Sixty-01 Association of Apartment Owners v. Penny D. Goudelock
Takings DueProcess FifthAmendment Securities JusticiabilityDoctri
Does the Bankruptcy Code discharge community association assessments that accrue after the filing of a Chapter 13 bankruptcy even if the debtor retains ownership of the real property?
QUESTIONS PRESENTED When a condominium owner files a Chapter 13 bankruptcy, some courts are extending the discharge of “debts” to eliminate all personal liability for future condominium assessments — even though the owner continues to reap the benefits from owning property in the community. This stretches the definition of a “debt” beyond recognition, abrogating fundamental laws of federalism, due process, and ripeness. Debtors are being given not just a “fresh start”, but a “free pass” in contravention of state laws that treat future assessments as a property interest flowing from a covenant running with the land. The questions presented are: 1. Does the Bankruptcy Code discharge community association assessments that accrue after the filing of a Chapter 13 bankruptcy even if the debtor retains ownership of the real property? 2. If the Bankruptcy Code discharges future community association assessments, does this violate the Takings or Due Process Clauses of the Fifth Amendment of the U.S. Constitution? 3. If the Bankruptcy Code discharges future community association assessments, does this violate the ripeness doctrine?