Michigan Walden Hills II v. Walden Hills (2025): 2/3 Vote

Quick Answer

In Walden Hills II Condominium Association v Walden Hills Condominium Association (Mich App, April 9, 2025, unpublished per curiam), the Court of Appeals held that a 1983 agreement between two neighboring condominium associations to share a community building did not "materially alter" co-owners' rights. Because it did not, the board could sign it without the two-thirds co-owner vote that MCL 559.190(2) requires for material changes.

The court therefore affirmed an order compelling arbitration under the agreement. The opinion is unpublished, so treat it as an illustration of how one panel applied the statute, not as binding precedent.

At a Glance

The Dispute

Walden Hills and Summit View were built in the 1960s as one Ann Arbor apartment complex that included a swimming pool, club house and handball courts, called the community building. The complex was converted to condominiums in phases. The Walden Hills association was formed in 1981 as a nonprofit corporation, and the Summit View association followed in 1988.

In 1983 the Walden Hills association signed an Agreement for Use of Community Facilities with the developer, signed "by authority of its Board of Directors." It gave condominium owners and apartment renters an easement of enjoyment in the community building, moved maintenance duties to a new governing committee with members from both sides, set a cost-sharing structure, and contained an arbitration clause. A 1985 amendment changed the proration of assessments and the termination method and gave each association an office.

The two sides shared the building for more than 30 years. After a 2020 dispute about reopening it, Walden Hills began operating the building alone in 2021, arguing the 1983 agreement and amendment were invalid because two-thirds of the co-owners had not approved them. Summit View sued to compel arbitration and asserted other claims. After a bench trial in June 2023, the trial court compelled arbitration and dismissed the counterclaim, finding the agreement valid because the board had authority to sign it without co-owner approval since it was not a material change to co-owner rights.

What the Court Held

The statute

The court described MCL 559.190(1) as allowing the board to amend condominium documents without co-owner consent so long as the amendments do not "materially alter or change the rights of a co-owner or mortgagee," while subsection (2) requires approval from two-thirds of the co-owners for an amendment that does.

Reasoning

The court reviewed the master deed, articles and bylaws as contracts, interpreted by plain meaning. It noted that neither party offered evidence on whether two-thirds of Walden Hills co-owners approved the 1983 agreement. It then found the plain language showed no material alteration:

• The master deed "broadly empowers" the board to act for the association unless authority is specifically reserved to co-owners.
• The articles give the association authority to contract for management, operation and maintenance, and the bylaws make the board responsible for management and for contracting with agents to assist in administration.
• Nothing in those documents prohibits the board from agreeing with an adjoining association that holds an easement over the recreational area "to share the administration, regulation, maintenance, and associated costs."
• The master deed's paragraph 10 reserved rights for the developer's rental units to use the recreational area on paying a proportionate share of costs. The court read that cost-sharing language as showing the developer intended both use and control, shared with cost responsibility.
• The agreement changed the deed's cost-sharing formula, but that change "was necessary to carry out the master deed's intent," because without it, as apartments converted, the formula would have shifted the entire cost to Walden Hills co-owners. It therefore "did not materially alter the co-owners' rights."

Arbitration and remaining issues

Because the agreement was valid, the arbitration clause applied. Walden Hills could raise its dismissed counterclaims in arbitration. The court did not reach the trial court's alternative reasoning on equitable estoppel and laches.

Why It Matters for Associations

The case turned on the association's own documents. Our reading: the outcome would likely have been different if the master deed, articles or bylaws had reserved that authority to co-owners, so every board should know what its documents delegate.

The decision also shows the court treating an arbitration clause in an inter-association agreement as enforceable once the agreement itself was held valid. Boards that share facilities with a neighbor should expect to arbitrate disputes if the agreement says so.

Limits of the holding

• It applied to one 1983 agreement and one set of documents.
• The court noted the record contained no evidence on whether two-thirds of co-owners had approved. It did not decide that a vote was unnecessary for all shared-facility agreements.
• It is unpublished and nonbinding. Counsel should confirm whether and how it may be cited.

Related Michigan Law

• Amending the master deed and bylaws (MCL 559.190)
• Mortgagee voting on amendments (MCL 559.190a)
• Mandatory bylaw provisions and ADR (MCL 559.154)
• Janini v. London Townhouses

Board Checklist

• Read the master deed, articles and bylaws for what the board may do without a co-owner vote.
• Before signing a long-term shared-use or cost-sharing agreement, ask counsel whether it materially alters co-owner rights.
• Keep records of any co-owner vote taken on such an agreement.
• Check any agreement for an arbitration clause and understand what it covers.
• Calendar periodic reviews of old inter-association agreements and amendments.
• Do not rely on an unpublished opinion as settled law.

Frequently Asked Questions

Does a board always need a two-thirds vote to sign a shared-facility agreement?

No, according to this panel's reading of MCL 559.190. The two-thirds vote applies to amendments that materially alter co-owner or mortgagee rights. The panel found this agreement did not.

Is Walden Hills binding precedent?

It is an unpublished per curiam opinion, so it is not binding precedent. Confirm with counsel before relying on it.

What happened to the arbitration clause?

The court affirmed the order compelling arbitration, and the remaining disputes go to an arbitrator.

Did the court decide the equitable estoppel argument?

No. It said it need not address the trial court's alternative reasoning on estoppel or laches.

Did evidence show a co-owner vote occurred?

The opinion says neither party presented evidence on whether two-thirds of Walden Hills co-owners approved the 1983 agreement.

Where This Comes From

We read the full text of the Court of Appeals opinion in Docket No. 366707 (April 9, 2025) as posted by the State Bar of Michigan. We did not check later history such as an application for leave to appeal. The opinion is unpublished and has no reporter citation.

How APM Helps

Association Property Managers manages condominium and HOA communities across Michigan from our East Lansing office, with flat, published pricing. See our Michigan service area, browse every Michigan state-law guide, or request a free proposal. Laws and documents differ by community, and we review your master deed and bylaws when we build your proposal.

Legal disclaimer: This article is general information, not legal advice. Laws change and associations differ. Confirm the current statute text and how it applies to your governing documents with a licensed Michigan attorney before acting.