Collection Issues for Condominium and Homeowners’ Associations: Legal tips, concepts and current trends in  assessment col...
Seminar Overview <ul><li>Assessments: The Lifeblood of the Community Association </li></ul><ul><li>Collecting Assessments:...
Assessments: The Lifeblood of the Community  <ul><li>The ubiquity of community associations </li></ul><ul><li>Deed restric...
Collecting Assessments: Legal Rights, Remedies, Procedure and Limitations  <ul><li>Sources of Law for Assessment Collectio...
Collecting Assessments: Legal Rights, Remedies, and Procedure (continued) <ul><li>Money Judgment Litigation: Step-by-Step ...
Collecting Assessments: Legal Rights, Remedies, and Procedure (continued) <ul><li>Lien Foreclosure </li></ul><ul><ul><li>T...
Collecting Assessments: Legal Rights, Remedies, and Procedure (continued) <ul><li>Judicial Foreclosure: Step-by-Step </li>...
Collecting Assessments: Legal Rights, Remedies, and Procedure (continued) <ul><ul><li>Debtor/owner’s rights of reinstateme...
Collecting Assessments: Legal Rights, Remedies, and Procedure (continued) <ul><li>Fair Debt Collection Practices Act (FDCP...
Collecting Assessments: Legal Rights, Remedies, and Procedure (continued) <ul><li>Bankruptcy </li></ul><ul><ul><li>Chapter...
Recent Economic Trends Affecting Assessment Collection and Lien Rights <ul><li>Escalating foreclosure rates </li></ul><ul>...
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Collection Issues For Condominium And Homeowners’ Associations

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Common collection issues, legal aspects and various remedies available for collecting unpaid assessments.

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Collection Issues For Condominium And Homeowners’ Associations

