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7C. Condominium Act - Management of Condominium, 47-7C-1 through 47-7C-19
Index
47-7C-1. Organization of unit owners' association.
47-7C-2. Powers of unit owners' association.
47-7C-3. Executive board members and officers.
47-7C-4. Transfer of special declarant rights.
47-7C-5. Termination of contracts and leases of declarant.
47-7C-6. Bylaws.
47-7C-7. Upkeep of condominium.
47-7C-8. Meetings.
47-7C-9. Quorums.
47-7C-10. Voting; proxies.
47-7C-11. Tort and contract liability.
47-7C-12. Conveyance or encumbrance of common elements.
47-7C-13. Insurance.
47-7C-14. Surplus funds.
47-7C-15. Assessments for common expenses.
47-7C-16. Lien for assessments.
47-7C-17. Other liens affecting the condominium.
47-7C-18. Association records.
47-7C-19. Association as trustee.
47-7C-1. Organization of unit owners' association.
A unit owners' association shall be organized no later than the date the first unit in the condominium is conveyed. The membership of the association at all times shall consist exclusively of all the unit owners or, following termination of the condominium, of all former unit owners entitled to distributions of proceeds under Section 30 [47-7B-18 NMSA 1978] of the Condominium Act or their heirs, successors or assigns. The association shall be organized as a profit or nonprofit corporation or as an unincorporated association.
47-7C-2. Powers of unit owners' association.
A. Except as provided in Subsection B of this section, and subject to the provisions of the declaration, the association may:
(1) adopt and amend bylaws and rules and regulations;
(2) adopt and amend budgets for revenues, expenditures and reserves and collect assessments for common expenses from unit owners;
(3) hire and discharge managing agents and other employees, agents and independent contractors;
(4) institute, defend or intervene in litigation or administrative proceedings in its own name on behalf of itself or two or more unit owners on matters affecting the condominium;
(5) make contracts and incur liabilities;
(6) regulate the use, maintenance, repair, replacement and modification of common elements;
(7) cause additional improvements to be made as a part of the common elements;
(8) acquire, hold, encumber and convey in its own name any right, title or interest to real or personal property, but common elements shall be conveyed or subjected to a security interest only pursuant to Section 45 [47-7C-12 NMSA 1978] of the Condominium Act;
(9) grant easements, leases, licenses and concessions through or over the common elements;
(10) impose and receive any payments, fees or charges for the use, rental or operation of the common elements, other than limited common elements described in Subsections B and D of Section 14 [47-7B-2 NMSA 1978] of the Condominium Act, and for services provided to the unit owners;
(11) 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;
(12) impose reasonable charges for the preparation and recordation of amendments to the declaration, resale certificates required by Section 61 [47-7D-9 NMSA 1978] of the Condominium Act or statements of unpaid assessments;
(13) provide for the indemnification of its officers and executive board and maintain directors' and officers' liability insurance;
(14) assign its right to future income, including the right to receive common expense assessments, but only to the extent the declaration expressly so provides;
(15) exercise any other powers conferred by the declaration or bylaws;
(16) exercise all other powers that may be exercised in this state by legal entities of the same type as the association; and
(17) exercise any other powers necessary and proper for the governance and operation of the association.
B. The declaration shall not impose limitations on the power of the association to deal with the declarant which are more restrictive than the limitations imposed on the power of the association to deal with other persons.
47-7C-3. Executive board members and officers.
A. Except as provided in the declaration, the bylaws or other provisions of the Condominium Act, the executive board may act in all instances on behalf of the association. In the performance of their duties, the officers and members of the executive board are required to exercise, if appointed by the declarant, the care required of fiduciaries of the unit owners and, if elected by the unit owners, ordinary and reasonable care.
B. The executive board shall not act on behalf of the association to amend the declaration, to terminate the condominium or to elect members of the executive board or determine the qualifications, powers and duties or terms of office of executive board members, but the executive board shall fill vacancies in its membership for the unexpired portion of any term.
