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Patricia Paruch, Kemp Klein Law Firm
Riparian Rights of Front-Lot Owners: The Statutory “Base Fee”
By Joseph H. Wener; Couzens Lansky Fealk Ellis Roeder & Lazar, P.C.
In 2000 Baum Family Trust v. Babel , 2010 WL 5393474 (No. 139617, December 29, 2010), the Michigan Supreme Court reversed the Michigan Court of Appeals and held that the dedication of land for a public road under the Plat Act of 1887 does not convey an ownership interest which severs riparian rights of lakefront lot owners separated from the lake solely by the road.
The Court upheld the presumption established in prior cases that only fee simple ownership of an intervening strip or an express reservation in an applicable recorded instrument can sever riparian rights of a front-lot owner. In 2000 Baum, although the statutory “base fee” dedication of the strip of land “to the use of the public” was deemed vested in fee for public use pursuant to the Plat Act, the Court determined that the conveyance did not divest riparian rights, rejecting the road commission’s claim to fee title and the back-lot owners’ access and usage claims.
The dissent rejected as incorrectly decided any decisions expressing a bright line rule that front-lot owners cannot be dispossessed of riparian rights by an intervening road, or that the dedication of a statutory base fee interest subject to a limitation (making it a fee simple determinable) conveys something less than a fee simple interest. The dissent distinguished the decision that was purported to create the bright line rule on facts, noting that the road there pre-dated the subsequent plat and was therefore an easement and not a base fee.
Attorneys representing lakefront owners or prospective purchasers of lakefront or back-lot property should always undertake a detailed review of historical plat and title instruments to determine their client’s actual lake access and usage rights.
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February 1, 2011
February 3, 2011
New Federal Appraisal GuidelinesBy Glen M. Zatz, Senior VP/Associate General Counsel, Comerica Bank
Federal agencies (e.g. OCC, FRB, FDIC, OTS, and NCUA) recently issued Interagency Appraisal and Evaluation Guidelines, effective December 10, 2010, which replace 1994 guidelines and explain the agencies’ minimum regulatory standards for appraisals and evaluations. The Guidelines incorporate recent supervisory issuances on appraisal practices, address advancements in information technology used in collateral valuation practices, and clarify standards for appropriate use of analytical methods and technological tools for evaluations. While primarily clarifying the 1994 Guidelines, the new Guidelines emphasize that financial institutions are responsible for selecting appraisers and people performing evaluations based on their competence, experience, knowledge of the market and property being valued, and independence. Financial institutions should review their appraisal and evaluation programs to ensure they are consistent with the Guidelines.
See more information and a copy of the Guidelines.