Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-alsd-1_11-cv-00629/USCOURTS-alsd-1_11-cv-00629-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Contract Dispute

---

IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

SE PROPERTY HOLDINGS, LLC, )

Plaintiff, )

)

v. ) CIVIL ACTION 11-0629-WS-B

 )

THE ROOKERY III, A CONDOMINIUM, )

OWNERS’ ASSOCIATION, INC., et al., )

Defendants. )

 )

)

THE ROOKERY III, A CONDOMINIUM, )

OWNERS’ ASSOCIATION, INC., et al., )

Counterclaim/Third-Party Plaintiffs, )

)

v. )

)

SE PROPERTY HOLDINGS, LLC and )

VISION BANK, )

Counterclaim/Third-Party Defendants. )

ORDER

This matter comes before the Court on a quartet of overlapping summary judgment 

motions, to-wit: SE Property Holdings, LLC’s Motion for Summary Judgment (doc. 26); Motion 

for Summary Judgment by Marion Cooper (doc. 29); Motion for Summary Judgment by the 

Rookery III, A Condominium, Owners’ Association on the Complaint (doc. 32); and the 

Association’s Motion for Summary Judgment on its Counterclaim/Third-Party Complaint (doc. 

35). The Motions have been briefed and are ripe for disposition.1

 1 Two points bear noting from the outset. First, both the Association and Cooper 

have requested oral argument on their Rule 56 Motions. The Local Rules allow for oral 

argument; however, they also state that “the court may in its discretion rule on any motion 

without oral argument.” LR 7.3. After careful review of the parties’ lengthy written 

submissions, the undersigned finds that oral argument would be neither necessary nor helpful in 

resolving the issues presented; therefore, the request for oral argument is denied. Second, both 

the Scheduling Order (doc. 16, ¶ 13(c)) and a separate Order (doc. 40) entered on August 21, 

2012 instructed the parties to submit to chambers courtesy hard copies of their summary 

(Continued)

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 1 of 36
-2-

I. Nature of the Action.

Although this lawsuit has a plethora of moving parts, the parties’ dispute at its core is 

quite simple. A lender, Vision Bank (“Vision”), foreclosed on a condominium developer’s 

mortgage and acquired certain property from a condominium development called “The Rookery 

III.” Vision promptly conveyed that property to an affiliated entity, SE Property Holdings, LLC 

(“SPH”). Subsequently, a dispute emerged between SPH and the condominium owners’ 

association, called The Rookery III, a Condominium Owners’ Association, Inc. (the 

“Association”). Flashpoints of disagreement included SPH’s liability (if any) for monthly condo 

assessment fees and SPH’s rights (if any) to access the Association’s books and records, to call 

for Association meetings, and so on. The dispute escalated when the Association’s agent, 

Marion Cooper (“Cooper,” not to be confused with nonparty Joe Cooper, who was the 

Association’s corporate representative in this litigation), signed liens that were filed in probate 

court against SPH’s property for the unpaid assessments.

The ultimate, unfortunate result of these circumstances (and the parties’ inability or 

unwillingness to forge a reasonable compromise) was that everybody sued everybody else in 

federal court.2 In particular, SPH filed suit against the Association and Cooper seeking (in Count 

One) declaratory and injunctive relief on a host of subjects, including the units on which the 

Association can assess common expenses, SPH’s rights to select the Association’s directors and 

to access its books and records, the validity of the Association’s assessments and liens against 

SPH’s property, and the Association’s obligation to render an accounting of its finances. In 

Count Two, SPH sued Cooper directly for damages under Alabama Code § 10A-1-3.32, for 

denying SPH access to the Association’s books and records. And in Count Three, SPH brought a 

 

judgment filings. All parties except for SPH complied with this requirement. In lieu of issuing a 

third order directing SPH to provide such courtesy copies and/or to show cause for its failure to 

adhere to the aforementioned directives, the Court in its discretion will consider those materials 

as submitted.

2 No federal claims are asserted. Nonetheless, SPH properly invoked federal 

subject-matter jurisdiction under 28 U.S.C. § 1332, as the well-pleaded allegations of the 

Complaint establish complete diversity of citizenship between SPH (on the one hand) and the 

Association and Cooper (on the other), with the amount in controversy substantially exceeding 

the jurisdictional minimum of $75,000, exclusive of interest and costs.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 2 of 36
-3-

slander of title claim against the Association and Cooper under Alabama law, alleging that the 

defendants had refused or failed to release or cancel the liens on SPH’s property, all to SPH’s 

detriment. (See doc. 1.)

The Association and Cooper responded in kind, unleashing a volley of counterclaims 

against SPH and third-party claims against Vision. (See doc. 5.) In particular, the Association 

brought a claim for open account, alleging that Vision owed it $226,800 in unpaid monthly 

assessments for the development’s units (Count One); another claim for open account, alleging 

that SPH owed it $162,000 in unpaid monthly assessments for those same units (Count Two); a 

claim against Vision and SPH for open account, claiming that Vision’s or SPH’s “agent or 

employee turned on the water at the Project without authority” and that they are therefore 

“indebted to the Association for the unpaid water bill” (doc. 5, at 17) (Count Three); and a 

statutory claim against Vision and SPH for enforcement of liens pursuant to Alabama Code § 35-

8A-316 (Count Four). Also, Cooper sued SPH under the “Alabama Litigation Accountability 

Act and Rule 11,” insisting that SPH’s claims against her were brought in bad faith and without 

substantial justification, entitling her to recover monetary sanctions, attorney’s fees, and 

expenses (Count Five).

True to form, everybody has now moved for summary judgment against everybody else

via overlapping and often redundant Rule 56 filings, placing the merits of this action before the 

undersigned for review and (to the extent appropriate) resolution under Rule 56 of the Federal 

Rules of Civil Procedure.

II. Factual Background.

The parties’ summary judgment filings are noteworthy for the dearth of factual disputes 

identified as to material matters. With few (if any) exceptions, the material facts are uncontested 

and undisputed, to the point where it is fair to question why the parties did not streamline matters 

by submitting their legal arguments on stipulated facts.

3

 3 As SPH correctly observes in one of its briefs, “The parties agree on the vast 

majority of facts that are relevant to this dispute and material to the claims, counterclaims and 

third-party claims.” (Doc. 42, at 2.) Nonetheless, to the extent that there are disputed facts, the 

Court construes the record, including all evidence and factual inferences, in the light most 

favorable to the non-movant. See Skop v. City of Atlanta, GA, 485 F.3d 1130, 1136 (11th Cir. 

2007). As to each of the cross-motions for summary judgment, then, the record will be viewed 

in the light most favorable to the non-movant.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 3 of 36
-4-

A. The Vision Loans, the Project, and Various Unit Purchases / Foreclosure.

The summary judgment record reveals the following: Back in 2007, Vision lent money 

to a developer to build a condominium project known as The Rookery III (the “Project”) in Gulf 

Shores, Alabama. To secure the loans, the developer provided two mortgages to Vision covering 

the property where the Project was to be built. On December 31, 2007, the developer filed in

Baldwin County Probate Court certain governing documents for the Project, including Articles 

of Incorporation for the Association, a Declaration of Condominium, Association Bylaws, and a 

proposed Site Plan. (Doc. 27, Exhs. A-D.) The Site Plan depicts 88 planned units in buildings 

of either duplex or single-family residence construction, all with the prominent legend “Need 

Not be Built.” (Doc. 27, Exh. D.) And the Declaration specifies that “[t]he maximum number of 

condominium units which shall comprise The Rookery III, a Condominium, is eighty eight,” to 

be built in phases of 10 units each, subject to a prominent disclaimer that each phase “NEED 

NOT BE BUILT.” (Doc. 27, Exh. C, Art. 4.)

As of June 9, 2008, the developer filed an Updated Site Plan reflecting that some 23 units 

had been constructed, including the units numbered 4001, 4002, 4008, 4009, 4010, 4013, 4014, 

4015, 5006, 6002, 6004, 6005, 6006, 6008, 6012, 6017, 6019, 6022, 6023, 6025, 6032, 6035, and 

7002. (Doc. 27, Exh. E.) Two additional units (numbered 7014 and 7024) were partially built, 

but not completed. In the summer of 2008, the developer successfully sold seven completed

units, including those numbered 4001, 4008, 5006, 6002, 6005, 6017, and 7002 (collectively, 

“the 7 Sold Units”). Vision released the 7 Sold Units from its mortgages; however, it retained 

mortgages on the remainder of the Project, including the other 16 units that had been built but 

not sold (collectively, “the 16 Other Units”), two partially completed units (the “2 Incomplete

Units”) and what would have been the remaining 63 units (collectively, “the 63 Unbuilt Units”) 

had the full 88-unit Project been constructed as planned. As their moniker implies, the 63 

Unbuilt Units were never constructed, by the developer or anyone else. Even today, the 63 

Unbuilt Units consist of nothing more than unimproved, bare land.4

 4 In framing the facts this way, the Court notes that the parties’ briefs and exhibits 

include inconsistencies concerning the number of unbuilt units. For example, sometimes parties 

and witnesses refer to 65 unbuilt units, yet other times those same parties and witnesses write in 

terms of 63 (or even 66) unbuilt units. This discrepancy echoes through the parties’ filings, 

including their calculations of unpaid assessments, their assertions of what assessments and have 

(Continued)

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 4 of 36
-5-

Unfortunately for all concerned, the developer defaulted on its loan obligations, 

prompting Vision to initiate legal proceedings in state court in August 2009 in an effort to 

recover the unpaid loan balances. (Burnett Aff. (doc. 38, Exh. 2), ¶ 7.) By mid-2010, the 

developer notified owners of units that it was abandoning the Project altogether because of 

financial difficulties. (J. Cooper Aff. (doc. 38, Exh. 3), ¶ 6.) Some time later, Vision initiated 

foreclosure proceedings, and conducted a foreclosure sale on the Project on June 30, 2011. 

