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Question: I filed for chapter 7 bankruptcy in May 2008, I informed my attorney that I was leaving the condo association that day. He sent out the letters for the meeting of creditors, I personally did not inform the condo association that I was leaving the property. The meeting of creditors took place in June 2008,and I was discharged from bankruptcy in August 2008.I mailed the keys to the condo directly to the attorney right after the discharge. I just recently have been served papers from the condo association that I'am being sued for past condo fees with interest, late gas bills, attorney fees, all together 3600 dollars. The bankruptcy has basically blown me off with this law suit. Response 1: Unfortunately, your moving out and surrendering the keys did not wipe out your legal ownership of the property and the fees due after your bankruptcy petition was filed. You remain the legal owner of the property and thus liable for future fees until the property is sold. However, any past dues condo fees and property taxes if they remain unpaid would go as liens on the property. Nonetheless, you are still obligated for any condo fees that became due after your bankruptcy filing so long as the Unit remains in your name. The only condo fees that were discharged in bankruptcy are fees that you were due up to the date of your bankruptcy filing. See 11 U.S.C Section 523(16). While you are no longer personally liable for the Note, you remain the legal owner of the property until the property has been sold by the lender. Nevertheless, the Condo Association does not have legal capacity to bring this lawsuit because the Statute of Limitations on the debt has passed. In Maryland, the Statutes of Limitations for written contracts, which condo documents are is 3 years. See Maryland Code, Courts and Judicial Proceedings Section 5-101.
The Statute of Limitations on a debt deals with the time a creditor/collector has to file a lawsuit to collect on its debt or forever barred from bringing up the lawsuit. The creditor may still use other means to try to collect the debt such as telephone calls and letters. However, without the threat of lawsuit, there is really nothing the creditor/collector can do. So, a debtor does not have to pay debts that are passed the Statute of Limitations. Finally, if a creditor files a lawsuit, the fact that the Statute of Limitations has run on the debt is an Affirmative Defense and the debtor must request that the Court dismiss the case because the Statute of Limitations has run on the debt.
The Statute of Limitations on a debt starts to run from the time the debtor stopped paying on the debt.
Kindly note that paying anything on the debt will restart the Statute of Limitations period. So, the debtor must not agree to pay anything on a debt that has passed its Statute of Limitations.
I offered another fee, not sure if that is correct thing to do? Response 2: No, it is not and you should not do it again. See my first response. Does the condo association have legal rights for this lawsuit that five years have passed Response 3: No, see my first response.
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