Rep. Norm Thurston — Voting Record

Bill

Number

S.B. 183 Second Substitute (2020GS)

Sponsor

Sen. Bramble, C.

Final action

Governor Signed 3/30/2020

Outcome

Became law — signed by Gov. Gary R. Herbert

Summary

What it does

• This bill:
• amends terms;
• amends provisions related to nonjudicial foreclosure on a unit, including:
• establishing limitations on nonjudicial foreclosure; and
• exempting time share estates from certain limitations;
• amends provisions related to nonjudicial foreclosure on a lot, including:
• establishing limitations on nonjudicial foreclosure; and
• exempting time share estates from certain limitations; and
• makes technical and conforming changes.

Every vote on this bill

Bill text

NONJUDICIAL FORECLOSURE AMENDMENTS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Curtis S. Bramble
House Sponsor: 
Marc K. Roberts
LONG TITLE
General Description:
This bill amends provisions of the Condominium Ownership Act and the Community
Association Act.
Highlighted Provisions:
This bill:
▸ amends terms;
▸ amends provisions related to nonjudicial foreclosure on a unit, including:
• establishing limitations on nonjudicial foreclosure; and
• exempting time share estates from certain limitations;
▸ amends provisions related to nonjudicial foreclosure on a lot, including:
• establishing limitations on nonjudicial foreclosure; and
• exempting time share estates from certain limitations; and
▸ makes technical and conforming changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
57-8-3
, as last amended by Laws of Utah 2017, Chapter 131
57-8-46
, as enacted by Laws of Utah 2011, Chapter 355
57-8a-102
, as last amended by Laws of Utah 2017, Chapters 131 and 424
57-8a-303
, as enacted by Laws of Utah 2011, Chapter 355
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
57-8-3
 is amended to read:
57-8-3.
Definitions.
As used in this chapter:
(1) "Assessment" means any charge imposed by the association, including:
(a) common expenses on or against a unit owner pursuant to the provisions of the
declaration, bylaws, or this chapter; and
(b) an amount that an association of unit owners assesses to a unit owner under
Subsection 
57-8-43
(9)(g).
(2) "Association of unit owners" or "association" means all of the unit owners:
(a) acting as a group in accordance with the declaration and bylaws; or
(b) organized as a legal entity in accordance with the declaration.
(3) "Building" means a building, containing units, and comprising a part of the
property.
(4) "Commercial condominium project" means a condominium project that has no
residential units within the project.
(5) "Common areas and facilities" unless otherwise provided in the declaration or
lawful amendments to the declaration means:
(a) the land included within the condominium project, whether leasehold or in fee
simple;
(b) the foundations, columns, girders, beams, supports, main walls, roofs, halls,
corridors, lobbies, stairs, stairways, fire escapes, entrances, and exits of the building;
(c) the basements, yards, gardens, parking areas, and storage spaces;
(d) the premises for lodging of janitors or persons in charge of the property;
(e) installations of central services such as power, light, gas, hot and cold water,
heating, refrigeration, air conditioning, and incinerating;
(f) the elevators, tanks, pumps, motors, fans, compressors, ducts, and in general all
apparatus and installations existing for common use;
(g) such community and commercial facilities as may be provided for in the
declaration; and
(h) all other parts of the property necessary or convenient to its existence, maintenance,
and safety, or normally in common use.
(6) "Common expenses" means:
(a) all sums lawfully assessed against the unit owners;
(b) expenses of administration, maintenance, repair, or replacement of the common
areas and facilities;
(c) expenses agreed upon as common expenses by the association of unit owners; and
(d) expenses declared common expenses by this chapter, or by the declaration or the
bylaws.
(7) "Common profits," unless otherwise provided in the declaration or lawful
amendments to the declaration, means the balance of all income, rents, profits, and revenues
from the common areas and facilities remaining after the deduction of the common expenses.
(8) "Condominium" means the ownership of a single unit in a multiunit project
together with an undivided interest in common in the common areas and facilities of the
property.
(9) "Condominium plat" means a plat or plats of survey of land and units prepared in
accordance with Section 
57-8-13
.
(10) "Condominium project" means a real estate condominium project; a plan or