(Harmon Decl. (doc. 27, Exh. F), ¶ 2.)5 At that sale, Vision bought the entire property of the 

Project, save for the 7 Sold Units (as to which it had previously released its mortgage), for the 

sum of $1.391 million. (Id. & Exh. 1.) Thus, as of July 1, 2011, the Project’s owners consisted 

of the purchasers of the 7 Sold Units (who owned their individual units) and Vision (which 

owned everything else, including the 16 Other Units, the 2 Incomplete Units and the 63 Unbuilt

Units). Vision held this property for just a few days, before conveying it to SPH via Quitclaim 

Deed for slightly over $1.3 million on July 12, 2011. (Harmon Decl., ¶ 3 & Exh. 2.)6

 

not been paid and for which units, and so on. While these discrepancies may be distracting, they 

are not material to the issues presented on summary judgment. The tripartite categorization of 

the units that SPH came to own in July 2011 (consisting of the 16 Other Units, the 2 Incomplete 

Units, and the 63 Unbuilt Units) appears to be the most accurate rendering of facts in the record. 

The Court therefore adopts that formulation, and will not squander resources revisiting whether, 

for example, there are 63 or 65 or 66 unbuilt units, each time the parties’ briefs or witness 

statements waver on the point.

5 The Harmon Declaration reflects that the foreclosure sale took place on January 

30, 2011; however, this appears to be a typographical error, given that the Foreclosure Deed 

appended to this Declaration repeatedly dates the foreclosure sale as having occurred on June 30, 

2011. (Harmon Decl., at Exh. 1.) The parties’ briefs also fix June 30, 2011 as the date of sale. 

(See doc. 27, at 3; doc. 33, at 6.)

6 Vision merged with SPH on February 16, 2012. (Harmon Decl., ¶ 1.) The 

Certificate of Merger and Transfer memorializing that transaction confirms that as of that date, 

“Vision Bank no longer exists as a separate entity” and SPH “is the successor to Vision Bank, 

and may undertake any and all actions to which Vision Bank was entitled, and is subject to all 

rights and liabilities to which Vision Bank was subject.” (Doc. 27, Exh. I, ¶¶ 1, 7.) In light of 

these developments, the Association’s and Cooper’s insistence on continuing to press third-party 

claims against Vision (rather than simply folding those claims into their existing counterclaims 

against SPH, which by all accounts is legally responsible for any liabilities and obligations of the 

now-nonexistent Vision) serves only to inject unnecessary, confusing layers of parties and claims 

into these proceedings. This is particularly true, given the Association’s admissions during 

(Continued)

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 5 of 36
-6-

SPH undertook efforts to sell the property, and successfully sold each of the 16 Other

Units, plus the 2 Incomplete Units, in the time period of February – June 2012, while this 

litigation was ongoing. (Harmon Decl., ¶ 5; doc. 38, Exh. 6.) Because SPH and the Association 

continue to quarrel over unpaid assessments (as discussed in detail infra), SPH reduced the 

amount each buyer of the 16 Other Units paid at closing by the amount the Association claimed 

was owed in back assessments for that unit. (Harmon Decl., ¶ 5 & Exh. 5.) Also, at each of 

those closings, SPH obtained from the purchaser an “Irrevocable Proxy.” (Harmon Decl., ¶ 6.) 

Each proxy states that the purchaser is granting SPH “an irrevocable proxy and right to vote ... 

as a member of the [Association] and as the owner of the Unit ... for a period of one (1) year 

commencing on the date hereof.” (Id. at Exh. 6.)

In addition to selling the 16 Other Units and the 2 Incomplete Units, SPH has attempted 

to sell all of its remaining property at the Project, including specifically the 63 Unbuilt Units 

(which, again, consist of nothing but bare land). (Id., ¶ 7.) For reasons not disclosed in the 

record, SPH has not yet sold the land. (Id.)

B. The Association and the Monthly Assessments.

In February 2007, the Association’s Board of Directors prepared a “First Year’s 

Projected Operating Budget,” calling for monthly maintenance fees of $400 per unit. (Burnett 

Aff., ¶¶ 2-3 & Exh. A.) After the developer sold the 7 Sold Units in the summer of 2008, the 

Board reduced the monthly assessment to $375 per unit. (Id., ¶ 4.)7 As of the summer of 2010, 

however, the original Board abandoned the Project, leaving the owners of the 7 Sold Units to 

their own devices to convene a new Association Board of Directors, which they did. (Id., ¶ 6; J. 

Cooper Aff. (doc. 38, Exh. 3), ¶ 6.)

 

summary judgment briefing that “Vision Bank has merged with and into SPH so that SPH is the 

surviving corporation. ... As a result, SPH is obligated and liable for all of Vision’s obligations 

to the Association.” (Doc. 33, at 12.)

7 By all appearances, the original Projected Operating Budget was provided to the 

purchasers of the 7 Sold Units at the time of their respective closings. (J. Cooper Aff. (doc. 38, 

Exh. 3), ¶ 4 & Exh. A.) The owners of the 7 Sold Units dutifully paid $375 monthly assessments 

during the years of 2008 through 2010. (Id., ¶ 5.)

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 6 of 36
-7-

On July 31, 2010, the Association’s new Board conducted a meeting to address financial, 

maintenance and other issues. (J. Cooper Aff., ¶ 7.) Owners of all 7 Sold Units were notified, 

invited to attend, and given a breakdown of the Association’s expenses. (Id., ¶ 7 & Exhs. B & 

C.) Vision was not, as it owned no units but was merely a mortgagee at that time. The day after 

the meeting, the Association circulated an e-mail reflecting that dues were set at $400 per month 

and that the next meeting was set for October 9, 2010. (Id., ¶ 7 & Exh. D.) The Association did 

not transmit this memorandum to (or share the information contained therein with) Vision.

On October 4, 2010, the owners of the 7 Sold Units (calling themselves “The 7 Owners 

of Units in Rookery III,” rather than the Association) wrote a letter to Vision describing their 

financial difficulties following the developer’s abandonment of the Project. (J. Cooper Aff., ¶ 9 

& Exh. E.) Citing no legal or contractual authority, the letter set forth the position of “The 7 

Owners” as follows: “We feel it is time for the Bank to pay monthly association dues ... for the 

units that have been completed.” (Id., Exh. E.) The October 4 letter did not purport to ask 

Vision to pay dues for the 63 Unbuilt Units. Moreover, the October 4 letter did not identify what 

the monthly assessment figure was, or how much “The 7 Owners” wanted Vision to pay. 

Certainly, nothing in the October 4 letter stated or implied that “The 7 Owners” believed that 

delinquent assessment charges were due and owing by Vision at that time; rather, the tone of the 

letter is reasonably clear that “The 7 Owners” were requesting only that bank contribute 

prospective assessments for the 16 Other Units. On October 13, 2010, Vision responded with a 

letter of its own, notifying the owners that “[w]e have referred this matter to our legal council 

[sic] for review” and that counsel may or may not choose to respond to the request that Vision 

pay monthly assessments. (Id., Exh. F.) Vision sent no other response to the October 4 letter. 

More importantly, Vision did not accede to the request or begin paying assessments on the 16 

Other Units or anything else. (J. Cooper Aff., ¶¶ 9-10.)

The Association did not follow up on its October 4, 2010 request for an entire year. The 

record reveals a dearth of activity as to Association matters during that time. There is no 

evidence, for example, that the Association conducted regular meetings during the October 2010 

– October 2011 time frame. There is no evidence that the Association invited Vision (or SPH) to 

attend meetings or even notified them when such meetings were scheduled (if indeed such 

meetings ever took place).