C. Within thirty days after adoption of any proposed budget for the condominium, the executive board shall provide a summary of the budget to all the unit owners, and shall set a date for a meeting of the unit owners to consider ratification of the budget not less than fourteen nor more than thirty days after mailing of the summary. Unless at that meeting a majority of all the unit owners or any larger vote specified in the declaration reject the budget, the budget is ratified, whether or not a quorum is present. In the event the proposed budget is rejected, the periodic budget last ratified by the unit owners shall be continued until such time as the unit owners ratify a subsequent budget proposed by the executive board.
D. Subject to Subsection E of this section, the declaration may provide for a period of declarant control of the association, during which period a declarant, or persons designated by him, may appoint and remove the officers and members of the executive board. Regardless of the period provided in the declaration, a period of declarant control terminates no later than the earlier of:
(1) one hundred eighty days after conveyance of ninety percent of the units which may be created to unit owners other than a declarant;
(2) two years after all declarants have ceased to offer units for sale in the ordinary course of business; or
(3) five years after any development right to add new units was last exercised.
A declarant may voluntarily surrender the right to appoint and remove officers and members of the executive board before termination of that period, but in that event he may require, for the duration of the period of declarant control, that specified actions of the association or executive board, as described in a recorded instrument executed by the declarant, be approved by the declarant before they become effective.
E. Not later than sixty days after conveyance of fifty percent of the units which may be created to unit owners other than a declarant, at least one member and not less than twenty-five percent of the members of the executive board shall be appointed by the declarant from among the unit owners. No member so appointed shall be an affiliate of the declarant if such persons are available.
F. Not later than the termination of any period of declarant control, the unit owners shall elect an executive board of at least three members, at least a majority of whom shall be unit owners. The executive board shall elect the officers. The executive board members and officers shall take office upon election.
G. Notwithstanding any provision of the declaration or bylaws to the contrary, the unit owners, by a two- thirds' vote of all persons present and entitled to vote at any meeting of the unit owners at which a quorum is present, may remove any member of the executive board with or without cause, other than a member appointed by the declarant.
47-7C-4. Transfer of special declarant rights.
A. No special declarant right created or reserved under the Condominium Act shall be transferred except by an instrument evidencing the transfer recorded in each county in which any portion of the condominium is located. The instrument is not effective unless executed by the transferee.
B. Upon transfer of any special declarant right, the liability of a transferor declarant is as follows:
(1) a transferor is not relieved of any obligation or liability arising before the transfer. Lack of privity does not deprive any unit owner of standing to maintain an action to enforce any obligation of the transferor;
(2) if a successor to any special declarant right is an affiliate of a declarant, the transferor is jointly and severally liable with the successor for any obligations or liabilities of the successor relating to the condominium;
(3) if a transferor retains any special declarant right but transfers other special declarant rights to a successor who is not an affiliate of the declarant, the transferor is liable for any obligations or liabilities imposed on a declarant by the Condominium Act or by the declaration relating to the retained special declarant rights and arising after the transfer; and
(4) a transferor has no liability for any act or omission or any breach of a contractual or warranty obligation arising from the exercise of a special declarant right by a successor declarant who is not an affiliate of the transferor.
C. Unless otherwise provided in a mortgage instrument or deed of trust, in case of foreclosure of a mortgage, tax sale, judicial sale or sale under bankruptcy laws or receivership proceedings, of any units owned by a declarant or real estate in a condominium subject to development rights, a person acquiring title to all the real estate being foreclosed or sold, but only upon his request, succeeds to all special declarant rights related to that real estate held by that declarant, or only to any rights reserved in the declaration pursuant to Section 27 [47-7B-15 NMSA 1978] of the Condominium Act and held by that declarant to maintain models, sales offices and signs. The judgment or instrument conveying title shall provide for transfer of only the special declarant rights requested.
D. Upon foreclosure, tax sale, judicial sale, sale by a trustee under a deed of trust or sale under bankruptcy laws or receivership proceedings, of all units and other real estate in a condominium owned by a declarant:
(1) the declarant ceases to have any special declarant rights; and
(2) the period of declarant control terminates unless the judgment of instrument conveying title provides for transfer of all special declarant rights held by that declarant to a successor declarant.
