Determining the liability for legal fees is the central issue in CAI's most recent amicus curiae, or "friend of the court," brief in the Pennsylvania case of Mountain View Condominium Owners Association v. Maria P. Bomersbach. The case centers around whether a community association has a right to receive legal fees that it incurred while attempting to collect delinquent assessments from an owner.
In the initial ruling for the association, the Commonwealth Court labeled the owner's apparent efforts to drive up the association's legal costs in the hope that it would abandon the collection effort as "trench warfare". The Commonwealth Court awarded the association $46,549.00, which included attorney's fees. CAI's brief was filed in May after the owner appealed the Commonwealth Court's decision, arguing that she should not be held responsible for the association's legal fees because the association refused a settlement offer before the matter was addressed in court.
CAI's brief asserts that the Supreme Court of Pennsylvania should affirm the Commonwealth Court's decision because the ruling is vital to the fundamental ability of community associations to collect assessments, which are the lifeblood of community operations. Moreover, the brief argues that the prohibition of the collection of reasonable legal fees incurred to capture delinquent assessments, as provided for in association documents and state law, would unfairly force associations to either forgo any attempt to collect delinquent assessments or shift the necessary legal costs to other residents.
"While this case centers around one individual who refused to fulfill her assessment obligations, consciously ran up the association's legal fees and then got upset when the court held her liable for her actions, the outcome is important for all associations that depend on a fairly enforced collections policy to ensure financial security and the provision of services to all owners," said Pamela Scott, CMCA, PCAM, Vice Chair of CAI's Government & Public Affairs Council. "It would be unfair to all association residents if one individual could force an association to incur substantial legal costs, knowing that, at the end of the line, the association would be bound to accept a settlement offer that did not reasonably cover its legal expenses. Associations would have to stop enforcing their collections policies or force other owners to pick up the legal tab—both alternatives that would harm the community and its residents," added Scott.
CAI amicus curiae briefs, one aspect of CAI's overall government and public affairs efforts, are filed in federal or state cases that pose questions of significant importance in community association law. CAI attorney member, Steven Sugarman, Esq., prepared CAI's brief in this case.
The Community Associations Institute is a nonprofit association created in 1973 to educate and represent the nation's 205,000 community associations—condominium associations, homeowner associations and cooperatives. CAI members include homeowners, associations and related professionals and service providers.
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