Fenton Orchards: Unbuilt Condo Units and Old Section 67

Quick Answer

On September 17, 2025, the Michigan Court of Appeals decided Charter Township of Fenton v Fenton Orchards Condominium Association, No. 370733, and affirmed summary disposition for the association. The court held that units that were never built and were not withdrawn within the statutory period reverted to general common elements under the pre-2016 version of MCL 559.167 (called "old section 67"), so a township that took the units through tax foreclosure had no right to sell them. The opinion is unpublished, but it applies reasoning from earlier published cases and is useful for associations dealing with abandoned developments.

Background

A developer created the Fenton Orchards condominium in 2000 and recorded a 52-unit master deed in 2001, then added units by amendment in 2003. Between 2007 and 2009, according to the township, the developer went out of business and stopped paying taxes on a number of units, which were transferred to the township through tax foreclosure sales in 2011 and 2017. In 2018 and again in 2022, the association told the township the unbuilt units had reverted to general common elements. In 2022 it recorded an affidavit and a third amendment to the master deed saying so. The township sued in 2023.

What Old Section 67 Says

Under the pre-amendment version of MCL 559.167(3), if a developer has not completed units or improvements that are not identified as "must be built" within 10 years of the start of construction, the developer may withdraw the undeveloped portions without co-owner consent. If the developer does not withdraw them within the period, the undeveloped land remains part of the project as general common elements and all rights to construct units on it cease. The statute was amended effective September 21, 2016 by 2016 PA 233; the Court of Appeals has held the amendment does not apply retroactively, so older projects are analyzed under the earlier text.

The Court's Reasoning

• Units were not "site condominiums." The township argued the added units were site condominiums that count as developed when recorded. The court examined the master deed, amendments and bylaws and concluded they described structure units with shared general common elements, so treating some units as site units would make the documents unworkable.
• Roads and utilities were not shown to be complete. Citing Elizabeth Trace Condominium Association v American Global Enterprises, 340 Mich App 435 (2022), the court noted that beginning construction on general common elements is not enough to make units "developed," and the record contained no real evidence of completed roads or utilities.
• Result. The units were undeveloped, not withdrawn in time, and reverted by operation of law.

Why It Matters

Boards at older, partly built projects may be dealing with unbuilt units owned by a defunct developer, a lender or a taxing authority. The case shows that old section 67 can transfer those units to the association's general common elements automatically, and that associations that act and document their position can defeat a later sale. It also shows how much depends on the master deed language and on evidence in the record.

Cautions

• The decision is unpublished and fact-specific, and later amendments to section 67 changed the rules for newer projects.
• Tax foreclosure, assessments owed on the units, and title insurance issues can complicate the picture.
• Recording an affidavit or amendment asserting reversion should be done with an attorney.

Board Action Checklist

• Review your master deed and amendments for units labeled "must be built" or "need not be built" and for expansion or withdrawal rights.
• Find the date construction commenced and the dates of any expansion or contraction amendments, which affect the statutory clock.
• Identify who holds title to any unbuilt units and whether assessments are unpaid.
• Keep evidence of what was actually built, such as plans, inspection records and photographs.
• Consult counsel before recording a reversion affidavit or amendment. Our Michigan Condominium Act guide explains developer-control and turnover issues.

How APM Helps

APM organizes recorded documents, tracks developer-era obligations and supports boards through turnover and title issues. See our Michigan resources or contact us.

Source: Charter Township of Fenton v Fenton Orchards Condominium Association, Mich Ct App No. 370733 (September 17, 2025) (unpublished per curiam). This article is general information, not legal advice. Last verified October 24, 2026.