand the matter for further proceedings. If it is determined by the factfinder that the developer created any of the encroachments before MCL 559.140 was amended on January 2, 2001, defendant would be entitled to an easement. However, if the encroachment was created by a predecessor of defendant, the trial court would have to entertain defendant’s arguments that he acquired rights to the property by way of acquiescence or adverse possession. Because the trial court did not weigh in on defendant’s contention that these common law claims apply to condominium ownership, or that he met the requirements of either, we decline to decide these issues in the first instance.

Based on Carney, Michigan courts will continue to rely on the previous version of MCL 559.140 if the requisite events occurred prior to January 2, 2001. However, Carney clarifies that the application of MCL 559.140 in granting an automatic easement for encroachments only applies to actions performed by the developer prior to January 2, 2001. The statute cannot be used as a license for co-owners to unilaterally encroach upon neighboring units or unilaterally change the boundaries to their units. In addition, even if the actions were performed by the developer, if the actions causing the encroachment occurred after January 2, 2001, there would not be an automatic easement without the consent of the burdened co-owner.

Moving forward, the right of a condominium association to unilaterally record easements over one co-owner’s unit in favor of another co-owner has been limited. Because of the additional language added to the current version of MCL 559.140, it is crucial to have appropriate language contained in a condominium’s master deed, which identifies easements created pursuant to MCL 559.140. If a master deed contains the appropriate language, a strong argument could be made that all co-owners purchasing a unit after the recordation of said master deed have consented to the easement. Proper planning and appropriate drafting of the condominium’s governing documents can help put condominium associations is a strong position to address these boundary line disputes that arise over time.

Brandan A. Hallaq is an attorney with Hirzel Law, PLC where he litigates cases involving construction defects, contract disputes, shareholder/member disputes, quiet title actions to determine interests in property, and enforcement of restrictive covenants. Mr. Hallaq is also a licensed Real Estate Broker in the State of Michigan and leads the real estate transactions department at Hirzel Law, PLC where he negotiates and prepares the necessary documents for business and real estate transactions, including purchase agreements, loan/financing documents, mortgages, land contracts, and commercial and residential leases. In each year from 2018 through 2020, he has been recognized as a Rising Star in the area of real estate law by Super Lawyers Magazine, a designation that is given to no more than 2.5% of the attorneys in the State of Michigan each year. He was recognized as a 2020 Up & Coming Lawyer by Michigan Lawyer’s Weekly, an award given to no more than 30 attorneys in the state each year. He was also recognized in the inaugural issue of the 2021 Best Lawyers in America: “Ones to Watch” list for professional excellence in real estate law. Mr. Hallaq obtained his Juris Doctor degree, cum laude, from Wayne State University Law School where he served as an editor on the Wayne Law Review. He can be reached at (248) 480-8758 or at [email protected]