07 LC 21
9444S
The House Committee on Judiciary offers the following substitute to HB
383:
A
BILL TO BE ENTITLED
AN ACT
AN ACT
To
amend Article 3 of Chapter 3 of Title 44 of the Official Code of Georgia
Annotated, the "Georgia Condominium Act," so as to define certain terms; to
provide that a declarant shall pay certain expenses; to provide for exceptions;
to provide for an exception for a certain obligation to provide a certificate of
occupancy; to provide for the effect on land use and zoning ordinances or laws
of an expandable condominium; to provide for the creation of a subcondominium;
to provide for a subassociation; to provide for insurance; to provide for the
effect of certain liens; to provide for eminent domain; to provide for the
description of certain units; to provide for assessments; to provide for related
matters; to repeal conflicting laws; and for other purposes.
BE
IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
SECTION
1.
Article
3 of Chapter 3 of Title 44 of the Official Code of Georgia Annotated, the
"Georgia Condominium Act," is amended in Code Section 44-3-71, relating to
definitions, by adding new paragraphs to read as follows:
"(19.1)
'Master association' means an association of a master condominium.
(19.2)
'Master condominium' means a condominium in which the condominium instruments
permit one or more of the units to constitute a
subcondominium."
"(26.1)
'Subassociation' means an association of a subcondominium.
(26.2)
'Subcondominium' means the property consisting of a unit of an existing
condominium lawfully submitted under this article by the recordation of separate
condominium instruments pursuant to this article."
"(27.1)
'Subunit' means a unit that constitutes a portion of a
subcondominium."
SECTION
2.
Said
article is further amended in Code Section 44-3-80, relating to allocation and
liability for common expenses and how assessments are made, by revising
subsection (d) as follows:
"(d)(1)
No unit
owner other than the association shall be exempted from any liability for any
assessment under this Code section or under any condominium instrument for any
reason whatsoever, including, without limitation, abandonment, nonuse, or waiver
of the use or enjoyment of his unit or any part of the common
elements.
The declarant
shall pay for all common expenses until the first common expense assessment is
due from any unit owner. Thereafter, no unit owner other than the association
shall be exempted from any liability for any assessment under this Code section
or under any condominium instrument for any reason whatsoever, including,
without limitation, abandonment, nonuse, or waiver of the use or enjoyment of
his or her unit or any part of the common elements.
(2)
Notwithstanding paragraph (1) of this subsection, if authorized by the
declaration, a declarant who is offering units for sale may elect to be excused
from payment of assessments assessed pursuant to subsection (c) of this Code
section against those unsold and unoccupied units for a stated period of time
after the original declaration is recorded, not to exceed 24 months after the
date the original declaration is recorded; provided, however, that as to
assessments assessed pursuant to subsection (c) of this Code section, the
declarant must pay common expenses incurred during such period which exceed the
amounts assessed against other unit owners in the same condominium. During any
period in which the declarant is excused from payment of assessments assessed
pursuant to subsection (c) of this Code section:
(A)
No capital contributions, start-up funds, initiation fees, or contributions to
capital reserve accounts which are receivable from unit purchasers or unit
owners and payable to the association at closing may be used for payment of
common expenses;
(B)
No portion of the payment of assessments collected from owners intended to be
utilized for reserves for deferred maintenance, reserves for depreciation, or
other reserves, as shown on the operating budget for the condominium, may be
used for payment of common expenses; and
(C)
No prepayments of assessments made by owners shall be used for the payment of
common expenses prior to the time the assessments would otherwise be
due.
(3)
If during the period that the declarant is excused from payment of assessments
as provided in paragraph (2) of this subsection common expenses are incurred
resulting from a casualty which is not covered by proceeds from insurance
maintained by the association, such common expenses shall be assessed against
all unit owners owning units on the date of such casualty, and their respective
successors and assigns, including the declarant with respect to units owned by
the declarant. In the event of such an assessment, all units shall be assessed
in accordance with the allocation of the liability for common expenses set forth
in the declaration as provided in subsection (c) of this Code
section.
