Maine Condo Fines: Notice and Hearing First, Then a Foreclosable Lien

The fine power in Maine condominiums comes from a single clause of the Maine Condominium Act, enacted as PL 1981, c. 699. Section 1603-102(a) opens with a limit that owners often miss: subject to the provisions of the declaration, the association may exercise the listed powers. The declaration comes first, so a Maine declaration that withholds or caps the fine power controls over the statute. What paragraph (11) supplies is a default: the association may impose charges for late payment of assessments and, after notice and an opportunity to be heard, levy reasonable fines for violations of the declaration, bylaws and rules and regulations of the association.

Read the sequence in that paragraph closely, because it draws a line Maine boards routinely blur. The notice and hearing condition sits between the late-charge power and the fine power, and attaches to fines. A late charge on an overdue common expense assessment can be applied under the association's schedule, while a fine for a rule violation cannot be levied until the owner has had notice and an opportunity to be heard. The Act does not prescribe how many days of notice, who conducts the hearing or whether the owner may bring counsel, so those details come from the bylaws. What the Act does mean is that a fine imposed with no advance notice and no chance to respond was not authorized by paragraph (11) at all, which is the owner's strongest procedural argument.

There is no cap. The only substantive limit in the text is that the fine be reasonable, measured against the violation, and Maine has no per-day maximum, no aggregate ceiling and no statutory schedule. Paragraph (12) uses the same reasonableness language for charges to prepare and record declaration amendments, resale certificates under section 1604-108 and statements of unpaid assessments, and paragraph (10) covers fees for the use, rental or operation of common elements.

The fine power reaches older Maine condominiums as well as new ones. Section 1601-102(a) lists section 1603-102(a) paragraphs (1) through (6) and (11) through (16), together with section 1603-116 on liens, among the provisions that apply to condominiums created in this State before the effective date of the Act. Those sections apply only to events and circumstances occurring after the effective date, and they do not invalidate provisions of declarations, bylaws or duly adopted rules that already existed then.

Collection is where the statute becomes serious. Under section 1603-116(a) the association has a lien on the unit for any assessment levied against it or fines imposed against its owner from the time the assessment or fine becomes due, and that lien may be foreclosed in like manner as a mortgage on real estate. Unless the declaration provides otherwise, fees, charges, late charges, fines and interest charged under paragraphs (10), (11) and (12) are enforceable as assessments. Nothing further needs to be recorded: section 1603-116(d) makes the recording of the declaration itself record notice and perfection of the lien. Section 1603-116(e) gives the association six years from the date the full amount becomes due to institute proceedings, after which the lien for unpaid assessments is extinguished.

Priority is the owner's and the lender's main protection. Section 1603-116(b) subordinates the association's lien to liens and encumbrances recorded before the declaration, to a first mortgage recorded either before or after the delinquency, and to liens for real estate taxes and other governmental assessments. Maine gives the association no six-month super-priority over a first mortgage. Where two or more associations hold liens on the same real estate, subsection (c) gives them equal priority unless the declaration says otherwise.

Two further provisions shape a fine dispute. Section 1603-116(g) requires that a judgment or decree in an action under the section include costs and reasonable attorney's fees for the prevailing party, which cuts in both directions and is why a weak fine is expensive for a board to litigate. Section 1603-116(h) requires the association, on written request, to furnish a recordable statement of the amount of unpaid assessments currently levied against the unit within 10 business days, and that statement is binding on the association, the executive board and every unit owner.

All of this is condominium law. Chapter 31 is the Maine Condominium Act, and Title 33 contains no general common interest ownership act extending these powers to lot-owner or planned-community associations. A Maine homeowners association that is not a condominium takes its fine authority from its recorded declaration and bylaws.

The sequence for a Maine condominium owner runs from rule violation to lien to foreclosure. The association must give notice and an opportunity to be heard before levying the fine, per section 1603-102(a)(11). Once levied and due, the fine is a lien on the unit under section 1603-116(a) without any further recording, because section 1603-116(d) treats the recorded declaration as notice and perfection. The association may then foreclose in like manner as a mortgage on real estate, or sue on the debt, or take a deed in lieu of foreclosure, all preserved by section 1603-116(f).

An owner who wants to fight has several concrete footholds. If no notice and hearing preceded the fine, the levy falls outside the power the statute grants. If the declaration limits or withholds the fine power, the opening words of section 1603-102(a) make the declaration control. If more than six years have passed since the full amount became due without proceedings being instituted, section 1603-116(e) extinguishes the lien. If the amount is disputed, a written request obliges the association to produce a binding recordable statement of unpaid assessments within 10 business days under subsection (h). And because subsection (g) awards costs and reasonable attorney's fees to the prevailing party, an owner who wins does not absorb the cost of defending.

Separately, section 1603-102(a)(18) lets the association suspend any right or privilege of an owner who fails to pay an assessment, but draws two hard lines: it may not deny the owner or another occupant access to the unit, and it may not withhold a service provided to the unit or owner if withholding it would endanger the health, safety or property of any person. Locking an owner out over arrears, or shutting off a service that protects the building, is outside the statute.