project whereby two or more units, whether contained in existing or proposed apartments,
commercial or industrial buildings or structures, or otherwise, are separately offered or
proposed to be offered for sale. Condominium project also means the property when the
context so requires.
(11) "Condominium unit" means a unit together with the undivided interest in the
common areas and facilities appertaining to that unit. Any reference in this chapter to a
condominium unit includes both a physical unit together with its appurtenant undivided interest
in the common areas and facilities and a time period unit together with its appurtenant
undivided interest, unless the reference is specifically limited to a time period unit.
(12) "Contractible condominium" means a condominium project from which one or
more portions of the land within the project may be withdrawn in accordance with provisions
of the declaration and of this chapter. If the withdrawal can occur only by the expiration or
termination of one or more leases, then the condominium project is not a contractible
condominium within the meaning of this chapter.
(13) "Convertible land" means a building site which is a portion of the common areas
and facilities, described by metes and bounds, within which additional units or limited common
areas and facilities may be created in accordance with this chapter.
(14) "Convertible space" means a portion of the structure within the condominium
project, which portion may be converted into one or more units or common areas and facilities,
including limited common areas and facilities in accordance with this chapter.
(15) "Declarant" means all persons who execute the declaration or on whose behalf the
declaration is executed. From the time of the recordation of any amendment to the declaration
expanding an expandable condominium, all persons who execute that amendment or on whose
behalf that amendment is executed shall also come within this definition. Any successors of
the persons referred to in this subsection who come to stand in the same relation to the
condominium project as their predecessors also come within this definition.
(16) "Declaration" means the instrument by which the property is submitted to the
provisions of this act, as it from time to time may be lawfully amended.
(17) "Electrical corporation" means the same as that term is defined in Section 
54-2-1
.
(18) "Expandable condominium" means a condominium project to which additional
land or an interest in it may be added in accordance with the declaration and this chapter.
(19) "Gas corporation" means the same as that term is defined in Section 
54-2-1
.
(20) "Governing documents":
(a) means a written instrument by which an association of unit owners may:
(i) exercise powers; or
(ii) manage, maintain, or otherwise affect the property under the jurisdiction of the
association of unit owners; and
(b) includes:
(i) articles of incorporation;
(ii) bylaws;
(iii) a plat;
(iv) a declaration of covenants, conditions, and restrictions; and
(v) rules of the association of unit owners.
(21) "Independent third party" means a person that:
(a) is not related to the unit owner;
(b) shares no pecuniary interests with the unit owner; and
(c) purchases the unit in good faith and without the intent to defraud a current or future
lienholder.
(22) "Judicial foreclosure" means a foreclosure of a unit:
(a) for the nonpayment of an assessment;
(b) in the manner provided by law for the foreclosure of a mortgage on real property;
and
(c) as provided in this chapter.
[
(22)
] 
(23)
 "Leasehold condominium" means a condominium project in all or any
portion of which each unit owner owns an estate for years in his unit, or in the land upon which
that unit is situated, or both, with all those leasehold interests to expire naturally at the same
time. A condominium project including leased land, or an interest in the land, upon which no
units are situated or to be situated is not a leasehold condominium within the meaning of this
chapter.
[
(23)
] 
(24)
 "Limited common areas and facilities" means those common areas and
facilities designated in the declaration as reserved for use of a certain unit or units to the
exclusion of the other units.
[
(24)
] 
(25)
 "Majority" or "majority of the unit owners," unless otherwise provided in
the declaration or lawful amendments to the declaration, means the owners of more than 50%
in the aggregate in interest of the undivided ownership of the common areas and facilities.
[
(25)
] 
(26)
 "Management committee" means the committee as provided in the