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 7 of 36
-8-

C. The Liens, Information Requests, and Ensuing Lawsuit.

This period of relative tranquility was shattered in October 2011, as both sides retained 

counsel and engaged in a rapidly escalating exchange of correspondence that fanned faint embers 

of discontent into a blazing conflagration in a matter of days. On October 4, 2011, the 

Association’s counsel sent a letter to Vision, stating that “the Association hereby makes demand 

on Vision Bank to remit the sum of $328,000 for unpaid monthly fees and/or assessments related 

to the condo units set forth on Exhibit A.” (J. Cooper Aff., ¶ 11 & Exh. G.) The referenced 

Exhibit A detailed the Association’s calculations as follows: For each of approximately 82 units 

(including the 16 Other Units, the 2 Incomplete Units and the 63 Unbuilt Units), the Association 

claimed that Vision owed $400 monthly assessments for a 10-month period from January 

through October 2011.8 The October 2011 letter threatened that unless Vision paid the full 

amount with six days, “the Association will be filing liens against each unit” for the alleged 

unpaid assessments. (Id.) Vision did not pay.

On October 21, 2011, the Association followed up with another letter to Vision (as well 

as to SPH and Vision’s parent company) reiterating the demand for payment, accusing Vision of 

“again hiding its head in the sand regarding its obligations,” and confirming that the Association 

had “filed liens against each of the lots owned by Vision in The Rookery III.” (J. Cooper Aff., ¶ 

12 & Exh. I.) It was true. On October 14, 2011, Cooper (owner of one of the 7 Sold Units) 

signed liens as “agent” of the Association, which liens were filed in Baldwin County Probate 

Court later that day. (M. Cooper Aff. (doc. 38, Exh. 4), ¶ 7.) The liens consisted of 81 

substantively identical “Verified Statements of Lien,” each specifying that the Association was 

claiming a lien on a particular unit “to secure an indebtedness of $4,000 with interest and 

reasonable attorney’s fees” for “delinquent assessments.” (Harmon Aff., ¶ 4 & Exh. 3; M. 

Cooper Aff., ¶ 7.) Cooper was chosen to sign the liens on the Association’s behalf “primarily for 

logistical reasons, because [she] happened to be in Gulf Shores at that time.” (M. Cooper Aff., ¶ 

7.) The liens covered each of the 16 Other Units, the 2 Incomplete Units, and the 63 Unbuilt

Units.

 8 That Exhibit A lists “Pre-foreclosure Assessments” for the period of “Jan – Jun 

2010;” however, the 2010 reference appears to be erroneous given that foreclosure occurred on 

or about June 30, 2011, and not June 2010.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 8 of 36
-9-

The October 21 letter triggered an immediate and aggressive response, in the form of a 

letter by Vision’s counsel dated the same day. (J. Cooper Aff., ¶ 13 & Exh. J.) Vision’s letter 

expressed the bank’s position that neither the Association’s counsel nor Cooper was authorized 

to act on behalf of the Association, given that Vision owned the majority of the units (and held

the majority of votes to be cast at any Association meeting) at The Rookery III, and that the 

Association had failed to provide notice of any meeting to Vision, much less to conduct any 

valid meetings to elect a board of directors or authorize the actions of Cooper and the 

Association’s counsel. Vision’s letter indicated that, because of these omissions, the liens signed 

by Cooper were “invalid, unlawful and constitute slander of Vision Bank’s title to the property,” 

and must be released immediately. (Id.) Vision further expressed its intent to call a special 

meeting of unit owners to elect a new board of directors for the Association, and called upon the 

Association’s counsel to furnish a list of names and addresses of unit owners to facilitate proper 

notice of such meeting. Finally, Vision demanded access to the Association’s financial and other 

records, and requested notice of “reasonable times during the next two (2) business days during 

which a representative of Vision Bank may inspect and copy all such records.” (Id.) Three days 

later, the same law firm sent a similar letter to the Association, this time on behalf of SPH, 

Vision, and their parent company, rather than just Vision. (J. Cooper Aff., ¶ 14 & Exh. K.)9

The Association responded to both the October 21 and October 24 letters via 

correspondence of its own dated October 27, 2011. (J. Cooper Aff., ¶ 15 & Exh. L.) That letter 

accused Vision of “irresponsible lending practices,” contended that Vision had delayed 

foreclosure on the Project for two years after the developer’s default for the purpose of avoiding 

liability for assessments and “put[ting] the entire cost of this situation on the backs of the seven 

(7) owners,” and ratcheted up the rhetoric by asserting that SPH was “play[ing] legal games 

regarding who has what rights under what agreements.” (Id.) Not surprisingly, the October 27 

letter was not well received by SPH. On November 1, 2011, SPH’s counsel sent another letter to 

the Association’s counsel, reiterating the bank’s legal position, demanding cancellation of the 

existing liens against SPH’s property, calling for immediate access to the Association’s books 

 9 The most noteworthy content modifications in the October 24 letter were that it 

apprised the Association that SPH had purchased all of The Rookery III property previously

owned by Vision as of July 2011; and that SPH was requesting that the Association deliver the 

roster of unit owners and make available its financial and other records within the next five days.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 9 of 36
-10-

and records, and so on. (J. Cooper Aff., ¶ 16 & Exh. M.) Ominously, the November 1 letter 

included a statement that SPH intended to sue Cooper personally as an “agent” or “governing 

person” of the Association if she did not “provide SPH with immediate access to the books and 

records.” (Id.) The November 1 letter demanded that the Association and Cooper provide 

written notice by the close of business on November 3 as to (i) whether the Association’s books 

and records would be made available to SPH and, if so, when and where; and (ii) whether they 

would release the liens filed against SPH’s property.

There was some follow-up email correspondence between counsel concerning the 

exchange of books and records. (J. Cooper Aff., ¶ 17 & Exh. N.) Unfortunately, it was much 

too little, much too late. The Association allowed the November 3 deadline to expire without 

any serious effort at compliance with SPH’s demands.10 Cooler heads did not prevail, and SPH 

filed suit on November 4, 2011 against the Association and Cooper.

Interestingly, on November 23, 2011, some 19 days after suit was filed, the Association’s 

attorney executed a “Release of Recorded Lien” as to all 81 parcels at The Rookery III owned by 

SPH. The Baldwin County Probate Court recorded that release effective December 10, 2011. 

(M. Cooper Aff., ¶ 10 & Exh. A.)11 This apparent olive branch did not result in the modification, 

redaction or dismissal of any of SPH’s claims against the Association or Cooper. Moreover, 

post-filing demands by Cooper’s counsel that SPH withdraw its claims against her (M. Cooper 

Aff., ¶ 12 & Exh. B) fell on deaf ears, resulting in the proliferation (rather than the narrowing) of 

litigation as Cooper lodged counterclaims of her own against SPH.

 10 On this record, Marion Cooper’s protestations that she “did not refuse SPH’s 

demand” for access to books/records or release of the liens because she “understood that the 

parties’ attorneys were working things out” was simply inaccurate. (M. Cooper Aff., ¶ 11.) 

Frankly, the record indicates that neither side made a bona fide effort to “work things out” 

amicably, but instead layered one sharp-tongued, ante-upping demand atop another until 

litigation became inevitable.

11 In that Release, however, the Association hastened to add the following caveat: 

“[T]he release of the above liens does not constitute and shall not be construed as evidenced [sic] 

that the indebtedness relating to such liens has been satisfied. Such indebtedness remains unpaid 

and due and owing to the Association.” (Id.) So in releasing the liens, the Association did not 

back off or withdraw its prior public statements that SPH owed thousands of dollars in 

delinquent assessments on each unit, including the dozens of units that had never been built.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 10 of 36
-11-

III. Summary Judgment Standard.

Summary judgment should be granted only “if the movant shows that there is no genuine 

dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Rule 

56(a), Fed.R.Civ.P. The party seeking summary judgment bears “the initial burden to show the 

district court, by reference to materials on file, that there are no genuine issues of material fact

that should be decided at trial.” Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991). 

Once the moving party has satisfied its responsibility, the burden shifts to the non-movant to 

show the existence of a genuine issue of material fact. Id. “If the nonmoving party fails to make 

'a sufficient showing on an essential element of her case with respect to which she has the burden 

of proof,' the moving party is entitled to summary judgment.” Id. (quoting Celotex Corp. v. 

Catrett, 477 U.S. 317 (1986)) (footnote omitted). “In reviewing whether the nonmoving party 

has met its burden, the court must stop short of weighing the evidence and making credibility 

determinations of the truth of the matter. Instead, the evidence of the non-movant is to be 

believed, and all justifiable inferences are to be drawn in his favor.” Tipton v. Bergrohr GMBHSiegen, 965 F.2d 994, 999 (11th Cir. 1992) (internal citations and quotations omitted). 

“Summary judgment is justified only for those cases devoid of any need for factual 

determinations.” Offshore Aviation v. Transcon Lines, Inc., 831 F.2d 1013, 1016 (11th Cir. 1987) 

(citation omitted).

Both sides have moved for summary judgment on all or substantially all of the claims, 

counterclaims and third-party claims interposed herein. The law is clear that “[t]he applicable 

Rule 56 standard is not affected by the filing of cross-motions for summary judgment.” Page v. 

