Priority
Facts

A unit owner stopped paying assessments.  The condominium association properly recorded and perfected a lien against the unit for those assessments.  Under the applicable Oregon statute, the condo association lien is prior to all other liens, except tax liens and a first mortgage or deed of trust.  An exception exists, such that the condominium association can gain priority over the first mortgage if (among other things) “the association gives the first lienholder formal notice of the unpaid assessments, and the lienholder ‘has not initiated judicial action to foreclose the mortgage * * * prior to the expiration of 90 days following the notice[.]’”  In this case, five days after the association recorded its lien, the bank filed a judicial foreclosure action against the unit, but did not name the association as party, and therefore the foreclosure suit would not have terminated the lien rights of the association.  To correct this issue, the bank filed an amended complaint naming the association as a party.  Five months later the trial court issued a dismissal of the claim against the association, without prejudice, for failure to prosecute.  Five months after that the association sent the bank notice of the unit owner’s default on assessments.  The bank took no action in the next 90 days to reinstate the dismissal or file a new action against the association. Continue Reading Lien Priority Statutes and Why They Make Sense

Pencil Eraser
Facts

The property was subject to a discriminatory restrictive covenant recorded in 1953 that stated: “No race or nationality other than the white race shall use or occupy any building on any lot, except that this covenant shall not prevent occupancy by domestic servants of a different race or nationality employed by an owner or tenant.”  In 2017 Plaintiffs obtained the property by deed referencing that the deed was subject to covenants.  Plaintiff then filed suit to “have the discriminatory restrictive covenant declared void and to ‘strike that same subsection from public record and eliminating it from the title of the property.’”  Continue Reading Covenants that Discriminate on Race – ARE STILL A PROBLEM

Association Academy.210526 2

Please join Husch Blackwell’s Condominium & HOA Law Team for this informative seminar. We’ll review fine collection, common zoning regulations and practices, the importance of cyber insurance, and recent updates from the Department of Housing and Urban Development on emotional support animals. Continue Reading Association Academy: Condo and HOA: Zoning, Cyber Crimes, Fine Collection, and Emotional Support Animals

My good friend Jim Slaughter, a CCAL attorney from North Carolina, just posted the following on his blog (I have condensed simply to show what other states are doing).  You can read his entire blog HERE.

North Carolina Democratic Governor Roy Cooper announced Executive Order No. 204 (“Further Easing of Restrictions on Business and Gatherings”) which took effect on March 26, 2021.  While the order was 27 pages long, here a couple of the items that Jim highlighted from the order:

“Indoor or outdoor pools. Indoor and outdoor pool facilities must do all of the following: Continue Reading Pools and Fitness Centers are Starting to Open Around the Country

Defect
Facts

Plaintiff, Brooktree Village Homeowners Association, Inc. (“Association”), filed suit “on behalf of itself and on behalf of its members” in May 2017 against the second developer, Brooktree Village, LLC (“Developer”).  Developer had acquired the remaining undeveloped portions of the development, other than the common areas.  “A construction company affiliated with Developer, Rivers Development, Inc. (“Builder”), completed construction of the development.  Developer sold all the newly constructed townhomes to individual homeowners.”  The Association sought damages for the cost of repairs.  The claims asserted by the Association were breach of implied warranty, negligence, and negligence per se. Continue Reading Developers/Declarants are Liable for Implied Warranties to Association for Construction Defects

Documents
Facts

Defendant, Castletown Corner Owner’s Association, Inc. (“Association”), had a duty to maintain a lift station.  Specifically, the declaration imposed an obligation on the Association to pay “all Maintenance Costs in connection with” improvements constructed at the Association.  Maintenance costs are then defined as “all of the costs necessary to maintain the … sewers, utility strips, and other facilities … and to keep such facilities operational and in good condition, including, but not limited to, the cost of all upkeep, maintenance, repair, replacement … for the continuous operation of such facilities.”  Plaintiff, owner of one of the commercial units, sued the Association for failing to properly maintain the lift station after an incident where the sanitary lift station malfunctioned and flooded the building with human sewage, which allegedly caused Plaintiff’s tenant to terminate its lease. Continue Reading Language in Declaration Makes Association Strictly Liable

Sophisticated Woman

Does your condominium or homeowners association (HOA) have owners who don’t pay their assessments?  Owners are finding more excuses to avoid paying their assessments.  Filing multiple bankruptcies, submitting payments with conditional language, NSF payments, claiming they don’t owe since they don’t use the common elements. . .  The list goes on and on.

So how does your association handle these “Sophisticated Debtors”?  Does your Association have a strong written collection policy?  Are your governing documents updated and in compliance with current law?  If not, your association will spend more than you should be in trying to collect unpaid assessments.

To ease the pain and headache of collecting unpaid assessments, make sure your association has: Continue Reading Dealing with Sophisticated Debtors

FDCPA
Facts

Plaintiff, O’Donnell, bought his condo in 2012 and sold it in 2019.  Beginning in 2013, O’Donnell missed various assessment payments.  In late 2013 the association filed a lien, and in 2018 the association commenced a foreclosure action.  To bring the lawsuit to an end, O’Donnell sold his unit.  The sale allowed O’Donnell to pay off the claimed past due assessments and attorney fees.  At the time of sale, he paid $23,342 to the association and $22,234.94 to the attorneys which brought the case to an end.  Plaintiff then filed suit against the association’s law firm alleging violations of the Fair Debt Collection Practices Act (“FDCPA”) by filing a foreclosure suit without legal authority.  Specifically, O’Donnell alleged the law firm failed to satisfy several of the prerequisites to proceed with a foreclosure suit against him.  Both parties moved for summary judgment. Continue Reading Attorney Fees – FDCPA Violation – Failure to Follow Association Document Procedures

Emotion Faces

Mental health issues can impact community associations in a myriad of ways.  Often Associations become the “reluctant care provider” (owners have no family/next of kin, or the family “dumped” the owner in the Association rather than in a care facility).  This can be true of older residents (“aging-in-place”) as well of younger residents.  The COVID pandemic, and the corresponding year of lockdowns, has added extra stress and increased isolation, exacerbating existing mental health conditions.  This has led to an increase of emotional distress, substance abuse, and suicides.

Because community associations are communities, issues that arise with one resident can interfere with another resident’s use and enjoyment of their property.  Mental health issues don’t always stay “contained” within the affected owner’s property – noise, shouting, threats, trespassing, damage to property, physical violence – all can interfere with other residents’ quiet enjoyment of their property.  While these issues can manifest themselves as harassment and hostilities, they can also lead to dangerous situations.  [To read more on dealing with harassment and hostile environment, click HERE.]

While it is not the Association’s responsibility to determine if someone has a mental disability, it is the Association’s responsibility to help ensure that all residents live harmoniously.  Continue Reading Tackling Mental Health and Aging Issues in Your Community Association

Solar Panels

When faced with a request by a homeowner or condominium owner to install solar panels at your association, your Board needs to determine a number of things:

  1. Whether there are restrictive covenants or rules that prevent the installation;
  2. What “solar access rights” if any exist under their state’s laws;
  3. What if any restrictions the Association wants and can place on the installation, maintenance, repair, replacement and removal of the solar panels;
  4. Who is paying for any of the maintenance, repairs or removal of the solar panels.

Continue Reading Solar Panels – What Your Association Should Do When Someone Requests to Install Them