Collecting Unpaid Common Charges
In New York, condominium unit owners must pay certain common charges in accordance with the by-laws and declarations (and house rules, if any) of their condo association. Failure to pay such charges could give the condo association a right to file a lien against the unit and to take legal action against the unit owner, such as foreclosure of the condominium common charge lien.
Procedures for Recovering Owed Charges
With respect to condominiums, in the event that the unit owner has not paid outstanding common charges, the association is entitled to file a lien on the property. The condo association must comply with New York State's Condominium Act (Article 9-b of the Real Property Act). Section 339-AA of Article 9-B, (“Lien for Common Charges; Duration; Foreclosure”), says, in part: “In the event that unpaid common charges are due, any member of the board of managers may file a notice of lien… if no notice of lien has [already] been filed within sixty days after the unpaid charges are due… Such lien may be foreclosed by suit authorized by and brought in the name of the board of managers….”
Additionally, the governing documents of the condo association (i.e., the by-laws, declarations, and house rules, if any), by which the unit owner is bound, provide guidance on the procedures necessary before a lien may be filed— for example, the governing documents may require that the unit owner be served with a written notice of their delinquency, and may also require that the unit owner be given a specified amount of time to cover their unpaid charges.
The owed amount may include, but are not necessarily limited, to:
- Past-due charges
- Late fees and interest
- Attorneys’ fees and costs.
When a lien is placed on a condo unit, it makes it difficult for the owner to sell, since the buyer will likely want the lien satisfied before closing, in order to purchase with clean title.
If the owner does not satisfy the unpaid common charges even after the lien has been filed, the condo association may bring an action on behalf of the unit owners to foreclose on the lien.
More recently, condo associations have begun employing other means within their governing documents to persuade delinquent owners to pay outstanding common charges. These policies may include barring the owner—or the owner’s tenant, if the unit is being rented—from using nonessential services in the building like the health club or the pool. Also, doormen may be required to stop accepting packages and deliveries, if the owner does not satisfy the unpaid charges. (There are limitations on these powers in cases of bankruptcy.)
Contact an Attorney Experienced in New York Condo Association Law for Further Guidance
Here at Griffin Alexander, P.C., our attorneys have decades of combined experience advocating on behalf of condo associations, boards, and condo association members in disputes with unit owners, including those that fail to pay their common charges in a timely manner.
We have a long and consistent record of success in handling claims relating to New York condo association law, and have provided effective end-to-end representation to a range of clients at various stages of a dispute.
The information in this Client Alert is provided solely for information purposes. It should not be construed as legal advice on any specific matter and is not intended to create an attorney-client relationship. The information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based upon particular circumstances. Each legal matter is unique, and prior results do not guarantee a similar outcome.
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