SENATE BILL No. 577

July 10, 2001, Introduced by Senator BULLARD and referred to the Committee on Economic Development, International Trade and Regulatory Affairs.

A bill to amend 1978 PA 59, entitled

"Condominium act,"

by amending section 54 (MCL 559.154), as amended by 2000 PA 379.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1 Sec. 54. (1) The bylaws shall contain provisions for the

2 designation of persons A PERSON to administer the affairs of

3 the condominium project and shall require that those persons

4 THE PERSON keep books and records with a detailed account of the

5 expenditures and receipts affecting the condominium project and

6 its administration, and which THAT specify the operating

7 expenses of the project.

8 (2) The bylaws shall provide that the person designated to

9 administer the affairs of the project shall be assessed as the

10 person in possession for any tangible personal property of the

11 project owned or possessed in common by the co-owners. Personal

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1 property taxes based on that tangible personal property shall be

2 treated as expenses of administration.

3 (3) The bylaws shall contain specific provisions directing

4 the courses COURSE of action to be taken in the event of par-

5 tial or complete destruction of the building or buildings in the

6 project.

7 (4) The bylaws shall provide that expenditures affecting the

8 administration of the project shall include costs incurred in the

9 satisfaction of any liability arising within, caused by, or

10 connected with , the common elements or the administration of

11 the condominium project. , and that receipts affecting the

12 administration of the condominium project shall include all sums

13 received as the proceeds of, or pursuant to, a policy of insur-

14 ance securing the interest of the co-owners against liabilities

15 or losses arising within, caused by, or connected with the common

16 elements or the administration of the condominium project.

17 (5) THE BYLAWS SHALL PROVIDE THAT RECEIPTS AFFECTING THE

18 ADMINISTRATION OF THE CONDOMINIUM PROJECT SHALL INCLUDE ALL SUMS

19 RECEIVED AS THE PROCEEDS OF, OR ACCORDING TO, A POLICY OF INSUR-

20 ANCE SECURING THE INTEREST OF THE CO-OWNERS AGAINST LIABILITIES

21 OR LOSSES ARISING WITHIN, CAUSED BY, OR CONNECTED WITH THE COMMON

22 ELEMENTS OR THE ADMINISTRATION OF THE CONDOMINIUM PROJECT.

23 (6) (5) The bylaws shall provide that the association of

24 co-owners shall prepare and distribute to each owner CO-OWNER

25 at least once each year a financial statement, the contents of

26 which shall be defined by the association of co-owners.

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1 (7) (6) The bylaws shall provide an indemnification clause

2 for the board of directors of the association of co-owners. The

3 indemnification clause shall require that 10 days' notice ,

4 before payment under the clause, be given to the co-owners,

5 BEFORE PAYMENT UNDER THE CLAUSE. The indemnification clause

6 shall exclude indemnification for willful and wanton misconduct

7 and for gross negligence.

8 (8) (7) The bylaws may allocate to each condominium unit a

9 number of votes in the association of co-owners proportionate to

10 the percentage of value appertaining to each condominium unit, or

11 an equal number of votes. in the association of co-owners.

12 (9) (8) The bylaws shall contain a provision providing

13 that arbitration of disputes, claims, and grievances A DISPUTE,

14 CLAIM, OR GRIEVANCE arising out of or relating to the interpreta-

15 tion of the application of the condominium document or arising

16 out of disputes A DISPUTE among or between co-owners shall be

17 submitted to arbitration and that the parties to the dispute,

18 claim, or grievance shall accept the arbitrator's decision as

19 final and binding, upon the election and written consent of the

20 parties to the disputes, claims, or grievances DISPUTE, CLAIM,

21 OR GRIEVANCE and upon written notice to the association. The

22 commercial arbitration rules of the American arbitration associa-

23 tion are applicable to any such arbitration.

24 (10) (9) In the absence of the election and written con-

25 sent of the parties under subsection (8) (9), neither a

26 co-owner nor the association is prohibited from petitioning a

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1 court of competent jurisdiction to resolve any A dispute,

2 claim, or grievance.

3 (11) (10) The election by the parties to submit any A

4 dispute, claim, or grievance to arbitration prohibits the parties

5 from petitioning the courts regarding that dispute, claim, or

6 grievance.

