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Michigan Summer Resort Lawyers Representing Petoskey Summer Resort Associations

In addition to traditional homeowners associations, Michigan also recognizes a unique type of homeowners association called a “Summer Resort Association.” These are established under one of the following five statutes:

• Act 230 of 1897, Summer Resort and Park Associations, MCL 455.1, et seq.;
• Act 39 of 1889, Summer Resort and Assembly Associations, MCL 455.51, et seq.;
• Act 69 of 1887, Suburban Homestead, Villa Park, and Summer Resort Associations, MCL 455.101, et seq.;
• Act 137 of 1929, Incorporation of Summer Resort Owners, MCL 455.201, et seq.; or
• Act 161 of 1911, Parks, Playgrounds, Drives, and Boulevards, MCL 455.301, et seq.

Unlike condominium associations, which are governed under the Michigan Condominium Act, Petoskey Summer Resort Associations are governed by their respective Summer Resort Act and the Michigan Business Corporation Act, MCL 450.1101, et seq. Summer Resort Associations were first created over 100 years ago and were governed by a set of complicated and unique rules that are often different than a typical homeowners association. 

What is the Michigan Summer Resort and Assemblies Act?

The Michigan Summer Resort and Assemblies Act was established in 1889 as an act to authorize the formation of corporations for the purchase and improvement of grounds to be occupied for summer homes, for camp-meetings, for meetings of assemblies or associations and societies organized for intellectual and scientific culture and the promotion of the cause of religion and morality, or any or all of such purposes; and to impose certain on the department of commerce.

What are the basic principles that govern a Petoskey Summer Resort Association?

In Michigan, a summer resort association is defined by a few basic characteristics.

• First, a Michigan Summer Resort is an organization that is responsible for managing and maintaining real property. In some instances, the summer resort association is responsible for managing common areas and in other cases it is also responsible all the land, including the land on which the cottages are situated.

• Second, a Michigan Summer Resort is composed of members, and in almost all cases, the members must have some form of ownership interest in the real property that is governed by the association.  It is also typical for a summer resort owner to receive a stock certificate that is representative of their interest in the summer resort association, along with a real property interest.
• Third, summer resort associations are governed by contractual agreements between the association and its members. In most cases, the contractual agreements impose restrictions on how the members may use real property and provide a framework for governing the community association. A summer resort association’s primary responsibility is to enforce the restrictions and abide by the procedures in the governing documents to preserve property values and protect the health, safety, and welfare of the membership.
• Fourth, summer resort associations almost always involve a financial component, in which the members have an obligation to contribute financially toward the management and maintenance of the real property governed by the community association. In most cases, a summer resort association has the right to secure payment by placing and foreclosing liens if a member does not satisfy their financial obligations.

Do members of Petoskey summer resorts have to pay dues?

The board of trustees of a summer resort owners corporation has authority to enact bylaws for purposes subject to repeal or modification by the members at any regular or special meeting. Assessments are determined based on the bylaws, but also subject to the specific act in which that association was organized under. Examples of the assessment provisions that can be found in the Michigan Summer Resort and Park Associations Act, MCL 455.1 are as follows:

455.16 Annual dues; levy, use, payment.
Sec. 16.

It shall be lawful for the board of directors to provide for annual dues to be levied upon each share of stock which shall be paid by the holder thereof in such an amount and under such rules and regulations as shall be provided by the by-laws of such corporation, such annual dues and all sums realized thereby to be used for the purpose of paying the expenses attending the care, management and control of the grounds and property kept, occupied or used for the purposes set forth in the articles of association. The payment of such annual dues may be enforced by said corporation by some proper action at law, or by a sale of the shares of stock against which the same is assessed in the manner provided in section 15 of the act for the collection of installments of subscriptions to the capital stock.

455.23 Special dues; purpose, time, enforcement.
Sec. 23.

It shall be lawful for the stockholders at a special meeting called for that purpose by a vote of a majority of all the capital stock, to authorize the board of directors to provide for special dues additional to those provided for in section 16, not exceeding 25 dollars per share in any 1 year, and such special dues shall be used only for the purpose of paying any existing indebtedness of said corporation or for improving and bettering the lands and property of said corporation or for improving the sanitary condition thereof, providing protection from loss or damage by fire or water, or erecting, purchasing or maintaining any hotel, club house or other building for the entertainment, comfort or convenience of said corporation and its stockholders, and any resolution adopted by said stockholders’ meeting for such purpose shall determine the purpose for which such special dues shall be expended and the period of time during which they may be levied. The payment of dues authorized under the provisions of this section may be enforced by said corporation in the same manner as is provided in section 16 for the enforcement of the annual dues.

455.67 Assessment; collection from members.
Sec. 17.

Whenever the real estate of any such association and the cottages and buildings thereon shall be assessed to the association and taxes paid as provided in the last preceding section, the association may assess, levy and collect from its several lessees, owners of cottages and buildings, such fair and just proportion of the taxes thus levied and paid as the value of such cottages and buildings shall bear to the total valuation of such real estate assessed in the manner aforesaid, such assessment and levy to be made in the manner hereinafter provided, and the amount to be paid by any such owner or lessee when so fixed and determined shall constitute and be a debt against such owner of and a lien upon the cottage or building thus assessed, payable with interest as hereinafter provided, and the association may enforce the payment thereof in the same manner as in the case of non-payment of rent or non-performance of any condition in the lease under which said lessee holds, and no transfer or assignment of any such lease shall be valid until such assessment or tax is paid.

However, please keep in mind that each type of summer resort may have different statutory requirements, so it is important to consul with an attorney that handles summer resorts in order to determine if assessments are being properly imposed and collected.

Contact Our Summer Resort Lawyers for Help with Updating Governing Documents in Petoskey.

At Hirzel Law, PLC, our Michigan summer resort lawyers can help your summer resort with updating the documents. We stand by our clients, offering the highest quality legal representation and promptly responding to our clients’ needs.

Contact Hirzel Law online or call our Traverse City office at 231-486-5600 to see how our Michigan summer resort lawyers can assist with updating governing documents for your summer resort association in Petoskey.