By-Laws Article V

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ASSESSMENTS

 

 

Section 5.01 Annual Accounting

 

Annually, after the close of each calendar year and prior to the date of annual meeting of the Association, the Board shall cause to be prepared and furnished to each Owner a financial statement prepared by a certified public accountant then serving the Association, which statement shall show all receipts and expenses received, incurred and paid during the preceding calendar year.

 

Section 5.02 Proposed Annual Budget

 

Annually, on or before the date of the annual meeting of the Association, or the Board shall cause to be prepared a proposed annual budget for the ensuing calendar year estimating the total amount of Common Expenses for the ensuing year, including reserves for replacement, and furnish a copy of such proposed budget to each Owner prior to the annual meeting. The annual budget shall be submitted to the Owners at the annual meeting of the Association for adoption and, if so adopted, shall be the basis for the Regular Assessments (hereinafter defined) for the ensuing calendar year. At the annual meeting of the Owners, the budget may be approved in whole or in part or may be amended in whose or in part by a majority of the Percentage Votes cast at the meeting; provided, however, that in no event may the annual meeting of the Owners be adjourned until an annual budget is approved and adopted at such meeting, either the proposed annual budget or the proposed annual budget as amended. The annual budget, the Regular Assessments and all sums assessed by the Association shall be established by using generally accepted accounting principles applied on a consistent basis. The annual budget and the Regular Assessments shall, in addition, be established to include the establishment and maintenance of an adequate replacement reserve fund for capital expenditures and replacement and repair of the common Areas, which replacement reserve fund shall be used for those purposes and not for usual and ordinary repair expenses of the Common Areas. Such replacement reserve fund for capital expenditures and replacement and repair of the Common Areas shall be maintained by the Association in a separate interest bearing account or accounts with one or more banks or savings and loan associations authorized to conduct business in St. Joseph County, Indiana, selected from time to time by the Board. The failure or delay of the Board to prepare a proposed annual budget and to furnish a copy thereof to the Owners will not constitute a waiver or release in any manner of the obligations of the Owners to pay the Common Expenses as herein provided whenever determined. Whenever, whether before or after the annual meeting of the Association, there is no annual budget approved by the Owners as herein provided for the current year, the Owners shall continue to pay Regular Assessments based upon the last approved budget or, at the option of the Board, based upon 110% of the last approved budget as a temporary budget.

 

Section 5.03  Regular Assessments

 

The annual budget as adopted shall contain a proposed assessment against each Unit based on the Percentage Interest of each Unit. Immediately following the adoption of the annual budget, each Owner shall be given written notice of such assessment against each respective Unit (herein called the “Regular Assessment”). The Regular Assessment against each Unit shall be paid in equal monthly installments, commencing on the first day of March of such calendar year and on the first day of each calendar month thereafter through and including the following twelve months. Payment of the monthly installments of the Regular Assessment shall be made to the Board or the managing agent, as directed by the Board. The Regular Assessment for each year shall become a lien on each separate Unit as of April 1 of each calendar.

 

During the period Declarant controls the Board, it shall determine the annual budget and the amount of the Regular Assessment for each Unit.

 

Section 5.04 Special Assessments

 

From time to time expenses of an annual or extraordinary nature or not otherwise anticipated may arise, including but not limited to assessments for the Association’s maintenance or repair of Limited Areas which Owners have refused to repair and maintain. At such time and without the approval of the Owners, unless otherwise provided in these By-Laws, the Declaration or the Act, the Board shall have the full right, power and authority to make special assessments which, upon resolution of the Board, shall be come a lien on each Unit, prorated in accordance with the Percentage Interest of each Unit (herein called “Special Assessment”).

 

Section 5.05 Failure of Owner to Pay Assessment

 

