Bill Text: OH HB408 | 2009-2010 | 128th General Assembly | Introduced

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Bill Title: To provide that a portion of a condominium assessment is prior to other liens on condominium units.

Spectrum: Moderate Partisan Bill (Democrat 9-1)

Status: (Introduced - Dead) 2010-01-12 - To Civil & Commercial Law [HB408 Detail]

Download: Ohio-2009-HB408-Introduced.html

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As Introduced

128th General Assembly Regular Session 2009-2010

H. B. No. 408

Representatives Yuko, Williams, B. 

Cosponsors: Representatives Domenick, Letson, Lundy, Fende, Murray, Chandler, Hagan, Ujvagi 

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A BILL

To amend section 5311.18 of the Revised Code to

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provide that a portion of a condominium assessment

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is prior to other liens on condominium units.

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BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1.  That section 5311.18 of the Revised Code be	4
amended to read as follows:	5

Sec. 5311.18.  (A)(1) Unless otherwise provided by the	6
declaration or the bylaws, the unit owners association has a lien	7
upon the estate or interest of the owner in any unit and the	8
appurtenant undivided interest in the common elements for the	9
payment of any of the following expenses that are chargeable	10
against the unit and that remain unpaid for ten days after any	11
portion has become due and payable:	12

(a) The portion of the common expenses chargeable against the	13
unit;	14

(b) Interest, administrative late fees, enforcement	15
assessments, and collection costs, attorney's fees, and paralegal	16
fees the association incurs if authorized by the declaration, the	17
bylaws, or the rules of the unit owners association and if	18
chargeable against the unit.	19

(2) Unless otherwise provided by the declaration, the bylaws,	20
or the rules of the unit owners association, the association shall	21
credit payments made by a unit owner for the expenses described in	22
divisions (A)(1)(a) and (b) of this section in the following order	23
of priority:	24

(a) First, to interest owed to the association;

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(b) Second, to administrative late fees owed to the	26
association;	27

(c) Third, to collection costs, attorney's fees, and	28
paralegal fees incurred by the association;	29

(d) Fourth, to the principal amounts the unit owner owes to	30
the association for the common expenses or penalty assessments	31
chargeable against the unit.	32

(3) The lien described in division (A)(1) of this section is	33
effective on the date that a certificate of lien in the form	34
described in division (A)(3) of this section is filed for record	35
in the office of the recorder of the county or counties in which	36
the condominium property is situated pursuant to an authorization	37
given by the board of directors of the unit owners association.	38
The certificate shall contain a description of the unit, the name	39
of the record owner of the unit, and the amount of the unpaid	40
portion of the common expenses and, subject to subsequent	41
adjustments, any unpaid interest, administrative late fees,	42
enforcement assessments, collection costs, attorney's fees, and	43
paralegal fees. The certificate shall be subscribed by the	44
president or other designated representative of the association.	45

(4) The lien described in division (A)(1) of this section is	46
a continuing lien and is subject to automatic subsequent	47
adjustments that reflect any additional unpaid interest,	48
administrative late fees, enforcement assessments, collection	49
costs, attorney's fees, paralegal fees, and court costs.	50

(5) The lien described in division (A)(1) of this section is	51
valid for a period of five years from the date of filing, unless	52
it is sooner released or satisfied in the same manner provided by	53
law for the release and satisfaction of mortgages on real property	54
or unless it is discharged by the final judgment or order of a	55
court in an action brought to discharge the lien as provided in	56
division (C) of this section.	57

(B)(1) The lien described in division (A)(1) of this section	58
is prior to any lien or encumbrance subsequently arising or	59
created except liens for real estate taxes and assessments of	60
political subdivisions and liens of first mortgages that have been	61
filed for record and may be foreclosed in the same manner as a	62
mortgage on real property in an action brought on behalf of the	63
unit owners association by the president or other chief officer of	64
the association pursuant to authority given to that individual by	65
the board of directors.	66

(2) The lien described in division (A)(1) of this section, in	67
an amount equal to the lesser of the amount of the delinquency or	68
six months of common expense assessments based on the budget	69
adopted by the association for the year in which the foreclosure	70
action against the unit is commenced, plus the association's	71
reasonable attorney's fees, costs, and expenses related to the	72
foreclosure, is prior to any lien or encumbrance previously	73
arising or created except liens for real estate taxes and	74
assessments of political subdivisions. Following the security	75
interest created by this section, the association's lien returns	76
to the priority outlined in division (B)(1) of this section.	77

(3) In a foreclosure action a unit owners association	78
commences pursuant to division (B)(1) of this section or a	79
foreclosure action the holder of a first mortgage or other lien on	80
a unit commences, the owner of the unit, as the defendant in the	81
action, shall be required to pay a reasonable rental for the unit	82
during the pendency of the action. The unit owners association or	83
the holder of the lien is entitled to the appointment of a	84
receiver to collect the rental. Each rental payment a receiver	85
collects during the pendency of the foreclosure action shall be	86
applied first to the payment of the portion of the common expenses	87
chargeable to the unit during the foreclosure action.	88

(3)(4) In a foreclosure action the holder of a lien on a unit	89
commences, the holder of that lien shall name the unit owners	90
association as a defendant in the action.	91

(4)(5) Unless prohibited by the declaration or the bylaws,	92
following a foreclosure action a unit owners association commences	93
pursuant to division (B)(1) of this section or a foreclosure	94
action the holder of a lien on a unit commences, the association	95
or its agent duly authorized by action of the board of directors,	96
is entitled to become a purchaser at the foreclosure sale.	97

(5)(6) A mortgage on a unit may contain a provision that	98
secures the mortgagee's advances for the payment of the portion of	99
the common expenses chargeable against the unit upon which the	100
mortgagee holds the mortgage.	101

(6)(7) In any foreclosure action, it is not a defense, set	102
off, counterclaim, or crossclaim that the unit owners association	103
has failed to provide the unit owner with any service, goods,	104
work, or material, or failed in any other duty.	105

(C) A unit owner who believes that the portion of the common	106
expenses chargeable to the unit, for which the unit owners	107
association files a certificate of lien pursuant to division (A)	108
of this section, has been improperly charged may commence an	109
action for the discharge of the lien in the court of common pleas	110
of the county in which all or a part of the condominium property	111
is situated. In the action, if it is finally determined that the	112
portion of the common expenses was improperly charged to the unit	113
owner or the unit, the court shall enter an order that it	114
determines to be just, which may provide for a discharge of record	115
of all or a portion of the lien.	116

Section 2.  That existing section 5311.18 of the Revised Code	117
is hereby repealed.	118