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Responsibility for Past Delinquent Subdivision Dues

Discussion in 'Banking - Investing - Finances' started by insite, May 12, 2019.

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  1. insite

    insite DI New Member

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    I have a question on Subdivision Dues not paid by a previous home owner :

    We purchased a property in a Subdivision currently run by the Developer and as yet not handed over to a HOA - the property was sold to us by one of the Developers Agents.

    Prior to the sale closing we and our lawyers were assured by the Agent that all property taxes and Subdivision dues had been paid in full by the seller.

    This has turned out not to be the case and now the Developer has presented us with a bill for 2 years of delinquent debt from the previous owners time in residence in this house.

    Our own dues since we took up residence are paid up in full annually.
    • Are we liable for this debt ?
    • Is there somewhere in written or case law to cover this issue ?
     
    insite, May 12, 2019
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  2. DavyL200

    DavyL200 DI Forum Luminary ★ Global Mod ★ Highly Rated Poster Showcase Reviewer

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    It should have been stated somewhere in the deed of sale who pays what. Its also upto the buyer to check if taxes and dues have been paid and up to date.
     
    DavyL200, May 12, 2019
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  3. Show Pony

    Show Pony DI Forum Patron Highly Rated Poster Showcase Reviewer

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    The developers AGENT sold the property. The key word being agent. As an agent that person is speaking on behalf of the developer.
    Imho. Too bad for the developer.
    Edit.. your lawyer should sort this out.
     
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    Show Pony, May 12, 2019
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  4. IggyPop

    IggyPop DI Member Showcase Reviewer

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    There should had been something along with the deed of sale to show what you are buying into.
     
    IggyPop, May 12, 2019
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  5. furriner

    furriner DI Forum Adept Restricted Account

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    HOA dues seem to be a real scam around here. We RENTED a place and before leaving, the absentee owner “required” us to be back HOA dues which we never knew about. It was not part of the rent agreement. Landlords seemed to think it was between us and the HOA. Of course I declined paying as only the home OWNER could be held liable if indeed there was anything due at all. In your case, I would decline payment, not even knowing if the bill was for real or just a scam since prior HOA dues was not part of your closing statement as witnessed by your attorney, who by the way, should give you better advice than we on this forum. Even if he advised to pay I wouldn’t. There is no credit rating system here and you’re being forced to pay would be in extreme violation of my sense of fair play. Let them sue; without a signed statement on your part that you would pay before taking possession of they property, they would probably lose.


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    furriner, May 12, 2019
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  6. IggyPop

    IggyPop DI Member Showcase Reviewer

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    Was there a document to do with subdivision rules, and restrictions of home owners ?
     
    IggyPop, May 13, 2019
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  7. OP
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    insite

    insite DI New Member

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    Thanks Furriner ,

    I agree with you on the aspect of fair play and on that basis had previously refused to pay however there is a new Board now directly appointed by the Developer ( should these people not be elected ? ) and they have just signed an agreement between themselves that will permit them to disconnect the water supply for all delinquent non payment of dues - this gives the Developer the upper hand in this stand off .

    There is a document relating to subdivision rules and restrictions however this document did not form part of the sales transaction.

    The Subdivision Office and RE have pointed out to us that the onus is on us to check with them if dues are paid and to get a certificate of clearance from them prior to signing - in some regards I agree with this statement however as the Agent who sold us the property , and gave us assurances the dues were paid , was a direct employee of the Developer are we not doing this however indirectly ? That we did not get this in writing I accept is a failure on our part and that of our Lawyer whom we paid to represent our interest .

    I intend to seek further clarification from my Lawyer as soon as he is available and see what wizardry he can come up with to address this f*/%k up
     
    insite, May 13, 2019
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  8. furriner

    furriner DI Forum Adept Restricted Account

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    It is common for the Developer to control the HOA until they sell their properties to where they have less than 51% ownership. Since they own 51% or more, they have 51% or more of the votes. Well, somehow they control your water supply so they have the power to make you pay. Whenever I sold in the US, the attorney for the buyer took care of ensuring that I was up to date on taxes, HOA dues and other assessments. Your attorney didn’t do the for you so I kind of assumed it was not customary to do that here. Apparently it should be. But if HOA certificates exist for this purpose and they did not ask for one, I would think your lawyer or his clerk had erred. But how is it that the developer 1) sold you the property with previous assessments due and 2) now demands payment from YOU of the assessments he was responsible for before even selling you the property? The developer is on the hook for selling you property which was apparently free from assessments and encumbrances and now it turns out he lied. We would call that fraud, and now he can turn off your water and force you to pay.


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    furriner, May 13, 2019
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  9. IggyPop

    IggyPop DI Member Showcase Reviewer

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    I would first check if it's a legit subdivision. Some developers build within the limit not required to be classed as a subdivision. If this is the case then the developer cannot enforce dues, and certainly cannot disrupt your water supply.

    Is the sale completed already? Onbviously the sale proceeds should had gone to pay any debt on the title. Mortgage debt first , and then liens on the title. Yes a proper subdivision enforcing dues would use liens on the title from which a lawyer would then be able to identify during purchase.
     
    IggyPop, May 13, 2019
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  10. OP
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    insite

    insite DI New Member

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    Yes - its a legit operation - they are national developers on a large scale - they can enforce dues but they are not enforcing their own rules as set down and we will bring that back to bite them in time ...........

    The sale is completed but no lien or debt were reflected on title and that is a failure on the developers part as the debt was two years in arrears.
     
    insite, May 16, 2019
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