Successful Challenge of Covenant Interpretation for Condominium Association

The Client

Our client, a newly formed condominium association within a master-planned community, faced an unforeseen legal challenge. A lender, who had previously financed the construction of the condominiums, attempted to foreclose on several acres of land critical to the association—a move that posed serious risks to the community’s property rights.

The Challenge

This case centered around the complex interpretation of covenants within the condominium’s horizontal property regime (HPR). Despite our client’s ownership of the land as a common element and the extinguishment of security interests following the sale of the condominium units, the lender pursued foreclosure. Our team needed to:

• Analyze HPR documents, property deeds, and mortgage releases associated with the condominium units.
• Challenge the lender’s claims by demonstrating that the attempted foreclosure was invalid due to the extinguished security interests.

Despite our detailed findings and multiple appeals, the lending institution disregarded our position, forcing us to initiate litigation.

Our Approach

Our team of experienced attorneys at McCullough Khan Appel took swift and strategic action:

1. In-depth Document Analysis: We meticulously reviewed the HPR documents, property deeds, and mortgage releases, which revealed that the lender’s foreclosure claim was unfounded.
2. Clear Communication: Presented evidence to the lender, highlighting the common element status of the disputed land and the extinguished security interests.
3. Strategic Litigation: When the lender dismissed our evidence, we moved forward with litigation. Leveraging our expertise in real estate law, condominium law, and foreclosure law, we obtained a summary judgement in favor of our client, protecting the association’s ownership rights.

Our successful outcome not only reaffirmed our client’s property rights but also emphasized the importance of meticulous legal scrutiny and advocacy in condominium and real estate matters.

Are you facing legal challenges related to property rights or covenant interpretation? Contact us today to discover how McCullough Khan Appel’s dedicated team can offer the guidance and representation you need. Learn more about our services in Property Disputes and Property Contract Disputes and Development Entitlement and Consulting.

Let’s protect your property, your rights, and your future.