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Law Educator, Esq.
Law Educator, Esq., Lawyer
Category: Real Estate Law
Satisfied Customers: 90038
Experience:  Licensed attorney practicing landlord-tenant, land use and other real estate law and litigation.
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Multiple questions in regard to property liens: 1) If there

Customer Question

Multiple questions in regard to property liens:

1) If there are consecutive liens for 2011, 2012, 2013 ... How should the letter from the lawyer communicate this to the debtor if liens have been registered in 2011 and 2012 .....If lien was 2k in 2011, 3k in 2012, and 3k in 2013 ,,,, should the letter from the lawyer specify the lien amount as 8k in his letter trying to be collected in 2013 or the 3k that would be recorded.

2) Lien recorded in city record a month before validation is provided ,,, implications.
3) Lawyer ignoring obvious errors in amounts collected even when notified ... time issues, statue of limitations, special assessments in 2013 on 1/2/2013 where no special assessment was ever issued voted on, etc etc ..4 unit building..verified , using property managers totals for legal expenses that are amounts never billed. Lawyer ignores all claims, lien gets recorded even when the amount is disputed and validation is added ...validation provided doesn't add up, nor does it represent correct amount.

In a nutshell HOA continues to add in assessments and charges that don't exist because they think they can, because a civil suit is cost prohibitive, and their lawyer is willing to cooperated.
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  Law Educator, Esq. replied 1 year ago.
Thank you for your question. I look forward to working with you to provide you the information you are seeking.

1) There is no proper format for this letter and there is no template. Each lawyer writes their own letter to collect on a lien in their own format. As long as the letter explains the amount they are seeking on the lien they are sending the letter about, which according to your example above, the 2013 amount of 3K, they do not have to say anything about the total due on the prior liens as they have already given you notice about those.

2) The lien may be recorded before any validation is sent. The penalty for placing an invalid lien that the party placing the lien will not remove once it is discovered to be invalid would be they could be sued for damages for placing an invalid lien, including attorney's fees. A lien, as you may know, is merely a notice to third parties and the owner of a debt and to collect on a lien, the lienholder has to go to court to foreclose on the lien or wait until the property is sold or until the lienholder removes it. As the lienholder can remove the lien at their will, this is why they can place the lien before the validation.

3) This is a problem, if you have a dispute over the amount due once you receive the validation and you have presented that to the attorney, the attorney has a choice to maintain his client's amounts are correct or agree with you and make the corrections. If you are indeed correct in your calculations and the attorney refuses to make the corrections in the liens, then this gives you grounds to go to court to file suit to invalidate the liens and seek damages for them placing invalid liens on the property.

If you have a problem with the board not properly passing assessments, you also need to file a petition for declaratory judgment in court to get the assessments invalidated for not being properly passed in accordance with your bylaws. The attorney represents his client, if his client is insisting the amounts are correct despite your calculations, then you have to take the association to court to dispute the amount of the debt for which the liens are placed.




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Law Educator, Esq., Lawyer
Category: Real Estate Law
Satisfied Customers: 90038
Experience: Licensed attorney practicing landlord-tenant, land use and other real estate law and litigation.
Law Educator, Esq. and 5 other Real Estate Law Specialists are ready to help you
Customer: replied 1 year ago.

For number one .. if lawyers letter for intent to file lien has an amount of 12K on it .... and then the lien registered is for 3k etc ...he's providing a grand total per his lien letter then supposedly reviewing the final lien which gets entered for 3k ... so there are 3 liens placed in total of 12K ..but he continues to send letters and even the validation from the property manager as the sum of all three years .. more a question of format here .. whats correct?


 


There have been various like 20 requests for validation of legal expenses that appear on validation analysis .. they fail to provide .. and/or they disapear all of a sudden replaced by another charge like misc....


 


DC has little enforcement power over condo associations .. thus everything goes to a civil court ,,,thus I just assume they add on charges thinking a lawsuit isn't financially feasible .. at the same time I can't get a resale package, I can't get access to any documentation.


 


I live in a 4 unit building ... I'm the only person who hasn't held a board seat...thus I have little ability beyond a court proceeding to challenge them.


