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P.L. Condominium Association, Inc. v. Juckett

A-2548-05T1 (N.J. Super. App. Div. 2007) (Unpublished)

CONDOMINIUMS —Absent a specific provision in a condominium association’s organic documents, there is no general authorization for the assessment of counsel fees against the unit owner asserting rights against the condominium association.

A condominium association claimed that a unit owner had failed to pay monthly fees as required by the governing documents. The association sued for the unpaid monthly fees together with interest and reasonable counsel fees. The owner counterclaimed, and the case was tried for nine days. The jury awarded damages to both the association and the unit owner (on his counterclaim) under various causes of action resulting in a net damage award to the association. The lower court also awarded prejudgment interest, counsel fees, and costs to the association. The unit owner also had a pending credit with the association which was deducted from the association’s award. The unit owner took an appeal on the final order of judgment insofar as it awarded interest to the association on the full amount of the verdict rather than on the net amount of the two verdicts, failed to award interest to the unit owner, included costs in excess of those permitted, and included counsel fees.

The Appellate Division first stated that it agreed with the lower court that interest on the association’s verdict was properly computed on the full amount of the association’s verdict. The Court concluded that a calculation of interest on the net amount would frustrate the statutory mandate that interest be collected on each installment as it becomes due. The Court reasoned that the association would be deprived of interest on amounts due prior to when the owner’s entitlement accrued.

The Court next held that the owner was entitled to interest on his award pursuant to a tort claim according to court rule and remanded to the lower court to fix the amount of the owner’s entitlement to interest, beginning on the later of the filing of the counterclaim or six months after the cause of action accrued. Additionally, the Court found that the lower court erred in awarding counsel fees to the association. The Court noted no general authorization for the assessment of counsel fees against a member of a condominium association asserting rights, but did find only for the reasonable value of services expended in the collection of maintenance fees owed by the owner. It directed the lower court to determine such limited fees and include only those counsel fees in the judgment.

Lastly, the Court concluded that the lower court, on remand, identify specifically the costs that were claimed and determine which, in its discretion, were properly taxable.


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