Maryland General Assembly OKs Bill to Help Condos Collect Delinquent Assessments

The Maryland General Assembly has approved legislation to make it easier for condominium associations to suspend use of the common area parking lot, pool and other recreational amenities when an owner is delinquent in paying the condo assessments for more than 60 days.

The new law allows approval by owners with 60 percent of the total eligible votes to amend a condominium declaration to provide for the suspension of use of these portions of the condominium common property.  This is far less than the 80 percent minimum required by the Maryland Condominium Act for other declaration amendments, and some older condo documents require as much as 100 percent unanimous approval. 

The  legislation allows the suspension to take effect after notice is sent to the delinquent owner and the owner does not request a hearing before the board of director to contest the suspension.  Although not addressed directly in the legislation, if an owner parks a vehicle on the condo property after the right to park is revoked, the vehicle could be towed from the property.

In 2017, the Maryland Court of Appeals–the highest state appellate court–ruled that a condominium board of directors did not have the authority to adopt rules for suspending use of the common parking and recreational amenities as a means of inducing payment of assessments.  Instead, any restriction on the right to use the common area had to be in the condo declaration because the Maryland Condominium Act grants all owners a right to use the common property unless that right is restricted in a declaration.

In response to the Court decision, the legislation allowing a new lower threshold of 60 percent to amend the declaration was adopted to aid condos in collection of delinquent assessments since getting owner approval of 80 percent or more is very difficult to achieve–especially in communities with a large number of delinquent owners.

These changes to the Condominium Act were approved in final days of the 2018 legislative session and take effect October 1, 2018.

Posted by Thomas Schild Law Group, LLC, attorneys for condominiums, homeowner associations and housing cooperatives in Maryland -– including Montgomery County, Prince George’s County, Howard County, and Baltimore County; and in Baltimore City and Washington, D.C.

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