Winn-Dixie Montgomery, Inc., 702 F. Supp.2d 1334, 1345 (S.D. Ala. 2010) (citations omitted); 

see also Murray v. Holiday Isle, LLC, 620 F. Supp.2d 1302, 1307 (S.D. Ala. 2009) (same). The 

Eleventh Circuit has explained that “[c]ross-motions for summary judgment will not, in 

themselves, warrant the court in granting summary judgment unless one of the parties is entitled 

to judgment as a matter of law on facts that are not genuinely disputed.” United States v. Oakley, 

744 F.2d 1553, 1555 (11th Cir. 1984) (citation omitted); see also Wermager v. Cormorant Tp. 

Bd., 716 F.2d 1211, 1214 (8th Cir. 1983) (“the filing of cross motions for summary judgment 

does not necessarily indicate that there is no dispute as to a material fact, or have the effect of 

submitting the cause to a plenary determination on the merits”). Nonetheless, “cross-motions 

may be probative of the absence of a factual dispute where they reflect general agreement by the 

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 11 of 36
-12-

parties as to the dispositive legal theories and material facts.” Page, 702 F. Supp.2d at 1345 

(citations omitted); see also Murray, 620 F. Supp.2d at 1307. Such is the case here.

IV. Analysis.

Given the breadth and volume of the causes of action joined in this case, the Court will 

proceed on a claim-by-claim basis. The logical starting point is to address the parties’ competing 

claims concerning unpaid monthly assessments, after which the Court will move on to examine 

the other facets of SPH’s claims for declaratory and injunctive relief, the claims brought by and 

against Marion Cooper, SPH’s claim for slander of title, and finally the Association’s claims for 

an unpaid water bill and enforcement of liens.

A. The Dueling Claims Regarding Unpaid Assessments.

1. The Parties’ Respective Positions Concerning Assessments.

Although this case embraces a variety of topics, the centerpiece of the parties’ dispute is 

and has always been whether SPH must pay monthly assessments to the Association for any unit 

or portion of The Rookery III property. Nor is this a mere trifling disagreement. By the 

Association’s reckoning, SPH is responsible for more than $500,000 in delinquent assessments 

spanning more than 80 units for a period including the first six months of 2011, as well as unpaid 

assessments for the 63 Unbuilt Units from July 2011 through the present.12 By SPH’s 

calculations, however, it is responsible for exactly $0 in assessments. That chasm is the 

animating force of this litigation, with the other ancillary issues amounting to little more than 

collateral skirmishes.

In Count One of the Complaint, SPH requests a declaration that the assessments imposed 

by the Association on SPH’s property at The Rookery III are “invalid” and that SPH has no 

obligation to pay them. (Doc. 1, at 7.) In its slander of title claim (to be discussed separately

infra), SPH also seeks to recover $58,800 in assessments paid to the Association at the closing of 

SPH’s sales of the 16 Other Units. (Doc. 27, at 14.) For its part, the Association seeks damages 

from Vision on an “open account” theory for the six months preceding foreclosure and for one 

 12 A witness for the Association computes the owed assessments as follows: (i) for 

the first half of 2011, 81 units x $400/month x 6 months = $194,400; (ii) from July 2011 through 

August 2012, 65 units x $400/month x 13 months = $338,000; and (iii) from August 2012 

through the present, $26,000/month (or $104,000 through December 2012). (J. Cooper Aff., ¶¶ 

18-19.) So the Association appears to be demanding unpaid assessments of roughly $636,400. 

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 12 of 36
-13-

month following foreclosure for 81 units at $400 per unit per month (or $226,800), all pursuant 

to Alabama Code § 35-8A-316. (Doc. 5, ¶ 18.) The Association also seeks damages from SPH 

on an “open account” theory for unpaid assessments at the 63 Unbuilt Units from July 2011 

through the present, or 63 units x $400/month x 17 months (or $428,400). The critical 

components of the parties’ dispute concerning assessments are (i) whether SPH owes anything at 

all for unpaid monthly fees; and (ii) if so, whether SPH’s payment obligations extend to the 63 

Unbuilt Units (i.e., whether unit assessments are properly levied on unimproved land owned by 

SPH that was originally intended to constitute 63 additional units but was never developed).

Before tackling these questions, it is helpful to summarize the relevant record facts. As 

of July 2010, the Association conducted a meeting and set monthly assessments at $400 per unit 

for owners of the 7 Sold Units. In July 2011, following a Vision foreclosure sale and subsequent 

conveyance, SPH became the owner of all other property at The Rookery III, including the 16 

Other Units, the 2 Incomplete Units, and the 63 Unbuilt Units. Neither Vision nor SPH paid 

monthly assessments on any of these units in connection with the foreclosure sale or the 

subsequent conveyance to SPH, and SPH did not volunteer such assessments thereafter. The 

Association does not appear to have held meetings in 2011 or to have provided notice to Vision 

or SPH of any such meetings; moreover, the Association does not appear to have taken any 

affirmative steps to review or fix monthly assessments during 2011 or to apprise unit owners 

(including Vision or SPH) of any such developments. In the spring of 2012, SPH successfully 

sold 18 Units, consisting of the 16 Other Units and the 2 Incomplete Units. In connection with 

these sales transactions, SPH reduced the purchase price at closing by a total of $58,800 for the 

16 Other Units to account for the Association’s demands for unpaid assessments. (Harmon 

Decl., ¶ 5.) Those withheld assessments were paid to the Association. (No assessments were 

held back for the 2 Incomplete Units.) 

2. Whether All Assessments Imposed by the Association are Invalid.

As an initial proposition, SPH contends that, as a matter of law, it owes no monthly 

assessments to the Association for any of its property because the Association failed to comply 

with applicable requirements for “notice, meeting, voting, and record keeping,” which it 

contends are necessary conditions precedent for the Association “to validly assess common 

expenses against any Units.” (Doc. 27, at 8.) SPH argues that the Alabama Uniform 

Condominium Act, as well as The Rookery III’s Declaration and Association Bylaws, impose 

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 13 of 36
-14-

certain procedural requirements that the Association simply did not follow. Indeed, the 

Association’s Bylaws require annual meetings, annual elections of Directors, notice of meetings, 

a formal budget process, and so on. (Doc. 27, Exh. C.) The Association admits that it failed to 

observe certain of these formalities. For example, the Association never conducted an annual 

meeting as required by its Bylaws. (J. Cooper Dep., at 74.) The Association never gave notice 

to SPH or Vision of any meetings. (Id.)

The Association counters that these shortcomings do not invalidate the $400 monthly 

assessments, based on Paragraph 46 of the Bylaws. That paragraph provides, in relevant part, as 

follows: 

“Annual assessments against the condominium unit owners for their respective 

shares of the items of the budget shall be made for the calendar year annually in 

advance at the annual meeting to be held on the second Saturday in December of 

the year preceding the year for which the assessments are made. Such 

assessments shall be payable in equal installments, commencing on the first day 

of each month of the year for which the assessments are made. If an annual 

assessment is not made as required, an assessment shall be presumed to have 

been made in the amount of the last prior assessment.”

(Doc. 27, Exh. C, ¶ 46 (emphasis added). The Association’s point is that the Association’s 

acting Board of Directors (i.e., the owners of the 7 Sold Units) unanimously agreed in July 2010 

to fix assessments at $400 per month, just as had been done by the original Board of Directors 

back in 2007.13 That monthly assessment being properly in place, the Association reasons, it 

remained applicable in 2011 and 2012 despite the Association’s failure to conduct an annual 

meeting, approve a budget, and the like during those years.

In response, SPH balks that the Association did not comply strictly with the Bylaws as to 

the July 2010 meeting because the notice was not in the correct form, the timing of the notice 

was inadequate, there was no detailed budget for the following year, and the Board did not 

provide notice 14 days in advance that ratification of a budget was to be considered at that 

 13 At the July 2010 meeting (at which all of the 7 Sold Unit’s owners were present), 

the Association examined outstanding bills and recurring expenses, considered future insurance 

costs, and “tried to figure how much it would be and how much we needed to pay, each owner, 

and that’s how we did the budget.” (J. Cooper Dep., at 30.) The Association “went back over ... 

all of the bills that had to be paid every month and we figured out how much that would total and 

we tried to come up with a figure that would be our monthly budget. ... But we figured we had 

to pay $400 a month, each person, in order to pay our bills.” (Id. at 31.)

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 14 of 36
-15-

meeting. (Doc. 42, at 3-4.) SPH is correct that there were procedural irregularities as to the July 

2010 meeting; however, such irregularities neither invalidate the Association’s actions nor 

mandate a conclusion that that no assessments have ever been owed by any owner of any unit of 

The Rookery III at any time. To accept SPH’s formalistic argument would be to ignore the 

reality and context of what happened in July 2010. The developer had abruptly abandoned The 

Rookery III, leaving the seven unit owners twisting in the wind. In an effort to pick up the 

pieces and take financial responsibility for the condominium complex, all seven unit owners 

attended a meeting at a mutually agreeable time and place. They reviewed The Rookery III’s 

recurring expenses and fixed a monthly assessment figure ($400) that they believed would be 

adequate to cover those expenses. Perhaps they did not observe all corporate niceties, but the 

facts remain that every single unit owner at that time was on board with and agreeable to the 

$400/month assessment plan, and that those existing unit owners have faithfully paid that fee to 

the Association ever since.