E. The obligations and liabilities of a person who succeeds to special declarant rights are as follows:
(1) a successor to any special declarant right who is an affiliate of a declarant is subject to all obligations and liabilities imposed on the transferor by the Condominium Act or by the declaration;
(2) a successor to any special declarant right, other than a successor described in Paragraph (3) or (4) of this subsection, who is not an affiliate of a declarant, is subject to all obligations and liabilities imposed by the Condominium Act or the declaration:
(a) on a declarant which relate to his exercise or nonexercise of special declarant rights; or
(b) on his transferor, other than:
1) misrepresentations by any previous declarant;
2) warranty obligations on improvements made by any previous declarant, or made before the condominium was created;
3) breach of any fiduciary obligation by any previous declarant or his appointees to the executive board; or
4) any liability or obligation imposed on the transferor as a result of the transferor's acts or omissions after the transfer;
(3) a successor to only a right reserved in the declaration to maintain models, sales offices and signs, if he is not an affiliate of a declarant, may not exercise any other special declarant right and is not subject to any liability or obligation as a declarant, except the obligations to provide a disclosure statement; and
(4) a successor to all special declarant rights held by his transferor who is not an affiliate of that declarant and who succeeded to those rights pursuant to a deed in lieu of foreclosure or a judgment or instrument conveying title to units under Subsection C of this section may declare his intention in a recorded instrument to hold those rights solely for transfer to another person. Thereafter, until transferring all special declarant rights to any person acquiring title to any unit owned by the successor or until recording an instrument permitting exercise of all those rights, that successor shall not exercise any of those rights other than any right held by his transferor to control the executive board in accordance with the provisions of Section 36 [47-7C-3 NMSA 1978] of the Condominium Act for the duration of any period of declarant control, and any attempted exercise of those rights is void. So long as a successor declarant may not exercise special declarant rights under this subsection, he is not subject to any obligation or liability as a declarant other than liability for his acts and omissions under Section 36 of the Condominium Act.
F. Nothing in this section subjects any successor to a special declarant right to any claims against or other obligations of a transferor declarant, other than claims and obligations arising under the Condominium Act or the declaration.'
47-7C-5. Termination of contracts and leases of declarant.
If entered into before the executive board elected by the unit owners pursuant to Section 36 [47-7C-3
NMSA 1978] of the Condominium Act takes office, any management contract, employment contract or lease of recreational or parking areas or facilities, any other contract or lease between the association and a declarant or an affiliate of a declarant or any contract or lease that is not bona fide or was unconscionable to the unit owners at the time entered into under the circumstances then prevailing may be terminated without penalty by the association at any time after the executive board elected by the unit owners pursuant to Section 36 of that act takes office, upon not less than ninety days' notice to the other party. This section does not apply to any lease the termination of which would terminate the condominium or reduce its size, unless the real estate subject to that lease was included in the condominium for the purpose of avoiding the right of the association to terminate a lease under this section.
A. The bylaws of the association shall provide for:
(1) the number of members of the executive board and the titles of the officers of the association;
(2) election by the executive board of a president, treasurer, secretary and any other officers of the association the bylaws specify;
(3) the qualifications, powers and duties, terms of office and manner of electing and removing executive board members and officers and filling vacancies;
(4) which, if any, of its powers the executive board or officers may delegate to other persons or to a managing agent;
(5) which of its officers may prepare, execute, certify and record amendments to the declaration on behalf of the association; and
(6) the method of amending the bylaws.
B. Subject to the provisions of the declaration, the bylaws may provide for any other matters the association deems necessary and appropriate.
47-7C-7. Upkeep of condominium.
A. Except to the extent provided by the declaration, Subsection B of this section or Section 46 [47-7C-13 NMSA 1978] of the Condominium Act, the association is responsible for maintenance, repair and replacement of the common elements, and each unit owner is responsible for maintenance, repair and replacement of his unit. Each unit owner shall afford to the association and the other unit owners, and to their agents or employees, access through his unit reasonably necessary for those purposes. If damage is inflicted on the common elements or on any unit through which access is taken, the unit owner responsible for the damage, or the association if it is responsible, is liable for the prompt repair thereof.
