Northernaire Resort & Spa v. Northernaire Condo. Ass'n (WI)

Summary: The definition of a "unit" in the condominium declaration, rather than the definition in the Condominium Ownership Act, controls when determining voting rights for unbuilt units.


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Northernaire Resort & Spa, LLC v. Northernaire Condo. Ass'n, Inc., 2013 WI App 116, 351 Wis. 2d 156, 839 N.W.2d 117 review denied by 353 Wis. 2d 449.


Facts: Northernaire of Deer Lake, LLC recorded a condominium declaration subjecting land to a 108-unit condominium. Only 45 units have been constructed. The declaration defines unit as "any portion of a structure situated upon the [property subject to the declaration] designed and intended for use and occupancy as a residence by a single family…" The declaration creates two classes of voting membership: Class A & Class B. Class A memberships permits the fee title owner of a unit to one vote per unit owned. Class B memberships consists only of the declarant, who is entitled to a single vote, regardless of the number of units owned.

After encountering financial difficulties, the condominium was sold to M & I Regional Properties, LLC. Northernaire Resort and Spa, LLC (‘Northernaire’) purchased the property from M & I Regional, and came into possession of several unbuilt units. Disputes arose almost immediately between Northernaire and the Northernaire Condominium Association (‘Association’). Northernaire eventually filed a complaint against the Association, and, after failing to obtain a restraining order to bar Association members from holding meetings to vote on the condominium’s declaration and bylaws, filed a motion for declaratory judgment on the issue of voting rights.

The trial court held that Northernaire could vote on behalf of its unbuilt units. The Association appealed.


Holding: Reversed and Remanded with Instructions. The issue presented before the court was whether Northernaire was entitled to one vote only, or one vote for each of the units it held. After first correcting Northernaire’s mislabeling of its motion for summary judgment as a declaratory judgment, the court reviewed the issue de novo.

In reviewing the applicable law, the court stated that, under Wis. Stat. § 703.15(4)(d)1 and § 703.09(1)(f), the statutes deferred to condominium declarations in allocating voting interests. This summarily invalidated Northernaire’s claim that the statute’s interpretation should control.

The court then addressed the trial court’s assertion that the case was not about voting rights, but rather which definition, statutory or declaration, of “unit” controlled. While disagreeing with the trial court’s interpretation, the court stated, “[T]hough the statutory definition of a “unit” controls, it may be altered by other statutory provisions that look specifically to the declaration to define the substantive rights and obligations of unit owners.” Therefore, because Wis. Stat. § 703.15(4)(d)1 and § 703.09(1)(f) deferred to the declaration and the declaration limited voting rights to title owners and declarants, the court held that Northernaire was allowed one vote if the circuit court determined that Northernaire was a declarant.


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By: ATG Underwriting Department | Posted on: Fri, 11/21/2014 - 4:20pm