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Committee hears proposal to restore older property restrictions; stakeholders say bill reconciles 2018 changes
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Summary
Representative Wozniak and representatives of the Real Property Law Section and trade groups testified in support of House Bill 4524, a bill intended to clarify and preserve certain pre-1950 recorded property restrictions affected by 2018 amendments to the Marketable Record Title Act.
Representative Wozniak introduced House Bill 4524 and said stakeholders had largely agreed on language to resolve long-running title issues created by the 2018 amendments to the Marketable Record Title Act.
David Pearson of the Real Property Law Section told the committee that the Marketable Record Title Act (created in 1945) was designed to simplify title searches by limiting the chain of title to 40 years, but that industry practice of broad “proviso subject to” language had raised uncertainty about whether older restrictions remained enforceable. Pearson said the 2018 amendments required specific recording references to preserve older interests and produced a two‑year grace period for notices of claim; as a result, many stakeholders believed valuable restrictions and easements (including subdivision restrictions, common‑area arrangements and commercial easements) had fallen away.
Pearson described HB4524 as a clarification that restores practical expectations: "All this bill does is clarify some of that language to make clear that in effect, if you have an easement that's old, you still have an easement," he said. He told the committee the bill preserves restrictions recorded up to 75 years ago — effectively those recorded since Jan. 1, 1950 — and does not differentiate between residential and commercial interests.
Emily Dagnostini, appearing by Zoom, said stakeholders have been extending the effective date and negotiating fixes since passage of the 2018 amendments. She said the legislature has repeatedly delayed the amendments' effective date and that the current extension runs out in September; proponents hope the presently negotiated bill will avoid another extension.
Representative DeBoer asked for clarification whether the 40‑year rule for ownership/title remained; proponents confirmed the 40‑year marketable‑title provision remained in effect for ownership but that recorded deed restrictions and easements might reach back further under the bill and under the statute's notice provisions. Pearson and Dagnostini said there is a two‑year grace period in the statute for filing notices of claim for older interests if necessary.
Supporters present on the record included the Real Property Law Section, Michigan Realtors and the Community Association Institute — Michigan chapter. Committee members said they anticipated a substitute and further committee work before returning the bill to the floor.