14

SPH identifies no aspect of the Alabama Uniform Condominium Act, the Bylaws or 

Declaration, or Alabama case law that demands strict compliance with all notice and budgeting 

procedures, and invalidates assessments imposed by the Association in the absence of same 

(even if all unit owners contemporaneously voted on and agreed with that assessment plan).15 

 14 For its part, SPH has made no argument or showing that it (or Vision) was entitled 

to be heard about the Association’s budget or assessment calculations as of July 2010. Recall 

that SPH/Vision was simply a mortgagee at that time, and did not own a single unit at The 

Rookery III. To be sure, SPH/Vision could have foreclosed on those mortgages earlier; 

however, it chose not to do so, and must bear the consequences of that election. Under the 

circumstances, SPH/Vision identifies no authority and advances no argument that would have 

entitled it to be heard or to object in July 2010 to the method and manner of fixing monthly 

assessments for The Rookery III. Every unit owner at that time acquiesced to the process and the 

result without objection. Surely, this constitutes substantial compliance with the Bylaws under 

any reasonable interpretation.

15 The hypertechnical, form-over-substance nature of SPH’s argument is laid bare 

by its admission that the selected monthly assessment figure approved by all unit owners in July 

2010 was in fact reasonable. See doc. 42, at 7 (“The seven unit owners have, by paying between 

a $375 to $400 per month assessment, met the common element expense obligations of the 

project as built.”). So SPH has no quarrel with the amount of the assessment imposed in July 

2010. Likewise, it appears to have no quarrel with the lack of notice to SPH/Vision of the July 

2010 meeting, given its status as a mortgagee (not an owner) at that time.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 15 of 36
-16-

Courts in other jurisdictions have refused in analogous circumstances to require mechanistic 

compliance with notice requirements in the absence of prejudice. See generally Restatement 

(Second), Judgments, § 3, comment b (“The modern approach to notice-giving attaches primary 

importance to actual notice and treats technical compliance with notice procedures as a 

secondary consideration. ... To invalidate the notice simply because it is irregular is to protect no 

worthwhile interest of the party who has raised the objection. He has had his due.”); TwentyFour Merrill Street Condominium Ass’n, Inc. v. Murray, 902 A.2d 24 , 29 (Conn. App. 2006) 

(applying comment b to condominium bylaw notice requirements); Gary A. Poliakoff, 1 Law of 

Condominium Operations § 5:8 (“In reviewing whether bylaws support the imposition of 

assessments, substantial compliance with substantive requirements of the bylaws may support 

imposition of an assessment, even if the association has made technical or ministerial errors in 

imposing such costs on unit owners.”).

There is a more fundamental problem with SPH’s argument. The logical consequence of 

SPH’s position (i.e., that all assessments imposed on unit owners at The Rookery III since 2007 

are void) is that all unit owners would be entitled to return of their assessment payments because 

all assessments were invalid. The Association would have no means of paying its bills and 

presumably the entire enterprise would go up in smoke. A condominium association’s bylaws 

are not a suicide pact,

16 and this Court declines to construe them as such, particularly given the 

stated Alabama legislative concern that “[t]he economic viability of condominium associations is 

a major concern of the drafters of the present act.” Ala. Code § 35-8A-315 (Alabama 

Commentary, ¶ 1); Restatement (Third), Property (Servitudes) § 6.5 (comment (b)) (“The 

assessment power is critical to the financial viability of most common-interest communities.”). 

This Court will not accede to SPH’s request that the Bylaws be construed in a manner that 

unravels a financial arrangement to which all unit owners agreed in July 2010, to the prejudice of 

no one, simply because certain procedural requirements were not punctiliously observed, when 

 16 See generally Barclay Square Condominium Owners’ Ass’n v. Grenier, 899 A.2d 

991, 995 (N.H. 2006) (“We are also mindful that a condominium declaration should not be so 

narrowly construed so as to eviscerate the association’s intended role as the governing body of 

the community. ... The important role associations play in maintaining property values and 

providing municipal-like services justifies a broad view of the powers delegated to them.”) 

(citations and internal marks omitted).

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 16 of 36
-17-

the effect of adopting SPH’s stance would be to assure the economic destruction of the 

Association.

Based on the foregoing, the undersigned concludes that the $400 monthly assessment to 

which all unit owners agreed as of July 2010 was in fact a proper, valid assessment under 

applicable law and condominium documents. That being the case, the Association’s failure to 

make annual assessments after that date in accordance with the Bylaws is not fatal, but is instead 

saved by Paragraph 46’s express allowance that “[i]f an annual assessment is not made as 

required, an assessment shall be presumed to have been made in the amount of the last prior 

assessment.” (Doc. 27, Exh. C, ¶ 46.) Thus, there is a presumed valid $400/month assessment 

for each unit at The Rookery III, and the SPH’s contention that no valid assessments exist must 

fail.

17

3. Whether Assessments Concerning the 63 Unbuilt Units are Invalid.

The determination that the $400 monthly assessments are generally valid still leaves the 

question of defining the portions of The Rookery III on which assessments are properly charged. 

The parties’ disagreement on this point is sharp. For its part, the Association insists that SPH 

must pay assessments for the 63 Unbuilt Units for the entire time period at issue; meanwhile,

SPH is adamant that no such assessments are due because those “units” do not exist and consist 

of nothing but vacant land.

The starting point of the analysis is the Alabama Uniform Condominium Act, which 

draws no distinction between built and unbuilt units. As a general matter, the Act dictates that 

“all common expenses must be assessed against all the units.” Ala. Code § 35-8A-315(b). And 

a “unit” is defined as “[a] physical portion of the condominium designated for separate 

ownership or occupancy.” Ala. Code § 35-8A-103(27). The accompanying commentary 

explains that a unit “describes a tangible, physical part of the project.” Id. (Commissioners’ 

Commentary, ¶ 16.) Nothing in the text of the Act would exempt unbuilt units from the 

 17 This finding is dispositive of SPH’s contention that it is entitled to recover 

damages for assessments collected by the Association out of sale proceeds at the closings of the 

16 Other Units. The monthly assessments on those completed units were in fact proper, and the 

Association was entitled to those funds.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 17 of 36
-18-

definition of a “unit” on which assessments may validly be imposed.18 The Act makes clear, 

however, that where unit boundaries are fixed “by the declaration,” such boundaries trump the 

statutory parameters. Ala. Code § 35-8A-202(1); see also § 35-8A-103 (Commissioners’ 

Commentary, § 1) (explaining that the Act “permits the defined terms used in the Act to be 

defined differently in the declaration and bylaws”).

19 Thus, if the Declaration of Condominium 

for The Rookery III limits “units” to completed physical buildings, then that definition governs.

The Declaration defines “unit” as “[a] physical portion of the condominium designated

for separate ownership or occupancy, the boundaries of which are described herein.” (Doc. 27, 

Exh. B, at Art. 1, ¶ 2(w).) With respect to boundaries, the Declaration explains that “[t]he 

boundaries of each unit are hereby designated as the innermost plane of the interior finished 

surfaces of the unit’s walls, floors and ceilings.” (Doc. 27, Exh. B, at Art. 5, ¶ 6.) SPH 

persuasively argues that, as to the 63 Unbuilt Units, there are no “innermost planes of the interior 

finished surfaces of the unit’s walls, floors and ceilings,” because those units have never been 

 18 This uncontroversial proposition has been adopted by courts in a number of states 

in interpreting their jurisdiction’s version of the Uniform Condominium Act. See, e.g., Tara 

Manatee, Inc. v. Fairway Gardens at Tara Condominium Ass’n, Inc., 870 So.2d 32, 35 (Fla.App. 

2 Dist. 2003) (under Florida law, “all units, whether built or unbuilt, must share in assessments 

for common expenses of the condominium”); Centennial Station Condominium Ass’n v. Schaefer 

Co. Builders, Inc., 800 A.2d 379 (Pa. Cmwlth. 2002) (reviewing and agreeing with authorities 

from other jurisdictions “that the Uniform Condominium Act does not distinguish between 

completed and uncompleted units in the context of levying assessments for maintenance, repair 

and administration of common elements,” and affirming lower court ruling that owner “was 

responsible for payment of fees for units that were declared but non-existent”); Pilgrim Place 

Condominium Ass’n v. KRE Properties, Inc., 666 A.2d 500, 502 (Me. 1995) (“No provision of 

the Act requires any distinction between built and unbuilt units in the assessment for common 

expenses. ... The Act implicitly recognizes that the creation of units owned by the declarant and 

the concomitant obligation to pay assessments may occur prior to the actual construction of the 

physical units.”).

19 Commentators have similarly observed that the text of the condominium 

documents, not the language of the statute, ordinarily controls the question of whether owners of 

unbuilt units must pay condominium assessments. See 15B Am.Jur.2d Condominiums and Cooperative Apartments § 33 (“Whether an unbuilt unit in a condominium is subject to the general 

assessment for common expenses depends generally on the particular declaration controlling the 

condominium.”); 31 C.J.S. Estates § 268 (“While under some condominium documents the 

owner of undeveloped interests in a condominium project is not subject to assessments, under 

other condominium documents and statutory provisions the owner of unconstructed units may be 

assessed for common expenses.”) (footnotes omitted).