(4)
During any such time as the declarant has the right to control the association
pursuant to Code Section 44-3-101, any capital contributions, start-up funds,
initiation fees, or contributions to capital reserve accounts which are
receivable from unit purchasers or unit owners and payable to the association at
closing and any portion of the payment of assessments collected from owners
intended to be utilized for reserves for deferred maintenance, reserves for
depreciation, or other reserves, as shown on the operating budget for the
condominium, shall be deposited into one or more separate reserve accounts and
shall not be used to pay for any common expenses, without the agreement of the
unit owners of units to which two-thirds of the votes in the association
pertain, exclusive of any vote or votes appurtenant to any unit or units then
owned by the declarant. No waiver of the right of any unit owner to grant or
withhold consent to such agreement shall be valid."
SECTION
3.
Said
article is further amended by revising paragraph (5) of subsection (e) of Code
Section 44-3-111, relating to sales of residential condominium units for
residential occupancy, information required to be furnished by seller,
buyer´s right to void contract, limitations period, attorney´s fees,
and penalty for willful violation, as follows:
"(5)
If, but only if, any applicable statute, ordinance, rule, or regulation
requires, permits, or provides for the issuance of a certificate of occupancy by
any officer, department, or agency of any governmental entity, the contract
shall contain an express obligation on the part of the seller to furnish to the
buyer at or prior to closing a true, correct, and complete copy of a duly issued
certificate of occupancy covering the unit which is the subject matter of the
covered contract
unless the
buyer executes a separate agreement at or before closing setting forth that the
contract applies to a condominium unit for which the seller is not obligated to
obtain a certificate of occupancy before conveyance of the unit to the buyer and
such agreement contains the following statement in at least 14-point boldface
type or capital letters:
'THE
SELLER IS NOT OBLIGATED TO OBTAIN A CERTIFICATE OF OCCUPANCY BEFORE CONVEYANCE
OF THE UNIT TO THE BUYER. THE LACK OF A CERTIFICATE OF OCCUPANCY SHALL NOT
EXCUSE THE BUYER FROM ANY OBLIGATION TO PAY ASSESSMENTS TO THE
ASSOCIATION.'; and"
SECTION
4.
Said
article is further amended in Code Section 44-3-114, relating to the effect of
such article upon land use, zoning, building, and subdivision laws and the
effect of a certain Code section, by adding a new subsection to read as
follows:
"(c)
No subdivision law, ordinance, or regulation shall apply to the additional
property of an expandable condominium for so long as the additional property may
be added to the expandable condominium in accordance with the provisions of this
article and the declaration. If the additional property is not deemed separate
from the submitted property under any zoning, land use, subdivision, building,
or life safety law, code, regulation, or ordinance at the time of the
establishment of the condominium, the additional property shall not be deemed
separate from the submitted property under any zoning, land use, subdivision,
building, or life safety law, code, regulation, or ordinance so long as the
additional property may be added by the declarant to the expandable condominium
in accordance with the provisions of this article and the
declaration."
SECTION
5.
Said
article is further amended by adding a new Code section to read as
follows:
"44-3-117.
(a)
Except as otherwise set forth in this Code section, the creation of a
subcondominium shall not limit the application of this article in its entirety
to such subcondominium.
(b)
To the extent permitted in the condominium instruments, a condominium unit may
be submitted by the owner thereof to a subcondominium and such owner shall
thereafter be deemed the declarant, as such term is defined in paragraph (13) of
Code Section 44-3-71, of such subcondominium.
(c)
Upon the creation of a subcondominium:
(1)
No tax or governmental assessment shall be levied against the unit as a whole
but instead shall only be levied on the subunits;
(2)
The subassociation shall represent and be responsible for acting on behalf of
the subunit owners in discharging the rights and obligations of the unit owner
as a member of the master association, including, without limitation, voting the
interests of the unit in the master association and paying assessments owing on
the unit to the master association;
(3)
The insurance required in paragraph (1) of Code Section 44-3-107 may be obtained
by either the subassociation or the master association for the condominium in
which the subcondominium is a unit;
(4)
No lien for labor or services performed or materials furnished in the
improvement of the unit shall be filed against the subcondominium as a whole but
shall only be filed against the subunits, and such lien may be discharged by the
owner of any subunit in the same manner provided in subsection (d) of Code
Section 44-3-95;
(5)
If a subassociation has been created for property affected by an eminent domain
proceeding, no eminent domain action shall be brought against the subassociation
as a whole but only against the subunit owners thereof; and
(6)
No description of a subunit shall be deemed to be vague, uncertain or otherwise
insufficient if the description complies with Code Section 44-3-73.
