MI: Old HOA Being Revived?

We have owned our home (Michigan) since 2012. There has been no HOA activity in the time we've been here, but I can't check the deed until Monday to see if there is a HOA provision.

A few months ago, we received a letter from a woman in our subdivision stating that there was an inactive HOA that she was going to revive, and announcing the first meeting. In the letter, she stated that there would be an election of officers, and that the by-laws stated only members who owned lakefront lots were eligible to hold those seats.(That's a very small minority. There are probably 200 homes in the area, maybe 10-20 of which are on the lake.) A small community uproar at the meeting resulted in the "officers" saying they were going to hold off until they could get more information.

Fast foward to today, the next time we have heard anything. We received a bill for $25, which the HOA stated is to cover the insurance we need for the community common spaces.

My husband called the woman, who said that she had filed papers with the state to make the HOA legal, and that if we don't pay they will put a lien on our property. She would't tell us when the meeting was held, or who the officers were, except to refer us to the secretary.

Honestly, no offense, but we are not HOA type people. If there had been an HOA here, we probably would not have purchased the property.

But it is what it is: my question is: How can I find out if this HOA has any legitimate legal standing, or if I can tell her to go pound sand?

The annual reports were probably brought up to date with the state. You can see this in the state of Michigan LARA website, but you need to know the name of the corporation.

There MAY be property taxes due with your local municipality . Too hard to tell from your post.

Find your deed and look it over. It will name the subdivision in the property description.

I am a bit confused by the statement "We don't know who any of the board members are" but then mentions referred to the "Secretary" for questions. Isn't the Secretary one of the board members? Seems the Secretary's job is to keep up with certain POC information. So not sure why did not contact the person referred to for your questions.

A HOA isn't something to be scared of or fight. It's simply a "club" of homeowner's whom want to make sure their neighborhood stays "nice" to attract potential buyers. If your neighbor decided to put out an "Outhouse" in the front yard, you and your other neighbors can have it removed. A HOA sets the standards of how wants the neighborhood to look and maintain common items/areas. It being incorporated simply allows it to collect monies to support those efforts.

-- The Michigan Seller Disclosure statute requires sellers to disclose the following:
"[Are there a]ny 'common areas' (facilities like pools, tennis courts, walkways, or other areas co-owned with others), or a homeowners' association that has any authority over the property?
unknown ___ yes___ no___" See https://www.dhd2.org/wp-content/uploads/2016/12/Act-288-PA-1967.pdf . LisaG15, do your 2012 closing documents include this seller's disclosure? If so, what is the response to the aforementioned question? Else so far, I do not see a requirement for a seller to disclose the covenants, restrictions et cetera that may apply to the property being sold.

-- I concur with trying to establish the status of any HOA via checking the Michigan corporations web site at https://cofs.lara.state.mi.us/SearchApi/Search/Search and going to your county clerk and seeing whether a Declaration of Covenants is on file there. If a corporation is listed at the Michigan corporations web site, see if the Bylaws are on file with the state.

-- I concur with asking these neighbors who want to re-instate the HOA for a copy of the Bylaws. As TimB4 noted, use the Michigan Nonprofit Corporation statute. Write a short letter stating something like the following: Dear Board, The Michigan Nonprofit Corporation Statute section 450.2131(4) states in part, "The records and files of the administrator relating to corporations shall be open to reasonable inspection by the public." Please provide me with a copy of the Bylaws, Declaration of Covenants, articles of incorporation for the HOA you claim exists. Thank you, Lisa ___, [address]." Send the letter certified mail, return receipt requested, to whoever is claiming to be in charge.

-- It appears elections have not occurred in many years at LisaG15's subdivisions. Because of this, there is a reasonable likelihood that any written Bylaws (that your neighbors claim to be in existence) have been waived, per common law (court-made precedent). This means the neighbors that oppose re-instating the Bylaws et cetera may be able to get a court order stopping implementation of the written Bylaws. In the courts, this is also known as 'estopping the enforcement of the Bylaws' and similar. In Michigan, the courts will want to know whether the written Bylaws have an "anti-waiver" provision in them. Once you get a copy of the Bylaws, I hope you will either post them here or report back on whether there is an anti-waiver provision in them.

-- However, even if the Bylaws are waived, the existence of common areas pose liabilities. I think LisaG15 and her fellow neighbors opposed to a HOA have to figure out how to address this without a HOA. This could be tricky. A HOA may be the better way to ensure all pay their fair share for maintenance of these common areas and insurance on same.

-- LisaG15 wrote that the Bylaws allegedly say that only lakefront owners may serve on the board. This is giving one member of the (alleged) HOA different rights from other members. I believe the case law says this is unlawful.

