Fed. Nat'l Mortg. Ass'n v. Lagoons Forest Condo. Ass'n, Docket No. 313953.

305 Mich.App. 258

852 N.W.2d 217

FEDERAL NATIONAL MORTGAGE ASSOCIATION

v.LAGOONS FOREST CONDOMINIUM ASSOCIATION.

Docket No. 313953.

Court of Appeals of Michigan.

Submitted May 9, 2014, at Detroit.

Decided May 15, 2014, at 9:05 a.m.

Trott & Trott, PC, Farmington Hills, (by Charles L. Hahn).

Zelmanski, Danner & Fioritto, PLLC, Plymouth (by Tracy N. Danner and Corene C. Ford), for defendant.

Before: RIORDAN, P.J., and DONOFRIO and FORT HOOD, JJ.

DONOFRIO, J.

Plaintiff/counterdefendant, Federal National Mortgage Association (Fannie Mae), appeals as of right an order denying summary disposition in its favor and granting summary disposition in favor of defendant/counterplaintiff, Lagoons Forest Condominium Association. For the reasons stated below, we affirm in part, reverse in part, and remand.

I. BASIC FACTS

This case arises out of a foreclosure and subsequent sheriff's sale of a condominium unit in West Bloomfield, Michigan. The owners of the condominium unit had stopped making payments and defaulted on the mortgage. Additionally, the owners also had failed to pay their condominium association fees and owed defendant $2,460.58 in delinquent association assessment fees. Defendant filed a lien against the property for the unpaid condominium assessments on January 5, 2006.

On March 1, 2011, at the sheriff's sale, RBS Citizens Bank purchased the unit for $162,800 and received a sheriff's deed for the property. The sheriff's deed stated that the statutory period for redemption by the previous owners would end on September 1, 2011, at which time the sheriff's deed would become fully operative. On April 7, 2011, RBS Citizens Bank transferred the property to Fannie Mae by quitclaim deed in exchange for $1.

On September 9, 2011, defendant filed an amendment to its existing lien against the condominium at issue. The amendment provided that the unpaid sum was $13,144.27 and that the owner of the condominium unit was Fannie Mae. On the same day, attorneys for defendant sent a letter to Fannie Mae claiming that because Fannie Mae never requested a written statement from the condominium association of the amount of unpaid assessments owed, pursuant to MCL 559.211(2), it owed defendant for all of the unpaid assessments, including those that accrued before and those that accrued after the foreclosure sale.

On March 29, 2012, Fannie Mae filed its complaint against defendant in this case. The complaint requested that the court grant declaratory relief in the form of an order releasing Fannie Mae from defendant's condominium lien. The complaint further alleged common-law slander of title, statutory slander of title, and recording of documents with the intent to harass or intimidate. Defendant filed a countercomplaint, alleging that Fannie Mae owed it $21,619.27 for unpaid assessments, late charges, and legal fees pursuant to the Condominium Act, MCL 559.101 et seq.

On June 27, 2012, Fannie Mae filed its motion for summary disposition, pursuant to MCR 2.116(C)(8), (9), and (10). Fannie Mae argued that the condominium fees were illegal because defendant's lien was extinguished by the foreclosure and that the provision of the Condominium Act requiring notice to the association before a transfer, MCL 559.211, does not apply to assignments after a foreclosure. Fannie Mae further argued that the acquisition of title that occurs as the result of a sheriff's sale does not take place until after the statutory redemption period, rather than on the date of sale. Finally, Fannie Mae argued that its claims for slander of title and unlawful recording of documents with the intent to harass or intimidate were proper because defendant knew that its condominium lien was illegal at the time it filed the amendment.

On July 31, 2012, defendant filed its competing motion for summary disposition pursuant to MCR 2.116(C)(8), (9), and (10). Defendant argued that there was no genuine issue of material fact that Fannie Mae acquired title to the condominium unit as a result of the quitclaim deed from RBS Citizens Bank and, as a result of Fannie Mae's failure to pay the amount owed or to request a written statement setting forth the unpaid fees, Fannie Mae was liable for the full amount of assessments and costs. Further, defendant argued that Fannie Mae failed to state a claim on which relief could be granted for either its claims for slander of title or recording of documents with the intent to harass or intimidate.

On September 19, 2012, the trial court held a hearing on the parties' competing motions for summary disposition. The trial court determined that MCL 559.211 did not distinguish between types of conveyances, which meant that RBS Citizens Bank's transfer to Fannie Mae was a conveyance under the statute. Consequently, because Fannie Mae had not requested a written statement of the unpaid assessments at least five days before the sale, it owed “ any unpaid assessments against the condominium,” which included assessments owed on the condominium that accrued before the foreclosure. The trial court entered an order denying Fannie Mae's motion and granting defendant's motion.

