§514B-146 
Association fiscal matters; lien for assessments.  (a)  All sums assessed by the association but
unpaid for the share of the common expenses chargeable to any unit shall
constitute a lien on the unit with priority over all other liens, except:



(1)  Liens for
taxes and assessments lawfully imposed by governmental authority against the
unit; and



(2)  All sums
unpaid on any mortgage of record that was recorded prior to the recordation of
a notice of a lien by the association, and costs and expenses including
attorneys' fees provided in such mortgages.



The lien of the
association may be foreclosed by action or by nonjudicial or power of sale
foreclosure procedures set forth in chapter 667, by the managing agent or
board, acting on behalf of the association, in like manner as a mortgage of
real property.  In any such foreclosure, the unit owner shall be required to
pay a reasonable rental for the unit, if so provided in the bylaws, and the
plaintiff in the foreclosure shall be entitled to the appointment of a receiver
to collect the rental owed.  The managing agent or board, acting on behalf of
the association, unless prohibited by the declaration, may bid on the unit at
foreclosure sale, and acquire and hold, lease, mortgage, and convey the unit. 
Action to recover a money judgment for unpaid common expenses shall be
maintainable without foreclosing or waiving the lien securing the unpaid common
expenses owed.



(b)  Except
as provided in subsection (g), when the mortgagee of a mortgage of record or
other purchaser of a unit obtains title to the unit as a result of foreclosure
of the mortgage, the acquirer of title and the acquirer's successors and
assigns shall not be liable for the share of the common expenses or assessments
by the association chargeable to the unit which became due prior to the
acquisition of title to the unit by the acquirer.  The unpaid share of common
expenses or assessments shall be deemed to be common expenses collectible from
all of the unit owners, including the acquirer and the acquirer's successors
and assigns.  The mortgagee of record or other purchaser of the unit shall be
deemed to acquire title and shall be required to pay the unit's share of common
expenses and assessments beginning:



(1)  Thirty-six
days after the order confirming the sale to the purchaser has been filed with
the court;



(2)  Sixty days
after the hearing at which the court grants the motion to confirm the sale to
the purchaser;



(3)  Thirty
days after the public sale in a nonjudicial power of sale foreclosure pursuant
to section 667‑5; or



(4)  Upon the
recording of the instrument of conveyance;



whichever occurs
first; provided that the mortgagee of record or other purchaser of the unit
shall not be deemed to acquire title under paragraph (1), (2), or (3), if transfer
of title is delayed past the thirty-six days specified in paragraph (1), the
sixty days specified in paragraph (2), or the thirty days specified in
paragraph (3), when a person who appears at the hearing on the motion or a
party to the foreclosure action requests reconsideration of the motion or order
to confirm sale, objects to the form of the proposed order to confirm sale,
appeals the decision of the court to grant the motion to confirm sale, or the
debtor or mortgagor declares bankruptcy or is involuntarily placed into
bankruptcy.  In any such case, the mortgagee of record or other purchaser of
the unit shall be deemed to acquire title upon recordation of the instrument of
conveyance.



(c)  No
unit owner shall withhold any assessment claimed by the association.  A unit
owner who disputes the amount of an assessment may request a written statement
clearly indicating:



(1)  The amount of
common expenses included in the assessment, including the due date of each
amount claimed;



(2)  The amount of
any penalty, late fee, lien filing fee, and any other charge included in the
assessment;



(3)  The amount of
attorneys' fees and costs, if any, included in the assessment;



(4)  That under Hawaii law, a unit owner has no right to withhold assessments for any reason;



(5)  That a unit
owner has a right to demand mediation or arbitration to resolve disputes about
the amount or validity of an association's assessment, provided the unit owner
immediately pays the assessment in full and keeps assessments current; and



(6)  That payment
in full of the assessment does not prevent the owner from contesting the
assessment or receiving a refund of amounts not owed.



Nothing in this
section shall limit the rights of an owner to the protection of all fair debt
collection procedures mandated under federal and state law.



