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Michigan Supreme Court Case Summary

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Michigan Courts of Appeals rules that HOA Developer is subject to the Michigan Consumer Protection Act

In Liss v. Lewiston–Richard Inc, 478 Mich. 203; 732 NW2d 514 (2007), the Michigan Supreme Court held that a residential home builder was exempt from complying with the Michigan Consumer Protection Act, MCL 445.901 et seq. The Michigan Supreme Court reasoned that MCL 445.904(1)(a) exempted homebuilders from compliance with the Act as they were specifically authorized to build homes under the Michigan Occupational Code, MCL 339.101 et seq. The Supreme Court reasoned that homebuilders were not subject to the Act as they held a professional licenses and were regulated by the Residential Builders’ and Maintenance and Alteration Contractors' …show more content…
324331 (January 28, 2016) (Unpublished Opinion), the Michigan Court of Appeals provided clarification as to the application of Liss. Specifically, the Plaintiffs sued the developer of a subdivision for violating the Michigan Consumer Protection Act after the developer, and its officers, misrepresented the enforceability of an amendment to the declaration of restrictions and the amount of assessments that Plaintiffs would be required to pay. The Court of Appeals upheld the trial court’s ruling that the developer of the subdivision, and its officers, violated the Michigan Consumer Protection Act. The Court of Appeals held that a developer of a subdivision, which was also a licensed builder, was subject to the Michigan Consumer Protection Act as the developer did not enter into an agreement to construct a home with the Plaintiffs. Specifically, the Court of Appeals held that the developer entered into an agreement to sell property, and then in a separate capacity, agreed to serve as the construction manager for the Plaintiffs’ home. The Court of Appeals determined that the Plaintiffs served as their own general contractor on the project. Under these circumstances, the Court held that the fact that the developer held a builder’s license did not exempt it from compliance with the Michigan Consumer Protection Act as it was not engaged in an activity that was specifically authorized by statute,

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