39 Conn. App. 736 | Conn. App. Ct. | 1995
The dispositive issue in this appeal is whether a trial court may order a party foreclosing a mortgage on a condominium unit to make payments in lieu of common charges during the pendency of the foreclosure action. We hold that such an order is inconsistent with General Statutes § 47-258
General Statutes § 47-258 establishes the priority of liens with respect to foreclosures involving condominiums. As our Supreme Court noted in Hudson House Condominium Assn., Inc. v. Brooks, 223 Conn. 610, 614, 611 A.2d 862 (1992), “[l]iens for delinquent common expense assessments on individual units within an association are creatures of statute” and the governing statute, § 47-258 (b), sets forth the priority of these liens with respect to other liens. Our Supreme Court also recognized that this legislative scheme departs from the common law rule of first in time equals first in right. Id. Section 47-258 (b) establishes a specific priority scheme and delineates which liens may take priority over assessment liens and the extent to which assessment liens may take priority over even those priority liens. This court must respect the intricate priority scheme that the legislature has established.
Section 47-258 (b) first pronounces that “[a] lien under this section is prior to all other liens and encumbrances on a unit except (1) liens and encumbrances recorded before the recordation of the declaration . . . (2) a first or second security interest on the unit recorded before the date on which the assessment
As applied to this case, the scheme, pursuant to § 47-258, is as follows: (1) super priority lien for the six months of assessments; (2) the FGB mortgage, if it is a first or second security interest; (3) the remainder of the unpaid condominium assessments, including those assessments that accrue during the pendency of the action; and (4) other liens, if any. The statute clearly provides a place in the priority scheme for common charges that accrue during the pendency of an action. The trial court’s order disturbs this scheme by subordinating the priority of FGB’s first or second security interest to the association’s hens for those assessments not within the super priority lien.
The order of the court requires that FGB pay the association in lieu of common charges. These payments would then become additional debt that FGB would seek to recover from the equity of the real estate through the foreclosure action. Thus, the total amount of liens asserted against the property will remain the same, except that the association’s lien will have been satisfied by FGB. The effect of the court’s order is to force the holder of a first or second security interest
The association argues that the court’s order is supported by the policy evidenced in General Statutes § 47-258 (k).
Finally, the association contends that because a lien for assessments not covered by the super priority lien often remains unpaid, the association will be burdened with that debt. It argues that because these expenditures are used for the common good of all units and
The order of the trial court is reversed and the case is remanded with direction to deny the motion for payments in lieu of common charges.
In this opinion the other judges concurred.
General Statutes § 47-258 provides in pertinent part: “(a) The association has a statutory lien on a unit for any assessment levied against that unit or fines imposed against its unit owner from the time the assessment or fine becomes delinquent. Unless the declaration otherwise provides, fees, charges, late charges, fines and interest charged pursuant to subdivisions (10), (11) and (12) of subsection (a) of section 47-244 are enforceable as assessments under this section. If an assessment is payable in instalments, the full amount of ihe assessment is a lien from the time the first instalment thereof becomes due.
The association earlier moved to dismiss this appeal for lack of a final judgment. This court denied the motion.
General Statutes § 47-207 provides: “The principles of law and equity, including the law of corporations and unincorporated associations, the law of real property, and the law relative to capacity to contract, principal and agent, eminent domain, estoppel, fraud, misrepresentation, duress, coercion, mistake, receivership, substantial performance, or other validating or invalidating cause supplement the provisions of this chapter, except to the extent inconsistent with this chapter.’'
General Statutes § 47-258 (k) provides: "In any action by the association to collect assessments or to foreclose a lien for unpaid assessments, the court may appoint a receiver of the unit owner pursuant to section 52-504 to collect all sums alleged to be due from that unit owner prior to or during the pendency of the action. The court may order the receiver to pay any sums held by the receiver to the association during the pendency of the action to the extent of the association’s common expense assessments based on a periodic budget adopted by the association pursuant to subsection (a) of section 47-257.”