Deghetto V Beaumont's Seven Harbors White And Duck Lack Association Summary

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In Deghetto v Beaumont’s Seven Harbors White and Duck Lack Association, issued June 22, 2017 (Docket No. 330972) (Unpublished Opinion), the Michigan Court of Appeals recently ruled that a homeowners’ association could not continue to collect assessments after the restrictive covenant expired. In Deghetto, the plaintiffs were the owners of multiple lots in six separate subdivisions in Highland Township, Michigan that contained over 650 lots. The land now known as Seven Harbors Subdivision belonged to various members of the Beaumont family until Harry S. and Florence M. Beaumont (the "Beaumonts") began subdividing the land in the 1930s. The first two subdivisions created from the land are known as Supervisor’s Plat No. 1 ("SP1") and Supervisor’s …show more content…

There was a provision authorizing the association to place a lien on the property if the dues were not paid. However, the deed restrictions explicitly stated that they would expire on January 1, 1960. Effective on January 1, 1960, the owners in SP1 and SPOSH adopted new restrictions (the "1959 Restrictions"). However, the 1959 Restrictions did not indicate that the covenants ran with the land and they did not indicate that any maintenance fees could be charged. The 1959 Restrictions expired on January 1, 1986, unless they were extended by the …show more content…

Rather, the Court finds and rules that the duty to pay the bi-annual assessment is an equitable servitude. It is the rule in the Commonwealth that a previous grantee's promise to make annual payments connected with land may impose on the granted premises an equitable servitude enforceable against the subsequent owner taking title with actual or constructive notice of the obligation, even where the equitable servitude calls for the payment of money. It is an indisputable fact that Plaintiffs' took title to the Property with full knowledge of the existence of the Association; moreover, they certainly had constructive—if not actual—notice of their obligations to the Association. Therefore, there exists an equitable servitude that requires Plaintiffs to pay the assessments as the previous owners

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