Each Owner shall be personally liable for the payment of all Regular and Special Assessments, and all such Assessments shall become a lien on the Unit to which they pertain from the date of assessment until paid in full. Where the Owner constitutes more than one person, the liability of such persons shall be joint and several. If any Owner fails, Refuses or neglects to make any payment of any Regular or Special Assessment when due, the lien for such Assessment on the Unit may be filed and foreclosed by the Board for and on behalf of the Association as provided by law, which lien shall be prior to all other liens on said Unit except for the lien for real estate taxes and all sums unpaid on the first mortgage of record, recorded prior in time to said date of assessment, to which such lien shall be junior. Upon any payment of a Regular or Special Assessment being past due by more than ten days, the Association may declare all unpaid installment of Regular or Special Assessments due and payable immediately and the sum of all such Assessments shall be the amount of the lien described herein. The amount of said lien shall increase as additional Assessments are made which are unpaid, and interest at a rate equal to the prime interest rate charged by First Interstate Bank of Northern Indiana, N. A., South Bend, Indiana, to its most creditworthy commercial borrowers as of the date the lien is filed of record. In any action to foreclose the lien for Assessments, the Owner and occupant shall be jointly and severally liable for the payment to the Association of reasonable rental for such Unit and the Board shall be entitled to the appointment of a receiver for the purpose of preserving the Unit and to collect the rentals and other profits therefrom for the benefit of the Association to be applied to the unpaid Regular and Special Assessments. The Board may, at its option, bring a suit to recover a money judgment for any unpaid Regular or Special Assessment without foreclosing or waiving the lien securing the same. In any action to recover a Regular or Special Assessment, whether by foreclosure or otherwise, the Board, for and on behalf of the Association, shall be entitled to recover costs and expenses of such action incurred, including but not limited to reasonable attorneys’ fees, from the Owner of the subject Unit.

 

Notwithstanding anything contained in this section or elsewhere in the Declaration and these By-Laws, any sale or transfer of a Unit to a Mortgage pursuant to a foreclosure on its mortgage or conveyance in lieu thereof, or a conveyance to any person at a public sale in the manner provided by law with respect to mortgage foreclosures shall extinguish the lien of any unpaid installment of any Regular Assessment or Special Assessment as to such installments which became due prior to such sale, transfer or conveyance; provided, however, that the extinguishments of such lien will not relieve the prior Owner from personal liability therefore. No such sale, transfer or conveyance will relieve the unit or the purchases at such foreclosure sale, or grantee in the event of conveyance in lieu thereof, from liability for any installments of Regular Assessments or Special Assessments thereafter becoming due or from the lien therefor. Such unpaid share of any Regular Assessment or Special Assessments, the lien for which has been divested as aforesaid, shall be deemed to be a Common Expense, collectible from all Owners (including the party acquiring the subject Unit from which it arose), as provided in the Act.

 

Section 5.06 Regular Assessment Prior to Applicable Date

 

During the period that the Declarant is constructing the Condominiums it will be difficult to accurately allocate the Common Expenses to the individual Units. The purpose of this section is to provide for the maintenance and upkeep of the Condominiums and for the payment of the Common Expenses during the period prior to the Applicable Date. Accordingly, and notwithstanding any other provision contained in the Declaration, these By-Laws, the Act or otherwise, prior to the Applicable Date the annual budget and all Regular Assessments and Special Assessments shall be established by the initial Board without meetings of or concurrence of the Owners; provided, however, the Regular Assessments shall be determined in accordance with the provisions contained in this Section 5.06

 

The annual Regular Assessment shall include such amount to be deposited into a reserve fund for maintenance, repairs or replacement of Common Areas and Limited Areas that must be repaired and replaced on a periodic basis, as the Board determines necessary.

 

That portion of the Regular Assessment collected by the Declarant prior to the Applicable Date pertaining to the replacement reserve shall be held by the initial Board and, if required, applied to the replacement of the Property. To the extent that such replacement reserve is not so applied, the balance thereof shall be retained by the Association at the Applicable Date.

 

Payment of the Regular Assessment prior to the Applicable Date with respect to each Unit shall commence on the date of conveyance by Declarant to such new Owner. The first payment shall be payable on the date of conveyance prorated to the first date of the calendar month next ensuing. Thereafter, payment of the Regular Assessment shall be paid the first day of each calendar month during the period prior to the Applicable Date.

 

Section 5.07 Maintenance and Repairs

 

Every Owner shall promptly perform all maintenance and repair within his own Unit which, if neglected, would affect the value of the Property and is the responsibility of the Owner to make personally. Such maintenance and repairs include, but are not limited to, internal water lines, telephone, plumbing, electric lines, appliances, gas lines, air conditioning, doors, windows, lamps and all other accessories belonging to the Owner and appurtenances to the Unit. The Association shall have a reasonable right of entry upon each Unit to effect emergency or other necessary repairs which the Owner of the Unit fails to perform.