Vol. 82, No. 3, March 2009
A law adopted in 2007 as part of the budget bill prohibits the recording of declarations for marina condominiums after June 1 of that year, but the law grandfathers and protects the validity of marina condominiums whose declarations were recorded before the cut-off date.1 A lawyer asked to draft a condominium declaration for property that includes a marina, a pier, or boat slips should advise the client concerning this law’s possible effect on the intended development plan.
A key aspect of the new statute is its careful definition of marina condominium. The statute has no effect on residential condominiums that also include a marina or pier slips. The statute defines a marina condominium as a condominium in which a boat docking facility is a unit, limited common element, or common element and in which either there are no dwellings or one or more of the slips is not appurtenant to a dwelling.
The statute was adopted with the support of the Department of Natural Resources (DNR) as a means of resolving issues raised in a controversial Wisconsin Supreme Court decision, ABKA Limited Partnership v. DNR.2 That case involved a contested application for a pier permit. The DNR required the owner of a marina, ABKA Limited Partnership, to request a new marina pier permit because ABKA had elected to declare the marina a condominium. Other parties intervened. An administrative law judge granted a new permit.
Following several appeals, the supreme court set aside the permit. The high court found that the condominium units were not large enough to have “independent use,” which is part of the statutory definition of a unit.3 It also ruled that, without valid condominium units, “the transfer of riparian rights that ABKA’s declaration purports to accomplish is in violation of § 30.133….” This ruling left lawyers and the DNR to puzzle over the status of other similar projects.
J. Bushnell Nielsen, Marquette 1981, is a shareholder in the Waukesha office of Reinhart Boerner Van Deuren s.c. He represented one of the parties that sought passage of this law.
The budget bill created Wis. Stat. section 30.1335 as an exception to section 30.133. Section 30.1335 states that a declaration that “creates or purports to create a marina condominium and that is recorded before June 1, 2007, shall be effective in creating the marina condominium….” The statute also provides that this valid status is not affected by “subsequent activity,” which includes amendments to the declaration, and that pier permits issued before conversion are deemed to satisfy the law and may not be rescinded or modified “based on the fact that the marina has been converted to a marina condominium.”
The counterbalance in the statute is its prohibition on future marina condominiums. Any declaration recorded on or after June 1, 2007 “is invalid and establishes ownership of the riparian land as a tenancy in common that is held by the owners of the marina condominium units.” The author believes that the effect of the statute on a condominium declared after the prohibition date is essentially the same as removal of property from condominium ownership, as provided in Wis. Stat. section 703.28.
Wisconsin is the first state to establish a ban on future marina condominiums as a statement of public policy. This law was a cooperative effort between many people and groups.