Nebraska Court Says HOA Miscalculation of Assessments Did Not Invalidate Lien

Nebraska Supreme Court decision (March 13, 2015).

After the owner of property located within a common interest development governed by a homeowners association (“Association”) failed to pay assessments, the Association recorded notices of liens and filed a foreclosure action. After the Association filed the notices of lien and the complaint, while the foreclosure action was pending, it learned that it was levying assessments against the subject property in a manner that was prohibited by the Association’s governing documents. The Association recalculated the assessments and proceeded. The district court found that the Association had a valid lien against the owner’s property for delinquent assessments and ruled that the Association could foreclose its lien if the owner did not pay the back assessments within 90 days.

The owner appealed the district court’s decision contending that the Association did not have a valid lien on the owner’s property because it failed to levy assessments in the manner required by the Association’s governing documents. The Association also appealed the district court decision arguing that the lower court did not award all of the relief that the Association is entitled to and that the lower court failed to make all the findings necessary for a foreclosure decree.

The appellate court ruled that the Association’s initial miscalculation of assessments did not invalidate its lien and that it did have the right to foreclosure on the property. The appellate court further ruled that the lower court erred by not awarding the Association attorney fees, not including several installments as part of the debt secured by the lien, and failing to include a legal description of the subject property in its judgment.

See case decision: Twin_Towers_Condo._Ass’n,_In