Summary Disposition Granted in Condominium Association Case

Joel Ashton, a partner in our Livonia office, recently had a case dismissed for a Condominium Association on summary disposition pursuant to MCR 2.116(C)(8) in the Oakland County Circuit Court.

In this case, a disgruntled condominium owner represented himself in his quest to obtain a preliminary injunction to avoid the imminent March 2020 election of three directors to the Board of Directors or, alternatively, to set aside the results of that election.  The issue was whether three or four directors should be elected in 2020.  The Bylaws provided for a seven-member Board, having two-year terms, with staggered yearly elections of three or four directors depending upon the number of directors whose terms expired.  Notably, in March 2019, five directors were elected due to a significant number of resignations from the Board.  In order to elect three directors at the subject March 2020 election, the Board decided to award two-year terms to four of the newly elected directors and a one-year term to the remaining newly elected director.  The pro-per Plaintiff complained that, historically, four directors had been elected in even numbered years and three directors were elected in odd numbered years.  Accordingly, he argued that the subject March 2020 election should include the election of four directors rather than three.

Procedurally, the Plaintiff initially incorrectly filed this case in the local District Court, which lacked jurisdiction due to his request for equitable relief.  In response to our request for dismissal or transfer, the District Court allowed the Plaintiff to voluntarily dismiss the case.  He then filed a slightly altered Complaint in the Oakland County Circuit Court, where, days before the March 2020 election, we successfully opposed his request for a preliminary injunction to halt the election.  Following the March 2020 election, which included the election of three directors, he filed two amended Complaints, with the Court striking the second amended Complaint at our request due to his failing to properly seek leave of Court or consent of the Association and since the amendment was futile due to including improper requests such as an “admonishment” of the Board and damages for mental anguish and anxiety.

Before incurring the cost of discovery, the Circuit Court granted our dispositive motion, agreeing that the Plaintiff failed to state a claim upon which relief may be granted since the Bylaws supported the Association’s actions.  Specifically, the Court dismissed the claim for breach of contract since the Plaintiff’s only support was the Bylaws for which the plain language clearly allowed the election of three directors in 2020.  Similarly, the Court dismissed the claim for breach of fiduciary duty since, although the Association owed a fiduciary duty to its members, the Plaintiff failed to state a breach by merely alleging the same facts underlying the alleged breach of contract.  Additionally, the Court agreed that the Plaintiff’s request for punitive and exemplary damages were not available absent extraordinary circumstances, which were not present in this case.  Probably because the case involved a self-represented Plaintiff, the Court denied our request for sanctions for filing a frivolous case.

As is often true with these types of cases, the outlook for defense costs looked to be expensive.  The early dismissal of the case not only resolved the litigation in our client’s favor but avoided costly discovery and motions with a litigious and emotionally vested Plaintiff.

Joel Ashton focuses his practice on insurance defense, including Michigan No-Fault claims (PIP, automobile negligence, uninsured/underinsured motorist), as well as premises liability and general negligence. He has handled a variety of cases involving condominium associations, condominium association members, and general real estate matters as part of his general practice. Mr. Ashton maintains an AV Preeminent Rating from Martindale-Hubbell, which is the highest possible rating an attorney can achieve for both ethical standards and legal ability. He may be reached at (734) 261-2400 or jashton@cmda-law.com.