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§ 47F-3-116. Lien for assessments.

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§ 47F‑3‑116.  Lienfor assessments.(a)        Any assessmentlevied against a lot remaining unpaid for a period of 30 days or longer shallconstitute a lien on that lot when a claim of lien is filed of record in theoffice of the clerk of superior court of the county in which the lot is locatedin the manner provided herein. Prior to filing a claim of lien, the associationmust make reasonable and diligent efforts to ensure that its records containthe lot owner's current mailing address. No fewer than 15 days prior to filingthe lien, the association shall mail a statement of the assessment amount dueby first‑class mail to the physical address of the lot and the lotowner's address of record with the association, and, if different, to theaddress for the lot owner shown on the county tax records and the county realproperty records for the lot. If the lot owner is a corporation, the statementshall also be sent by first‑class mail to the mailing address of theregistered agent for the corporation. Unless the declaration otherwiseprovides, fees, charges, late charges, and other charges imposed pursuant toG.S. 47F‑3‑102, 47F‑3‑107, 47F‑3‑107.1, and47F‑3‑115 are enforceable as assessments under this section. Exceptas provided in subsections (a1) and (a2) of this section, the association mayforeclose the claim of lien in like manner as a mortgage on real estate underpower of sale under Article 2A of Chapter 45 of the General Statutes.(a1)      An association maynot foreclose an association assessment lien under Article 2A of Chapter 45 ofthe General Statutes if the debt securing the lien consists solely of finesimposed by the association, interest on unpaid fines, or attorneys' feesincurred by the association solely associated with fines imposed by theassociation. The association, however, may enforce the lien by judicialforeclosure as provided in Article 29A of Chapter 1 of the General Statutes.(a2)      An association shallnot levy, charge, or attempt to collect a service, collection, consulting, oradministration fee from any lot owner unless the fee is expressly allowed inthe declaration. Any lien securing a debt consisting solely of these fees mayonly be enforced by judicial foreclosure as provided in Article 29A of Chapter1 of the General Statutes.(b)        The lien under thissection is prior to all liens and encumbrances on a lot except (i) liens andencumbrances (specifically including, but not limited to, a mortgage or deed oftrust on the lot) recorded before the docketing of the claim of lien in theoffice of the clerk of superior court, and (ii) liens for real estate taxes andother governmental assessments and charges against the lot. This subsectiondoes not affect the priority of mechanics' or materialmen's liens.(c)        A lien for unpaidassessments is extinguished unless proceedings to enforce the lien areinstituted within three years after the docketing of the claim of lien in theoffice of the clerk of superior court.(d)        This section doesnot prohibit other actions to recover the sums for which subsection (a) of thissection creates a lien or prohibit an association taking a deed in lieu offoreclosure.(e)        A judgment, decree,or order in any action brought under this section shall include costs andreasonable attorneys' fees for the prevailing party. If the lot owner does notcontest the collection of debt and enforcement of a lien after the expirationof the 15‑day period following notice as required in subsection (e1) ofthis section, then reasonable attorneys' fees shall not exceed one thousand twohundred dollars ($1,200), not including costs or expenses incurred. Thecollection of debt and enforcement of a lien remain uncontested as long as thelot owner does not dispute, contest, or raise any objection, defense, offset,or counterclaim as to the amount or validity of the debt and lien asserted orthe association's right to collect the debt and enforce the lien as provided inthis section. The attorneys' fee limitation in this subsection shall not applyto judicial foreclosures or to proceedings authorized under subsection (d) ofthis section or G.S. 47F‑3‑120.(e1)      A lot owner may notbe required to pay attorneys' fees and court costs until the lot owner isnotified in writing of the association's intent to seek payment of attorneys'fees and court costs. The notice must be sent by first‑class mail to theproperty address and, if different, to the mailing address for the lot owner inthe association's records. The association must make reasonable and diligentefforts to ensure that its records contain the lot owner's current mailingaddress. The notice shall set out the outstanding balance due as of the date ofthe notice and state that the lot owner has 15 days from the mailing of thenotice by first‑class mail to pay the outstanding balance without theattorneys' fees and court costs. If the lot owner pays the outstanding balancewithin this period, then the lot owner shall have no obligation to payattorneys' fees and court costs. The notice shall also inform the lot owner ofthe opportunity to contact a representative of the association to discuss apayment schedule for the outstanding balance as provided in subsection (e2) ofthis section and shall provide the name and telephone number of therepresentative.(e2)      The association,acting through its executive board and in the board's sole discretion, mayagree to allow payment of an outstanding balance in installments. Neither theassociation nor the lot owner is obligated to offer or accept any proposedinstallment schedule. Reasonable administrative fees and costs for acceptingand processing installments may be added to the outstanding balance andincluded in an installment payment schedule. Reasonable attorneys' fees may beadded to the outstanding balance and included in an installment schedule onlyafter the lot owner has been given notice as required in subsection (e1) ofthis section.(f)         Where the holderof a first mortgage or first deed of trust of record, or other purchaser of alot obtains title to the lot as a result of foreclosure of a first mortgage orfirst deed of trust, such purchaser and its heirs, successors, and assigns,shall not be liable for the assessments against such lot which became due priorto the acquisition of title to such lot by such purchaser. Such unpaidassessments shall be deemed to be common expenses collectible from all the lotowners including such purchaser, its heirs, successors, and assigns.(g)        A claim of lienshall set forth the name and address of the association, the name of the recordowner of the lot at the time the claim of lien is filed, a description of thelot, and the amount of the lien claimed. The first page of the claim of lienshall contain the following statement in print that is in boldface, capitalletters and no smaller than the largest print used elsewhere in the document:"THIS DOCUMENT CONSTITUTES A LIEN AGAINST YOUR PROPERTY, AND IF THE LIENIS NOT PAID, THE HOMEOWNERS ASSOCIATION MAY PROCEED WITH FORECLOSURE AGAINSTYOUR PROPERTY IN LIKE MANNER AS A MORTGAGE UNDER NORTH CAROLINA LAW." Theperson signing the claim of lien on behalf of the association shall attach toand file with the claim of lien a certificate of service attesting to theattempt of service on the record owner, which service shall be attempted inaccordance with G.S. 1A‑1, Rule 4(j) for service of a copy of a summonsand a complaint. If the actual service is not achieved, the person signing theclaim of lien on behalf of the association shall be deemed to have met therequirements of this subsection if service has been attempted pursuant to bothof the following: (i) G.S. 1A‑1, Rule 4(j)(1) c., d., or e.; and (ii) bymailing a copy of the lien by regular, first‑class mail, postage prepaidto the physical address of the lot and the lot owner's address of record withthe association, and, if different, to the address for the lot owner shown onthe county tax records and the county real property records for the lot. In theevent that the owner of record is not a natural person, and actual service isnot achieved, the person signing the claim of lien on behalf of the associationshall be deemed to have met the requirements of this subsection if service hasbeen attempted once pursuant to the applicable provisions of G.S. 1A‑1,Rule 4(j)(3) through G.S. 1A‑1, Rule 4(j)(9).  (1998‑199, s. 1; 2005‑422,s. 6; 2009‑515, s. 1.)
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  • § 47F‑3‑116.  Lienfor assessments.

