Condo Unit Owner Inconvenienced by Defective Exhaust Fan: Was the Board Entitled to Foreclose the Common Charge Lien?

This was originally posted on the SGR Blog.

Condo unit owners often feel aggrieved by every day “housekeeping” type problems—and withhold payment of their common charges until the matter is resolved. But the Board may file a common charge lien as a result of the non-payment. Was the “inconvenience” of a broken exhaust fan sufficient to stop foreclosure of the lien?

Bristol Plaza is a 50-story “white glove” condominium at 200/210 East 65th Street. Angus McCallum is the fee owner of apartment 21K in the 308-unit building.

The Board sued McCallum to foreclose on a $10,202.72 lien for unpaid make common charges, assessments and other charges assessed against the apartment. The Board moved for summary judgment alleging that no material issues of fact existed as to whether the Board was entitled to foreclose on the lien.

The Board asserted that it was entitled to summary judgment because the admissible documentary evidence proved that: (1) there was no dispute that McCallum was the fee owner of the apartment; (2) there was no dispute that McCallum had not paid the common charges and assessments billed to him; and (3) the Board was charged by law and by the by-laws with the duty to enforce the owners of units to pay common charges and special assessments against their units.

McCallum cross-moved for summary judgment requesting that the Court: (1) dismiss the complaint; (2) consolidate the action with an action previously filed by him against the Board; and (3) award him summary judgment in the amount of $10,000.00, to enable him to engage counsel to assist in the defense of the action.

The dispute began in January 2019, when McCallum wrote to Board complaining of a problem with an exhaust vent in one of the apartment’s bathrooms. McCallum then further outlined his complaint in a letter dated February 28, 2019, claiming that the exhaust issue had been ongoing since 2008. In that letter, he demanded reimbursement of a percentage of the common charges he had paid in the past as “compensation” for the inconvenience he had endured due to the exhaust ventilation problem and admitted that he had withheld payment of the common charges because of this inconvenience.

The condominium, staff, and HVAC technicians investigated the complaint, detected some issues with the exhaust vent line, and corrected the problem on or about May 3, 2019.

On June 18, 2019, a lien was recorded against the subject’s apartment.

Once created, the administration of a condominium’s affairs is governed principally by its by-laws, which are, in essence, an agreement among all of the individual unit owners as to the manner in which the condominium will operate and which sets forth the respective right and obligation of unit owners both with respect to their own units and the condominium’s common elements.

A purchaser of a unit in a condominium enters into a binding relationship with every other unit owner by both contract and statute. One of the elements of the relationship is the obligation to pay common charges. Common charges are each unit’s proportionate share of the common expenses in accordance with the common interest. Common expenses are expenses of operation of the property, and all sums designated common expenses by or pursuant to statute, the declaration, or the by-laws.

The obligation of a condominium unit owner to pay charges is for the most part absolute, and cannot be avoided. Consequently, absent a valid defense, the Board is entitled to judgment in its favor on the issue of liability as a matter of law.

The by-laws of the condo governing the dispute at Article 6, section 6.2(a) state that the owner of a unit is obligated to pay all special assessments and common charges.

Article 6, Section 6.2(c) states that all such payments are due on the first day of each month in advance.

Article 6, Section 6.2(d) provides that “no unit owner shall be exempted from liability for the payment of common charges or special assessments by waiving the use or enjoyment of any or all of the “common elements” or by abandoning his unit. No unit owner shall be entitled to a diminution or abatements in the common charges or special assessments payable thereby for any inconvenience or discomfort arising from (i) the failure or interruption of any utility or other services; (ii) the making of repairs or improvements to the common elements of any unit.”

Article 6, Section 6.4 charges the Board with the responsibility of taking “prompt action” to collect unpaid charges due from the owners including; charging delinquent owners interest for late or unmade payments; to file liens for arrears, and; to recover reasonable attorneys’ fees incurred by the Board or its managing agent in any action or proceeding commenced against a delinquent unit owner to recover sums due to the Condominium.

Article 7 of the Condominium Declaration lists what are the “common elements” of the building. That list includes the building’s exhaust vents.

In this case, the Board demonstrated entitlement to judgment as a matter of law in the amount of the lien upon which the case was commenced.

The Board, through the affidavit of Jeffrey R. Pirkl, managing agent of the Board, the affirmation of Robert T. Holland, Esq., and the deed, by-laws, and correspondence between the parties showed that McCallum was the owner of the apartment and that he was in default of his obligation to pay common charges and special assessments. The Board also demonstrated the validity of the lien.

The Board also showed that McCallum was not entitled to withhold payment of the common charges for any inconvenience related to a common element of the unit and that the exhaust system in the subject apartment was a common element under the By-Laws.

McCallum agreed to be bound by the Condominium’s by-laws when he purchased the apartment. The by-laws required that McCallum, as a unit owner, pay common charges, late charges, interest, and attorneys’ fees and expenses incurred to collect such charges. McCallum did not contest the affidavit testimony by Jeffrey Pirkl, the Board’s managing agent, to which was attached a detailed account history demonstrating McCallum’s failure to pay the common charges and other related charges and expenses as required by the by-laws.

Since Board presented documentary evidence of its entitlement to summary judgment as a matter of law, it became incumbent upon McCallum to come forward and lay bare his proof and demonstrate, by admissible evidence, and evidentiary facts showing the existence of a triable issue with regards to bona fide defenses to the action such as a waiver, estoppel, bad faith, fraud, oppressive and/or unconscionable conduct on the part of the Board or the existence of a material issue of fact requiring a trial.

McCallum failed to present to the Court any proof or evidence showing the existence of a triable issue of fact that would warrant a trial. It was clear that McCallum failed to pay the common charges and assessments because he was “inconvenienced” due to an issue with a bathroom exhaust fan. However, McCallum was not permitted to withhold payment of those fees by the governing documents of the condominium. McCallum had no defense to this action.

The Court found that Board had established a prima facie case for summary judgment based upon the submissions which proved the failure of McCallum to pay the common charges due and owing in accordance with the by-laws. The Court also found that, in opposition, McCallum failed to raise a factual issue vis-a-vis a viable defense to Board’s claim.

Accordingly, Board was awarded summary judgment. And the Court directed that a Judicial Hearing Officer or Special Referee be designated to compute and ascertain the amount due on the lien and to decide the appropriate manner in which the foreclosure was to be conducted.

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