II. STANDARD OF REVIEW

Both parties moved for summary disposition pursuant to MCR 2.116(C)(8), (9), and (10). But because the parties relied on materials outside the pleadings, such as the mortgage filings attached to the parties' briefs in this case, this Court will treat the trial court's decision as one based on MCR 2.116(C)(10). Cuddington v. United Health Servs., Inc., 298 Mich.App. 264, 270, 826 N.W.2d 519 (2012).

“This Court reviews de novo a trial court's decision on a motion for summary disposition.” Allen v. Bloomfield Hills Sch. Dist., 281 Mich.App. 49, 52, 760 N.W.2d 811 (2008). A motion for summary disposition under MCR 2.116(C)(10) tests the factual sufficiency of the complaint. Joseph v. Auto Club Ins. Ass'n, 491 Mich. 200, 206, 815 N.W.2d 412 (2012). In reviewing a grant of summary disposition under MCR 2.116(C)(10), this Court considers the pleadings, admissions, and other evidence submitted by the parties in the light most favorable to the nonmoving party. Sallie v. Fifth Third Bank, 297 Mich.App. 115, 117–118, 824 N.W.2d 238 (2012). Summary disposition is appropriate if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. MCR 2.116(C)(10); Latham v. Barton Malow Co., 480 Mich. 105, 111, 746 N.W.2d 868 (2008). A genuine issue of material fact exists when, after viewing the evidence in the light most favorable to the nonmoving party, the record leaves open an issue upon which reasonable minds may differ. Debano–Griffin v. Lake Co., 493 Mich. 167, 175, 828 N.W.2d 634 (2013).

But to the extent that our review involves issues of statutory interpretation, that aspect of our review is de novo. Podmajersky v. Dep't of Treasury, 302 Mich.App. 153, 162, 838 N.W.2d 195 (2013) The primary goal of statutory interpretation is to give effect to the intent of the Legislature. Ford Motor Co. v. Woodhaven, 475 Mich. 425, 438, 716 N.W.2d 247 (2006). To ascertain the Legislature's intent, we look to the language in the statute and give the words their plain and ordinary meanings. Lafarge Midwest, Inc. v. Detroit, 290 Mich.App. 240, 246, 801 N.W.2d 629 (2010). If the plain and ordinary meaning is otherwise clear, “judicial construction is neither required nor permitted.” In re Receivership of 11910 S Francis Rd., 492 Mich. 208, 222, 821 N.W.2d 503 (2012). Judicial construction is only appropriate when an ambiguity exists in the language of the statute. Whitman v. City of Burton, 493 Mich. 303, 312, 831 N.W.2d 223 (2013). A statute is ambiguous when it irreconcilably conflicts with another provision or is equally susceptible to more than a single meaning. Lansing Mayor v. Pub. Serv. Comm., 470 Mich. 154, 166, 680 N.W.2d 840 (2004).

III. ANALYSIS

A. CONDOMINIUM ACT

Fannie Mae first contends that the trial court erred by ruling that it was liable for association assessments because the court's application of MCL 559.211 to the instant case was improper. We agree, in part.

MCL 559.211 provides, in pertinent part:

(1) Upon the sale or conveyance of a condominium unit, all unpaid assessments, interest, late charges, fines, costs, and attorney fees against a condominium unit shall be paid out of the sale price or by the purchaser in preference over any other assessments or charges of whatever nature....

* * *

(2) ... Unless the purchaser or grantee requests a written statement from the association of co-owners as provided in this act, at least 5 days before sale, the purchaser or grantee shall be liable for any unpaid assessments against the condominium unit together with interest, costs, fines, late charges, and attorney fees incurred in the collection thereof.

“Association of co-owners” is defined as “the person designated in the condominium documents to administer the condominium project,” MCL 559.103(4), which is in this case, defendant. However, MCL 559.158 provides, in pertinent part:

If the mortgagee of a first mortgage of record or other purchaser of a condominium unit obtains title to the condominium unit as a result of foreclosure of the first mortgage, that mortgagee or purchaser and his or her successors and assigns are not liable for the assessments by the administering body chargeable to the unit that became due prior to the acquisition of title to the unit by that mortgagee or purchaser and his or her successors and assigns.

The statute does not define “successors and assigns.” When a legal term of art is left undefined, it is appropriate for this Court to consult a legal dictionary. Hunter v. Sisco, 300 Mich.App. 229, 239, 832 N.W.2d 753 (2013). Black's Law Dictionary (9th ed.) defines “successor” as “one who replaces or follows a predecessor,” and “successor in interest” as “[o]ne who follows another in ownership or control of property.” Further, “ assign” is defined by way of “assignee” as “[o]ne to whom...