Delays Prove Costly – Sandberg Phoenix

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In 2003, The Grand Meridien Condominiums at Lands’ End (“Condominium”) was created. As required under the Missouri Uniform Condominium Act (“Act”), the declaration of the Condominium disclosed certain declarant and special developer rights including the right to add real property.  Specifically, an area described as the “Point.” In 2015, the declarant began marketing for construction of units on the Point.  In 2017, the Association argued that the declarant no longer had any rights in the Point and that several units owned by the declarant were delinquent in assessments. Eventually, a lawsuit was filed resulting in a trial court finding that: (a) the declarant rights remained vested with the declarant, and (b) the declarant did owe assessments, but that an applicable five year statute of limitations limited the recovery of the Association pursuant to RSMo. 516.120.1 and not ten years under RSMo. 516.110(1).

In focusing on the statute of limitations, the Court of Appeals agreed.  The association brought suit alleging a breach of contract. The trial court found the declaration of condominium to be a contract but that it does not by itself set forth an amount of money to be paid as required for RSMo. 516.110(1) and the ten year statute of limitations to apply. The association then argued that the ten year statute of limitations applied anyway because the claim the claim was an action to recover lands, but this point was rejected as without merit because: (a) the association’s claim was for a breach of contract against a unit owner personally, (b) a condominium unit is different than a lot within a subdivision.

As the primary income for most community associations is assessments, this case emphasizes that delays in collections can end up resulting in recovering less money than an association might otherwise be able to recover. Accordingly, it is vital for community associations to work with legal counsel to develop collection procedures to ensure that all assessments levied by the association are recoverable before the statute of limitations applies whether located within the Southern District Court of Appeals, St. Louis, Kansas City, or other areas of Missouri.

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