 


I thought that upon 30 days of receipt of the letter if I asked for validation their collection activity should stop .... In 2013 they recorded the lien 20 days after sending the letter and provided validation 50 days after .. asking me for individual challenges to the debt ... this protocol can't make sense.....I'll tip or add more in at the end ...


 


There is also the issue of requesting the assessment balance which they have 10 days to do or the lien amount becomes unenforceable .... This can be proven 20 times over , maybe 100 ...their lawyer is from Maryland where there is a 30 day period.. Is this a feasible issue to raise or does a court look at it as a technicality ... The reason being asked is because I've wanted to sell my unit ... something that would require them to provide disclosures .. something they can't because of what started this entire process ... the president/treasurer cant explain where 40k went .....would the 10 day rule stand up as a valid argument in court ...


 


In regard to the FDCPA .... their violations are beyond obvious and intentional .. when the AG's office asked for the detail ... they agreed .. but instead of providing the information .. they took out a civil suit .. but never sent the summons .. suppose a scare tactic .. AG's office can't mandate they provide info in dc eventhough in writing they said they would.


 


This is about much more than 12k ...it's about 25K+ something I could pay .. I wont go into all of the other issues regarding this insignificant amount of money .. one though was destroying my personal property in an attempt to collect fees from my renters ..after they ok'd the contract.


 


The complaint is focused around the sale of my home .. something I wanted to do in 10/2010 ...yes 10/2010 ... I realize the assessment issue is their best issue do to the courts seemingly finding that you pay assessments no questions asked ... though cases involving financial fraud and cases involving repair of unit owners residence after damage have found for the unit owner .. these both apply.


 


I wrote way too much ... 1)but will the 10 day rule in dc have any teeth in court.


 


2)Damages awarded due to lawyer and HOA filing intentionally false/inaccurate liens amount to much.


 


3) Implications of filing liens incorrectly per their method of providing in lawyers letter total of all three but recording individual years violated FDCPA ( Note also that their grand total has been altered time after time as I bring up challenges)


 


4) Filing lien before 30 days .. an accelerated lien .. then taking 50-70 days for validation ... no implications? what would be their excuse they are registering lien before they take legal action in court .. so validation is provided before official civil action? Why ask me for detaited challenges 50-70 days after lien filed ... I'm assuming because they'll ignore the request .. but say they asked and then take civil action.


 


FYI my lawyer isn't what I expected ... great firm , etc ... but has been trying to get out of case due to being caught behind the 8 ball due to his letting things go unchallenged ....stuck with him due to the time delays and time delay that would result from getting someone up to speed.


 


sorry for long response ... do you know any good general or real estate attorneys in DC .. they all seem to work for CAI

Expert:  Law Educator, Esq. replied 1 year ago.
Thank you for your response.

1) As I said, there is no form prescribed for the letters, as long as the letter includes the intent to file a lien and the amount that must be paid to avoid the lien, the letter is valid notice and every attorney drafts the letters differently. There is no right or wrong way in DC I am afraid.

The FDCPA applies to entities whose primary business is collection of debts. Thus, if the HOA is the one engaging an attorney to represent them to collect this debt, as the HOA is not in the primary business of collecting debts, they can sidestep the FDCPA sometimes.

However, attorneys engaged in debt collection for an HOA are bound by the FDCPA rules. The FDCPA applies if you prove (1) you have been the object of collection activity arising from consumer debt; (2) the defendant is a debtor collector as defined by the FDCPA; and (3) the defendant has engaged in an act or omission prohibited by the FDCPA. Consumer Credit Protection Act, § 802 et seq., as amended, 15 U.S.C.A. § 1692 et seq.

To prove this attorney is covered by the FDCPA, you have to prove that he "regularly collected or attempted to collect debts" and were "debt collectors," for purposes of Fair Debt Collection Practices Act (FDCPA), or prove that they did collection and foreclosure work and listed collection and foreclosure as their practice areas in firm profile. Consumer Credit Protection Act, § 803, as amended, 15 U.S.C.A. § 1692a.

If you can prove the attorney fits the above profile, then you need to consider filing your suit under the FDCPA for non-compliance and also you need to file a complaint against them with the Federal Trade Commission.

The fact they have not followed the 10 day notice provision also invalidates their liens in DC and regardless that their attorney is from MD, he is bound to know and follow the DC law if he is dealing with a property in DC. Thus, this matter would be raised in the court to void the liens.