    (a)        Any assessmentlevied against a lot remaining unpaid for a period of 30 days or longer shallconstitute a lien on that lot when a claim of lien is filed of record in theoffice of the clerk of superior court of the county in which the lot is locatedin the manner provided herein. Prior to filing a claim of lien, the associationmust make reasonable and diligent efforts to ensure that its records containthe lot owner's current mailing address. No fewer than 15 days prior to filingthe lien, the association shall mail a statement of the assessment amount dueby first‑class mail to the physical address of the lot and the lotowner's address of record with the association, and, if different, to theaddress for the lot owner shown on the county tax records and the county realproperty records for the lot. If the lot owner is a corporation, the statementshall also be sent by first‑class mail to the mailing address of theregistered agent for the corporation. Unless the declaration otherwiseprovides, fees, charges, late charges, and other charges imposed pursuant toG.S. 47F‑3‑102, 47F‑3‑107, 47F‑3‑107.1, and47F‑3‑115 are enforceable as assessments under this section. Exceptas provided in subsections (a1) and (a2) of this section, the association mayforeclose the claim of lien in like manner as a mortgage on real estate underpower of sale under Article 2A of Chapter 45 of the General Statutes.

    (a1)      An association maynot foreclose an association assessment lien under Article 2A of Chapter 45 ofthe General Statutes if the debt securing the lien consists solely of finesimposed by the association, interest on unpaid fines, or attorneys' feesincurred by the association solely associated with fines imposed by theassociation. The association, however, may enforce the lien by judicialforeclosure as provided in Article 29A of Chapter 1 of the General Statutes.

    (a2)      An association shallnot levy, charge, or attempt to collect a service, collection, consulting, oradministration fee from any lot owner unless the fee is expressly allowed inthe declaration. Any lien securing a debt consisting solely of these fees mayonly be enforced by judicial foreclosure as provided in Article 29A of Chapter1 of the General Statutes.

    (b)        The lien under thissection is prior to all liens and encumbrances on a lot except (i) liens andencumbrances (specifically including, but not limited to, a mortgage or deed oftrust on the lot) recorded before the docketing of the claim of lien in theoffice of the clerk of superior court, and (ii) liens for real estate taxes andother governmental assessments and charges against the lot. This subsectiondoes not affect the priority of mechanics' or materialmen's liens.

