The Township of Fenton is taking legal action against the Fenton Orchards Condominium Association over the association’s alleged interference in the sale of numerous tax-recovered properties for $420,000.
At the June 7 meeting, the Fenton Township Board of Directors approved sending a letter to the association and all owners of the property, as well as hiring a lawyer.
“They’ve chosen to fight with us over the sale of these units, and they’ve done everything in their power to make sure we can’t sell them,” Township Treasurer John Tucker said. who also sits on the planning committee,
The situation involves approximately 28 tax-free parcels in the association that belong to the township. Tucker said when they tried to sell these units a few years ago, the association had a problem with it. He spoke with their lawyer and he thought they had come to an agreement.
They were approved for sale to Cedar Creek Construction LLC on February 15, 2022. The intent of the sale was published in the Tri-County Times. The agreed amount is $420,000. However, after the sale was approved, the Fenton Orchards Condominium Association entered an affidavit claiming that these units do not exist.
“Shortly after the media coverage, Fenton Orchards took the initiative to file an affidavit stating that the units we had acquired from the county and had been paying taxes on for decades do not exist,” he said. -he declares. “The reason they filed this affidavit was to interfere with the sale.”
Tucker said the association had previously communicated to him that it believed the association should make money from the sale, not the township.
Changes to the main act require township approval, and the association has never asked for it to be changed. If the main deed shows that these lots do not exist, officials are unable to obtain title insurance for the units, preventing their sale.
The association’s attorney cited the Michigan Condominium Act, which states that if undeveloped condominium units remain undeveloped for 10 years, then a two-thirds vote of the association can declare the land to remain part of the project and return to general common elements. General common elements are amenities such as lawns, streets (if the road is private) and recreational facilities maintained by the association.
Tucker disagreed with the association’s attorney. He consulted with real estate attorney George Rizik, who agreed that the township owned the units.
Tucker called Rizik an “excellent, excellent” attorney and said: “I’m as confident as anything I’ve been in 35 years of real estate of our collective opinion on this issue and that is that these units don’t ‘have not disappeared. The main act has been altered in violation of the main act and proper rules, and that all of this was done with the specific intent of spoiling the sale we have for these units on the grounds that they want the money for themselves.
He has attempted to contact the association and their attorney to resolve the issue, and he believes the township should call their bluff.
“Personally, I don’t like the idea of suing an association of which about 20 residents of our township are members,” he said. However, he says he likes the loss of $420,000 in revenue even less, which can benefit all township residents.
Tucker recommended sending a letter to the association outlining the township’s position and planned legal action, and also sending a copy of the letter to all owners of the association. He also recommended that they retain the services of attorney George Rizik to initiate the appropriate litigation, which would likely include the following charges:
• Intentional interference in contractual relations
• Intentional interference with a business relationship or expectation
• Declaratory judgment to: Confirm that the condominium units do indeed exist today; Invalidate the modification of the Master Deed which was registered without the approval of the Municipality.
Administrator Mark Goupil questioned whether the association would be liable for paying any damages that may be awarded, according to the minutes of the meeting. Tucker said it would depend on the level of insurance coverage maintained by the association.
Administrator Christine Reid said the association’s argument was “interesting”.
“Their argument is that it sat there and 10 years has passed, so it becomes general commons, but they want to sell it to a developer. We can’t sell it to a developer, but they can. .it doesn’t hold up,” she said.
Supervisor Vince Lorraine said he agreed with Tucker and Rizik.
“I think it’s fair to our ratepayers and our residents that we sold this property, owned this property, and had the $400,000 go back to the township.” It’s the taxpayers,” he said.
Fenton Orchards Condominium Association President Mary Ann Brostek replied “no comment” when the Times reached out.