Retaliatory Eviction at the End of “Hybrid” Leases: Michigan Supreme Court Signals Reconsideration of the Fixed‑Term Exception and Remands for Full Review

Introduction

In Prudential Properties v. Diane Anderson (Mich. Oct. 3, 2025), the Michigan Supreme Court remanded a landlord-tenant dispute to the Court of Appeals “as on leave granted,” directing a full merits review of whether Michigan’s retaliatory-eviction statute, MCL 600.5720, can be raised as a defense when a landlord ends a tenancy at the end of a fixed term in a lease that automatically continues unless one party gives notice. Although the Court did not decide the merits, Justice Thomas, joined by Justice Welch, issued a concurring statement spotlighting significant doctrinal questions that have broad implications for Michigan’s 2.3 million renters and the landlords who serve them.

The central question: Does the statutory defense to retaliatory eviction extend to cases where a landlord’s notice is what causes the tenancy to end at the nominal end-date of a “fixed-term” lease that, by its terms, would otherwise continue month-to-month? The concurring statement questions the continued fit of the Court of Appeals’ 1982 decision in Frenchtown Villa v. Meadors, 117 Mich App 683 (1982), which limited the defense where a fixed-term lease expires, and emphasizes that Frenchtown Villa is not binding under modern Court of Appeals stare decisis rules.

Case Background

Defendant-appellant Diane Anderson lived in a townhome for 14 years under successive one-year leases. The last lease ran February 2023 through January 2024 and contained a “Required Move-Out Notice” provision:

If neither the Landlord nor the Resident notifies the other party at least thirty (30) days before the Lease termination date that this Lease will terminate on the termination date, then this Lease will continue beyond the termination date on a month-to-month basis until either the Resident or the Landlord gives at least thirty (30) days prior written notice to the other party that this Lease will terminate. Rent or other charges payable by the Resident or any other terms and conditions of this Lease may be changed by the Landlord after the Lease termination date by the Landlord giving Resident at least thirty (30) days prior written notice of the change. A month-to-month fee may be charged for any month-to-month tenancy.

In November 2023, Prudential Properties notified Anderson that her lease would terminate at the end of the one-year term and would not be renewed. Anderson asserted that the landlord’s action was taken primarily in retaliation for her role in helping form a tenant union and engaging elected officials over conditions at the complex—activity protected by MCL 600.5720(1)(c).

After the lease term ended, Prudential filed summary proceedings for possession. The district court rejected the retaliatory-eviction defense as inapplicable to an expired fixed-term lease, citing Frenchtown Villa. The circuit court affirmed.

Summary of the Opinion

The Michigan Supreme Court did not reach the merits. Instead, pursuant to MCR 7.305(I)(1), it remanded the case to the Court of Appeals for consideration “as on leave granted,” directing a comprehensive appellate review. Justice Thomas concurred to emphasize:

Frenchtown Villa (1982) is not binding on the Court of Appeals under MCR 7.215(J)(1) because it predates November 1, 1990.
Even if Frenchtown Villa was correct on its facts, Anderson’s lease is materially different: it does not self-terminate; instead, absent notice, it continues month-to-month. The landlord’s notice is what ends the tenancy on the term date.
Michigan courts have not addressed how the retaliatory-eviction statute applies to “combination” or “hybrid” leases, which the Second Restatement contemplates—leases that set an initial fixed term but automatically continue as periodic tenancies unless ended by notice.
Related open questions include whether such a continuation is an “extension” of the original tenancy or a “renewal” creating a new tenancy—an issue that could affect whether the landlord’s motive matters and whether MCL 600.5720 applies.

Legal Framework and Issues Presented

The Legislature has embedded a suite of tenant protections in Michigan law, including:

MCL 554.139(1): Implied covenants that rental units are fit for their intended use and kept in reasonable repair.
Truth in Renting Act, MCL 554.631 et seq.: Required disclosures and prohibition of abusive terms.
Antidiscrimination provisions, including MCL 37.2505 (Elliott–Larsen Civil Rights Act) and MCL 554.601c (source-of-income discrimination).
MCL 600.5720: The retaliatory-eviction statute, which protects tenants from a judgment of possession when proceedings are brought primarily in retaliation for enumerated protected activities, such as membership in or lawful activity through a tenant organization. See MCL 600.5720(1)(c).

The principal issues flagged for the Court of Appeals include:

Whether, under a lease that continues month-to-month absent notice, a landlord’s pre-expiration notice “terminates” the tenancy such that the landlord’s motive is relevant under MCL 600.5720.
Whether Frenchtown Villa correctly drew a categorical line barring the retaliatory-eviction defense upon expiration of a fixed term, and whether that line applies to hybrid lease structures.
How to conceptualize and construe “combination” leases under Michigan contract and property law—i.e., whether the post-term month-to-month is an extension of a single continuing tenancy or a renewal/new tenancy.