B. In addition to the liability that a declarant as a unit owner has under the Condominium Act, the declarant alone is liable for all expenses in connection with real estate subject to development rights. No other unit owner and no other portion of the condominium is subject to a claim for payment of those expenses. Unless the declaration provides otherwise, any income or proceeds from real estate subject to development rights inures to the declarant.
A meeting of the association shall be held at least once each year. Special meetings of the association may be called by the president, a majority of the executive board or by unit owners having twenty percent, or any lower percentage specified in the bylaws, of the votes in the association. Not less than ten days nor more than sixty days in advance of any meeting, the secretary or other officer specified in the bylaws shall cause notice to be hand-delivered or sent prepaid by United States mail to the mailing address of each unit or to any other mailing address designated in writing by the unit owner. The notice of any meeting shall state the time and place of the meeting and the items on the agenda, including the general nature of any proposed amendment to the declaration or bylaws, any budget changes and any proposal to remove a director or officer.
A. Unless the bylaws provide otherwise, a quorum is present throughout any meeting of the association if persons entitled to cast twenty percent of the votes which may be cast for election of the executive board are present in person or by proxy at the beginning of the meeting.
B. Unless the bylaws specify a larger percentage, a quorum is deemed present throughout any meeting of the executive board if persons entitled to cast fifty percent of the votes on that board are present at the beginning of the meeting.
A. If only one of the multiple owners of a unit is present at a meeting of the association, he is entitled to cast all the votes allocated to that unit. If more than one of the multiple owners are present, the votes allocated to that unit may be cast only in accordance with the agreement of a majority in interest of the multiple owners, unless the declaration expressly provides otherwise. There is a majority agreement if any one of the multiple owners casts the votes allocated to that unit without protest being made promptly to the person presiding over the meeting by any of the other owners of the unit.
B. Votes allocated to a unit may be cast pursuant to a proxy duly executed by a unit owner. If a unit is owned by more than one person, each owner of the unit may vote or register protest to the casting of votes by the other owners of the unit through a duly executed proxy. A unit owner may not revoke a proxy given pursuant to this section except by actual notice of revocation to the person presiding over a meeting of the association. A proxy is void if it is not dated or purports to be revocable without notice. A proxy terminates one year after its date, unless it specifies a shorter term.
C. If the declaration requires that votes on specified matters affecting the condominium be cast by lessees rather than unit owners of leased units:
(1) the provisions of Subsections A and B of this section apply to lessees as if they were unit owners;
(2) unit owners who have leased their units to other persons may not cast votes on those specified matters; and
(3) lessees are entitled to notice of meetings, access to records and other rights respecting those matters as if they were unit owners. Unit owners shall also be given notice, in the manner provided in Section 41 [47-7C-8 NMSA 1978] of the Condominium Act, of all meetings at which lessees may be entitled to vote.
D. No votes allocated to a unit owned by the association may be cast.
47-7C-11. Tort and contract liability.
Neither the association nor any unit owner except the declarant is liable for that declarant's torts in connection with any part of the condominium which that declarant has the responsibility to maintain. Otherwise, any action alleging a wrong done by the association shall be brought against the association and not against any unit owner. If the wrong occurred during any period of declarant control and the association gives the declarant reasonable notice of and an opportunity to defend against the action, the declarant who then controlled the association shall indemnify the association or any unit owner other than an affiliate of the declarant for all judgments paid which are not covered by insurance, which judgments resulted from a breach of control or other wrongful act or omission on the part of the declarant. Whenever the declarant is liable under this section, the declarant is also liable for all litigation expenses, including reasonable attorney's fees. Any statute of limitation affecting the association's right of indemnification under this section is tolled until the period of declarant control terminates. A unit owner is not precluded from bringing an action contemplated by this section because he is a unit owner or a member or officer of the association. Liens resulting from judgments against the association are governed by Section 50 [47-7C-17 NMSA 1978] of the Condominium Act.
47-7C-12. Conveyance or encumbrance of common elements.
