The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us) STATE OF MICHIGAN MIKE COX, ATTORNEY GENERAL Section 19 of the Summer Resort Owners Corporation Act, MCL 455.219, requires an affirmative vote of a majority of a summer resort corporation's members for the assessment of annual dues. A summer resort corporation's bylaw authorizing the assessment of annual dues against its members by a vote of fewer than a majority of its members is inconsistent with section 19 of the Summer Resort Owners Corporation Act, MCL 455.219, and is therefore unenforceable. Opinion No. 7164 October 7, 2004 Honorable Shirley Johnson You have asked two questions involving what are commonly referred to as summer resort corporations or associations. You first ask whether section 19 of the Summer Resort Owners Corporation Act, MCL 455.219, requires an affirmative vote of a majority of the corporation's members, or only a majority of those members voting, for the assessment of annual dues. The Summer Resort Owners Corporation Act (Act), 1929 PA 137, MCL 455.201 et seq, provides for the formation of a corporation by summer resort owners. Under section 1, ten or more freeholders of land may act to establish a summer resort owners corporation. MCL 455.201. Those persons associating are to subscribe and verify articles of association stating the "number of trustees to manage the affairs of said corporation, their terms of office, the names of the trustees for the first year or until the annual meeting of the corporation" and other matters relating to the corporation. MCL 455.202. Those "persons so associating . . . shall become and be a body politic and corporate, under the name assumed in their articles of association and shall have and possess all the general powers and privileges and be subject to all of the liabilities of a municipal corporation and become the local governing body." MCL 455.204. Section 6 of the Act, MCL 455.206, specifies that persons who are "eligible to membership" in the corporation must be freeholders of land in the county in which the corporation is organized. Section 12 of the Act lists the specific jurisdictional powers the corporation may exercise over the corporation's lands and members by enactment, repeal, or amendment of the bylaws: The board of trustees shall have the authority to enact by-laws, subject to repeal or modification by the members at any regular or special meeting, calculated and designed to carry into effect the following jurisdiction over the lands owned by the corporation and its members, viz.: To keep all such lands in good sanitary condition; to preserve the purity of the water of all streams, springs, bays or lakes within or bordering upon said lands; to protect all occupants from contagious diseases and to remove from said lands any and all persons afflicted with contagious diseases; to prevent and prohibit all forms of vice and immorality; to prevent and prohibit all disorderly assemblies, disorderly conduct, games of chance, gaming and disorderly houses; to regulate billiard and pool rooms, bowling alleys, dance halls and bath houses; to prohibit and abate all nuisances; to regulate meat markets, butcher shops and such other places of business as may become offensive to the health and comfort of the members and occupants of such lands; to regulate the speed of vehicles over its streets and alleys and make general traffic regulations thereon; to prevent the roaming at large of any dog or any other animal; to compel persons occupying any part of said lands to keep the same in good sanitary condition and the abutting streets and highways and sidewalks free from dirt and obstruction and in good repair. [MCL 455.212.] Section 19 of the Act authorizes the assessment of annual dues and special assessments to carry out the corporation's powers: The corporation may assess annual dues and special assessments against its members, by a vote of a majority thereof, for the purpose of carrying into effect any of the powers herein contained and may prescribe the time and manner of payment and manner of collection, and in case of delinquencies, may provide that such dues and assessments shall become a lien upon the land of the delinquent member and may provide the manner and method of enforcing such lien. [MCL 455.219; emphasis added.] Thus, analysis of your question requires determining what is meant by the word "thereof" in the statutory phrase "a vote of a majority thereof." Statutes are to be interpreted to effectuate the intent of the Legislature. AFSCME v Detroit, 468 Mich 388, 399; 662 NW2d 695 (2003). If the language of a statute is clear and unambiguous, it is to be assumed the Legislature intended its plain meaning. Id. Unless a technical or peculiar meaning applies, every word or phrase of a statute not otherwise defined is to be ascribed its plain and ordinary meaning. MCL 8.3a; Western Mich Univ Bd of Control v Michigan, 455 Mich 531, 538-539; 565 NW2d 828, 831 (1997). The words of the statute, "[t]he corporation may assess annual dues and special assessments against its members, by a vote of the majority thereof," are clear and unambiguous and must be enforced as written. The word " thereof" refers to "its members." The word "its" refers to the preceding noun, "corporation." Thus, a "vote of the majority thereof" means a vote of a majority of the corporation's members.
SUMMER RESORT CORPORATIONS VOTING:
Vote required for assessment of dues by summer resort owners corporation
State Senator
The Capitol
Lansing, MI 48909
Additional support for this conclusion is found by comparing section 19 to another section of the Act that authorizes voting. Section 8 of the Act provides for the election of trustees at an annual meeting, which "shall be by ballot and choice of trustees shall be by a majority of all votes cast." MCL 455.208. (Emphasis added.) In contrast, section 19 makes no reference to "votes cast"; rather, it authorizes a corporation to assess annual dues and special assessments against its members by "a vote of the majority thereof." MCL 455.219. In each section, the Legislature used plain language to accomplish its purpose.
It is my opinion, therefore, in answer to your first question, that section 19 of the Summer Resort Owners Corporation Act, MCL 455.219, requires an affirmative vote of a majority of a summer resort corporation's members for the assessment of annual dues.
You next ask whether a bylaw of a summer resort corporation stating that annual dues may be assessed by a vote of "a majority of its voting members" would violate section 19 of the Summer Resort Owners Corporation Act, MCL 455.219.
As noted in OAG, 1975-1976, No 5065, p 731, 734 (December 17, 1976), section 123(1) of the Business Corporation Act, MCL 450.1123(1), provides that the Business Corporation Act applies to summer resort associations:
Unless otherwise provided in, or inconsistent with, the act under which a corporation is or has been formed, this act applies to deposit and security companies, summer resort associations, . . . .
Section 231 of the Business Corporation Act states that the bylaws of a corporation "may contain any provision for the regulation and management of the affairs of the corporation not inconsistent with law or the articles of incorporation." MCL 450.1231. (Emphasis added.) As concluded in the answer to your first question, a bylaw adopted by a summer resort corporation authorizing the corporation to assess annual dues by a vote of fewer than a majority of all the members of the corporation is inconsistent with section 19 of the Act.
It is my opinion, therefore, in answer to your second question, that a summer resort corporation's bylaw authorizing the assessment of annual dues against its members by a vote of fewer than a majority of its members is inconsistent with section 19 of the Summer Resort Owners Corporation Act, MCL 455.219, and is therefore unenforceable.
MIKE COX
Attorney General