Analysis

Precedents and Authorities Cited

Frenchtown Villa v. Meadors, 117 Mich App 683 (1982)
The Court of Appeals held that “the retaliatory eviction defense does not extend to summary proceedings instituted at the expiration of a fixed-term lease.” It reasoned that a fixed-term tenancy ends by its own terms; therefore, a landlord seeking possession after term expiry “has not independently caused the termination,” making the landlord’s motivation irrelevant to MCL 600.5720. By contrast, for periodic (e.g., month-to-month) tenancies, termination requires notice, and the landlord’s motive can be scrutinized. Justice Thomas notes that this decision predates the Court of Appeals’ binding-precedent rule (MCR 7.215(J)(1)) and that its reasoning “effect[ed] a severe limitation” on the retaliatory-eviction defense and diverges from other jurisdictions’ approaches.
Ellsworth v. Taylor, 233 Mich 163 (1925)
Cited in Frenchtown Villa for the proposition that a tenant’s right to possession under a fixed-term lease expires absent securing an extension. Ellsworth involved an option to renew “on terms and conditions to be agreed upon,” a posture materially different from a lease that continues automatically unless notice is given.
Rice v. Atkinson, Deacon, Elliott Co., 215 Mich 371 (1921)
States that a periodic lease “constitutes as a whole one continuing tenancy,” rather than a series of discrete tenancies. Justice Thomas flags Rice to illuminate whether the post-term month-to-month here should be seen as a continuation (extension) of the original leasehold or a renewal forming a new tenancy, a distinction that could affect the applicability of retaliatory-eviction defenses.
In re Smith Trust, 480 Mich 19 (2008)
Reinforces fundamental contract principles: a lease is a contract; courts ascertain and enforce the parties’ intent from unambiguous language. This anchors the analysis of hybrid leases by focusing on the text the parties chose.
Restatement (Second) of Property (Landlord & Tenant) § 1.5 cmt. i
Recognizes “combination” tenancies that are fixed for an initial period and then continue as periodic tenancies. Michigan appellate courts have not yet addressed how such hybrid structures interact with the retaliatory-eviction statute.
Secondary and comparative authorities (as cited by Justice Thomas)
52 CJS Landlord & Tenant §§ 70, 75; Andrews v. Marshall Creamery Co., 118 Iowa 595 (1902); Orton v. Noonan, 27 Wis 272 (1870). These bear on whether holdover or continuation constitutes an extension vs. a renewal and how to characterize ongoing possession after a term’s nominal end.

Legal Reasoning Highlighted by the Court

Justice Thomas’s concurrence frames several decisive points for the Court of Appeals:

Frenchtown Villa’s nonbinding status and narrowness. Because Frenchtown Villa predates November 1, 1990, it does not bind the Court of Appeals, and its categorical rule may be in tension with the remedial purpose of MCL 600.5720. The decision sharply limited retaliation defenses precisely where landlords can most easily avoid scrutiny—at fixed-term end—potentially undermining legislative intent to protect tenants who exercise their rights.
Hybrid lease structure materially alters the analysis. The lease here does not self-terminate; it would continue month-to-month unless either party gives notice. The landlord’s decision to give notice, and thus to cause the tenancy’s end, brings into focus the landlord’s motivation and invites application of MCL 600.5720’s retaliation inquiry. This factual posture differs from a truly self-expiring fixed-term lease where no party action is required.
Doctrinal characterization matters. If the lease creates a single, continuing tenancy that can end only by notice (either immediately at the term date or later month-to-month), then the landlord’s notice functions as a termination—triggering the statute. If, instead, the term ends automatically and the month-to-month is a wholly new tenancy only if no notice is given, Frenchtown Villa might retain some force. The concurrence urges a careful, text-based contract construction analysis.
Purpose of MCL 600.5720. The statute protects against a “judgment of possession” sought primarily for retaliatory reasons, including a tenant’s union activity. Its protective ambit arguably should not turn on technicalities of lease form where, as here, the landlord’s affirmative notice is the but-for cause of the tenancy’s end.

Application to Anderson’s Lease

Under the “Required Move-Out Notice” clause, if neither party gave timely notice, the lease would automatically continue month-to-month. Prudential Properties’ November 2023 notice ensured the tenancy did not continue. On these facts:

The landlord’s notice—not mere passage of time—ended Anderson’s right to continued possession.
That action potentially subjects the landlord’s motive to scrutiny under MCL 600.5720(1)(c) (membership in or lawful activity of a tenant organization).
Therefore, the bright-line rule from Frenchtown Villa may not fit; either it should be limited to genuinely self-terminating fixed terms, or reexamined entirely in light of statutory purpose and the prevalence of continuation-by-notice lease forms.

