Tag: landlord

Five Stories that Matter in Michigan This Week – November 18, 2022

  1. Proposed Modifications to Michigan Court Rules Seek to Make Pandemic-Inspired Changes Permanent, Making it Harder to Evict Tenants

During the COVID-19 pandemic, Michigan’s court rules related to landlord-tenant eviction procedures were modified in some ways to utilize video conferencing and to make certain proceedings more efficient, and modified in other ways that made it more difficult for landlords to evict residential and commercial tenants.

Why it Matters: Pursuant to recently proposed amendments to Michigan Court Rule 4.201, Michigan’s State Court Administrative Office has taken steps to make many pandemic-era changes to minimize evictions permanent. Some of the proposed rules are allowing a judge to adjourn trial for at least seven days if a default judgment is not entered, and staying an eviction case if a tenant has applied for rent assistance. Learn more from our Fraser Trebilcock real estate attorneys on the matter.

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  1. Michigan Small Business Growth Remains Strong

According to a recent report from the small Business Association of Michigan, Michigan’s entrepreneurial economy continues to grow. Among other things, SBAM’s Entrepreneurship Score Card shows that Michigan small businesses have outperformed U.S. averages in terms of the percentages of businesses being opened and revenue.

Why it Matters: Small businesses have always been the backbone of economic growth in Michigan and across the country. This report highlights the resilience of Michigan entrepreneurial economy.

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  1. Business Planning for the Future

A lot of small-to-medium size businesses devote time and focus on their near-term future but may not think of what 5-10 years will bring. The value of a business can often be in the ability to transition it to a new owner, but some business owners are unsure how to set themselves up to be successful in this arena.

Why it Matters: Capitalizing on the ability to plan for the long-term will aid your business in any transitions that may occur. Learn more here.

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  1. CRA Issues Michigan Consumer Advisory

Earlier this week, CRA issued a bulletin giving notice to consumers that a marijuana business that operates as both a state-licensed medical and adult-use recreational, Green Culture, sold unregulated products that may have contained several contaminants, such as mold and/or bacteria.

Why it Matters: Following the investigation, the CRA suspended both of Green Culture’s licenses. Marijuana businesses should heed this as a warning, the CRA are cracking down on businesses that do not follow the strict guidelines and rules laid out by the state agency.

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  1. IRS Announces 2023 Cost-of-Living Adjustment for Retirement and Health and Welfare Benefit Plans

The Internal Revenue Service recently announced 2023 cost-of-living adjustments for retirement and health and welfare benefit plans. The significant adjustments reflect the increase in inflation over the last year. The adjustments are detailed in IRS Notice 2022-55. For example, the contribution limit for a Simple 401(k) will increase to $15,500 in 2023 from $14,000 in 2022, and for a Health FSA, limits will increase to $3,050 in 2023 from $2,850 in 2022.

Why it Matters: Business owners and employers should be aware of these adjustments and share this information with employees as we approach the new year. If you have any questions regarding these adjustments, please contact our Employee Benefits team.

Related Practice Groups and Professionals

Real Estate | Jared Roberts
Business & Tax | Mark Kellogg
Cannabis Law | Sean Gallagher
Employee Benefits | Robert Burgee

Proposed Modifications to Michigan Court Rules Seek to Make Pandemic-Inspired  Changes Permanent, Making it Harder to Evict Tenants

During the COVID-19 pandemic, Michigan’s court rules related to landlord-tenant eviction procedures were modified in some ways to utilize video conferencing and to make certain proceedings more efficient, and modified in other ways that made it more difficult for landlords to evict residential and commercial tenants. Pursuant to recently proposed amendments to Michigan Court Rule 4.201, Michigan’s State Court Administrative Office has taken steps to make many pandemic-era changes to minimize evictions permanent.

The rule changes were subject to a shortened public comment period which ended on November 1, 2022. The Supreme Court will take them up at its November 16 public hearing.

