H. B. 2515
(By Delegates Talbott, Hunt and Shaver)
[Introduced January 17, 2011; referred to the
Committee on the Judiciary then Finance.]
A BILL to amend and reenact §36B-3-116 of the Code of West
Virginia, 1931, as amended, relating to liens for assessments
on common interest community real property; and providing that
these assessments take priority over sheriffs' liens for
delinquent taxes.
Be it enacted by the Legislature of West Virginia:
That §36B-3-116 of the Code of West Virginia, 1931, as
amended, be amended and reenacted to read as follows:
ARTICLE 3. MANAGEMENT OF THE COMMON INTEREST COMMUNITY.
§36B-3-116. Lien for assessments.
(a) The association has a lien on a unit for any assessment
levied against that unit or fines imposed against its unit owner
from the time the assessment or fine becomes due. Unless the
declaration otherwise provides, fees, charges, late charges, fines and interest charged pursuant to section 3- 102(a)(10), (11) and
(12) are enforceable as assessments under this section. If an
assessment is payable in installments, the full amount of the
assessment is a lien from the time the first installment thereof
becomes due.
(b) A lien under this section is prior to all other liens and
encumbrances on a unit except (i) liens and encumbrances recorded
before the recordation of the declaration and, in a cooperative,
liens and encumbrances which the association creates, assumes, or
takes subject to, (ii) a first security interest on the unit
recorded before the date on which the assessment sought to be
enforced became delinquent, or, in a cooperative, the first
security interest encumbering only the unit owner's interest and
perfected before the date on which the assessment sought to be
enforced became delinquent, and (iii) liens for real estate taxes
and other governmental assessments or charges against the unit or
cooperative: Provided, That a sheriff's lien for delinquent real
estate is not prior to common expense assessments against a unit.
The lien is also prior to all security interests described in
clause (ii) above to the extent of the common expense assessments
based on the periodic budget adopted by the association pursuant to
section 3-115(a) which would have become due in the absence of
acceleration during the six months immediately preceding
institution of an action to enforce the lien. This subsection
does not affect the priority of mechanics' or materialmen's liens, or the priority of liens for other assessments made by the
association. (The lien under this section is not subject to the
provisions of (insert appropriate reference to state homestead,
dower and curtesy, or other exemptions).)
(c) Unless the declaration otherwise provides, if two or more
associations have liens for assessments created at any time on the
same property, those liens have equal priority.
(d) A lien for unpaid assessments is extinguished unless
proceedings to enforce the lien are instituted within three years
after the full amount of the assessments becomes due.
(e) This section does not prohibit actions to recover sums for
which subsection (a) creates a lien or prohibit an association from
taking a deed in lieu of foreclosure.
(f) A judgment or decree in any action brought under this
section must include costs and reasonable attorney's fees for the
prevailing party.
(g) The association upon written request shall furnish to a
unit owner a statement setting forth the amount of unpaid
assessments against the unit. If the unit owner's interest is real
estate, the statement must be in recordable form. The statement
must be furnished within ten business days after receipt of the
request and is binding on the association, the executive board, and
every unit owner.
(h) For the purpose of perfecting and preserving its lien, the
association shall give notice to the unit owner in the manner set forth in section one (§56-2-1), article two, chapter fifty-six of
this code, or by registered or certified mail, return receipt
requested, and in a form reasonably calculated to inform the owner
of his or her liability for payment of the assessment. The lien
shall be discharged as to subsequent purchasers for value without
notice unless the association shall cause to be recorded a notice
of the lien in the office of the clerk of the county commission of
any county wherein any part of the condominium is located. The
notice shall contain:
(1) A legally sufficient description of the unit;
(2) The name or names of the owners of the unit;
(3) The amount of unpaid assessments due together with the
date when each fell due; and
(4) The date of recordation.
The clerk of the county commission in whose office the notice
is recorded shall index the notice in the appropriate deed books
and lien books in the name of the unit owners and of the
association. The cost of recordation shall be assessed against any
unit owner found to be delinquent in a subsequent proceeding to
enforce the lien.
Upon payment of the assessment, the association shall execute
a written release of the lien in the manner set forth in section
one (§38-12-1), article twelve, chapter thirty-eight of this code.
This release shall be recorded, at the expense of the association,
in the office of the clerk of the county commission wherein the notice of the lien was filed.
(i) At any time before the association has disposed of a unit
in a cooperative or entered into a contract for its disposition
under the power of sale, the unit owners or the holder of any
subordinate security interest may cure the unit owner's default and
prevent sale or other disposition by tendering the performance due
under the security agreement, including any amounts due because of
exercise of a right to accelerate, plus the reasonable expenses of
proceeding to foreclosure incurred to the time of tender, including
reasonable attorney's fees of the creditor.
NOTE: The purpose of this bill is to provide that liens for
assessments on common interest community real property take
priority over sheriffs' liens for delinquent taxes.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.