(d)
The description of submitted property or additional property to a subcondominium
required by this article shall be valid if described by a legal description by
metes and bounds or by a description of a unit in a master condominium in the
manner provided for in Code Section 44-3-73.
(e)
All sums lawfully assessed by a master association against a subassociation
shall have the same effect as provided in subsection (a) of Code Section
44-3-109.
The
recording of the declaration for a subcondominium pursuant to this article shall
constitute record notice of the existence of the lien, and no further
recordation of any claim of lien for assessments shall be required.
(f)
In the event any lien becomes effective against a subunit as provided in
subsection (e) of this Code section, the subassociation may remove that lien
from the subunits by:
(1)
The payment of the amount attributable to the subunits, or
(2)
Bonding of the amount assessed against the subassociation
or
any subunit owner may remove that lien from his or her subunit by the payment of
the amount attributable to his or her subunit. The amount shall be computed by
reference to the liability for common expenses pertaining to that condominium
unit pursuant to subsection (c) of Code Section 44-3-80. Subsequent to the
payment, discharge, or other satisfaction of such amount, the subunit owner of
that subunit shall be entitled to have that lien released as to his or her
subunit in accordance with applicable provisions of law, and notwithstanding
anything to the contrary in Code Sections 44-3-80 and 44-3-109, the master
association shall not assess or have a valid lien against that subunit for any
portion of the common expenses incurred by the master association in connection
with that lien.
(g)
Not less than 30 days after notice is sent by certified mail or statutory
overnight delivery, return receipt requested, to the subunit owner both at the
address of the subunit and at any other address or addresses which the subunit
owner may have designated to the master association in writing, the lien of the
master association may be foreclosed by the master association by an action,
judgment, and foreclosure in the same manner as other liens for the improvement
of real property, subject to superior liens or encumbrances, but any such court
order for judicial foreclosure shall not affect the rights of holders of
superior liens or encumbrances to exercise any rights or powers afforded to them
under their security instruments. The notice provided for in this subsection
shall specify the amount of the assessments then due and payable together with
authorized late charges and the rate of interest accruing thereon. No
foreclosure action against a lien arising out of this subsection shall be
permitted unless the amount of the lien is at least $2,000.00. Unless
prohibited by the master condominium instruments, the master association shall
have the power to bid on the subunit at any foreclosure sale and to acquire,
hold, lease, encumber, and convey the same. The lien for assessments shall
lapse and be of no further effect, as to assessments or installments thereof,
together with late charges and interest applicable thereto, four years after the
assessment or installment first became due and payable.
(h)
Any subunit owner, mortgagee of a subunit, person having executed a contract for
the purchase of a subunit, or lender considering the loan of funds to be secured
by a subunit shall be entitled upon request to a statement from the
subassociation or its management agent setting forth the amount of assessments
past due and unpaid together with late charges and interest applicable owed by
the subassociation to the master association. If the subassociation or its
management agent states an amount less than the amount actually owed by the
subassociation to the master association, the lien created by Code Section
44-3-109 for any amounts in excess of the stated amount shall be subordinate to
the lien of any first priority mortgage covering the subunit.
(i)
In addition to the documents required to be furnished to the prospective buyer
under subsection (b) of Code Section 44-3-111, if the covered contract applies
to a condominium unit which is part of a subcondominium, the following shall be
provided to the prospective buyer:
(1)
A copy of the declaration for the master condominium, and a copy of each
amendment thereto; and
(2)
A copy of the articles of incorporation and bylaws of the master association,
and of each amendment to either."
SECTION
6.
All
laws and parts of laws in conflict with this Act are repealed.