A. Portions of the common elements may be conveyed or subjected to a security interest by the association if persons entitled to cast at least eighty percent of the votes in the association, including eighty percent of the votes allocated to units not owned by a declarant, or any larger percentage the declaration specifies, agree to that action, but all the owners of units to which any limited common element is allocated shall agree in order to convey that limited common element or subject it to a security interest. The declaration may specify a smaller percentage only if all of the units are restricted exclusively to nonresidential uses. Proceeds of the sale are an asset of the association.
B. An agreement to convey common elements or subject them to a security interest shall be evidenced by the execution of an agreement, or ratifications thereof, in the same manner as a deed, by the requisite number of unit owners. The agreement shall specify a date after which the agreement will be void unless recorded before that date. The agreement and all ratifications thereof shall be recorded in each county in which a portion of the condominium is situated, and is effective only upon recordation.
C. The association, on behalf of the unit owners, may contract to convey common elements or subject them to a security interest, but the contract is not enforceable against the association until approved pursuant to Subsections A and B of this section. Thereafter, the association has all powers necessary and appropriate to effect the conveyance or encumbrance, including the power to execute deeds or other instruments.
D. Any purported conveyance, encumbrance, judicial sale or other voluntary transfer of common elements, unless made pursuant to this section, is void.
E. A conveyance or encumbrance of common elements pursuant to this section does not deprive any unit of its rights of access and support.
F. A conveyance or encumbrance of common elements pursuant to this section does not affect the priority or validity of preexisting encumbrances.
A. Commencing not later than the time of the first conveyance of a unit to a person other than a declarant, the association shall maintain, to the extent reasonably available:
(1) property insurance on the common elements insuring against all risks of direct physical loss commonly insured against or, in the case of a conversion building, against fire and extended coverage perils. The total amount of insurance after application of any deductibles shall be not less than eighty percent of the actual cash value of the insured property at the time the insurance is purchased and at each renewal date, exclusive of land, excavations, foundations and other items normally excluded from property policies; and
(2) liability insurance, including medical payments insurance, in an amount determined by the executive board but not less than any amount specified in the declaration, covering all occurrences commonly insured against for death, bodily injury and property damage arising out of or in connection with the use, ownership or maintenance of the common elements.
B. In the case of a building containing units having horizontal boundaries described in the declaration, the insurance maintained under Paragraph (1) of Subsection A of this section, to the extent reasonably available, shall include the units, but need not include improvements and betterments installed by unit owners.
C. If the insurance described in Subsections A and B of this section is not reasonably available, the association promptly shall cause notice of that fact to be hand-delivered or sent prepaid by United States mail to all unit owners. The declaration may require the association to carry any other insurance, and the association in any event may carry any other insurance it deems appropriate to protect the association or the unit owners.
D. Insurance policies carried pursuant to Subsection A of this section must provide that:
(1) each unit owner is an insured person under the policy with respect to liability arising out of his interest in the common elements or membership in the association;
(2) the insurer waives its right to subrogation under the policy against any unit owner or member of his household;
(3) no act or omission by any unit owner, unless acting within the scope of his authority on behalf of the association, shall void the policy or be a condition to recovery under the policy; and
(4) if, at the time of a loss under the policy, there is other insurance in the name of the unit owner covering the same risk covered by the policy, the association's policy provides primary insurance.
E. Any loss covered by the property policy under Paragraph (1) of Subsection A and Subsection B of this section must be adjusted with the association, but the insurance proceeds for that loss are payable to any insurance trustee designated for that purpose, or otherwise to the association, and not to any mortgagee or beneficiary under a deed of trust. The insurance trustee or the association shall hold any insurance proceeds in trust for unit owners and lienholders as their interests may appear. Subject to the provisions of Subsection H of this section, the proceeds shall be disbursed first for the repair or restoration of the damaged property, and unit owners and lienholders are not entitled to receive payment of any portion of the proceeds unless there is a surplus of proceeds after the property has been completely repaired or restored or the
condominium is terminated.
F. An insurance policy issued to the association does not prevent a unit owner from obtaining insurance for his own benefit.