  1. 1. Collection Issues for Condominium and Homeowners’ Associations: Legal tips, concepts and current trends in assessment collection and foreclosure Prepared and Presented by:   Mark E. Lines, Esq. Shaw & Lines, LLC
  2. 2. Seminar Overview <ul><li>Assessments: The Lifeblood of the Community Association </li></ul><ul><li>Collecting Assessments: Rights, Remedies, and Procedures </li></ul><ul><ul><li>Controlling or applicable laws: Uniform Act, state laws and federal laws (and any conflicts) </li></ul></ul><ul><ul><li>Pursuing Owners Personally </li></ul></ul><ul><ul><ul><li>Deciding when to pursue a money judgment vs. foreclosure </li></ul></ul></ul><ul><ul><ul><li>Money judgment litigation: step-by-step </li></ul></ul></ul><ul><ul><li>Lien Foreclosure </li></ul></ul><ul><ul><ul><li>Lien priority, the statutory lien and contractual liens </li></ul></ul></ul><ul><ul><ul><li>Judicial foreclosure litigation: step-by-step </li></ul></ul></ul><ul><ul><ul><li>Redemption Rights </li></ul></ul></ul><ul><ul><li>Federal Fair Debt Collection Practice (FDCPA) </li></ul></ul><ul><ul><li>Bankruptcy </li></ul></ul><ul><li>Recent Economic and Housing Market Trends </li></ul>
  3. 3. Assessments: The Lifeblood of the Community <ul><li>The ubiquity of community associations </li></ul><ul><li>Deed restrictions creating contracts </li></ul><ul><li>Expenses, budgeting and choosing legal remedies to collect assessments </li></ul>
  4. 4. Collecting Assessments: Legal Rights, Remedies, Procedure and Limitations <ul><li>Sources of Law for Assessment Collection </li></ul><ul><ul><li>Uniform Common Interest Ownership Act (UCIOA) </li></ul></ul><ul><ul><li>Federal laws (applications and conflicts) </li></ul></ul><ul><ul><li>CC&R’s and governing documents </li></ul></ul><ul><li>The Personal Obligation of Owners </li></ul><ul><ul><li>Election of remedies issues? </li></ul></ul><ul><ul><li>The pros and cons of pursuing the owner personally with a money judgment action </li></ul></ul>
  5. 5. Collecting Assessments: Legal Rights, Remedies, and Procedure (continued) <ul><li>Money Judgment Litigation: Step-by-Step </li></ul><ul><ul><li>The demand </li></ul></ul><ul><ul><li>Summons and Complaint </li></ul></ul><ul><ul><li>The Answer </li></ul></ul><ul><ul><li>Default </li></ul></ul><ul><ul><li>Judgment </li></ul></ul><ul><ul><li>Attorney’s Fees and Costs </li></ul></ul><ul><ul><li>Post-judgment Collections </li></ul></ul><ul><ul><ul><li>Money judgments as investments (?) </li></ul></ul></ul>
  6. 6. Collecting Assessments: Legal Rights, Remedies, and Procedure (continued) <ul><li>Lien Foreclosure </li></ul><ul><ul><li>The “automatic” statutory lien </li></ul></ul><ul><ul><li>The contractual lien per the CC&R’s </li></ul></ul><ul><ul><li>Judicial foreclosure v. power of sale </li></ul></ul><ul><ul><li>Lien priority </li></ul></ul><ul><ul><ul><li>Statutory priority </li></ul></ul></ul><ul><ul><ul><li>Equitable priority (“Equitable Subordination”) </li></ul></ul></ul><ul><ul><li>The Notice of Lis Pendens </li></ul></ul>
  7. 7. Collecting Assessments: Legal Rights, Remedies, and Procedure (continued) <ul><li>Judicial Foreclosure: Step-by-Step </li></ul><ul><ul><li>Title review and initial demand </li></ul></ul><ul><ul><li>The foreclosure Complaint </li></ul></ul><ul><ul><li>The Answer </li></ul></ul><ul><ul><li>Default (or Disclaimers of Interest) </li></ul></ul><ul><ul><li>Final Judgment </li></ul></ul><ul><ul><li>The foreclosure sale (public auction) </li></ul></ul><ul><ul><li>Deed upon foreclosure </li></ul></ul>
  8. 8. Collecting Assessments: Legal Rights, Remedies, and Procedure (continued) <ul><ul><li>Debtor/owner’s rights of reinstatement, satisfaction and redemption </li></ul></ul><ul><ul><ul><li>Before the foreclosure sale </li></ul></ul></ul><ul><ul><ul><li>After the foreclosure sale </li></ul></ul></ul>
  9. 9. Collecting Assessments: Legal Rights, Remedies, and Procedure (continued) <ul><li>Fair Debt Collection Practices Act (FDCPA) </li></ul><ul><ul><li>Definitions </li></ul></ul><ul><ul><li>Limitations and applications </li></ul></ul><ul><ul><li>Liability for violations </li></ul></ul>
  10. 10. Collecting Assessments: Legal Rights, Remedies, and Procedure (continued) <ul><li>Bankruptcy </li></ul><ul><ul><li>Chapter 7 – Liquidation </li></ul></ul><ul><ul><li>Chapter 13 – Reorganization </li></ul></ul><ul><ul><li>Pre-petition vs. post-petition assessments </li></ul></ul><ul><ul><li>Effect of discharge on post-petition assessments </li></ul></ul><ul><ul><ul><li>Most recent change in federal bankruptcy code </li></ul></ul></ul><ul><ul><ul><li>Conditions for post-petition personal liability not affected by discharge of debt </li></ul></ul></ul><ul><ul><li>The “Unavoidable” statutory lien </li></ul></ul>
  11. 11. Recent Economic Trends Affecting Assessment Collection and Lien Rights <ul><li>Escalating foreclosure rates </li></ul><ul><li>Effect of mortgage foreclosure on lien rights and limits on collection options </li></ul><ul><li>“ Excess proceeds” from foreclosure sales </li></ul><ul><li>Lien foreclosure a viable option for non-paying banks </li></ul><ul><li>Making good business decisions and the “Business Judgment Rule” </li></ul>

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