Tax-foreclosing county not liable for condominium assessments

In Harbor Watch Condominium Association v Emmet County Treasurer, a published Michigan Court of Appeals opinion, the court held that a condominium association could not recover unpaid condominium assessments from a county from the time of foreclosure until the county sold the units.  Because the county was not a voluntary purchaser, because the county was restricted by statute in the use of funds generated by a tax sale, and because the properties ultimately sold for less than the unpaid taxes, the court held that the county was not liable.

The opinion raises several questions in the author’s mind.  

First, it appears that the association sued only the county for the unpaid assessments and not the purchaser of the units. Since a purchaser who does not request a statement from an association prior to conveyance of a unit is fully liable with the seller, why was the purchaser not a party defendant?

Second, why had the association apparently not recorded a lien against the unit?  A lien would have required the county to pay the assessments, or would have put the purchaser on notice of the obligation.

At any rate, it appears clear that a county cannot be held personally liable for assessments which accrue while it holds title pursuant to a tax foreclosure.  It remains unclear whether the assessments are simply uncollectible at all, or whether they continue to accrue and can be collected from the purchaser from the county.

© Steve Sowell 2017