From Wikipedia:
"A commune is an intentional community of people living together, sharing common interests, property, possessions, resources, and, in the more radical communes, work and income."
Michael's reaction may have been due to his dislike of being pigeonholed by the word "commune," and its implied relationship to communism, or he could have been objecting to the veiled but unsavory implication that perhaps he and the others "shared" Sylvia as well.
Authority is the aqua regia of golden character.