Good morning, Rhinestone,
To summarize briefly before explaining in conjunction with the
relevant statutes: The association may indeed foreclose a lien on the
unit for which the fees have not been paid. The statutes do not
specifically allow you to restrict the use of common elements until
fees are paid (but does state that the owner may not waive his right
to use of these elements in lieu of payment), but your association's
by-laws may provide for this. (The by-laws are a legal contract, and
all provisions may be enforced.) The by-laws may prevent an owner
from voting on any board action if he is in arrears and a lien has
been filed. There is no minimum amount the unit owner must be in
arrears before action may be taken.
“Doing Business in Wisconsin” offers a very brief summary of actions
you may take:
“Lien Priority. Unit owners may be assessed for funds for the payment
of common expenses and for the creation of reserves for the payment of
future common expenses in proportion to their percentage interest in
the common elements, or as otherwise provided in the condominium
declaration. All assessments, until paid, constitute a lien on the
condominium units on which they are assessed, if a statement of lien
is filed within two (2) years after the date the assessment becomes
due. Any grantee of a condominium unit is entitled to a statement from
the condominium association or executive board, setting forth the
amount of unpaid assessments against the grantor. Condominium liens
have priority over first mortgages which are not recorded prior to the
making of the assessment, and over all second mortgages, and may be
enforced through foreclosure. Section 703.16.”
CHAPTER 6 WISCONSIN REAL ESTATE LAW: 7. CONDOMINIUMS/TIMESHARES
http://www.mbf-law.com/pubs/guiderefs/guide/chapter6.cfm
The Wisconsin statutes you seek begin at 703.15 and continue from
there. They're easiest to read here:
Wisconsin Statutes: CHAPTER 703 CONDOMINIUMS
http://www.legis.state.wi.us/statutes/Stat0703.pdf
It is perhaps best to begin with the specific powers granted by the
state to condominium associations. These may be found under
703.15(3):
"POWERS OF THE ASSOCIATION. (a) Powers. An association
has the power to:
1. Adopt budgets for revenues, expenditures and reserves and
levy and collect assessments for common expenses from unit
owners;
2. Employ and dismiss employees and agents;
3. Sue on behalf of all unit owners; and
4. Exercise any other power conferred by the condominium
instruments or bylaws.
(b) Conditional powers. Subject to any restrictions and limitations
specified by the declaration, an association may:
1. Make contracts and incur liabilities.
2. Regulate and impose charges for the use of common ele-ments.
3. Cause additional improvements to be made as a part of the
common elements.
4. Acquire, hold, encumber and convey any right, title or
interest in or to real property.
5. Grant easements through or over the common elements.
6. Receive any income derived from payments, fees or
charges for the use, rental or operation of the common elements.
7. Grant or withhold approval of any action by a unit owner
or other person which would change the exterior appearance of the
unit or of any other portion of the condominium.
Of particular note for your situation are (a)1, (a)4, b(1), (b)2 and
(b)4. (It's important to keep your association's own rules in mind as
you try to determine how to go about collecting the unpaid fees.)
The portion of the statutes relevant to your question continue further
down the page with 703.16: Common expenses and common surpluses.
According to this section, condominium associations may assess fees
for common expenses, file liens against the unit for unpaid expenses,
and seek foreclosure. There doesn't appear to be a state minimum
delinquency before foreclosure may be sought.
Assessments and liability for assessments is covered in 703.16(2) and
703.16(3). Assessments *must* be paid by the unit owner. Owners may
not waive their right to use of common areas to avoid payment of the
fees, but the statutes do not address whether the association may
restrict use of these common facilities until the fees are paid. This
would depend on the association by-laws :
"LIABILITY FOR ASSESSMENTS. A unit owner shall be liable
for all assessments, or installments thereof, coming due while
owning a unit. In a voluntary grant, the grantee shall be jointly and
severally liable with the grantor for all unpaid assessments against
the grantor for his or her share of the common expenses up to the
time of the voluntary grant for which a statement of condominium
lien is recorded, without prejudice to the rights of the grantee to
recover from the grantor the amounts paid by the grantee for such
assessments. Liability for assessments may not be avoided by
waiver of the use or enjoyment of any common element or by
abandonment of the unit for which the assessments are made."