(d)  A unit
owner who pays an association the full amount claimed by the association may
file in small claims court or require the association to mediate to resolve any
disputes concerning the amount or validity of the association's claim.  If the
unit owner and the association are unable to resolve the dispute through
mediation, either party may file for arbitration under section 514B‑162;
provided that a unit owner may only file for arbitration if all amounts claimed
by the association are paid in full on or before the date of filing.  If the
unit owner fails to keep all association assessments current during the
arbitration, the association may ask the arbitrator to temporarily suspend the
arbitration proceedings.  If the unit owner pays all association assessments
within thirty days of the date of suspension, the unit owner may ask the
arbitrator to recommence the arbitration proceedings.  If the owner fails to
pay all association assessments by the end of the thirty-day period, the
association may ask the arbitrator to dismiss the arbitration proceedings.  The
unit owner shall be entitled to a refund of any amounts paid to the association
which are not owed.



(e) 
In conjunction with or as an alternative to foreclosure proceedings under
subsection (a), where a unit is owner-occupied, the association may authorize
its managing agent or board to, after sixty days' written notice to the unit
owner and to the unit's first mortgagee of the nonpayment of the unit's share
of the common expenses, terminate the delinquent unit's access to the common
elements and cease supplying a delinquent unit with any and all services
normally supplied or paid for by the association.  Any terminated services and
privileges shall be restored upon payment of all delinquent assessments but
need not be restored until payment in full is received.



(f)  Before the board or managing agent may
take the actions permitted under subsection (e), the board shall adopt a
written policy providing for such actions and have the policy approved by a
majority vote of the unit owners at an annual or special meeting of the
association or by the written consent of a majority of the unit owners.



(g) 
Subject to this subsection, and subsections (h) and (i), the board may
specially assess the amount of the unpaid regular monthly common assessments
for common expenses against a person who, in a judicial or nonjudicial power of
sale foreclosure, purchases a delinquent unit; provided that:



(1)  A purchaser
who holds a mortgage on a delinquent unit that was recorded prior to the filing
of a notice of lien by the association and who acquires the delinquent unit
through a judicial or nonjudicial foreclosure proceeding, including purchasing
the delinquent unit at a foreclosure auction, shall not be obligated to make,
nor be liable for, payment of the special assessment as provided for under this
subsection; and



(2)  A person who
subsequently purchases the delinquent unit from the mortgagee referred to in
paragraph (1) shall be obligated to make, and shall be liable for, payment of
the special assessment provided for under this subsection; and provided further
that the mortgagee or subsequent purchaser may require the association to
provide at no charge a notice of the association's intent to claim lien against
the delinquent unit for the amount of the special assessment, prior to the
subsequent purchaser's acquisition of title to the delinquent unit.  The notice
shall state the amount of the special assessment, how that amount was
calculated, and the legal description of the unit.



(h)  The
amount of the special assessment assessed under subsection (g) shall not exceed
the total amount of unpaid regular monthly common assessments that were
assessed during the six months immediately preceding the completion of the
judicial or nonjudicial power of sale foreclosure.  In no event shall the
amount of the special assessment exceed the sum of $3,600.



(i)  For
purposes of subsections (g) and (h), the following definitions shall apply,
unless the context requires otherwise:



"Completion"
means:



(1)  In a
nonjudicial power of sale foreclosure, when the affidavit required under
section 667-5 is filed; and



(2)  In a judicial
foreclosure, when a purchaser is deemed to acquire title pursuant to subsection
(b).



"Regular
monthly common assessments" does not include:



(1)  Any other
special assessment, except for a special assessment imposed on all units as
part of a budget adopted pursuant to section 514B‑148;



(2)  Late charges,
fines, or penalties;



(3)  Interest
assessed by the association;



(4)  Any lien
arising out of the assessment; or



(5)  Any fees or
costs related to the collection or enforcement of the assessment, including
attorneys' fees and court costs.



(j)  The
cost of a release of any lien filed pursuant to this section shall be paid by
the party requesting the release. [L 2004,
c 164, pt of §2 and §35(1); am L
2005, c 93, §7; am L 2006, c 273, §32; am L 2007, c 21, §1; am L 2009, c 10, §3]