Damages you can seek for the invalid liens are the actual damages you can prove you sustained plus attorney's fees for having to go to court against them.

If you prove the lawyer is bound by the FDCPA, then failure to follow the FDCPA guidelines subjects them to damages of $1000 per violation plus attorney's fees.

Again, they can file the lien before they send you the validation, but they still have to provide you the validation upon demand if they are covered under the FDCPA and them not following the FDCPA would again subject them to a penalty of up to $1000 per violation plus attorney's fees and you can file a complaint with the Federal Trade Commission against them.

If your attorney is not aggressively proceeding to remove the liens and attack this process as well as how the association is assessing fees improperly, then it is time to change attorneys.

I am afraid this site's rules strictly forbid us from taking cases from this site or from making personal referrals, but you can find qualified real estate/HOA attorneys and even consumer protection law attorneys at the same sites used by other attorneys, http://www.martindale.com or http://www.lexmundi.com or http://www.hg.org and you should also look in MD close to DC as most of those attorneys are also licensed in DC.

Customer: replied 1 year ago.

Paul -


 


Your one of few I've ever gotten clear and concise interpretation of the law from on here.


 


With that said, and again,I'll add in additional funds .... I'd like your take on a odd situation and what your opinion is.


 


One of my main complaints is that in 2012 ... after I realized the 40K missing ,,, our board hired a management company for 8k .. we have four units .. the hiring is unheard of in DC. But the board has made him the key contact ,, and refused to answer any questions or concerns ... I know that's a big problem for the board .,... but with that said.


 


He was brought in to secure the books etc ... The board hired him with only 27% of the vote .... Gray area it appears if they have authority to do so ... thoughts on what i should look at to determine hiring was appropriate... Note our entire budget before was 23k...


 


The main argument involves our annual meeting held in 2012 .... The meeting was held 2 days before the president was to sell his residence ...at this meeting a 40% increase in fees was approved and a 30K special assessment for accounting irregularities.


 


To form a quorum with over 67% of the vote ,,,,, they contacted a unit owner who had disappeared in the middle of the night 8 months prior... had made claims to the board he was in foreclosure and was unable to pay fees etc ....


 


He was the developer and unit owner of the 2.3 penthouse in the building .. his voting % was 44% ... he voted for these increases even when his agent said the unit was in foreclosure/short sale.


 


He voted I can only assume for one reason ... all of a sudden he was current on dues .. something the president needed to provide in his disclosures for the buyers lender to approve the loan.... with 44% of the "fees" not coming in ... loan would have needed 40% down.


 


He voted ... within days his voting rights were suspended, and he was view as a demissed premise .. due to DC Foreclosure laws .. which have stopped all of them due to regulations in constant rewrite the unit remains vacant.


 


Is their any validity to allowing him to vote for such an increase? Note the budget presented to the loan officer for the presidents sale was based on his assessments and special assessments being recorded on FStatements as cash .. I have a finance degree and those fees are receivables with a huge **** .. What do you make of this ... It seems so obviously fraudulent .. annual meeting in June, fiscal year starts Jan 1 .. meeting 2 days before Presidents home sells .. allowing missing home owner to vote when he'd claimed he was in foreclosure and unable to pay.


 


It's so bizarre, and the banks are afraid to say anything in regard to anything it seems .. but whats your take on how a judge or anyone else of authority would view this.


 


this is my last question and i realize i need to replace my lawyer .. but his delays have put me in a bind in regard to time and getting someone else up to speed in time to diffuse more serious actions like a lien foreclosure sale .. I have equity of 150K .. so I'd stop it .. but still ...too many detail to get someone up to speed


 


I appreciate your great straight forward answers ... confirmed what I thought was fact .. confirmed my biggest fears about lawyer :)

Expert:  Law Educator, Esq. replied 1 year ago.
Thank you for your response and kind words. Remember, we get no credit for the excellent answers you are referring to until the customer clicks on excellent service feedback (not just adding money to their accounts).

From what you are describing there are several irregularities, including allowing a delinquent dues member in foreclosure to cast a vote and this sounds as though, if it is true, may be sufficient to invalidate the vote on the assessment. Additionally, it is potentially illegal fraud since it was done for purposes of obtaining a mortgage for the sale of the property so the president had a personal financial gain.

