Mountain Home Properties v. Pine Mountain Lake Ass'n

This is an appeal by appellant Pine Mountain Lake Association from a judgment in favor of respondent Mountain Home Properties compelling appellant to transfer membership in its association to respondent. At issue in this case is the heretofore undecided question of whether Civil Code section 1466 bars an association of real property owners from imposing liability on new members for the unpaid association debts of the new member’s predecessors in interest. We hold that section 1466 protects new members from such liability.

Mountain Home Properties acquired certain lots and deeds of trust in the Pine Mountain Lake subdivision by conveyance from Diversified Mortgage Investors (DMI) in or about April 1977. DMI had acquired title to the lots and deeds of trust by nonjudicial foreclosure in early 1976.

Pine Mountain Lake Association, an association of owners in the Pine Mountain Lake Subdivision, is empowered by section 5(f) of its “Declaration of Restrictions” and article VIII of its bylaws to assess charges against members for the use of association-owned facilities and the upkeep of association property. Under the terms of its “Declaration of Restrictions” and bylaws, the…