Federal Cases

Case Name Summary Date
Bourne Valley Court Trust v. Wells Fargo Bank, NA

Nevada Revised Statutes section 116.3116 et seq. strips a mortgage lender of its first deed of trust when an forecloses on the property based on delinquent HOA fees.

The panel held that the Statute’s “opt-in” notice scheme, which required a HOA to alert a mortgage lender that it intended to foreclose only if the lender had affirmatively requested notice, facially violated the lender’s constitutional due process rights under the Fourteenth Amendment to the Federal Constitution. The panel held that the “state action” requirement for purposes of constitutional due process was met by the Nevada Legislature’s enactment of the Statute, which unconstitutionally degraded the mortgage lender’s interest in the property.

In re Jackson (B.A.P. 6th Cir.) Whether the Court abused its discretion in determining that Carlton House Condominium Association, Inc. (Ohio) violated a debtor’s Chapter 7 discharge in re-scheduling a sheriff’s sale in a pre-petition foreclosure action upon issuance of the discharge and closing of the case and in assessing fees associated with the re-scheduling of the foreclosure sale.  Discharge of personal obligations through a Chapter 7 discharge does not terminate a secured creditor’s in rem rights unless the creditor’s lien was avoided during the bankruptcy. The 6th Cir. BAP held that the court abused its discretion in sanctioning the Association for violating the debtor’s discharge. 8/4/16
In re Spence (B.A.P. 8th Cir.)

The Chapter 7 trustee appeals from the bankruptcy court’s judgment and order in favor of Sunset Cove Condominium Owners Association  on issues of turnover and preference related to a boat slip.

The BAP held that the posting of the order on the boat slip at issue was sufficient as a notice of levy and created a valid lien on the boat slip (agreed by the parties to be personal property) under Missouri law.

D.C., et al. v. Department of Labor, et al. Whether the Davis-Bacon Act applies to the construction of CityCenterDC. Davis-Bacon Act applies when the District of Columbia enters into a “contract . . . for construction” of
“public works.” The Act guarantees prevailing wages to construction workers on those projects. If the Act applies here, the construction workers who helped build CityCenterDC might be entitled to higher wages than they in fact received.  Two conditions must be present in order for the Davis-Bacon Act to apply here: (1) D.C. must have been a party to the contracts for construction of CityCenterDC, and (2) CityCenterDC must be a public work.  The Court held that the District of Columbia was not a party to the construction contracts for the building of CityCenterDC and CityCenterDC is not a “public work.”
United States v. Autumn Ridge Condominium Association, Inc. (N.D. Ind.) Court entered a consent order in United States v. Autumn Ridge Condominium Association, Inc. (N.D. Ind.), a Fair Housing Act pattern or practice/election case alleging discrimination on the basis of race and familial status. The complaint alleged that the Condominium Association and the members of Board maintained a written policy that prohibited families with minor children from living in the condominium complex . The complaint further alleged that members of the Board made oral statements indicating a preference against families with children and that the policy was enforced in a discriminatory manner to exclude African-Americans from living in the condominium complex. 10/27/10
In re: Lozada (Old Bridge Estates Community Ass’n, Inc.) Issue of whether amendments made to § 523 of the Bankruptcy Code by the Bankruptcy Reform Act of 1994 with respect to the dischargeability of post-petition condominium and cooperative assessments also apply to post-petition assessments by other types of property or homeowner associations.  Court holds that post-petition property owner’s homeowner’s assessments and fees do not fall within the provisions of Section 523(a)(16).  But, Association right to collect assessments post-petition.  Court finds that the right to collect these fees was unaffected by the debtors’ discharge. 10/20/97
EEOC v. Watergate at Landmark Condominium Unit Owners Association The Equal Employment Opportunity Commission (EEOC) brought an action against Watergate alleging that Watergate discharged a 63 year-old employee, Melvina
Nozick, on the basis of her age, in violation of the Age Discrimination in Employment Act. A jury found that Watergate had violated the ADEA, and that the violation was ”willful” thus warranting the award of liquidated damages.  The 4th Circuit Court of appeals affirmed the judgment against Watergate.
In re: Hodges Whether the debtors’ discharge in bankruptcy has extinguished their liability for postpetition (condominium) homeowners assessments.  The debtor’s liability for the assessments was incurred when the debtor signed the condominium agreement obligating him or her to pay the assessments. The future monthly assessment payments are not the consideration for a series of separate contracts which arise anew each month but are instead the unmatured portions of the debtors’ original liability.  The debtor’s obligation to pay the post-petition assessments was extinguished at filing when the debtor’s pre-petition personal liability was discharged. (U.S. Bank. Ct. for E.Dist.Va.).  Decided prior to adoption of Section 523(a)(16) of the Bankruptcy Code. 7/20/92


One lawyer's compilation of online legal resources and comments related to issues involving condominiums, HOAs, timeshares and cooperatives in Virginia and the District of Columbia.