Attorney fees related to an action for unpaid lot owner assessments on resort property; The Summer Resort Owners Corporation Act (SROCA) (MCL 455.201 et seq.); Contract provision as to attorney fees; Fleet Bus. Credit v. Krapohl Ford Lincoln Mercury Co.; A corporation’s bylaws as a contract between the corporation and its shareholders; Allied Supermarkets, Inc. v. Grocer’s Dairy Co.; Late fees

Holding that the trial court should have awarded the plaintiff-nonprofit corporation attorney fees that it incurred to recover unpaid dues and assessments, the court reversed the trial court’s denial of attorney fees and remanded for further proceedings. Plaintiff, which is organized under the SROCA, is designated to administer a summer resort. “Lot owners are required to pay yearly dues and assessments, which are used to maintain the resort property and to pay for taxes and insurance.” Plaintiff alleged that “defendant paid her dues and assessments from 2004 through 2009, but that she thereafter failed to pay. According to plaintiff, the amount of dues and assessments owed was $400.” In 2012, plaintiff recorded a lien for the unpaid dues and assessments, and it later filed suit. In moving for summary disposition, plaintiff “sought $400 in unpaid dues and assessments, $40 in late fees, $574.40 in court costs, and $6,007.29 in attorney fees. In its motion, plaintiff did not seek to foreclose its lien, but it argued in its brief that it was entitled to seek foreclosure.” The trial court granted plaintiff summary disposition because defendant did not provide any evidentiary materials to contradict plaintiff’s evidence showing that she had received the invoices. However, it declined to award plaintiff attorney fees and later denied plaintiff’s motion for reconsideration. The court concluded that it was “clear that defendant, as a lot owner in the resort, was a shareholder” in the plaintiff. “The bylaws of a corporation constitute a contract between a corporation and its shareholders.” The bylaws at issue stated that all “annual dues and/or special assessments levied against any or all members not paid by August 31st each year shall become a lien upon the property of the delinquent member and such delinquencies may be enforced by Court action. All costs of such action shall be assessed to the member and become part of said lien, including by [sic] not limited to actual attorney fees.” While defendant argued below that attorney fees were only recoverable if plaintiff foreclosed its lien, the provision clearly contemplated “permitting both a lien and a separate action to collect delinquent dues.” Further, $40 in late fees were appropriate.