Rea v. Breakers Ass'n, Inc., No. 94-CA-00192-SCT
| Court | United States State Supreme Court of Mississippi |
| Writing for the Court | Before DAN M. LEE; MILLS; DAN M. LEE |
| Citation | 674 So.2d 496 |
| Parties | Jimmy REA and Sammie C. Rea v. The BREAKERS ASSOCIATION, INC. |
| Docket Number | No. 94-CA-00192-SCT |
| Decision Date | 04 April 1996 |
Page 496
v.
The BREAKERS ASSOCIATION, INC.
Rehearing Denied June 6, 1996.
Joshua J. Wiener, Jackson, for Appellant.
William P. Featherston, Jr., Ridgeland, for Appellee.
Before DAN M. LEE, C.J., and BANKS and MILLS, JJ.
MILLS, Justice, for the Court:
On September 9, 1993, The Breakers Association, Inc. (the Association), filed a Complaint for Judicial Foreclosure in the Chancery Court of Madison County against the condominium unit owned by Jimmy Rea and Sammie C. Rea, alleging that the Reas were delinquent in paying their monthly carrying charges to the Association. The Reas answered by affirming that they were ready, willing and able to pay all amounts found to be lawfully due to the Association. They
Page 497
counterclaimed that the Association had failed to maintain their unit as required by the Association's governing declaration of covenants and bylaws. The Reas sought a declaration that the Association's imposition of a 20% per month late charge on delinquent monthly carrying charges was unlawful under Miss.Code Ann. § 75-17-27 (1972). During the pendency of this action, and with notice to the court and opposing counsel, the Reas tendered in trust to their counsel all amounts claimed to be due by the Association.The case was tried on January 26, 1994. Ruling from the bench at the conclusion of the trial, the chancellor awarded the Association judgment for the full amount of carrying charges and late charges which it sought. He specifically denied the Reas' request for a declaration that the Association's 20% per month late charge is unlawful. The Chancellor granted the Reas relief on the other portion of their counterclaim, ordering the Association to perform various repairs and maintenance items within forty-five days.
The Reas promptly paid in full the amount of the judgment entered below, and filed their appeal to this Court. Aggrieved, they assign as an issue:
Whether the Chancellor erred in refusing to declare unlawful the Association's 20% per month late charge on Defendants' "delinquent" monthly carrying charges?
The Association cross-appeals, assigning as an issue:
Whether the court below erred in failing to award the full amount of the attorney's fees incurred by appellee in the prosecution of its action to collect delinquent homeowners assessments owed by the Reas?
Jimmy Rea and Sammie Rea, husband and wife, were owners of a condominium unit at "The Breakers," located on the Ross Barnett Reservoir in Madison County, Mississippi. The condominium complex, the legal name of which is "The Breakers Association, Inc.," was established under the Mississippi Condominium Law, Miss.Code Ann. § 89-9-1 (1972), as a homeowners' association of condominium unit owners, pursuant to a declaration of covenants and bylaws (hereinafter declaration) recorded in the land records of Madison County.
The land on which The Breakers is located is leased by the Association from the Pearl River Water Valley District. Subject to the "land lease," unit owners receive title to their unit as a separate parcel of real property commonly conveyed by an "assignment of leasehold interest" recorded in the land records of Madison County.
The declaration provides that all owners of dwelling units shall be members of the Association. The members elect a board of governors, which is charged with management of the Association. The board of governors hires a general manager and staff to attend to the day-to-day work of managing the Association's finances, and maintaining the complex.
The declaration provides that the Association will charge each unit owner a monthly "assessment or carrying charge." The carrying charges defray the Association's common expenses, including the expenses associated with managing the Association and maintaining the common areas of the complex.
The Association is also obligated to maintain and repair the exteriors of the owners' dwelling units. In addition to monthly carrying charges, unit owners are invoiced for their pro rata share of the casualty insurance carried by the Association, and their share of the land lease.
The bylaws authorize the board to fix a penalty or "late charge" on delinquent payments. The board of governors of the Association adopted a 20% late fee to be charged on unit owners' delinquent monthly charges. If a unit owner fails to pay a monthly carrying charge, and the default continues for an entire year, the unpaid monthly carrying charge will be assessed each month with a 20% late fee, resulting in annual total late fees equaling 240% of the amount due.