7 (12) THE BYLAWS SHALL PROVIDE THAT CO-OWNERS MAY ATTEND ALL

8 MEETINGS OF THE BOARD OF DIRECTORS OF THE ASSOCIATION OF

9 CO-OWNERS EXCEPT AS PROVIDED IN SUBSECTION (15). THE CO-OWNERS'

10 RIGHT TO ATTEND THE MEETINGS INCLUDES THE RIGHT TO SPEAK ON A

11 DESIGNATED AGENDA ITEM.

12 (13) THE BYLAWS SHALL PROVIDE THAT, EXCEPT IN THE CASE OF AN

13 EMERGENCY, WRITTEN NOTICE OF A MEETING OF THE BOARD OF DIRECTORS

14 OF THE ASSOCIATION OF CO-OWNERS SHALL BE POSTED IN A CONSPICUOUS

15 PLACE ON THE CONDOMINIUM PROPERTY NOT LESS THAN 14 DAYS BEFORE

16 THE MEETING. THE NOTICE SHALL INCLUDE ALL AGENDA ITEMS FOR THE

17 MEETING. THE NOTICE OF A MEETING AT WHICH REGULAR ASSESSMENTS

18 AGAINST CO-OWNERS WILL BE CONSIDERED SHALL CONTAIN A SPECIFIC

19 STATEMENT THAT ASSESSMENTS WILL BE CONSIDERED AND DESCRIBE THE

20 NATURE OF THE ASSESSMENTS.

21 (14) THE BYLAWS SHALL PROVIDE THAT IN THE EVENT OF AN EMER-

22 GENCY REQUIRING A MEETING OF THE BOARD OF DIRECTORS OF THE ASSO-

23 CIATION OF CO-OWNERS WITHOUT NOTICE AS REQUIRED IN THIS SECTION,

24 THE BOARD OF DIRECTORS OF THE ASSOCIATION OF CO-OWNERS SHALL PRO-

25 VIDE THE DETAILS OF THAT EMERGENCY TO THE CO-OWNERS PRESENT AT

26 THE NEXT REGULAR MEETING OF THE BOARD OF DIRECTORS OF THE

27 ASSOCIATION OF CO-OWNERS.

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1 (15) THE BOARD OF DIRECTORS OF THE ASSOCIATION OF CO-OWNERS

2 MAY MEET IN A CLOSED SESSION ONLY FOR 1 OR MORE OF THE FOLLOWING

3 PURPOSES:

4 (A) TO CONSIDER THE DISMISSAL, SUSPENSION, OR DISCIPLINING

5 OF; TO HEAR COMPLAINTS OR CHARGES BROUGHT AGAINST; OR TO CONSIDER

6 A PERIODIC PERSONNEL EVALUATION OF AN OFFICER, EMPLOYEE, STAFF

7 MEMBER, OR INDIVIDUAL AGENT, IF THE NAMED PERSON REQUESTS A

8 CLOSED HEARING. A PERSON REQUESTING A CLOSED HEARING MAY RESCIND

9 THE REQUEST AT ANY TIME, IN WHICH CASE THE MATTER AT ISSUE SHALL

10 BE CONSIDERED ONLY IN OPEN SESSIONS.

11 (B) FOR STRATEGY AND NEGOTIATION SESSIONS CONNECTED WITH THE

12 NEGOTIATION OF A COLLECTIVE BARGAINING AGREEMENT IF EITHER NEGO-

13 TIATING PARTY REQUESTS A CLOSED HEARING.

14 (C) TO CONSULT WITH ITS ATTORNEY REGARDING TRIAL OR SETTLE-

15 MENT STRATEGY IN CONNECTION WITH SPECIFIC PENDING LITIGATION,

16 ONLY IF AN OPEN MEETING WOULD HAVE A DETRIMENTAL FINANCIAL EFFECT

17 ON THE LITIGATING OR SETTLEMENT POSITION OF THE ASSOCIATION OF

18 CO-OWNERS.

19 (D) TO REVIEW THE SPECIFIC CONTENTS OF AN APPLICATION FOR

20 EMPLOYMENT IF THE CANDIDATE REQUESTS THAT THE APPLICATION REMAIN

21 CONFIDENTIAL. HOWEVER, ALL INTERVIEWS FOR EMPLOYMENT SHALL BE

22 HELD IN OPEN SESSIONS.

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