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N.C. Ct. of App.: Executive Office Park of Durham Association v. Rock- Failure to Include Power of Sale in Association Covenants

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By Ed Boltz, 24 May, 2021

Summary:

Executive Office Park of Durham Association was created through a Declaration of Unit Ownership on November 9, 1982 subject to the provisions of the North Carolina Unit Ownership Act at N.C.G.S. §47A, with powers that included filing a claim of lien against any property if its assessments were more than 30 days delinquent. Unfortunately, those powers did not specifically include the right of a power of sale to conduct a non-judicial foreclosure. Despite N.C.G.S. §47C being enacted in 1985 and statutorily providing for a power of sale, the Court of Appeals held that such change in the law did not automatically grant the association to power of sale and, despite having the authority to amend its declaration, the association had never done so. Accordingly, the association had not had the authority to foreclose in the instant case.

Commentary:

Homeowner and condominium associations that were created before 1985 should review their Declarations and Covenants to ensure that they have a power of sale. (And those facing foreclosure by such should check also.)

And, as always, homeowner associations make the worst neighbors.

For a copy of the opinion, please click here:

Executive-Office-Park-of-Durham-Association-v.-RockDownload

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