declaration charged with and having the responsibility and authority to make and to enforce all
of the reasonable rules covering the operation and maintenance of the property.
[
(26)
] 
(27)
 " Management committee meeting" means a gathering of a management
committee, whether in person or by means of electronic communication, at which the
management committee can take binding action.
[
(27)
] 
(28)
 (a) "Means of electronic communication" means an electronic system that
allows individuals to communicate orally in real time.
(b) "Means of electronic communication" includes:
(i) web conferencing;
(ii) video conferencing; and
(iii) telephone conferencing.
[
(28)
] 
(29)
 "Mixed-use condominium project" means a condominium project that has
both residential and commercial units in the condominium project.
(30) "Nonjudicial foreclosure" means the sale of a unit:
(a) for the nonpayment of an assessment;
(b) in the same manner as the sale of trust property under Sections 
57-1-19
 through
57-1-34
; and
(c) as provided in this chapter.
[
(29)
] 
(31)
 "Par value" means a number of dollars or points assigned to each unit by the
declaration. Substantially identical units shall be assigned the same par value, but units located
at substantially different heights above the ground, or having substantially different views, or
having substantially different amenities or other characteristics that might result in differences
in market value, may be considered substantially identical within the meaning of this
subsection. If par value is stated in terms of dollars, that statement may not be considered to
reflect or control the sales price or fair market value of any unit, and no opinion, appraisal, or
fair market transaction at a different figure may affect the par value of any unit, or any
undivided interest in the common areas and facilities, voting rights in the unit owners'
association, liability for common expenses, or right to common profits, assigned on the basis
thereof.
[
(30)
] 
(32)
 "Period of administrative control" means the period of control described in
Subsection 
57-8-16.5
(1).
[
(31)
] 
(33)
 "Person" means an individual, corporation, partnership, association, trustee,
or other legal entity.
[
(32)
] 
(34)
 "Property" means the land, whether leasehold or in fee simple, the building,
if any, all improvements and structures thereon, all easements, rights, and appurtenances
belonging thereto, and all articles of personal property intended for use in connection
therewith.
[
(33)
] 
(35)
 "Record," "recording," "recorded," and "recorder" have the meaning stated
in Chapter 3, Recording of Documents.
[
(34)
] 
(36)
 "Rentals" or "rental unit" means:
(a) a unit that:
(i) is not owned by an entity or trust; and
(ii) is occupied by an individual while the unit owner is not occupying the unit as the
unit owner's primary residence; or
(b) an occupied unit owned by an entity or trust, regardless of who occupies the unit. 
[
(35)
] 
(37)
 "Size" means the number of cubic feet, or the number of square feet of
ground or floor space, within each unit as computed by reference to the record of survey map
and rounded off to a whole number. Certain spaces within the units including attic, basement,
or garage space may be omitted from the calculation or be partially discounted by the use of a
ratio, if the same basis of calculation is employed for all units in the condominium project and
if that basis is described in the declaration.
[
(36)
] 
(38)
 "Time period unit" means an annually recurring part or parts of a year
specified in the declaration as a period for which a unit is separately owned and includes a
timeshare estate as defined in Section 
57-19-2
.
[
(37)
] 
(39)
 "Unconstructed unit" means a unit that:
(a) is intended, as depicted in the condominium plat, to be fully or partially contained
in a building; and
(b) is not constructed.
[
(38)
] 
(40)
 (a) "Unit" means a separate part of the property intended for any type of
independent use, which is created by the recording of a declaration and a condominium plat
that describes the unit boundaries.
(b) "Unit" includes one or more rooms or spaces located in one or more floors or a
portion of a floor in a building.
(c) "Unit" includes a convertible space, in accordance with Subsection 
57-8-13.4
(3).
[
(39)
] 
(41)
 "Unit number" means the number, letter, or combination of numbers and
letters designating the unit in the declaration and in the record of survey map.
[
(40)
] 
(42)
 "Unit owner" means the person or persons owning a unit in fee simple and
an undivided interest in the fee simple estate of the common areas and facilities in the
