Modification Agreements

MODIFICATION AGREEMENTS
By Robert M. Meisner

Frequently, the association will be called upon to determine whether or not a modification to the common elements, be it general or limited, should be approved by the board of directors. The condominium bylaws normally provide the standards under which the board should operate in approving the modifications. Generally speaking, the provision provides that the modification must not impair the soundness, safety or appearance of the condominium. The board is generally given wide latitude in either approving or disapproving modifications so long as the person seeking the modification is not a disabled person, as defined in the Michigan Civil Rights Act, or does not have someone who regularly visits the condominium unit who is disabled, in which case the standards are different.

The important thing for an association to understand in reviewing modification requests is whether, in the first instance, the board of directors has the authority to grant the modification. Indeed, many times the board is asked to allow modifications which are really an expropriation of common elements to the exclusion of other co-owners, which is beyond the authority of the board to grant. Assuming, however, that the board has checked with counsel to determine that the modification is within its scope of responsibility and authority to approve or disapprove, the modification agreement should be prepared by the association’s attorney to be used by the association and co-owner to set forth the terms and conditions of the modification. One reason for this is to ensure that future purchasers of the condominium unit will know what the terms and conditions of the modification approval were since the agreement should be recorded with the County Register of Deeds against the unit which is sought to be modified putting on all purchase or construction notice or agreement. The modification agreement should also provide adequate protection to the association by way of indemnity and hold harmless for any damage suffered by the association to the common elements or other premises or elements of the condominium occasioned by the modification. The cost of the modification agreement, including its preparation, should be borne by the co-owner, as well as any other financial requirement which the association requests. In addition, the plan setting forth the modification should be attached to the modification agreement so there is no question as to the detail and specifications which will be used in connection with the modification.

In short, it is important that the association document approvals given in connection with modifications and that a comprehensive agreement be utilized to ensure that the parties are protected and that the terms and conditions of the approval are clearly set forth.