2026-09-12 · Michigan · Courts

What happened. The Michigan Court of Appeals held on 18 September 2025 that a nine-month residential lease violated a subdivision restriction limiting lots to residential purposes and barring business or commercial use. Timber Lake Drive Property Owners' Association v Gribi, No. 369520, Antrim Circuit Court — unpublished per curiam, panel of K.F. Kelly, P.J., Patel and Feeney.¹

The opinion is unpublished and therefore not binding under MCR 7.215(C)(1). It is still a striking extension of a line of Michigan authority most practitioners read as reaching only short-term rentals.

The covenant

A 1967 restriction in the Birch Lake Subdivision: “All lots shall be used and occupied for residential purposes only, and may not be used for business or commercial purposes.” That is ordinary language, and it appears in thousands of Michigan subdivisions.

The holding

Renting for money is a commercial use — in the panel's phrase, “even if that activity is residential in nature.” The income purpose transforms the property into a commercial enterprise regardless of how the tenant lives in it.

The panel drew on Terrien v Zwit, 467 Mich 56 (2002), Eager v Peasley, 322 Mich App 174 (2017), and Beverly Island Association v Zinger.

The facts, which will make some readers uncomfortable

Ms Gribi moved into assisted living in 2022 and leased her home for $2,400 a month to help pay for her care. That is the transaction the court held was a commercial enterprise.

The Association is a voluntary property owners' association; the restrictions are enforceable by any lot owner, not only by the association.

1. Timber Lake Drive Property Owners' Ass'n v Gribi, Mich Ct App No. 369520 (18 Sept 2025, unpublished) ↩
2. Melvin R. Berlin Revocable Trust v Rubin, Mich Sup Ct No. 166228 (9 July 2025) — affirmance by equal division ↩