SBM Real Property Law Section eNewsletter

January 2011

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Howard A. Lax, Lipson, Neilson, Cole, Seltzer & Garin, PC

Patricia Paruch, Kemp Klein Law Firm


Details, Details

By H. William Freeman, Freeman Cotton & Gleeson PLC

A recent decision in the Michigan Court of Appeals reminds us of the importance of attention to detail. Even the most seemingly innocuous requirement, if ignored, can lead to a disastrous result. Although it may be appealed, the unpublished opinion in Bridgewater Condos, LC v. Boersma (No. 293935, decided 12/14/10) proves this point.

Bridgewater was the developer of a 207 unit condominium. The appellees each entered into a purchase agreement for a condominium unit. The PA included a typical paragraph indicating that the title company was acting as the escrow agent and would hold all funds received from the potential purchasers. The paragraph did not, however, contain an address for the title company. When the purchase agreements were executed, the condominium units had not been built. When construction was finished in 2008, none of the appellees attended their scheduled closings. Instead they indicated their intent to rescind their purchase agreements.

The trial court granted summary disposition for appellees after concluding that the PAs were not binding because they did not provide the address of the escrow agent pursuant to MCL 559.184(4)(a). The trial court ruled that Bridgewater violated MCL 559.184a, which provides that the condominium developer must supply the purchaser with a purchase agreement that complies with MCL 559.184. Even though the "Condo Book" included a disclosure statement which provided the address, and another document contained an e-mail address and fax number for the title company, the Court of Appeals affirmed the decision of the trial court. Drafters beware!

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January 13, 2011
7:30–9:30 a.m.
"Groundbreaker" Breakfast Roundtable
Energy is Here to Stay
Townsend Hotel, Birmingham

January 27, 2011
7:30 a.m.–3:00 p.m.
ICSC 2011 Michigan Continuing Education Program for Real Estate Professionals
REinventing REtooling & REinvigorating Retail Real Estate
Rock Financial Showplace, Novi

February 3, 2011
2:00–5:00 p.m.
Homeward Bound
Total Development in the World of the Land Division Act—Platted & Unplatted Property
Inn at St. John's, Plymouth

March 10-12, 2011
2011 Winter Conference
Willard Intercontinental, Washington, DC

Legislature Amends Michigan's "Superfund" Law

By Arthur H. Siegal, Jaffe, Raitt, Heuer & Weiss, PC

At the end of the 2010 legislative session and after years of effort, the Michigan Legislature enacted the most significant package of bills in 15 years to amend Michigan's "superfund" law (MCL 324.20101 et seq.). The enrolled bills have been signed by the Governor and became effective on December 14. These amendments should enable sites where cleanup work has been conducted to achieve "closure" or "no further action" status and should facilitate financing and redevelopment. Among the highlights:

    1. Streamlined closure approval process.
    2. Expanded self implemented cleanups.
    3. New review panel to review MDNRE's denials of closures.
    4. Easier site closure where groundwater enters surface water (GSI) when surface water isn't threatened.
    5. New MDNRE requirement to report statistics on closures requested, granted, and denied.

The bills also amend the voter-approved 2002 Sewer Bond to free up some of the unallocated $650 million by streamlining the funding process for municipalities and by directing up to $140 million to remediate "orphan" contaminated sites posing a risk to surface water bodies.

The package isn't without detractors. Changes were made to the very popular and still-cutting edge BEA program late in the process which may cause more arguments than they solve. The Legislature's goal was to harmonize Michigan's program with that of other states and to address problems with BEAs involving the use of industrial sites for industrial purposes. The bills eliminate the opportunity to get State-approval of a BEA. Since most BEAs over the last 15 years were State-approved, this change may create new questions. Deals may go forward, but there may be future disputes if there is a future release.