Trustees of the Cambridge Point Condominium Tr. v. Cambridge Point, LLC

Supreme Judicial Court of Massachusetts · 2018 · Property
Updated
PropertyCondominiumsBylawsCommon areasPublic policycondominium trustlitigation authorityunit owner consent

Facts

The condominium bylaws authorized the trustees to conduct litigation involving common areas and facilities, but required them, before suing any non-unit owner, to circulate the proposed complaint, state a monetary cap on legal fees and costs, inform owners that consenting owners would be immediately specially assessed, and obtain written consent from at least eighty percent of all unit owners within sixty days. The trust later discovered widespread water leaks, mold, and numerous design and construction defects in the condominium's common areas and facilities, with repairs estimated to exceed $2 million. The trustees filed suit against the developers without obtaining the required eighty percent written consent. They alleged that the developers and their affiliates retained enough units to block the supermajority needed to authorize suit.

Issue

Whether the condominium bylaw requiring written consent of at least eighty percent of all unit owners before trustees may initiate litigation against non-unit owners is void. More specifically, the court considered whether such a provision is barred by the Condominium Act or, even if not per se barred, is void because it contravenes public policy.

Rule

The Condominium Act does not per se invalidate every bylaw requiring unit-owner consent before trustees initiate litigation concerning common areas and facilities. But a bylaw is void as contrary to public policy when, viewed in light of the totality of the circumstances, it functions as developer overreaching by making it extraordinarily difficult or effectively impossible for trustees to bring claims against developers for defects affecting the common areas and facilities, thereby impeding redress for unwaivable rights tied to home safety and habitability.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.
In Portland, Maine, the Harbor Slate Condominium bylaws provide that trustees may sue over defects in the roof and exterior walls only after approval by 55% of unit owners voting at a duly noticed meeting. The developer sold all of its units before turnover, and the bylaw imposes no special assessment or accelerated payment of projected legal fees.

If trustees argue that any owner-consent requirement for litigation concerning common areas is automatically invalid because the condominium statute gives trustees the exclusive power to litigate such claims, what is the strongest response?

Explanation. The majority held that the condominium act is an enabling statute and does not per se forbid bylaws requiring unit-owner consent before trustees initiate litigation. Although trustees have exclusive authority to bring common-area claims, that exclusivity does not automatically make every consent requirement inconsistent with the statute. The proper inquiry is not categorical invalidity, but whether the particular bylaw, viewed in the totality of the circumstances, contravenes public policy by effectively blocking redress. (Derived from Trustees of the Cambridge Point Condominium Tr. v. Cambridge Point, LLC (n.d.).)