Unpaid late charges from a preceding month are added to the principal balance due
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the next month, to which the 20% per month late charge is applied. By charging 240% per annum on each monthly payment, and by charging late fees on unpaid late fees, the Association accrues a balance due from the unit owner that grows exponentially.Upon default by a unit owner in paying monthly carrying charges, the bylaws authorize the Association to "bring an action against the member personally obligated to pay the same, or foreclose on the lien against the unit or units then belonging to said member in the manner provided for in the foreclosure of mortgages, deeds of trust or other liens on real property in the State of Mississippi." See Miss.Code Ann. § 89-9-21 (1972) (personal liability of condominium owner, and subjection of dwelling unit to foreclosable lien).
This dispute ripened when the Reas began to wilfully withhold payment of their monthly carrying charges. They did so to show their dissatisfaction with the manner in which the Association was maintaining the exterior of their unit. The Reas hoped that withholding payment would "get the Association's attention."
Discussions and meetings took place between the Reas, the Association's general manager, and the board regarding the Reas' complaints about the maintenance of their unit. The Reas presented their grievances at a meeting with the board of governors in April 1993, including a discussion of the maintenance and repairs needed at their unit, and stated their displeasure with the Association's 20% per month late charge. Believing that a constructive dialogue had been established at the April 1993 meeting with the board of governors, the Reas brought their account current immediately...
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Wright v. White, No. 94-CA-00269-SCT
...de novo review on questions of law. Id.; Estate of Bodman v. Bodman, 674 So.2d 1245, 1247 (Miss.1996); Rea v. Breakers Assoc., Inc., 674 So.2d 496, 499 (Miss.1996); Tucker v. Hinds County, 558 So.2d 869, 872 (Miss.1990); Harrison County v. City of Gulfport, 557 So.2d 780, 784 (Miss.1990). T......
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Amiker v. Drugs For Less, Inc., No. 97-CA-01493-SCT
...of review is de novo in passing on questions of law. In re Bodman, 674 So.2d 1245, 1247 (Miss. 1996); Rea v. Breakers Ass'n, Inc., 674 So.2d 496, 499 (Miss.1996); Harrison County v. City of Gulfport, 557 So.2d 780, 796 So.2d 946 784 (Miss.1990); Cole v. National Life Ins. Co., 549 So.2d 130......
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Miller v. Properties, No. 2009-CA-00435-SCT.
...Therefore, the amount of $21.40 most be considered a finance charge and will be discussed further below. See Rea v. Breakers Ass'n, Inc., 674 So.2d 496, 500 (Miss.1996) (late charge exceeding maximum amount must be computed as part of total finance charge). Additionally, the judge found, as......
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Kelso v. BREAKERS ASS'N, INC., No. 98-CA-00180-COA.
...Litigation brought by another condominium owner resulted in the 20% rate being declared usurious. Rea v. Breakers Assoc., Inc., 674 So.2d 496 (Miss.1996). The court's explanation of the facts of the usury was The bylaws authorize the board to fix a penalty or "late charge" on delinquent pay......
-
Wright v. White, No. 94-CA-00269-SCT
...de novo review on questions of law. Id.; Estate of Bodman v. Bodman, 674 So.2d 1245, 1247 (Miss.1996); Rea v. Breakers Assoc., Inc., 674 So.2d 496, 499 (Miss.1996); Tucker v. Hinds County, 558 So.2d 869, 872 (Miss.1990); Harrison County v. City of Gulfport, 557 So.2d 780, 784 (Miss.1990). T......
-
Amiker v. Drugs For Less, Inc., No. 97-CA-01493-SCT
...of review is de novo in passing on questions of law. In re Bodman, 674 So.2d 1245, 1247 (Miss. 1996); Rea v. Breakers Ass'n, Inc., 674 So.2d 496, 499 (Miss.1996); Harrison County v. City of Gulfport, 557 So.2d 780, 796 So.2d 946 784 (Miss.1990); Cole v. National Life Ins. Co., 549 So.2d 130......
-
Miller v. Properties, No. 2009-CA-00435-SCT.
...Therefore, the amount of $21.40 most be considered a finance charge and will be discussed further below. See Rea v. Breakers Ass'n, Inc., 674 So.2d 496, 500 (Miss.1996) (late charge exceeding maximum amount must be computed as part of total finance charge). Additionally, the judge found, as......
-
Kelso v. BREAKERS ASS'N, INC., No. 98-CA-00180-COA.
...Litigation brought by another condominium owner resulted in the 20% rate being declared usurious. Rea v. Breakers Assoc., Inc., 674 So.2d 496 (Miss.1996). The court's explanation of the facts of the usury was The bylaws authorize the board to fix a penalty or "late charge" on delinquent pay......