Potential Extinguishment of Restrictive Covenants under Amendments to Michigan’s Marketable Record Title Act
EDITED: Since the original publication of this article, the Legislature has extended the deadline to record notices to preserve interests in land to September 29, 2025. Our article with additional information regarding the extension is available here.
In 2018 and 2022 the Michigan legislature passed amendments to Michigan’s Marketable Record Title Act, MCL 565.101 et seq. (“MRTA”) that created the possibility of extinguishing restrictive covenants relied upon by many Michigan property owners, including homeowners’ associations and condominium associations. However, the legislature included a means of preserving these restrictive covenants. The deadline to take advantage of this method for restrictive covenants that are already more than 40 years old is March 29, 2024, and the deadline for more recent restrictive covenants is generally 40 years after their effective date.
Under the MRTA, certain property interests are extinguished if they do not appear in, or are not referenced within any documents appearing in, the property’s chain of title for 40 or more years. Prior to the legislature’s 2018 amendment, a generalized statement, such as “subject to all easements and restrictions of record,” was sufficient to satisfy this requirement and preserve recorded restrictions for more than 40 years.
The 2018 amendment now requires restrictions and other property interests to be specifically identified in a conveyance or other title transaction in order to be preserved, or a notice complying with specific statutory requirements must be recorded. Because property owners have relied upon the ability to use general statements to preserve their property interests and restrictions for decades, the legislature gave property owners whose interests or restrictions are already more than 40 years old time to record notices to avoid the effect of the new requirements. The original deadline was March 29, 2021, but it was later delayed to March 29, 2024.
In 2022, the legislature again amended the MRTA to exclude certain restrictions from extinguishment. Specifically, MCL 565.104(1) now provides that the MRTA must not “[b]ar or extinguish any land or resource use restriction” (emphasis added), including a list of several specifically identified types of restrictions. Notably absent from the list of specifically identified types of excluded restrictions are non-governmental deed restrictions and restrictive covenants relied upon by numerous private property owners, including, without limitation, homeowners’ associations and condominium associations. Although Michigan courts often interpret the term “any” very broadly, and restrictive covenants could be considered a “land or resource use restriction,” no Michigan court has interpreted whether this exclusion applies to non-governmental deed restrictions and restrictive covenants.
Until a court does interpret this statute, there is at least the possibility that any type of restriction that is not specifically listed in the exclusion could be extinguished. Therefore, we recommend that property owners who rely upon non-governmental deed restrictions and restrictive covenants, including homeowners’ associations and condominium associations, that are over 40 years old record a notice in compliance with the MRTA’s specific requirements prior to March 29, 2024 to ensure their restrictions are not inadvertently extinguished. Property owners that rely upon deed restrictions and restrictive covenants under 40 years old should determine the date on which their restrictions will be 40 years old and be sure to record a notice by that date if a court still has not interpreted the statutory exclusion.
Our experienced attorneys at GGTM can assist in preparing and recording a notice to preserve your deed restrictions and restrictive covenants, and we can also help in determining the date on which your restrictions will become subject to the 40-year extinguishment period. For assistance, please contact Nic Morano at (231) 291-0109 or [email protected], or Jacob Baelstrom at (231) 291-0116 or [email protected].
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