SB108: SB108 Property Owners' Associations; certificates of good standing for payment of annual assessments; provide

25 LC 59 0124S The Senate Committee on Economic Development and Tourism offered the following substitute to SB 108: A BILL TO BE ENTITLED AN ACT To amend Article 6 of Chapter 3 of Title 44 of the Official Cod e of Georgia Annotated,1 relating to property owners' associations, so as to provide for certificates of good standing2 for payment of annual assessments; to require associations to o ffer to participate in3 alternative dispute resolution prior to the effectuation of a l ien on a lot for unpaid4 assessments; to require associations to act in good faith in such alternative dispute resolution;5 to provide for the recovery of attorney's fees by lot owners; to provide that such a lien shall6 be inferior to liens for unpaid medical bills; to provide for a lternative dispute resolution7 policies and requirements therefor; to provide for a definition; to provide for related matters;8 to provide for applicability; to repeal conflicting laws; and for other purposes.9 BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:10 SECTION 1.11 Article 6 of Chapter 3 of Title 44 of the Official Code of Geor gia Annotated, relating to12 property owners' associations, is amended by adding a new subse ction to Code Section13 44-3-225, relating to assessment of expenses, exemption from li ability, and liability for14 unpaid assessments, to read as follows:15 - 1 - 25 LC 59 0124S "(e) For each lot for which all assessments and other amounts due to the association have16 been paid in full, the association or its authorized agent shal l provide the lot owner a17 certificate stating that such lot is in good standing within 45 days of the end of each fiscal18 year and without cost to the lot owner."19 SECTION 2.20 Said article is further amended by revising subsection (a) of Code Section 44-3-232, relating21 to assessments against lot owners as constituting lien in favor of association, additional22 charges against lot owners, procedure for foreclosing lien, and obligation to provide23 statement of amounts due, as follows:24 "(a)(1) All sums lawfully assessed by the association against any lot owner or property25 owners' association lot, whether for the share of the common expenses pertaining to that26 lot, fines, or otherwise, and all reasonable charges made to an y lot owner or lot for27 materials furnished or services rendered by the association at the owner's request to or on28 behalf of the lot owner or lot, shall, from the time the sums became due and payable, be29 the personal obligation of the lot owner, and shall, from the time the association30 completes its requirements pursuant to Code Section 44-3-232.2, constitute a lien in favor31 of the association on the lot prior and superior to all other liens whatsoever except:32 (1)(A) Liens for ad valorem taxes on the lot;33 (2)(B) The lien of any first priority mortgage covering the lot and the lien of any34 mortgage recorded prior to the recording of the declaration; or35 (3)(C) The lien of any secondary purchase money mortgage covering the lot, provided36 that neither the grantee nor any successor grantee on the mortgage is the seller of the37 lot; and38 (D) Liens on the lot for unpaid medical bills.39 - 2 - 25 LC 59 0124S (2) The recording of the declaration pursuant to this article shall constitute record notice40 of the existence of the lien provided for in paragraph (1) of this subsection, and no further41 recordation of any claim of lien for assessments shall be required."42 SECTION 3.43 Said article is further amended by adding a new Code section to read as follows:44 "44-3-232.2.45 (a) As used in this Code section, the term 'alternative dispute resolution' means mediation,46 arbitration, conciliation, or other nonjudicial procedure that involves a neutral party in the47 decision-making process.48 (b)(1) An association shall adopt a written policy providing f or a fair, reasonable, and49 expeditious alternative dispute resolution procedure for resolving any dispute regarding50 sums assessed by the association.51 (2) The association shall provide a copy of such policy to each lot owner annually and52 shall make a copy of such policy available to a lot owner upon request.53 (c) In developing an alternative dispute resolution procedure pursuant to this Code section,54 an association shall make maximum reasonable use of available l ocal dispute resolution55 programs involving a neutral third party, including low-cost mediation programs.56 (d) A fair, reasonable, and expeditious alternative dispute resolution procedure shall, at a57 minimum, satisfy all of the following requirements:58 (1) The procedure may be invoked by a lot owner. A request in voking the procedure59 shall be in writing;60 (2) The procedure shall provide for prompt deadlines. The pro cedure shall state the61 maximum time for the association to act on a request invoking the procedure;62 (3) If the procedure is invoked by a lot owner, the associatio n shall participate in the63 procedure; and64 (4) A lot owner shall not be charged a fee to participate.65 - 3 - 25 LC 59 0124S (e) The lien for unpaid assessments or other charges as provid ed for in Code66 Section 44-3-225 shall not be created unless the association of fers the lot owner67 participation in alternative dispute resolution in accordance with this Code section, and, if68 so requested by the lot owner, the association participates in such alternative dispute69 resolution.70 (f)(1) In any alternative dispute resolution conducted pursuant to this Code section, the71 parties shall act in good faith in all matters relating to the alternative dispute resolution,72 including, but not limited to, making reasonable efforts to pro mptly conclude such73 alternative dispute resolution.74 (2) In any alternative dispute resolution conducted pursuant to this Code section wherein75 any party violates the provisions of paragraph (1) of this subsection, the aggrieved party76 shall be entitled to recover reasonable attorney's fees incurred as a result of participating77 in such alternative dispute resolution."78 SECTION 4.79 This Act shall not apply to contracts entered into prior to July 1, 2025, before the expiration80 or first renewal of such contract.81 SECTION 5.82 All laws and parts of laws in conflict with this Act are repealed.83 - 4 -