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 18 of 36
-19-

built and consist of nothing more than bare land. Logically, then, if a unit is defined by the 

Declaration as having boundaries consisting of “innermost planes of the interior finished 

surfaces,” then an unbuilt unit cannot be a “unit” at all for purposes of the Declaration because 

the planes and surfaces that define the unit’s physical parameters do not exist. Furthermore, the 

Declaration describes the appearance of units as follows: “Each unit contains three bedrooms 

(one of which may be a den or study), two baths, washer and dryer closet, a kitchen-dining room 

– living room area, and screened porch.” (Doc. 27, Exh. B, at Art. 5, ¶ 5.) The 63 Unbuilt Units 

contain no bedrooms, no baths, no closets, no kitchens, no dining rooms, no living rooms and no 

porches. They are nothing more than vacant land. As such, they are not within the scope of 

what is contemplated as a “unit” in the plain language of the Declaration.20

 Moreover, there is persuasive support in the case law for SPH’s interpretation of the 

Declaration as overriding the statute’s failure to exclude unbuilt units from the definition of 

“units.” See Aluminum Industries Corp. v. Camelot Trails Condominium Corp., 535 N.W.2d 74, 

79-80 (Wis. App. 1995) (although statutory definition of “unit” encompasses property on which 

there is no constructed unit, declarations established that “units” are distinct from the land itself 

 20 Other provisions of the Declaration bolster and corroborate this determination. 

For example, the Declaration specifies that “[t]he eighty eight units which will comprise The 

Rookery III ... will be/are contained in a number of buildings that will be/are of either duplex 

construction or single family residence construction.” (Doc. 27, Exh. B, at Art. 5, ¶ 1.) The 63 

Unbuilt Units are not contained in buildings of either duplex construction or single family 

residence construction, and there is no indication that they ever will be; to the contrary, the 

Declaration states in the clearest of terms that each phase of units “NEED NOT BE BUILT.” 

(Id. at Art. 4, ¶ 1.) If “units” are or will be contained in duplex or single-family buildings, then 

the 63 Unbuilt Units cannot be “units” within the contemplation of the Declaration. Similarly, 

the Declaration describes various clusters of units as “more or less identical single family 

residence buildings” and other units as being “housed in a duplex residential building.” (Id. at 

Art. 4, ¶ 4.) Again, the 63 Unbuilt Units are not single-family residence buildings, nor are they 

housed in duplex residential buildings; rather, they are simply plots of land. Furthermore, the 

Declaration provides that “[t]he units ... shall be restricted to residential use, only.” (Id. at Art. 

12, ¶ 1.) The 63 Unbuilt Units are incapable of residential use because they are merely 

unimproved land. The Declaration indicates that “[n]o unit may be occupied by a number of 

persons in excess of the number permitted by the applicable zoning ordinance.” (Id. at Art. 12, ¶ 

2.) Of course, the 63 Unbuilt Units cannot be occupied at all, because they do not exist. All of 

these provisions, read together, unmistakably show that the Declaration contemplates units as 

residences that are or will be built, not plots of empty land that have never been and (by all 

appearances, given the developer’s abandonment of the Project years ago) never will become 

actual condominium residences.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 19 of 36
-20-

by, for example, referring to floor plans, layouts, number of rooms, dimensions, and providing 

that boundaries of each unit are the area enclosed by walls, floor, and roof); Country Oaks 

Condominium Management Committee v. Jones, 851 P.2d 640, 641-42 (Utah 1993) (declaration 

provisions taken as whole “indicate that a unit exists only when a structure provides an enclosed 

area for the exclusive use and possession of the owner,” such as (i) provision describing units as 

areas to which an owner shall have “exclusive ownership and possession,” whereas owners of 

unbuilt units would have no means to exercise such exclusive ownership or possession of 

undeveloped land, and (ii) provision describing unit as a space enclosed within interior surface of 

walls, floors and ceilings). The same kind of searching analysis of the condominium documents 

employed in Aluminum Industries and Country Oaks yields a conclusion that the condo 

documents governing The Rookery III exclude the 63 Unbuilt Units from the scope of units on 

which assessments may be levied.21

In so concluding, the Court has carefully weighed the Association’s counterarguments. 

For example, the Association relies on Mountain View Condominiums Homeowners Ass’n Inc. v. 

Scott, 883 P.2d 453 (Ariz.App. Div. 2 1994). That case appears distinguishable insofar as (i) it 

was predicated on a particular feature of Arizona law that “condominium ownership consists of 

individual ownership of a horizontal layer of cubic content space” (which the Association does 

 21 This conclusion is reinforced by the Commissioners’ Commentary to the Alabama 

Uniform Condominium Act, which explains that “[i]f a condominium were said to consist from 

the beginning of a certain number of units, even though some of those units had not yet been 

completed or even begun, serious problems would arise if the remaining units were never 

constructed ..... [V]otes in the unit owners’ association could be assigned to units, and those 

votes could be cast, even though the units were never built. The Act therefore requires that 

significant construction take place before units are assigned an interest in the common 

elements, a vote in the association, and a share of the common expense liabilities.” Ala. Code § 

35-8A-201 (Commissioners’ Commentary, ¶ 5 (emphasis added)). Of course, the 

Commissioners’ Commentary is not binding. And the text of § 35-8A-201 does not explicitly 

say that significant construction must occur before a unit may be assigned a share of common 

expense liabilities. But the Commissioners’ Commentary provides helpful guidance into the 

proper interpretation of the Act, and addresses how the very problems confronted here (unbuilt 

units as to which there are serious questions concerning voting rights and assessment 

obligations) should be resolved. By imputing a “significant construction” requirement before 

any unit at The Rookery III accrues voting rights and assessment obligations, the Court assures 

(as the Commissioners’ Commentary did) that the litany of “serious problems” described in the 

commentary does not and cannot come to pass.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 20 of 36
-21-

not argue has any analog in Alabama law); and (ii) the Arizona court reasoned that “defendants’ 

ownership interests must necessarily include not only the benefits but also the obligations of the 

previous owner” (yet the Association here does not suggest that The Rookery III’s developer (the 

previous owner) was under an obligation to pay monthly assessments, or for that matter that SPH 

has received any of the benefits that the developer enjoyed). Id. at 456, 458. Likewise, the 

Association has shown that the 63 Unbuilt Units were subject to ad valorem taxes imposed by 

the Baldwin County Revenue Commissioner. (Doc. 38, Exh. 7.) But the Association has not 

explained why a taxing authority’s treatment of the unbuilt units (which simply reflects the 

reality that SPH owns certain real property in Baldwin County and therefore must pay property 

tax on it just as any other owner of real property in the county must do) somehow translates into 

“unit” status under the Alabama Uniform Condominium Act, the Declaration, or the Bylaws.22 

And the Association’s selective parsing of bits of language in the Declaration that it contends 

evince an intent to treat unconstructed units as units for assessment purposes is unavailing, when 

taken in the context of the entire document.23

 22 If anything, these tax records work against the Association. Each unbuilt unit was 

assessed property taxes at an annual rate of roughly $100, while the finished units were taxed at

an annual rate of $900 or more. (Doc. 38, Exh. 7.) The disparity reveals that even taxing 

authorities were well aware of the considerable differences in valuation and usage of unbuilt 

versus built units, yet the Association insists that all units must be treated the same for 

assessment purposes whether they had been constructed or not. 

23 In this regard, the Association points to the portion of the Declaration which 

specifies that “[e]ach unit of The Rookery III, a Condominium, shall have a 1/88 interest in the 

common elements” (doc. 27, Exh. B, at Art. 11, ¶ 1). The Association interprets this language as 

implying that there must be 88 units regardless of which are built and which are not; however, 

the Association ignores the very next paragraph, which clarifies that “[t]he formula used to 

allocate common elements interests is to divide the whole of the common elements by the 

number of units” (id. at Art. 11, ¶ 2). With that clarification, the Declaration readily allows 

alteration of the fractional shares of unit holders in common elements should the number of units 

rise above or dip below 88, so the mere invocation of a 1/88 fraction does not evince an intention 

that there will be 88 units in The Rookery III at all times, nor does it create any dilemma or 

unallocated shares if the number of units is lower (because, for example, some units are not 

built). Similarly, the Association’s reliance on language concerning “[t]he eighty eight units that 

comprise or will comprise the condominium project” (id. at Art. 5, ¶ 5) is misplaced. That 

phrasing actually undermines the Association’s position. If the Association were correct, then 88 

units must comprise the condominium project at all times past, present and future because a unit 

is a unit even if it is not built. Yet the Declaration specifically recognizes that 88 units do not (or 

may not) comprise the project today by saying only that they “comprise or will comprise” it. 