percentage specified and established in the declaration or, in the case of a leasehold
condominium project, the person or persons whose leasehold interest or interests in the
condominium unit extend for the entire balance of the unexpired term or terms.
Section 2. Section 
57-8-46
 is amended to read:
57-8-46.
Notice of nonjudicial foreclosure -- Limitations on nonjudicial
foreclosure.
(1) At least 30 calendar days before [
initiating
] 
the day on which an association of unit
owners initiates
 a nonjudicial foreclosure[
, an
] 
by filing for record a notice of default in
accordance with Section 
57-1-24
, the
 association of unit owners shall [
provide
] 
deliver
 notice
to the owner of the unit that is the intended subject of the nonjudicial foreclosure.
(2) The notice under Subsection (1):
(a) shall:
(i) notify the unit owner that the association of unit owners intends to pursue
nonjudicial foreclosure with respect to the owner's unit to enforce the association of unit
owners' lien for an unpaid assessment;
(ii) notify the unit owner of the owner's right to demand judicial foreclosure in the
place of nonjudicial foreclosure;
(iii) be in substantially the following form:
"NOTICE OF NONJUDICIAL FORECLOSURE AND RIGHT TO DEMAND
JUDICIAL FORECLOSURE
The (insert the name of the association of unit owners), the association for the project in
which your unit is located, intends to foreclose upon your unit and allocated interest in the
common areas and facilities 
for delinquent assessments
 using a procedure that will not require
it to file a lawsuit or involve a court. This procedure 
is governed by Utah Code, Sections
57-8-46
 and 
57-8-47
, and
 is being followed in order to enforce the association's lien against
your unit and to collect the amount of an unpaid assessment against your unit, together with
any applicable late fees and the costs, including attorney fees, associated with the foreclosure
proceeding. 
This procedure cannot and will not be used to foreclose upon your unit for
delinquent fines for a violation of the association of unit owners' governing documents.
Alternatively, you have the right to demand that a foreclosure of your property 
for delinquent
assessments
 be conducted in a lawsuit with the oversight of a judge. If you make this demand
,
the association of unit owners may also include a claim for delinquent fines for a violation of
the association of unit owners' governing documents. Additionally, if you make this demand
and the association prevails in the lawsuit, the costs and attorney fees associated with the
lawsuit will likely be significantly higher than if a lawsuit were not required, and you may be
responsible for paying those costs and attorney fees. If you want to make this demand, you
must state in writing that 'I demand a judicial foreclosure proceeding upon my unit,' or words
substantially to that effect. You must send this written demand by first class and certified U.S.
mail, return receipt requested, within [
] 
 days after the [
date of the postmark on the
envelope in which
] 
day on which
 this notice was [
mailed
] 
delivered
 to you. The address to
which you must mail your demand is (insert the address of the association of unit owners for
receipt of a demand)."; and
(iv) be sent to the unit owner by certified mail, return receipt requested; and
(b) may be included with other association correspondence to the unit owner.
(3) An association of unit owners may not use a nonjudicial foreclosure to enforce a
lien if
:
(a) the association of unit owners fails to provide notice in accordance with Subsection
(1);
(b)
 the unit owner mails the association of unit owners a written demand for judicial
foreclosure:
[
(a)
] 
(i)
 by U.S. mail, certified with a return receipt requested;
[
(b)
] 
(ii)
 to the address stated in the association of unit owners' notice under Subsection
(1); and
[
(c)
] 
(iii)
 within [
] 
 days after the [
date of the postmark on the envelope of
] 
day on
which the return receipt described in Subsection (2)(a)(iv) shows
 the association of unit
owners' notice under Subsection (1)[
.
] 
is delivered;
(c) the lien includes a fine described in Subsection 
57-8-44
(1)(a)(iii); or
(d) unless the lien is on a time share estate as defined in Section 
57-19-2
, the lien does
not include an assessment described in Subsection 
57-8-44
(1)(a)(i) that is delinquent more than
days after the day on which the assessment is due.
Section 3. Section 
57-8a-102
 is amended to read:
57-8a-102.
Definitions.
As used in this chapter:
(1) (a) "Assessment" means a charge imposed or levied:
(i) by the association;