The whole description you are giving sounds like fraudulent conduct and at the very least self dealing and breach of fiduciary duty by the board.

Also, the board and management company must release and allow you to inspect the financial records of the association upon your demand and if they are not allowing such inspection this is another violation and cause of action for your suit.
Customer: replied 1 year ago.

What about the hiring of the property manager in the first place ... the president and treasurer just went out and found him one day .. and the next day all communication was cut off ... Are they able to hiring someone with no vote or anything .. there were meetings ,,,, so a vote could have been taken ..... what would determine if his hiring was appropriate and met business judgement standard .. association was broke so we hire a property manager whos 40miles away and pay him 3 times the going rate .. with less than 40 percent of the vote if a vote supposedly took place ... will hit the button


 


Thank you .... I'm not exaggerating but they have done everything in their power to not allow me to see the financial records ... I have my CPA and finance background and can read financial and budgets ... Naively I expected someone to stop the nonsense but one fraud led to the next led to the next ...


 


 

Expert:  Law Educator, Esq. replied 1 year ago.
Thank you for your response.

If the board took a proper vote, it was not illegal for them to hire a property manager. However, the circumstances you describe and the pay you describe seems like there may be other indications of fraud going on within the board. However, if the hiring was done based on a proper vote, they could hire someone to manage the property if the board chose to do so.
Customer: replied 1 year ago.

i guess my question is what is a proper vote for a hiring ... can the board just hire him or did they need a vote .. if they needed a vote he was hired with 44 percent of the vote ... one being the president who listed his property for sale a week after they hired him.


 


67% is what is needed for anything needing approval ... What should I look for in our condo docs that may allow the board just to hire a property manager without a vote ...,,,,,,I don't think the board has the ability to do so without a vote .. but from your experience could they enter into such a contract with just notice they may hire one?

Expert:  Law Educator, Esq. replied 1 year ago.
Thank you for your follow up.

Unless your bylaws state differently, the board of directors has the right to hire and they can do so by a simple majority vote of the board. If they did not have a simple majority of the board of directors, then the hiring is not legal.

If your bylaws state all expenditures of money for any reason require a 2/3 vote of all members, then again, this vote is not legal and you would file this as a petition for declaratory judgment to get the court to void the contract as not being properly approved and also a claim for breach of fiduciary duty against the president and board members who improperly passed this measure to hire.

Most associations leave hiring and daily operations to the board of directors, so you have to read those bylaws to see what it says about hiring or spending money and how much the board is allowed to spend without membership approval.
Customer: replied 1 year ago.

thanks again .. it pretty much says that any expenditure over 500 bucks needs the signature of two of the officers ... we have only two ... so i guess it would be ok unless the president who knew he was moving has a conflict of interest ... I think he does because the management company a one man company was responsible for providing all of the documentation the president needed for the sale of his home and even advertised it as professionally managed .... which is kind of a joke that we pay someone that amount of money for a 4 unit building ...where it was self run for 5 years until he wanted to move ... or I guess the business judgement rule would be in question ... when the condo association is broke ... we are getting rid of extra trashcans for pick up to save money .. what would be the rationale behind hiring someone with no management of building experience, who cost twice as much as other dc based mcompanies .. he lives 40 miles away ... and the condo association has the penthouse not paying dues etc .. hiring a mangement company for what? The answer is what I've claimed for years ... they found someone willing to cook the books for the loan the buyer of the presidents home needed ... so a management company was the way to use someone to make dues and special assessments owed by the penthouse guy ... cash ... when he voted for the 40% increase of fees and huge special assessment ... they found a guy who had no clue what basic accounting should be ...sorry for the ad lib it was ridiculous he was hired and he's stillaround because they need to keep him around ... he's 28 % of our budget and he collects 4 fee payments a month and pays like 2 bills all other are automatic...thank you very much for you help

Expert:  Law Educator, Esq. replied 1 year ago.
Thank you for your additional information.

It sounds like there is a possibility of mismanagement at the very least based on what you are saying. Potentially a breach of fiduciary duty to the association for spending money the association does not have, that would depend on what you can uncover in your suit though.

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