(Continued)

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 21 of 36
-22-

Two other points bear noting. The Association’s present position that the 63 Unbuilt

Units constitute “units” for which assessments are due runs counter to its own actions in July 

2010, when it calculated expenses and divided them among the seven unit owners to fix monthly 

assessments. If the Association had believed that The Rookery III consisted of 88 units, then it 

would have divided those expenses by 88 (not by seven) to derive a monthly assessment figure. 

So the Association is asking the Court to accept a reading of the Declaration that conflicts with

the Association’s own actions, without explaining the reversal in its position.

The second point is actually a corollary of the first. If the Court were to adopt the 

Association’s view that monthly assessments of $400 were due on all of the 63 Unbuilt Units at 

all times, the result would be a vast windfall to the Association, as collections would outstrip 

common expenses by an enormous margin. From January to December 2011, the Association’s 

total expenses were $31,960.96, and it collected dues of $33,345.00, resulting in net ordinary 

income of $1,384.04. (J. Cooper Dep., at Exh. 8.) The Association would have this Court order 

SPH to pay $400 per month per unit for each of the 63 Unbuilt Units, which would amount to a 

total sum of $302,400 for the year 2011 alone. Such an assessment would be vastly 

disproportionate to the Association’s common expenses; indeed, not a penny of those assessment 

funds would actually defray common expenses, which had already been paid in full from other 

assessments. This levy would therefore be patently improper and impermissible under the Act 

and the Declaration. See Ala. Code § 35-8A-315(b) (assessments consist of “common expenses” 

of the association); doc. 27, Exh. B, at Art. 21, ¶ 2 (assessments consist of “[a]ll common 

expenses”).

24 The Association has not explained (and presumably cannot explain) why imposing 

assessments on SPH of nearly tenfold the total common expenses would be proper, valid, 

reasonable, or in any way defensible under applicable law or The Rookery III’s governing 

 

That verbiage suggests that the Declaration intended for a unit to count as a unit only once it had 

been built; otherwise, there would have been no need to include “comprise or will comprise” 

language because the 88 units would always comprise the project.

24 See also Restatement (Third) Property (Servitudes) § 6.5(2) (“Unless expressly 

authorized by the declaration, fees for services rendered, or for the use of common property, 

must be reasonably related to the costs of providing the service, or providing and maintaining the 

common property, or the value of the use or service.”).

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 22 of 36
-23-

condominium documents. What’s more, if the 63 Unbuilt Units were indeed “units” on which 

assessments could be levied, this outcome would effectively open Pandora’s box by raising a 

host of questions about how to correct the gross (and improper) disparity between actual 

assessments imposed and common expenses.25 The Court need not and will not attempt to 

answer those questions herein (none of which have been briefed by the parties in any event). It 

suffices to recognize that, even if the Association’s position that the 63 Unbuilt Units qualify as 

“units” for purposes of assessments were valid, the relief sought by the Association (to the tune 

of hundreds of thousands of dollars of assessment fees, over and above common expenses) 

would not be available or permissible, in any event. Condo assessments are not a game of 

“Wheel of Fortune” designed to enrich the owners’ association far above and beyond actual

common expenses.

For all of the foregoing reasons, the Court finds that there is no genuine dispute of 

material fact and that SPH is not obligated to pay assessments to the Association for any of the 

63 Unbuilt Units because those unconstructed units do not constitute “units” on which 

assessments may be imposed.26

 25 The questions reasonably implicated in such an event would include the 

following: Should the entire assessment be struck down? Should/may it be judicially modified to 

a per-unit figure that more accurately correlates to common expenses? For what period of time? 

Who decides? What of the owners of the 7 Sold Units, the 16 Other Units, and the 2 Incomplete 

Units, all of whom have been diligently paying $400 monthly assessments? Would they be 

entitled to rebates of the facially excessive charges? How much? Who decides? Using what 

analytical framework or standard?

26 For the sake of clarity, the Court elaborates on this holding in three respects. 

First, this ruling is dispositive of the Association’s request under Alabama Code § 35-8A-316 for 

a “super priority lien against the 63 units acquired by Vision at the foreclosure sale for the six 

months preceding the date of the sale.” (Doc. 36, at 19.) Such a lien would exist only for unpaid 

assessments that are due and owing to the Association. The Court having concluded as a matter 

of law that no delinquent assessments have accrued as to the 63 Unbuilt Units, the Association is 

not entitled to any lien against SPH’s property for failure to pay such assessments. Second, this 

reasoning defeats the Association’s damages claim relating to unpaid assessments for the 63 

Unbuilt Units for the period of January 2011 through the present. No assessments are due for the 

63 Unbuilt Units, so the Association cannot recover damages from SPH/Vision for failure to pay 

same. Third, the 2 Incomplete Units are interesting because the Association lumps those units 

into its request for damages, while at the same time admitting that because the owners of those 

two units are not parties, “the court would not have jurisdiction to enter an order on those units.” 

(Doc. 36, at 14 n.4.) The Association does not explain (i) why no assessments were withheld at 

(Continued)

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 23 of 36
-24-

B. SPH’s Other Claims for Declaratory and Injunctive Relief.

In the wide-ranging claim for declaratory and injunctive relief presented in Count One of 

the Complaint, SPH not only seeks adjudication of its rights and obligations to pay assessments 

(as addressed supra), but also requests that the Court declare (i) that SPH is entitled to call a 

special meeting of the Association, (ii) that SPH is entitled to cast votes to remove directors and 

elect new directors at Association meetings, and (iii) that SPH is entitled to immediate and 

complete access to the Association’s books and records. (Doc. 1, at 7.)27 Both sides have moved 

for summary judgment on each of these claims.

With regard to whether SPH is entitled to call a special meeting, remove/elect directors, 

and so on, the Association’s threshold argument is that this issue is moot because “SPH no 

longer owns any completed units.” (Doc. 33, at 22 n.2.) It is true enough that SPH does not own 

any units that are part of the Association. After all, SPH sold the 16 Other Units and the 2 

Incomplete Units, and the Court has already held that the 63 Unbuilt Units are not “units” for 

Association purposes. However, when SPH sold each of the 16 Other Units in the first months 

of 2012, it obtained an “Irrevocable Proxy” from the purchaser. (Harmon Decl., ¶ 6.) These 16 

proxies state that the unit purchaser grants and assigns SPH “an irrevocable proxy and right to 

vote ... as a member of the [Association] and as the owner of the Unit, on all matters coming 

 

the time of closing of those two units, as happened for the closing of the 16 Other Units; or (ii) 

how it could be entitled to damages from SPH for assessments that have gone unpaid by the 

owners of the 2 Incomplete Units. At any rate, there is no evidence whatsoever in the record that 

the 2 Incomplete Units were at any time sufficiently advanced in their construction that they 

might be deemed “units” within the meaning of the Act, the Declaration and the Bylaws. 

Therefore, the portion of the Association’s damages claim seeking to hold SPH/Vision 

responsible for unpaid assessments for the 2 Incomplete Units is properly dismissed.

27 In Count One, SPH also requested judicial declarations that the assessments and 

liens imposed by the Association are invalid, and that the Association must provide SPH an 

accounting of the Association’s financial transactions and matters. (Id.) The assessment issue 

has fully been addressed supra and need not be addressed separately here. And SPH makes no 

mention of the accounting issue in its summary judgment briefs, such that by all appearances that 

claim has been abandoned. At any rate, it does not appear that SPH has any legitimate right or 

redressable need for an accounting from the Association, given that it no longer owns any units 

at The Rookery III, does not belong to the Association, and does not owe assessment payments 

to the Association.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 24 of 36
-25-

before the [Association] and/or to which members of the [Association] are entitled to vote ... for 

a period of one (1) year commencing on the date hereof.” (Harmon Decl., at Exh. 6.) Thus, at 

present, SPH holds proxies for 16 of the 23 units in the Association (or, if the 2 Incomplete Units 

are properly counted as units, for 18 of 25 units in the Association). SPH contends that these 

proxies confer upon it the rights to call special meetings, vote on dismissal or election of 

directors, and so on. According to SPH, the Association has impaired these rights by refusing to 

recognize SPH’s attempts to exercise them.

The Association fires back that the proxies are invalid under the Bylaws, which specify 

that a proxy “shall be valid only for the particular meeting designated in the proxy” and “shall be 

revocable at any time at the pleasure of the person executing it.” (Doc. 27, Exh. C., at § 13.) 

The proxies obtained by SPH do not designate a particular meeting and are irrevocable on their 

face;28 therefore, the Association argues, they are invalid and unenforceable. In response, SPH 

insists that the Bylaws must be cast aside on this point because they are “in conflict with the 

Articles of Incorporation, the Declaration and the Uniform Condominium Act.” (Doc. 44, at 1.) 