    (c)        A lien for unpaidassessments is extinguished unless proceedings to enforce the lien areinstituted within three years after the docketing of the claim of lien in theoffice of the clerk of superior court.

    (d)        This section doesnot prohibit other actions to recover the sums for which subsection (a) of thissection creates a lien or prohibit an association taking a deed in lieu offoreclosure.

    (e)        A judgment, decree,or order in any action brought under this section shall include costs andreasonable attorneys' fees for the prevailing party. If the lot owner does notcontest the collection of debt and enforcement of a lien after the expirationof the 15‑day period following notice as required in subsection (e1) ofthis section, then reasonable attorneys' fees shall not exceed one thousand twohundred dollars ($1,200), not including costs or expenses incurred. Thecollection of debt and enforcement of a lien remain uncontested as long as thelot owner does not dispute, contest, or raise any objection, defense, offset,or counterclaim as to the amount or validity of the debt and lien asserted orthe association's right to collect the debt and enforce the lien as provided inthis section. The attorneys' fee limitation in this subsection shall not applyto judicial foreclosures or to proceedings authorized under subsection (d) ofthis section or G.S. 47F‑3‑120.

    (e1)      A lot owner may notbe required to pay attorneys' fees and court costs until the lot owner isnotified in writing of the association's intent to seek payment of attorneys'fees and court costs. The notice must be sent by first‑class mail to theproperty address and, if different, to the mailing address for the lot owner inthe association's records. The association must make reasonable and diligentefforts to ensure that its records contain the lot owner's current mailingaddress. The notice shall set out the outstanding balance due as of the date ofthe notice and state that the lot owner has 15 days from the mailing of thenotice by first‑class mail to pay the outstanding balance without theattorneys' fees and court costs. If the lot owner pays the outstanding balancewithin this period, then the lot owner shall have no obligation to payattorneys' fees and court costs. The notice shall also inform the lot owner ofthe opportunity to contact a representative of the association to discuss apayment schedule for the outstanding balance as provided in subsection (e2) ofthis section and shall provide the name and telephone number of therepresentative.

    (e2)      The association,acting through its executive board and in the board's sole discretion, mayagree to allow payment of an outstanding balance in installments. Neither theassociation nor the lot owner is obligated to offer or accept any proposedinstallment schedule. Reasonable administrative fees and costs for acceptingand processing installments may be added to the outstanding balance andincluded in an installment payment schedule. Reasonable attorneys' fees may beadded to the outstanding balance and included in an installment schedule onlyafter the lot owner has been given notice as required in subsection (e1) ofthis section.

    (f)         Where the holderof a first mortgage or first deed of trust of record, or other purchaser of alot obtains title to the lot as a result of foreclosure of a first mortgage orfirst deed of trust, such purchaser and its heirs, successors, and assigns,shall not be liable for the assessments against such lot which became due priorto the acquisition of title to such lot by such purchaser. Such unpaidassessments shall be deemed to be common expenses collectible from all the lotowners including such purchaser, its heirs, successors, and assigns.

    (g)        A claim of lienshall set forth the name and address of the association, the name of the recordowner of the lot at the time the claim of lien is filed, a description of thelot, and the amount of the lien claimed. The first page of the claim of lienshall contain the following statement in print that is in boldface, capitalletters and no smaller than the largest print used elsewhere in the document:"THIS DOCUMENT CONSTITUTES A LIEN AGAINST YOUR PROPERTY, AND IF THE LIENIS NOT PAID, THE HOMEOWNERS ASSOCIATION MAY PROCEED WITH FORECLOSURE AGAINSTYOUR PROPERTY IN LIKE MANNER AS A MORTGAGE UNDER NORTH CAROLINA LAW." Theperson signing the claim of lien on behalf of the association shall attach toand file with the claim of lien a certificate of service attesting to theattempt of service on the record owner, which service shall be attempted inaccordance with G.S. 1A‑1, Rule 4(j) for service of a copy of a summonsand a complaint. If the actual service is not achieved, the person signing theclaim of lien on behalf of the association shall be deemed to have met therequirements of this subsection if service has been attempted pursuant to bothof the following: (i) G.S. 1A‑1, Rule 4(j)(1) c., d., or e.; and (ii) bymailing a copy of the lien by regular, first‑class mail, postage prepaidto the physical address of the lot and the lot owner's address of record withthe association, and, if different, to the address for the lot owner shown onthe county tax records and the county real property records for the lot. In theevent that the owner of record is not a natural person, and actual service isnot achieved, the person signing the claim of lien on behalf of the associationshall be deemed to have met the requirements of this subsection if service hasbeen attempted once pursuant to the applicable provisions of G.S. 1A‑1,Rule 4(j)(3) through G.S. 1A‑1, Rule 4(j)(9).  (1998‑199, s. 1; 2005‑422,s. 6; 2009‑515, s. 1.)

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