No More Non-Judicial Foreclosures?

Those who know me, and those who follow this blog, are aware that I’ve never been an advocate of non-judicial foreclosures of community association assessment liens. And at the the CCAL Law Conference last month, the pundits were agreeing.

I’ve had a number of reasons to dislike nonjudicial foreclosures; I think they usually take longer than a letter followed (when necessary) by a complaint; I think they are unduly aggressive in a number of situations; I think they unduly impose excessive costs on the association and ultimately the unit owner, and I’ve always questioned their legality under Utah statutes. And now, there’s published evidence that confirms that a Utah trial court has found them problematic, and an appelate court won’t review that decision, at least for now.

The case, McQueen v. Jordan Pines Townhomes Owners Association, Inc., involved challenges on a number of grounds to the legitimacy of a condominium non-judicial foreclosure; the trial court essentially held that ambiguities and omissions in the Utah Condominium Act would not justify the absence of a “trustee” in a nonjudicial foreclosure, and hence the attempted sale by the association’s counsel was set aside. The association’s counsel appealed, but that appeal was very quickly rejected by the Utah Court of Appeals, based upon the absence of a “final ruling” from which the association was appealing. Remaining controversies between the parties preclude consideration of the appeal at this time; I strongly suspect that the costs of further litigation will preclude further litigation and the eventual appeal.

I think it’s a very important case; we’ll be exploring it in more depth in connection with an upcoming CAALRS collection seminar. Keep an eye on this blog, and/or for information on the date, time and other subjects to be covered.

CAALRS, and this blog are all sponsored by the law firm of Hobbs & Olson, L.C.

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