G. An insurer that has issued an insurance policy under this section shall issue certificates or memoranda of insurance to the association and, upon written request, to any unit owner, mortgagee or beneficiary under a deed of trust. The insurer issuing the policy may not cancel or refuse to renew it until thirty days after notice of the proposed cancellation or nonrenewal has been mailed to the association, each unit owner and each mortgagee or beneficiary under a deed of trust to whom a certificate or memorandum of insurance has been issued at his last known address.
H. Any portion of the condominium for which insurance is required under this section which is damaged or destroyed shall be repaired or replaced promptly by the association unless the condominium is terminated, repair or replacement would be illegal under any state or local health or safety statute or ordinance or eighty percent of the unit owners, including every owner of a unit or assigned limited common element which will not be rebuilt, vote not to rebuild. The cost of repair or replacement in excess of insurance proceeds and reserves is a common expense. If the entire condominium is not repaired or replaced, the insurance proceeds attributable to the damaged common elements shall be used to restore the damaged area to a condition compatible with the remainder of the condominium, and the insurance proceeds attributable to units and limited common elements which are not rebuilt must be distributed to the owners of those units and the owners of the units to which those limited common elements were allocated, or to lienholders, as their interests may appear, and the remainder of the proceeds shall be distributed to all the unit owners or lienholders, as their interests may appear, in proportion to the common element interests of all the units. If the unit owners vote not to rebuild any unit, that unit's allocated interests are automatically reallocated upon the vote as if the unit had been condemned under Subsection A of Section 6 [47-7A-7 NMSA 1978] of the Condominium Act, and the association promptly shall prepare, execute and record an amendment to the declaration reflecting the reallocations.
I. Notwithstanding the provisions of Subsection H of this Section, Section 30 [47-7B-18 NMSA 1978] of the Condominium Act governs the distribution of insurance proceeds if the condominium is terminated.
J. Unless the declaration otherwise provides, the provisions of this section do not apply to a condominium all of whose units are restricted to nonresidential use.
Unless otherwise provided in the declaration, any surplus funds of the association remaining after payment of or provision for common expenses and any prepayment of reserves shall be paid to the unit owners in proportion to their common expense liabilities or credited to them to reduce their future common expense assessments.
47-7C-15. Assessments for common expenses.
A. Until the association makes a common expense assessment, the declarant shall pay all common expenses. After any assessment has been made by the association, assessments shall be made at least annually, based on a budget adopted at least annually by the association.
B. Except for assessments under Subsections C, D and E of this section, all common expenses shall be assessed against all the units in accordance with the allocations set forth in the declaration pursuant to Subsection A of Section 19 [47-7B-7 NMSA 1978] of the Condominium Act. Any past-due common expense assessment or installment thereof bears interest at the rate established by the association not exceeding eighteen percent per year.
C. To the extent required by the declaration:
(1) any common expense associated with the maintenance, repair or replacement of a limited common element shall be assessed against the units to which that limited common element is assigned, equally, or in any other proportion that the declaration provides;
(2) any common expense or portion thereof benefiting fewer than all of the units shall be assessed exclusively against the units benefited; and
(3) the costs of insurance shall be assessed in proportion to risk and the costs of utilities shall be assessed in proportion to usage.
D. Assessments to pay a judgment against the association shall be made only against the units in the condominium at the time the judgment was entered, in proportion to their common expense liabilities.
E. If any common expense is caused by the misconduct of any unit owner, the association may assess that expense exclusively against his unit.
F. If common expense liabilities are reallocated, common expense assessments and any installment thereof not yet due shall be recalculated in accordance with the reallocated common expense liabilities.
47-7C-16. Lien for assessments.
A. The association has a lien on a unit for any assessment levied against that unit or fines imposed against its unit owner from the time the assessment or fine becomes due. The association's lien may be foreclosed in like manner as a mortgage on real estate. Unless the declaration otherwise provides, fees, charges, late charges, fines and interest charged pursuant to Section 47-7C-2 NMSA 1978 are enforceable as assessments under this section. If an assessment is payable in installments, the full amount of the assessment is a lien from the time the first installment becomes due.