(ii) on or against a lot or a lot owner; and
(iii) pursuant to a governing document recorded with the county recorder.
(b) "Assessment" includes:
(i) a common expense; and
(ii) an amount assessed against a lot owner under Subsection 
57-8a-405
(7).
(2) (a) Except as provided in Subsection (2)(b), "association" means a corporation or
other legal entity, any member of which:
(i) is an owner of a residential lot located within the jurisdiction of the association, as
described in the governing documents; and
(ii) by virtue of membership or ownership of a residential lot is obligated to pay:
(A) real property taxes;
(B) insurance premiums;
(C) maintenance costs; or
(D) for improvement of real property not owned by the member.
(b) "Association" or "homeowner association" does not include an association created
under Title 57, Chapter 8, Condominium Ownership Act.
(3) " Board meeting" means a gathering of a board, whether in person or by means of
electronic communication, at which the board can take binding action.
(4) "Board of directors" or "board" means the entity, regardless of name, with primary
authority to manage the affairs of the association.
(5) "Common areas" means property that the association:
(a) owns;
(b) maintains;
(c) repairs; or
(d) administers.
(6) "Common expense" means costs incurred by the association to exercise any of the
powers provided for in the association's governing documents.
(7) "Declarant":
(a) means the person who executes a declaration and submits it for recording in the
office of the recorder of the county in which the property described in the declaration is
located; and
(b) includes the person's successor and assign.
(8) "Electrical corporation" means the same as that term is defined in Section 
54-2-1
.
(9) "Gas corporation" means the same as that term is defined in Section 
54-2-1
.
(10) (a) "Governing documents" means a written instrument by which the association
may:
(i) exercise powers; or
(ii) manage, maintain, or otherwise affect the property under the jurisdiction of the
association.
(b) "Governing documents" includes:
(i) articles of incorporation;
(ii) bylaws;
(iii) a plat;
(iv) a declaration of covenants, conditions, and restrictions; and
(v) rules of the association.
(11) "Independent third party" means a person that:
(a) is not related to the owner of the residential lot;
(b) shares no pecuniary interests with the owner of the residential lot; and
(c) purchases the residential lot in good faith and without the intent to defraud a current
or future lienholder.
(12) "Judicial foreclosure" means a foreclosure of a lot:
(a) for the nonpayment of an assessment; [
and
]
(b) [
(i)
] in the manner provided by law for the foreclosure of a mortgage on real
property; and
[
(ii)
] 
(c)
 as provided in Part 3, Collection of Assessments.
(13) "Lease" or "leasing" means regular, exclusive occupancy of a lot:
(a) by a person or persons other than the owner; and
(b) for which the owner receives a consideration or benefit, including a fee, service,
gratuity, or emolument.
(14) "Limited common areas" means common areas described in the declaration and
allocated for the exclusive use of one or more lot owners.
(15) "Lot" means:
(a) a lot, parcel, plot, or other division of land:
(i) designated for separate ownership or occupancy; and
(ii) (A) shown on a recorded subdivision plat; or
(B) the boundaries of which are described in a recorded governing document; or
(b) (i) a unit in a condominium association if the condominium association is a part of
a development; or
(ii) a unit in a real estate cooperative if the real estate cooperative is part of a
development.
(16) (a) "Means of electronic communication" means an electronic system that allows
individuals to communicate orally in real time.
(b) "Means of electronic communication" includes:
(i) web conferencing;
(ii) video conferencing; and
(iii) telephone conferencing.
(17) "Mixed-use project" means a project under this chapter that has both residential
and commercial lots in the project.
(18) "Nonjudicial foreclosure" means the sale of a lot:
(a) for the nonpayment of an assessment; [
and
]
(b) [
(i)
] in the same manner as the sale of trust property under Sections 
57-1-19
through 
57-1-34
; and
[
(ii)
] 
(c)
 as provided in Part 3, Collection of Assessments.
(19) "Period of administrative control" means the period during which the person who
filed the association's governing documents or the person's successor in interest retains
authority to:
(a) appoint or remove members of the association's board of directors; or
(b) exercise power or authority assigned to the association under the association's