Not a condo -a subdivision. The houses on the lake were built in the 50's, with the rest of the subdivision being developed in the 70's - 80's. After reading the above, I searched the MI SOS, and a quick peek at the SoS records indicate the original HOA was created by the developers, and dissolved in the early 90's.

According to her letter, there are 4 common spaces. I am only aware of 2. One is a vacant .25 acre lot designated as a park, but it's long neglected. Poison ivy abounds in the summer, and I've never seen anybody take their dogs, much less kids there.

The other common space I know of is a 15 foot strip of land that provides the community deeded access to the lake from a main road. There is a picnic table there, but I have never used it because I assumed it belongs to the person who owns the lot adjoining the RoW on the south. It is always mowed, but I think that's probably the homeowners just being neighborly.

As to your other question, I am fairly sure that most of the people here are not ok with the board even existing, much less being governed by the 10% that live somewhat isolated from the rest of us.

The lake sits on the NW corner of the subdivision. Imagine a big circle. Then put 10-20 houses around that circle. To the left of the houses on the left, draw a line running north / south, then curve that line west around the south end of the lake, then run it south again . That is the main road. Almost all the other houses are in a development that is on the southeast side of that road. We never see most of these people. Which is ok - this is a rural area. Our roads are not paved. We have (so far) almost no local restrictions on our land. We can have small farm animals, barns, an outhouse in the front yard, whatever.

My biggest fear is that these fine folks are going to start diligently working to change all that. Again, I don't mean any offense. I understand that most of you here on these boards work hard on your boards for your definition of a common good, and that lots of home buyers specifically seek out such environments. Peace be to all. But we tried that once, I even served on the board for a couple of years. After that, we decided that neighborhoods governed by HOAs were not our cup of tea.

-- Re dissolution: Good. It appears to me that this Michigan corporation could be renewed via submission of this form: https://www.michigan.gov/documents/lara/525_08-15_527724_7.pdf . Note item 4 on the form. A HOA is a nonprofit corporation (dissolved in this case), but it has "shareholders" (or "members"). The way I read item 4 is that the HOA members must vote to renew. Furthermore, whoever is claiming to be the directors has not been elected by any lawful vote.

-- Reinforcing the above is, of course, the Michigan Nonprofit Corporation statute Section 450.2815 "Renewal of corporate existence" at https://www.legislature.mi.gov/documents/mcl/pdf/mcl-Act-162-of-1982.pdf . Renewal appears to require a members' vote. You all opposed to a HOA need to dot every i and cross every t to make sure a majority vote against renewal.

-- Else the only power the corporation retains is the winding up of its affairs, including dissolution of its assets. (The corporation retains legal title to real estate after dissolution, unless say taxes have not been paid. Corporate dissolution law generally indicates the corporation is supposed to turn title over to someone else, but from some experience I had where I am last year, this seems loosely enforced.) Perhaps a vote of the owners would be necessary to complete a sale of the common property and relieve all of some liability concerns. More info on dissolved Michigan corporations appears at https://www.michigan.gov/documents/lara/8007_528147_7.pdf

-- Even though the corporation is dissolved, it can still be sued in, say, a slip-and-fall accident on common area still owned by the dissolved corporation. I believe this does put each member on the hook for a payout for any injury that occurs.

-- A road maintenance agreement, among the owners and prepared by an attorney, may be appropriate at some point.

-- You might want to check the county tax assessor web site and see who owns the common property and whether taxes have been paid.

-- I think many-to-most of the regulars here are in fact not wild about HOAs. I for one get from where you are coming.

I am pretty much shut down until the government reopens tomorrow, but thanks very much for all the input. A couple good points were raised. I now do wonder who has been paying the taxes on the common areas?

Also, as to the roads - the county maintains them. We pay an special assessment on our taxes annually for that service.

Respecting the anonymity clauses, the old HOA was known as "Anonymous Lake Civic Association" while the new entity is "Anonymous Lake Members Civic Organization." I don't think she revived the existing entity, I think she created a new one.

That just seems wrong.

And she's requesting cash and checks made to her personally. Not the HOA, not the treasurer That indicates they probably don't have any existing cash assets, else we'd be making payments to the bank.

WTH? A HOA or other entity can get a tax ID number immediately when it is formed, by applying for one online.

No way would I pay her.

I love those bylaws: they say in one place that no dues will be charged "at this time" (whatever that means) but the lady is trying to collect funds.

And are the bylaws trying to say that if you don't show up to a meeting, you're counted as a "present YES vote"-- meaning you're deemed to vote for something?

Nonsense and garbage. Shame on the lady who did all of this.

Lakefront or lake access lots have increased in value greatly. Too bad that subdivision’s lake access lots were acquired by the township. That means someday it could be a public beach, boat launch or kayak rental place. Open to the public.