B. Unless the declaration otherwise provides, if two or more associations have liens for assessments created at any time on the same real estate, those liens have equal priority.
C. Recording of the declaration constitutes record notice and perfection of the lien. No further recordation of the claim of lien for assessment under this section is required.
D. A lien for unpaid assessments is extinguished unless proceedings to enforce the lien are instituted within three years after the full amount of the assessments becomes due.
E. This section does not prohibit actions to recover sums for which Subsection A of this section creates a lien or prohibit an association from taking a deed in lieu of foreclosure.
F. A judgment or decree in any action brought under this section may include costs and reasonable attorney's fees for the prevailing party.
G. The association upon written request shall furnish at a unit owner's request a recordable statement setting forth the amount of unpaid assessments against his unit. The statement shall be furnished within ten business days after receipt of the request and is binding on the association, the executive board and every unit owner.
H. To the extent provided in the declaration, the lien established by this section shall be subordinate to other liens or encumbrances.
47-7C-17. Other liens affecting the condominium.
A. Except as provided in Subsection B of this section, a judgment for money against the association is not a lien on the common elements but is a lien in favor of the judgment lienholder against all of the units in the condominium at the time the transcript of judgment was recorded. No other property of a unit owner is subject to the claims of creditors of the association.
B. If the association has granted a security interest in the common elements to a creditor of the association pursuant to Section 47-7C-12 NMSA 1978, the holder of that security interest shall exercise its right against the common elements before its judgment lien on any unit may be enforced.
C. Whether perfected before or after the creation of the condominium, if a lien other than a deed of trust or mortgage, including a judgment lien or lien attributable to work performed or materials supplied before creation of the condominium, becomes effective against two or more units, the unit owner of an affected unit may pay to the lienholder the amount of the lien attributable to his unit, and the lienholder, upon receipt of payment, shall promptly deliver a release of the lien covering that unit. The amount of the payment shall be proportionate to the ratio which that unit owner's common expense liability bears to the common expense liabilities of all unit owners whose units are subject to the lien. After payment, the association shall not assess or have a lien against that unit owner's unit for any portion of the common expenses incurred in connection with that lien.
D. Subsequent to recording the declaration as provided in the Condominium Act and while the real estate remains subject to that act, no lien shall arise or be effective against the real estate. During the period, liens or encumbrances shall only arise or be created against each unit and the percentage of undivided interest in the common elements, appurtenant to the unit, in the same manner and under the same conditions as liens and encumbrances may arise or be created upon any other parcel of real property subject to individual ownership; provided, however, that no labor performed or materials furnished, with the consent or at the request of a unit owner or his agent or his contractor or subcontractor, shall be the basis for the filing of a lien pursuant to law against the unit or other property of another unit owner not expressly consenting to or requesting the same; except that express consent shall be deemed to be given by the owner of any unit in the case of emergency repairs. Labor performed or materials furnished for the common elements, if duly authorized by the association of unit owners, the manager or board of directors in accordance with the Condominium Act, the declaration or bylaws, shall be deemed to be performed or furnished with the express consent of each unit owner and shall be the basis for the filing of a lien pursuant to law against each of the units.
E. A judgment against the association must be indexed in the name of the condominium and the association and, when so indexed, is notice of the lien against the units.
47-7C-18. Association records.
The association shall keep financial records sufficiently detailed to enable the association to comply with Section 61 [47-7D-9 NMSA 1978] of the Condominium Act. All financial and other records shall be made reasonably available for examination by any unit owner and his authorized agents.
47-7C-19. Association as trustee.
With respect to a third person dealing with the association in the association's capacity as a trustee, the existence of trust powers and their proper exercise by the association may be assumed without inquiry. A third person is not bound to inquire whether the association has power to act as trustee or is properly exercising trust powers. A third person, without actual knowledge that the association is exceeding or improperly exercising its powers, is fully protected in dealing with the association as if it possessed and properly exercised the powers it purports to exercise. A third person is not bound to assure the proper application of trust assets paid or delivered to the association in its capacity as trustee.