[§514B-157] Attorneys' fees, delinquent assessments, and expenses of enforcement. (a) All costs and expenses, including reasonable attorneys' fees, incurred by or on behalf of the association for:
(1) Collecting any delinquent assessments against any owner's unit;
(2) Foreclosing any lien thereon; or
(3) Enforcing any provision of the declaration, bylaws, house rules, and this chapter, or the rules of the real estate commission;
against an owner, occupant, tenant, employee of an owner, or any other person who may in any manner use the property, shall be promptly paid on demand to the association by such person or persons; provided that if the claims upon which the association takes any action are not substantiated, all costs and expenses, including reasonable attorneys' fees, incurred by any such person or persons as a result of the action of the association, shall be promptly paid on demand to such person or persons by the association.
(b) If any claim by an owner is substantiated in any action against an association, any of its officers or directors, or its board to enforce any provision of the declaration, bylaws, house rules, or this chapter, then all reasonable and necessary expenses, costs, and attorneys' fees incurred by an owner shall be awarded to such owner; provided that no such award shall be made in any derivative action unless:
(1) The owner first shall have demanded and allowed reasonable time for the board to pursue such enforcement; or
(2) The owner demonstrates to the satisfaction of the court that a demand for enforcement made to the board would have been fruitless.
If any claim by an owner is not substantiated in any court action against an association, any of its officers or directors, or its board to enforce any provision of the declaration, bylaws, house rules, or this chapter, then all reasonable and necessary expenses, costs, and attorneys' fees incurred by an association shall be awarded to the association, unless before filing the action in court the owner has first submitted the claim to mediation, or to arbitration under subpart D, and made a good faith effort to resolve the dispute under any of those procedures. [L 2004, c 164, pt of §2]
Case Notes
Plaintiff condominium unit owner did not "incur" attorneys' fees and costs in owner's action against defendant condominium association and was therefore not entitled to attorneys' fees and costs beyond the portion of the total amount requested that plaintiff paid where law firm representing plaintiff's billing statements were sent to a third party and there was no agreement with law firm contractually binding plaintiff to pay those fees and costs; in order for plaintiff condominium unit owner to have "incurred" attorneys' fees and costs under subsection (b) in an action against defendant condominium association, plaintiff must have paid or be legally obligated to pay the fees and costs to the law firm representing plaintiff. 130 H. 540 (App.), 312 P.3d 1247 (2013).
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