Print View

Condominium Law
E-ALERT
March 2016

Supreme Judicial Court Upholds Rights of Condo Associations to File Super Liens

In a long-awaited decision, the Massachusetts Supreme Judicial Court has upheld a condominium association’s right to file successive lien enforcement suits and establish multiple, concurrent “super liens” with priority over a first mortgage. The Court’s decision in Drummer Boy Association, Inc. v. Britton empowers vigilant condominium associations to ensure that all unpaid regular common expense assessments receive super priority treatment by bringing a new lien action every six months.

The Court recognized in its decision that timely receipt of common expense assessments is critical to the financial stability of condominiums. The Court also pointed out that the Massachusetts Condominium Statute balances the interests of condominium associations against those of mortgage lenders by enabling lenders to protect the priority of their liens by “assum[ing] responsibility for a unit owner’s unpaid common expenses.” Interestingly, the Court noted that an amicus brief filed by banks that have lent almost $230 million to condominium associations supported this position because “the availability of multiple contemporaneous priority liens…reduces the risk associated with such loans and increases the willingness of financial institutions to make them.”

The decision also contains another jewel for condominium associations in the Commonwealth, recognizing that condominium associations may join in umbrella organizations to which they can delegate rights, such as the authority to assess and collect common expense assessments. This is the first time the Supreme Judicial Court has authorized the use of umbrella associations, which can provide developers and associations with greater planning and operational flexibility.

Click here to read the full court decision.
 

CONTACT

If you have any questions about this alert, please contact Samuel B. Moskowitz, or a member of our Condominiums, Cooperatives, and Homeowners' Associations Practice.

This article is provided as a courtesy and may not be relied upon as legal advice, or to avoid taxes and penalties. Distribution to promote, market, or recommend any arrangement or investment to avoid or evade taxes, including penalties, is expressly forbidden. Any communication with the author as to its contents, does not, of itself, create a lawyer-client relationship. Under the ethical rules applicable to lawyers in some jurisdictions, this may be considered advertising.