Brandon Farms Property Owners Association, Inc. v. Brandon Farms Condominium Association, Inc.

Brandon Farms was a common-interest community in New Jersey. The developer filed a declaration of covenants and restrictions, creating the Brandon Farms Property Owners Association (the umbrella association) (plaintiff) to manage the development’s common property and dividing the units into three classes: Classes A, B, and C. Class C units were managed by the Brandon Farms Condominium Association (the condominium association) (defendant), which included affordable-housing units that paid reduced assessments. Homeowners in every class had to pay a general-expense assessment levied by the umbrella association. Section 7.21 of the declaration provided that the condominium association—not its individual members—was primarily responsible for all umbrella-association-levied assessments, even if individual members had not paid the condominium association. When the umbrella association sued the condominium association for outstanding assessments, the condominium association challenged the validity of § 7.21, contending that it violated the New Jersey Condominium Act (the act). The trial court concluded that because § 7.21 put the developer’s interest ahead of the unit owners’ interests, it violated the act and inequitably allocated defaults among the different classes. The appellate court reversed, finding that § 7.21 simply rendered the assessments of the condominium units’ common expenses. The condominium association appealed.