Before filing a lien against the unit owner, it is imperative that you
ensure that he has received an accurate copy of a statement for the
amount owed, the date the fees are/were due and the period for which
the fees were assessed. 703.16(5) stipulates that ONLY the amount
given on the statement may be claimed under a lien, and that the
association must provide said statement within 10 days of the unit
owner's request, or forfeit the right to file a lien on that amount.
I'm going to assume that you've already provided such a statement in
your attempts to collect this debt. You'll want to provide another
before filing a lien, just to keep your collective backside covered.
Under 703.16(4), the association may file a lien up to two years after
the date the assessment became due:
"(4) ASSESSMENTS CONSTITUTE LIEN. All assessments, until
paid, together with interest on them and actual costs of collection,
constitute a lien on the units on which they are assessed, if a
statement
of lien is filed within 2 years after the date the assessment
becomes due. The lien is effective against a unit at the time the
assessment became due regardless of when within the 2-year
period it is filed. A statement of condominium lien is filed in the
land records of the clerk of circuit court of the county where the
unit is located, stating the description of the unit, the name of the
record owner, the amount due and the period for which the assessment
was due. The clerk of circuit court shall index the statement
of condominium lien under the name of the record owner in the
judgment and lien docket. The statement of condominium lien
shall be signed and verified by an officer or agent of the association
as specified in the bylaws and then may be filed. On full payment
of the assessment for which the lien is claimed, the unit
owner shall be entitled to a satisfaction of the lien that may be
filed
with the clerk of circuit court."
Note that under 703.16(7), unpaid assessments may, at the option of
the association, be assessed interest as well. Interest begins to
accrue from the date the fees are due.
In order to recover unpaid assessments (and interest and attorney's
fees), associations have several options, including suit without
foreclosure, foreclosure, and suit for deficiency after foreclosure.
According to the statute, the association may sue for recovery without
foreclosure or without waiving the lien against the unit.
Additionally, associations may recover attorney's fees.
Suit to foreclose the lien must be filed within 3 years from the date
the lien was filed, and the unit owner must be given at least 10 days
written notice of intent to foreclose, delivered by certified mail,
return receipt requested. These options are covered under 703.16(8):
"ENFORCEMENT OF LIEN. A lien may be enforced and foreclosed
by an association or any other person specified in the
bylaws, in the same manner, and subject to the same requirements,
as a foreclosure of mortgages on real property in this state. An
association may recover costs and actual attorney fees. An association
may, unless prohibited by the declaration, bid on the unit at
foreclosure sale and acquire, hold, lease, mortgage and convey the
unit. Suit to recover a money judgment for unpaid common
expenses shall be maintainable without foreclosing or waiving the
lien securing the same. Suit for any deficiency following foreclosure
may be maintained in the same proceeding. No action may
be brought to foreclose the lien unless brought within 3 years
following
the recording of the statement of condominium lien. No action may be
brought
to foreclose the lien except after 10 days' prior written notice to
the
unit owner given by registered mail, return receipt requested, to the
address of the unit owner shown on the books of the association."
The statutes also provide a form for the statement of lien in
703.16(9):
"(9) FORM OF STATEMENT OF CONDOMINIUM LIEN. A statement
of condominium lien is sufficient for the purposes of this chapter
if it contains the following information and is substantially in the
following form:
Statement of Condominium Lien
This is to certify that .................... owner(s) of unit No.
..... in
.................... Condominium (is) (are) indebted to the
association
in the amount of $.......... as of .........., .... (year) for (his)
(her) (its)
(their) proportionate share of common expenses of the Condominium
for the period from (date) to (date), plus interest thereon
at the rate of ....%, costs of collection, and actual attorney fees.
Association
By: ..........................
Officer's title (or agent)
Address
Phone number
I hereby affirm under penalties of perjury that the information
contained in the foregoing Statement of Condominium Lien is
true and correct to the best of my knowledge, information, and
belief.
...............................
Officer (or agent)"
You may be entitled to take other actions, depending on the provisions
of your association's by-laws. Check these thoroughly for your
options, and be certain to check with your attorney for specific
procedures you may need to follow to ensure that any necessary
paperwork is properly executed and filed.
I hope this answers your question! If you require further assistance,
please just ask for clarification. I’ll be happy to help.
Recalcitrant tenants are never pleasant for anyone. I hope the
situation is resolved quickly, with a minimum of fuss and
inconvenience for you.
--Missy
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