governing documents.
(20) "Rentals" or "rental lot" means:
(a) a lot that:
(i) is not owned by an entity or trust; and
(ii) is occupied by an individual while the lot owner is not occupying the lot as the lot
owner's primary residence; or
(b) an occupied lot owned by an entity or trust, regardless of who occupies the lot. 
(21) "Residential lot" means a lot, the use of which is limited by law, covenant, or
otherwise to primarily residential or recreational purposes.
(22) "Solar energy system" means:
(a) a system that is used to produce electric energy from sunlight; and
(b) the components of the system described in Subsection (22)(a).
Section 4. Section 
57-8a-303
 is amended to read:
57-8a-303.
Notice of nonjudicial foreclosure -- Limitations on nonjudicial
foreclosure.
(1) At least 30 calendar days before [
initiating
] 
the day on which an association
initiates
 a nonjudicial foreclosure[
, an
] 
by filing for record a notice of default in accordance
with Section 
57-1-24
, the
 association shall [
provide
] 
deliver
 notice to the owner of the lot that
is the intended subject of the nonjudicial foreclosure.
(2) The notice under Subsection (1):
(a) shall:
(i) notify the lot owner that the association intends to pursue nonjudicial foreclosure
with respect to the owner's lot to enforce the association's lien for an unpaid assessment;
(ii) notify the lot owner of the owner's right to demand judicial foreclosure in the place
of nonjudicial foreclosure;
(iii) be in substantially the following form:
"NOTICE OF NONJUDICIAL FORECLOSURE AND RIGHT TO DEMAND
JUDICIAL FORECLOSURE
The (insert the name of the association), the association for the project in which your lot
is located, intends to foreclose upon your lot and allocated interest in the common areas 
for
delinquent assessments
 using a procedure that will not require it to file a lawsuit or involve a
court. This procedure 
is governed by Utah Code, Sections 
57-8a-303
 and 
57-8a-304
, and
 is
being followed in order to enforce the association's lien against your lot and to collect the
amount of an unpaid assessment against your lot, together with any applicable late fees and the
costs, including attorney fees, associated with the foreclosure proceeding. 
This procedure
cannot and will not be used to foreclose upon your lot for delinquent fines for a violation of the
association's governing documents.
 Alternatively, you have the right to demand that a
foreclosure of your property 
for delinquent assessments
 be conducted in a lawsuit with the
oversight of a judge. If you make this demand
, the association may also include a claim for
delinquent fines for a violation of the association's governing documents. Additionally, if you
make this demand
 and the association prevails in the lawsuit, the costs and attorney fees
associated with the lawsuit will likely be significantly higher than if a lawsuit were not
required, and you may be responsible for paying those costs and attorney fees. If you want to
make this demand, you must state in writing that 'I demand a judicial foreclosure proceeding
upon my lot,' or words substantially to that effect. You must send this written demand by first
class and certified U.S. mail, return receipt requested, within [
] 
 days after the [
date of the
postmark on the envelope in which
] 
day on which
 this notice was [
mailed
] 
delivered
 to you. 
The address to which you must mail your demand is (insert the association's address for receipt
of a demand)."; and
(iv) be sent to the lot owner by certified mail, return receipt requested; and
(b) may be included with other association correspondence to the lot owner.
(3) An association may not use a nonjudicial foreclosure to enforce a lien if
:
(a) the association fails to provide notice in accordance with Subsection (1);
(b)
 the lot owner mails the association a written demand for judicial foreclosure:
[
(a)
] 
(i)
 by U.S. mail, certified with a return receipt requested;
[
(b)
] 
(ii)
 to the address stated in the association's notice under Subsection (1); and
[
(c)
] 
(iii)
 within [
] 
 days after the [
date of the postmark on the envelope of
] 
day on
which the return receipt described in Subsection (2)(a)(iv) shows
 the association's notice under
Subsection (1)[
.
] 
is delivered;
(c) the lien includes a fine described in Subsection 
57-8a-301
(1)(a)(iii); or
(d) unless the lien is on a time share estate as defined in Section 
57-19-2
, the lien does
not include an assessment described in Subsection 
57-8a-301
(1)(a)(i) that is delinquent more
than 180 days after the day on which the assessment is due.