Some of the highlights of the rule modifications include:

  • Giving courts discretion as to whether to enter an eviction order if a tent fails to appear at an eviction hearing (pre-pandemic such an order was mandatory).
  • Allowing a judge to adjourn trial for at least seven days if a default judgment is not entered.
  • Staying an eviction case if a tenant has applied for rent assistance.
  • Allowing tenants to request a jury trial with only 48 hours’ notice before a trial.
  • Permitting online pretrial hearings.
  • Requiring tenants to be served in person if a landlord is seeking an immediate default judgment.

Eviction is an issue that every Michigan landlord must grapple with at some point while running their business. Ever since COVID-19 began, it’s become harder for landlords to move forward with eviction. And now, given these proposed rule changes, it may not get any easier for the foreseeable future.

One of the best ways to avoid having to deal with the eviction process is to do due diligence on potential tenants to assess their ability to fulfill their obligations under a lease. Ensuring that a lease agreement is unambiguous and contains clear procedures for eviction (that are consistent with the law) is also critical.

To protect and enforce your rights as a landlord, please contact Fraser Trebilcock shareholder Jared Roberts.

Jared Roberts is a shareholder at Fraser Trebilcock who works in real estate litigation and transactions, among other areas of the law. Jared is Chair of the firm’s Real Estate department, and also “walks the walk” as a landlord and owner of residential rental properties and apartments in Downtown Lansing. He may be reached at jroberts@fraserlawfirm.com and (517) 482-0887.

Five Stories that Matter in Michigan This Week – November 11, 2022

  1. Sixth Circuit Rules that Notice is Required to Terminate Contract for Successive Performances

Under Section 440.2309(2) of Michigan’s Uniform Commercial Code, a contract that “provides for successive performances but is indefinite in duration” may be terminated at any time (without cause). However, as a U.S. Court of Appeals for the Sixth Circuit decision points out, reasonable notice of such termination must be provided, unless the requirement of notice is waived via the contract.

Why it Matters: The court’s ruling in the case of Stackpole International Engineered Products v. Angstrom Automotive Group is a reminder for buyers and sellers, especially in the manufacturing industry, who enter into contracts that provide for successive performances to work with experienced legal counsel in the drafting, review and enforcement of commercial contracts in order to avoid contractual disputes and litigation.

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  1. Michigan Election Results: Governor’s Race, State House and Senate

In the hotly contested governor’s race, Democrat Gretchen Whitmer defeated Republican challenger Tudor Dixon and will continue to serve as Michigan’s Governor for the next 4 years. And, both the State House and Senate flipped to Democratic control.

Why it Matters: This is the first time since 1984 that the Governor’s Office, State House and Senate are all controlled by Democrats. As officials look towards new leadership in certain areas, Fraser Trebilcock’s election law team will continue to monitor and report on any significant changes happening in Lansing.

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  1. Municipalities Vote on Marijuana

While adult-use recreational marijuana passed the ballot in 2018, each individual municipality has the control to allow adult-use recreational marijuana businesses to operate in their community. This election cycle saw numerous municipalities vote on this issue.

Why it Matters: According to data provided by the CRA prior to the November election, less than 10% of all municipalities in the state had opted in for adult-use recreational marijuana businesses. Following election results showing that more municipalities are allowing for adult-use recreational businesses to operate in their town, the issues that have plagued current license owners arise again for officials to handle.

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  1. Passed – Prop 1: Term Limits and Financial Requirements

Following the November 8, 2022 election results, Prop 1, which proposed changes to term limits for state legislators and required elected officials to disclose financial information, passed.

Why it Matters: As we covered in an earlier newsletter, this development will permit lawmakers to serve 12 years in Lansing, and all of that time can be spent in the House or Senate, or it could be divided between the two chambers. Additionally, elected officials would have to disclose their assets, income and liabilities, and their involvement in any businesses, nonprofits, labor organizations or educational institutions.

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  1. Controversial Landlord-Tenant Rules Proposed by State Court Administrative Office

The State Court Administrative Office unveiled proposed changes to Michigan Court Rule 4.201, that if enacted, would alter the way eviction cases are handled for both landlords and tenants. Some of the proposed amendments are the ability for tenants to get an automatic stay if they have applied for rental aid, and a requirement that tenants be served in person if a landlord wants an immediate default judgement.

