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Chesapeake Chapter of the Community Associations Institute Holds Another Successful Symposium

Thanks to all of the members of the Chesapeake Region Chapter of the Community Associations Institute who helped make the 2014 Annual Symposium & Expo a well- attended success.  Ober Kaler was proud to serve as an event sponsor, and to also sponsor a bus so that Eastern Shore members could attend the October 21 event at Martin’s West in Baltimore County.  Special thanks to all those whos stopped by the Ober Kaler table and discussed this blog.

A Portion of a Maryland Condominium Assessment Lien Takes Priority Over Mortgages and Deeds of Trust

Under Section 11-110 of the Maryland Condominium Act, in the event of a foreclosure of a mortgage or deed of trust on a condominium unit, a portion of the condominium’s lien for unpaid assessments has priority over the holder of a first mortgage or first deed of trust recorded after October 1, 2011.  That portion must consist of no more than four months, or the equivalent of four months, of unpaid regular assessments for common expenses, and may include interests, costs of collection, late charges, fines, attorney’s fees, special assessments, or any other costs or amounts due.  However, the total may not exceed $1,200.

Condominium Expenditures In Excess of 15 Percent of the Budget Must Approved By Amendment

Where a residential condominium expenditure results in an assessment increase that exceeds 15% of the amount contained in the adopted budget, the expenditure must be approved in an amendment to the budget, except in cases where the expenditure is required to address a threat to health or safety, or a significant risk of damage to the condominium.  Under Section 11-109.2 of the Maryland Condominium Act, the council of unit owners is required to submit an annual budget to the unit owners at least 30 days prior to its adoption, and the adoption of the budget must then occur at an open meeting of the owners.  Thereafter, any expenditure that would result in an increase in the amount of assessments for the current fiscal year that is in excess of 15% of the budgeted amount must be approved in an amendment to the budget adopted at a special meeting of the owners.  Written notice of the special meeting must be given to the owners at least 10 days prior to the meeting date.  There is an express exception for expenditures needed to correct conditions that constitute a threat to health or safety, or present a significant risk of damage to the condominium if not corrected. (more…)

Condominium Council Held In Contempt Of Court For Failing To Make Common Element Repairs

In a case in which my colleague, Jack Boyd, and I represented the unit owner, the Circuit Court for Baltimore City has held a high-rise condominium in contempt of a prior order of the Court to undertake and complete repairs to the exterior common elements needed to make the building watertight.  During a three-day trial, the Court found that both the failure to include certain specified items in the repair contract, and the failure to complete the repairs within the time ordered by the Court, amounted to willful contempt, and called for the imposition of sanctions.  The Court further found that the case presented the “exceptional circumstances” required under Maryland law for the award of compensatory damages as part of the sanction.  The Court also established certain construction deadlines to be met in order for the Condominium to avoid additional damage payments. (more…)

Maryland House of Delegates Fails To Pass Senate Approved Legislation To Limit Condo Developer Liability

The Maryland House of Delegates failed to take action on House Bill 259, which would have prevented residential condominium developers from including certain provisions in the project’s governing documents or sales contracts that limit the developer’s liability for construction defects. The Maryland Senate, by a vote of 36 – 11, passed Senate Bill 207, which would prohibit provisions in the declaration, bylaws or rules and regulations that limit the ability of a council of unit owners to file suit on behalf of itself or the unit owners or enforce warranty claims.  However, the House version died the Environmental Matters Committee. (more…)

Bill To Remove Limit On Condo Rentals In Hardship Cases Fails in Maryland General Assembly

The Maryland General Assembly failed to take action on a bill that would require condominiums to remove limits on the number or percentage of units that can be rented, if the unit owner demonstrates “financial hardship” and meets certain other requirements.  House Bill 1039 proposed to establish new Section 11-111.4 in the Maryland Condominium Act, and provide that unit owners who meet one of the bill’s six definitions of financial hardship may request a waiver from any rental limitations applicable to the community.  The unit must be the owner’s primary residence, and the appraised value of the unit must be less than 90% of what is owed.