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H. B. No. 408 As IntroducedAs Introduced
128th General Assembly | Regular Session | 2009-2010 |
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Representatives Yuko, Williams, B.
Cosponsors:
Representatives Domenick, Letson, Lundy, Fende, Murray, Chandler, Hagan, Ujvagi
A BILL
To amend section 5311.18 of the Revised Code to
provide that a portion of a condominium assessment
is prior to other liens on condominium units.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That section 5311.18 of the Revised Code be
amended to read as follows:
Sec. 5311.18. (A)(1) Unless otherwise provided by the
declaration or
the bylaws, the unit owners association has
a
lien
upon the estate or interest of the owner in any unit and
the
appurtenant
undivided interest in the common
elements for the
payment of
any of the
following expenses
that are
chargeable
against the
unit
and
that
remain
unpaid for ten
days
after
any
portion
has
become
due and
payable:
(a) The portion of the common
expenses chargeable against
the
unit;
(b) Interest,
administrative late fees, enforcement
assessments,
and
collection
costs, attorney's fees, and paralegal
fees
the
association incurs if authorized by the
declaration,
the
bylaws, or the
rules of the unit owners
association and if
chargeable against the
unit.
(2) Unless otherwise provided by the declaration, the
bylaws,
or the rules of the unit owners
association, the
association shall
credit payments
made by a unit owner for the
expenses
described in
divisions
(A)(1)(a)
and (b) of
this section
in the
following order
of priority:
(a)
First, to interest owed to the
association;
(b)
Second, to administrative late
fees owed to the
association;
(c)
Third, to collection costs,
attorney's fees, and
paralegal fees incurred by the
association;
(d)
Fourth, to the principal
amounts the unit owner owes
to
the association for the common
expenses or penalty assessments
chargeable against the
unit.
(3) The lien
described in division (A)(1) of this
section is
effective on the date
that a certificate of lien
in the form
described in division (A)(3) of this section is filed for record
in the office of
the recorder of the county or counties in which
the condominium
property is situated pursuant to
an authorization
given by the
board of
directors of the unit owners association.
The
certificate
shall contain a
description of the unit, the name
of
the record
owner
of the unit, and
the
amount of the unpaid
portion
of the
common expenses and, subject to subsequent
adjustments, any
unpaid interest,
administrative
late fees,
enforcement
assessments, collection costs,
attorney's
fees, and
paralegal
fees. The certificate
shall be
subscribed by the
president or
other
designated representative
of the association.
(4) The lien described in division (A)(1) of this section is
a continuing lien and is subject to automatic subsequent
adjustments that reflect any additional unpaid interest,
administrative late fees, enforcement assessments, collection
costs, attorney's fees, paralegal fees, and court costs.
(5)
The lien
described in division (A)(1) of this
section is
valid for a period of five years
from the date of filing, unless
it is sooner released or satisfied in
the same manner provided by
law for the release and satisfaction
of mortgages on real property
or
unless it is discharged by the final
judgment
or order of a
court in an
action brought to discharge the lien as
provided in
division (C)
of this section.
(B)(1) The lien
described in division
(A)(1)
of this section
is prior to any lien or encumbrance subsequently
arising or
created except liens for real estate taxes and
assessments
of
political subdivisions and
liens of first mortgages
that have been
filed for
record and may
be foreclosed in the same
manner as a
mortgage on
real property
in an action brought on
behalf of the
unit owners
association by
the president or
other chief officer
of
the
association pursuant to authority given
to
that
individual by
the board of
directors.
(2)
The lien described in division (A)(1) of this section, in
an amount equal to the lesser of the amount of the delinquency or
six months of common expense assessments based on the budget
adopted by the association for the year in which the foreclosure
action against the unit is commenced, plus the association's
reasonable attorney's fees, costs, and expenses related to the
foreclosure, is prior to any lien or
encumbrance previously
arising or created except liens for real
estate taxes and
assessments of political subdivisions. Following
the security
interest created by this section, the association's
lien returns
to the priority outlined in division (B)(1) of this
section.
(3) In a
foreclosure action
a unit owners
association
commences pursuant to
division (B)(1) of this section
or a
foreclosure action the holder of
a first mortgage or
other lien on
a unit commences, the
owner of the unit, as the
defendant in the
action, shall be required to pay a
reasonable
rental for the unit
during the pendency of the action.
The unit owners
association or
the holder
of the lien is entitled to the
appointment of a
receiver to
collect the rental.
Each
rental payment a
receiver
collects
during
the pendency of the
foreclosure
action shall be
applied
first to
the payment of the
portion of the
common expenses
chargeable to
the unit during the
foreclosure
action.
(3)(4) In a foreclosure action the holder of
a
lien on a unit
commences, the holder of that lien shall
name
the unit owners
association as a
defendant in the action.
(4)(5)
Unless prohibited by the declaration or the
bylaws,
following a foreclosure action a unit
owners
association commences
pursuant to division
(B)(1) of this section or
a
foreclosure
action
the holder of a lien on
a unit commences,
the
association
or its agent duly authorized
by
action
of
the board of
directors,
is entitled to become a purchaser at
the foreclosure
sale.
(5)(6)
A mortgage
on a unit may contain a provision that
secures the mortgagee's advances for the payment of
the portion of
the
common expenses chargeable against the
unit
upon which the
mortgagee holds the mortgage.
(6)(7) In any foreclosure action, it is not a defense,
set
off, counterclaim, or crossclaim that the unit owners
association
has
failed to provide the unit owner with any service,
goods,
work, or
material, or failed in any other duty.
(C) A unit owner who believes that the portion of the
common
expenses chargeable to
the unit, for which the unit owners
association files a certificate of lien
pursuant to
division (A)
of
this section, has been improperly
charged
may commence an
action for the
discharge of the
lien in the court
of common pleas
of the county
in which all or a
part of the
condominium property
is situated.
In
the action, if it
is
finally determined that the
portion of the
common expenses was improperly charged to the
unit
owner or
the
unit, the
court
shall
enter an order
that
it
determines to
be just, which may provide for a discharge of
record
of all or a
portion of the lien.
Section 2. That existing section 5311.18 of the Revised Code
is hereby repealed.
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