Impact and Prospective Significance

The Court’s remand signals substantial potential consequences:

For tenants: If the Court of Appeals recognizes that retaliatory eviction defenses can apply when landlords use pre-expiration notices to prevent automatic continuation, tenants engaged in protected activities (like union organizing) would gain meaningful protection at a common point of leverage—the end of a lease term.
For landlords: Lease drafting and notice practices may need recalibration. Landlords who prefer certainty may adopt unmistakably self-terminating fixed-term leases—or, conversely, accept that giving termination notices can trigger motive-based defenses under MCL 600.5720.
For courts: A doctrinal framework is needed to evaluate hybrid leases, distinguish extension from renewal, and harmonize landlord-tenant contract principles with statutory anti-retaliation protections.
For Michigan housing policy: With approximately 2.3 million residents in rental housing, clarifying the scope of retaliatory-eviction protections at lease end is likely to influence bargaining dynamics, tenant organizing, and stability in rental markets.

Complex Concepts Simplified

Retaliatory eviction (MCL 600.5720): A defense that can bar a landlord from obtaining a judgment for possession if the action is brought primarily to punish a tenant for exercising legal rights—here, membership in or lawful activity of a tenant organization (MCL 600.5720(1)(c)).
Fixed-term tenancy: A lease for a set period (e.g., one year) that typically ends automatically on the stated end date, unless the parties agree otherwise.
Periodic tenancy: A lease that renews every period (e.g., month-to-month) until one party gives proper notice to terminate.
Hybrid/combination lease: A lease that sets an initial fixed term but, by its own terms, continues as a periodic tenancy unless ended by notice. The Restatement recognizes this structure; Michigan appellate courts have not yet squarely addressed how it interacts with the retaliatory-eviction statute.
Self-termination vs. termination-by-notice: In self-terminating leases, the tenancy ends when the clock runs out. In termination-by-notice regimes, a party’s notice is the legal cause of ending the tenancy—making the actor’s motive potentially relevant.
Extension vs. renewal: An extension continues the original tenancy (often with the same terms) beyond the initial end date. A renewal is often characterized as creating a new tenancy. Whether a month-to-month continuation is an extension or renewal can influence whether the landlord’s act of ending the tenancy is scrutinized under anti-retaliation law.
“As on leave granted” (MCR 7.305(I)(1)): The Supreme Court directs the Court of Appeals to treat the case as though it granted leave—allowing full briefing and a merits decision—without the Supreme Court itself resolving the underlying legal questions.
Binding authority in the Court of Appeals (MCR 7.215(J)(1)): Published Court of Appeals decisions issued on or after November 1, 1990 bind later panels unless reversed. Earlier published decisions (like Frenchtown Villa from 1982) are persuasive but not binding.

Key Questions for the Court of Appeals on Remand

Does the lease’s continuation-by-default clause create a single, continuing tenancy that can end only by notice—thus rendering the landlord’s notice a “termination” for purposes of MCL 600.5720?
Should Frenchtown Villa be confined to genuinely self-terminating fixed-term leases, distinguished, or reconsidered in light of the statutory text and purpose?
Is the post-term month-to-month status in this lease an extension of the original tenancy or a renewal/new tenancy, and what follows for application of the retaliatory-eviction defense?
How should courts assess “primary” retaliatory motive under MCL 600.5720(1)(c) when the landlord’s act of giving notice prevents automatic continuation?
What evidentiary standards and burdens apply in this posture, given the statutory protections for tenant organizing?

What This Opinion Does—and Does Not—Decide

Decides: The case is remanded to the Court of Appeals for a full merits review. The Supreme Court signals that important and unresolved issues require careful analysis, and that pre-1990 Court of Appeals law is not binding.
Does not decide: Whether Anderson is entitled to the retaliatory-eviction defense; whether Frenchtown Villa remains sound; or how hybrid leases should be classified under Michigan law.

Conclusion

Prudential Properties v. Anderson marks a pivotal moment in Michigan landlord-tenant law. Without resolving the merits, the Supreme Court underscores that the retaliatory-eviction statute’s reach at the end of a lease term cannot be answered by rote reliance on Frenchtown Villa. Where, as here, a lease would continue absent notice, a landlord’s decision to give notice is the causal act that ends the tenancy—an act whose motivation may be scrutinized under MCL 600.5720(1)(c) when a tenant has engaged in protected organizing.

On remand, the Court of Appeals is poised to clarify: (1) how hybrid leases are construed; (2) whether the defense against retaliatory eviction extends to terminations accomplished by pre-expiration notice; and (3) the continued vitality and proper scope of Frenchtown Villa. The outcome will shape lease drafting, litigation strategy, and the practical protection Michigan law affords tenants who exercise their statutory rights. In a rental market affecting millions of Michiganders, the Court’s invitation for deeper analysis reflects both doctrinal care and the Legislature’s intent that tenants not lose their homes as punishment for asserting lawful rights.