Why it Matters: If enacted, these rules would allow commercial and residential tenants more time to pay their landlords if they fall behind on payments. However, some are against the new proposed rules as they believe it would increase the difficulty for landlords to evict non-paying tenants, and make the process of finding new tenants more difficult.

Related Practice Groups and Professionals
Labor, Employment & Civil Rights | Aaron Davis
Election Law | Garett Koger
Cannabis Law | Sean Gallagher
Real Estate | Jared Roberts

Five Stories that Matter in Michigan This Week – October 28, 2022

  1. Governor Whitmer Signs Bipartisan Election Bills

Governor Whitmer recently signed a package of election law bills which impact how clerks process ballots, including those coming from members of the military overseas. Michigan Public Act 195 permits clerks to pre-process absentee ballots two days prior to Election Day, changes requirements for ballot drop boxes to increase security, and requires clerks to more frequently review and update qualified voter files to remove dead voters. Public Act 196 allows military members serving overseas to submit ballots electronically.

Why it Matters: Polling shows that voters are highly energized and polarized leading up to the midterm elections. These laws are meant to address certain voting-related issues, such as ballot box integrity, that have led to controversy in the past. If you have questions about these bills, or election law issues in general, please contact a member of our election law team.

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  1. Department of Labor Issues New Proposed Rule on Independent Contractors 

The U.S. Department of Labor recently issued a Notice of Proposed Rulemaking that, if adopted, would change the standard for analyzing a worker’s classification as either an employee or independent contractor.

Why it Matters: Employee misclassification can result in severe financial consequences. Businesses and employers should remain diligent in analyzing their workers’ classifications. Learn more on the subject.

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  1. Michigan Court of Claims Rules in Prevailing Wage Policy Case

Judge Douglas Shapiro of the Michigan Court of Claims recently ruled in favor of the state’s Department of Technology, Management, and Budget (DTMB), when it implemented its prevailing wage policy. The Associated Builders and Contractors of Michigan (ABC) in July 2022 filed a preliminary injunction claiming that due to the 2018 repeal of Michigan’s prevailing wage law, that the state cannot require the wage rate, which the Court denied and agreed that DTMB did not violate separation of powers when implementing its prevailing wage policy.

Why it Matters: October 31 is the deadline for ABC to appeal the decision. If this decision stays, this signals changes to the way organizations do business with the state of Michigan. Learn more on DTMB’s prevailing wage.

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  1. New CRA Director Vows to Crack Down on Black Market Sales

This week, Brian Hanna, the Cannabis Regulatory Agency’s acting director, spoke to media and highlighted the agency’s focus on cracking down on cannabis that is continuing to illegally enter Michigan’s market.

Why it Matters: Though official numbers have not been confirmed, it is known that illicit cannabis is continuing to enter Michigan’s medical and adult-use cannabis markets, causing widespread effects on prices and profits for legal and law-abiding businesses.

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  1. State Court Administrative Office Proposes New Landlord-Tenant Rules

The State Court Administrative Office unveiled new proposed rules that if enacted, would alter the way eviction cases are handled for both landlords and tenants. Rules such as a requirement that tenants be served in person if a landlord wants an immediate default judgement, and the ability for tenants to get an automatic stay if they have applied for rental aid.

Why it Matters: If enacted, these rules would allow commercial and residential tenants more time to pay their landlords if they fall behind on payments, however landlords are against the new proposed rules as they believe it will make the process of finding new tenants more difficult.

Related Practice Groups and Professionals

Election Law | Garett Koger
Labor, Employment & Civil Rights | David Houston
Cannabis Law | Sean Gallagher
Real Estate | Jared Roberts

Michigan Supreme Court Rules Landlords Must Request Police Involvement for Criminal Acts

The Michigan Supreme Court has recently held that landlords have a duty to request police involvement when the landlord or its agent is placed on notice of potential criminal acts in a common area of the premises.

Continue reading Michigan Supreme Court Rules Landlords Must Request Police Involvement for Criminal Acts