KRS § 381.9171 — KY Code / Title XXXII / Chapter 381 / Section 381.9171
381.9171 Transfer of special declarant rights
Status: reserved

381.9171 Transfer of special declarant rights.

(1) No special declarant right created or reserved under KRS 381.9101 to 381.9207

may be transferred except by an instrument evidencing the transfer recorded in

every county in which any portion of the condominium is located. The instrument is

not effective unless executed by the transferee.

(2) Upon transfer of any special declarant right, the liability of a transferor declarant is

as follows:

(a) A transferor is not relieved of any obligation or liability arising before the

transfer and remains liable for warranty obligations imposed upon him or her

by KRS 381.9101 to 381.9207. Lack of privity does not deprive any unit

owner of standing to maintain an action to enforce any obligation of the

transferor;

(b) 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;

(c) 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

KRS 381.9101 to 381.9207 or by the declaration relating to the retained

special declarant rights and arising after the transfer; and

(d) 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.

(3) Unless otherwise provided in a mortgage, in case of foreclosure of a mortgage, tax

sale, judicial sale, or sale under Bankruptcy Code 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 or her request, succeeds to all special declarant rights related

to that real estate held by that declarant. The judgment or instrument conveying title

shall provide for transfer of only the special declarant rights requested.

(4) Upon foreclosure, tax sale, judicial sale, or sale under Bankruptcy Code or

receivership proceedings, of all units and other real estate in a condominium owned

by a declarant:

(a) The declarant ceases to have any special declarant rights; and

(b) The period of declarant control terminates unless the judgment or instrument

conveying title provides for transfer of all special declarant rights held by that

declarant to a successor declarant.

(5) The liabilities and obligations of a person who succeeds to special declarant rights

are as follows:

(a) 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 KRS

381.9101 to 381.9207 or by the declaration;

(b) A successor to any special declarant right, other than a successor described in

paragraph (c) or (d) of this subsection, who is not an affiliate of a declarant, is

subject to all obligations and liabilities imposed by KRS 381.9101 to

381.9207 or the declaration:

1. On a declarant which relate to his or her exercise or nonexercise of

special declarant rights; or

2. On his or her transferor, other than:

a. Misrepresentations by any previous declarant;

b. Warranty obligations on improvements made by any previous

declarant, or made before the condominium was created;

c. Breach of any fiduciary obligation by any previous declarant or his

or her appointees to the executive board; or

d. Any liability or obligation imposed on the transferor as a result of

the transferor's acts or omissions after the transfer;

(c) A successor to only a right reserved in the declaration to maintain models,

sales offices, and signs, if he or she is not an affiliate of a declarant, shall not

exercise any other special declarant right, and is not subject to any liability or

obligation as a declarant; and

(d) A successor to all special declarant rights held by his or her 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 (3) of this section, may declare his or her 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 a right held by his or her transferor to

control the executive board in accordance with KRS 381.9169(4) 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 or she is not subject to any liability

or obligation as a declarant other than liability for his or her acts and

omissions under KRS 381.9169(4).

(6) 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 KRS 381.9101 to 381.9207 or the declaration.