Action to Enforce Condominum Lien Must Be Brought in County of Defendant's Residence

In a case of first impression the Court of Appeals reversed the denial of the defendant's motion to transfer venue of an action to enforce a condominium association lien.  Foster v. Wilmington Plantation Owners Assn. Inc., Case Nos. A10A0262; A10A0374, Decided May 28, 2010.  The first case was filed in the county where the property is located, Chatham County, rather than Twiggs County where the defendants resided.  In the second case, also filed where the property was located, one of the two defendants admitted venue in Chatham County (wrongly) and the trial court held that the other defendant was a joint obligor.  The court of appeals reversed that holding as well, finding that the two defendants were not joint obligors.

William Foster owned four units in a Savannah condominum known as Wilmington Plantation.  In 2005, he sold two units to Ingelsby & Inglesby Real Estate Holdings ("Inglesby"), which had its office and registered agent in Fulton County.  In 2006, he sold two units to EKL Georgia, LLC, like Foster a resident of Twiggs County.  In 2008, Wilmington Plantation brought two actions for unpaid condominium association fees, one against Foster and EKL for the units owned by EKL, and one against Foster and Inglesby for the units owned by Inglesby.  In both actions, Wilmington alleged that venue was proper in Chatham County as as action for the foreclosure of real property.  Foster and EKL both answered and challenged venue, but Ingelsby admitted venue was proper in Chatham county.  Foster moved to transfer in both actions.  The trial court denied the motion in both cases.

With respect to the EKL units, the trial court held that a foreclosure action for condominium assessments is an "in rem" action against the property governed by Ga. Const. of 1983 Art. VI, Par II, Sec. II as a case respecting title to land.  Thus, reasoned the trial court, venue was proper where the condominium was located.  With respect to the Inglesby units, the court also found the case was an in rem action, but also noted that Inglesby had admitted venue, and held that venue was proper as to Foster as a joint obligor with Ingelsby.  The court cited to OCGA § 9-10-31 which states that a county court other than that of the defendant's residence can enter judgment against the defendant if the Georgia resident is a joint obligor, joint tort-feasor, joint promisor, copartner, or joint trespeasser.

OCGA § 44-3-109 of the Georgia Condominum Act provides for the creation and enforcement of liens for all sums lawfully assessed against any unit owner or condominium unit.  However, it does not specifically provide for venue of a foreclosure action; it states that the lien may be foreclosed in the same manner as other liens for the improvement of real property.  Thus, the Court of Appeals decided to look to cases involving the foreclosure of mechanics' and materialmens' liens under OCGA  § 44-14-360.  Foreclosure of lien suits for mechanics' liens must be brought in the county of residence of the defendant.  The trial court erred in holding that a foreclosure action is a case respecting title to land.  Cases respecting title to land are actions at law such as ejectment in which the plaintiff relies on legal title to recover possession of the land or of the land and mesne profits.  

As for the holding in the Inglesby case that Foster was a joint obligor, the Court of Appeals found this to be error as well.  At the time of the lawsuits, Foster had sold the two units to Inglesby, taking a purchase money mortgage from Ingelsby.  Under the Condominium Act the assessments are the personal obligation of the unit owner.  As a mortgagee Foster was not a unit owner.  Thus, he was not a joint obligor of the unit owner Inglesby.  Thus, venue was not proper as against Foster in Chatham County.