SPH’s premise is that, in the event of a conflict, the Act, Declaration, and Articles prevail over 

the Bylaws. Generally speaking, that is a correct statement of law. See Ala. Code § 35-8A203(c) (“In the event of a conflict between the provisions of the declaration and the bylaws, the 

declaration prevails ....”). The trouble is that SPH has identified no conflict. More precisely, 

SPH has identified no language in the Act, the Declaration, or the Articles that would (i) 

authorize proxies that fail to designate a particular meeting for which they will be effective, or 

(ii) authorize irrevocable proxies. Instead, SPH simply points out that the Act, the Declaration 

and the Articles are silent as to these matters. In SPH’s view, the conflict is that “[n]one of them 

require that the proxy be revocable or that it be linked to a particular meeting.” (Doc. 44, at 1 

n.1.) But silence does not a conflict make. Far from clashing with the Act, the Declaration, and 

the Articles, the Bylaws supplement those documents with additional rules and requirements 

 28 Any lingering doubt about whether the proxies may be revoked by the unit 

purchasers is eradicated by the following language: “THIS PROXY IS IRREVOCABLE, 

AND CANNOT BE REVOKED, CANCELLED OR TERMINATED, AND SHALL NOT 

EXPIRE UNTIL ONE (1) YEAR AFTER THE DATE HEREOF.” (Harmon Decl., Exh. 6.)

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 25 of 36
-26-

concerning proxies. SPH incorrectly conflates the concept of supplementation/elaboration with

that of conflict/inconsistency.

29

In light of the foregoing, the Court concludes that the “Irrevocable Proxies” on which 

SPH relies as its legal basis for seeking to call a special meeting and exercising voting rights are 

invalid under the Bylaws because they do not designate a particular meeting and are irrevocable. 

The Court further concludes that the applicable provisions of the Bylaws are enforceable and do

not conflict with the Alabama Uniform Condominium Act or other governing documents for The 

Rookery III. Because SPH’s request for an injunction or declaration allowing it to call a special 

meeting and vote on the Association’s directors hinges on the validity of the Irrevocable Proxies, 

and because those proxies are improper and invalid under the applicable Bylaws, the Court will 

enter summary judgment in the Association’s favor on this cause of action.30

With respect to SPH’s request for declaratory relief that it is entitled to “full access to all 

books and records of the Association” (doc. 1, at 7), this claim for relief is moot. It is 

undisputed that SPH has been granted full access to the Association’s books and records during 

discovery in this litigation. Moreover, it does not appear that there is any current, live dispute 

between SPH and the Association as to whether SPH may examine the Association’s books and 

records. Accordingly, even if this claim were not moot, the Court would exercise its discretion 

 29 Examination reveals the absurd results that would logically follow from SPH’s 

reasoning. If SPH were correct, then any language in the Bylaws that was not also set forth in 

the Act, the Declaration, or the Articles would be a “conflict” and therefore invalid. This would 

mean that the Bylaws would be totally ineffectual, and that drafting Bylaws would be a 

meaningless, redundant exercise of simply copying down exact provisions from the other 

documents, with no supplementation or elaboration whatsoever. Nothing in Alabama law, the 

governing documents, or SPH’s argument would support marginalizing the Bylaws in this 

manner by adopting an expansive interpretation of the term “conflict” to invalidate any text in 

the Bylaws that was not also recited in the Declaration.

30 As an aside, there is no discernible, valid reason why SPH would want to call 

Association meetings and vote on its directors at this time. SPH owns no units, is not an owner 

or member of the Association, and is not subject to monthly assessments. Under the 

circumstances, it is unclear why SPH would wish to exercise control over the Association’s 

activities. Of course, regardless of the purity or lack thereof of SPH’s motives, or the legitimacy 

or lack thereof of its reasons for wanting to interfere with the Association and handpick its 

leadership, the fact remains that the proxies through which SPH would exert such control are 

invalid and unenforceable under the Bylaws, so this claim must fail.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 26 of 36
-27-

under the Declaratory Judgment Act not to hear or decide this claim, as to which there appears to 

be no actual, bona fide disagreement between the parties today.31 This claim is properly 

dismissed on summary judgment.

C. SPH’s Claim Against Cooper for Denial of Access.

In Count Two of the Complaint, SPH brings a statutory claim against Cooper, personally, 

for denying SPH access to the Association’s books and records.32 SPH alleges that “Cooper has 

denied SPH access to the Association’s books and records without justification” and that she is 

therefore liable in damages under Alabama Code § 10A-1-3.32. Subsection (d) of that statute 

allows an award of damages against “[a]ny agent or governing person of an entity who, without 

reasonable cause, refuses to allow any owner or member ... to inspect any books or records of 

the entity.” Id.

Cooper’s argument for why SPH cannot prevail on this claim is as simple as it is 

compelling. Her position – and the uncontroverted evidence of record – is that the Association’s 

books and records were never in her custody or control. (M. Cooper Aff., ¶¶ 5, 10.) As a result, 

Cooper was in no position to grant or deny SPH access to documents that she did not have and 

that she did not control. SPH has come forward with no evidence that Cooper did possess 

 31 It is well-settled that the Declaratory Judgment Act is properly “understood to 

confer on federal courts unique and substantial discretion in deciding whether to declare the 

rights of litigants.” Wilton v. Seven Falls Co., 515 U.S. 277, 286, 115 S.Ct. 2137, 132 L.Ed.2d 

214 (1995). Indeed, the Supreme Court has “repeatedly characterized the Declaratory Judgment 

Act as an enabling Act, which confers a discretion on the courts rather than an absolute right 

upon the litigant.” Id. at 287 (citations omitted). As the Eleventh Circuit has observed, the Act 

“only gives the federal courts competence to make a declaration of rights; it does not impose a 

duty to do so.” Ameritas Variable Life Ins. Co. v. Roach, 411 F.3d 1328, 1330 (11th Cir. 2005).

32 Count Two is directed solely against defendant Cooper, not the Association. 

Although SPH argues in its briefs that the Association denied it access to books and records, that 

claim was not presented in the pleadings and is not part of the case. Of course, a plaintiff may 

not use its summary judgment brief as a de facto amendment of the complaint. See, e.g., 

GeorgiaCarry.Org, Inc. v. Georgia, 687 F.3d 1244, 1258 n.27 (11th Cir. 2012) (“It is well-settled 

in this circuit that a plaintiff may not amend the complaint through argument at the summary 

judgment phase of proceedings.”); Godfrey v. Nationwide Vinyl Siding & Home Imp., LLC, 2012 

WL 6569292, *12 n.23 (S.D. Ala. Dec. 14, 2012) (“Plaintiffs cannot use their summary 

judgment brief as a de facto amendment to their pleadings.”). Having sued Cooper alone for 

wrongfully denying it access to books and records in November 2011, SPH cannot now seek to 

hold the Association liable for wrongfully denying such access in November 2011.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 27 of 36
-28-

custody or control of such materials. Nor has SPH cited any law or propounded any argument 

that Cooper may be held personally liable under § 10A-1-3.32(d) when she lacked custody or 

control over the records sought. More generally, there is no evidence that Cooper decided – or 

had anything to do with the Association’s decision – not to produce the Association’s books and 

records to SPH in a reasonably prompt and timely fashion after SPH requested access to same 

via letter dated November 1, 2011 (just three days before SPH filed suit). Accordingly, SPH’s 

claim against Cooper for damages under § 10A-1-3.32(d) is properly dismissed for want of 

evidence from which a reasonable factfinder could determine that Cooper is liable for denying 

SPH access to requested books and records.

D. SPH’s Slander of Title Claim.

Recall that in Count Three of its Complaint, SPH asserted claims under Alabama law for 

slander of title against the Association and Cooper. This cause of action was predicated on the 

defendants’ “filing of ... assessments and liens against SPH’s 16 completed ‘Units’ and other 

property within the Project,” which activity SPH says had the effect of “clouding, disparaging 

and slandering the title to SPH’s property in the Project,” such that “SPH cannot sell any of such 

property while the assessments/liens exist in said public records.” (Doc. 1, ¶ 22.) Although the 

briefing on this claim is cursory at best and the claim itself appears to have been little more than 

an afterthought, both sides have moved for summary judgment on it, so the Court will proceed to 

examine SPH’s slander-of-title cause of action.

Under Alabama law, a cause of action for slander of title consists of the following 

elements: “(1) Ownership of the property by plaintiff; (2) falsity of the words published; (3) 

malice of defendant in publishing the false statements; (4) publication to some person other than 

the owner; (5) the publication must be in disparagement of plaintiff’s property or the title 

thereof; and (6) that special damages were the proximate result of such publication (setting them 

out in detail).” Folmar v. Empire Fire and Marine Ins. Co., 856 So.2d 807, 809 (Ala. 2003) 

(citations omitted); see also Dabbs v. Four Tees, Inc., 36 So.3d 542, 558 (Ala.Civ.App. 2008) 

(same). On this record, SPH cannot satisfy all of these elements with respect to Count Three.33

 33 In so concluding, the Court declines to adopt the Association’s reasoning that its 

November 23, 2011 release of liens renders this claim moot. Although the Association released 

its liens on that date, it specifically denied in the Release papers that the “indebtedness relating to 

such liens has been satisfied,” and insisted that “[s]uch indebtedness remains unpaid and due and 

(Continued)

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 28 of 36
-29-

For analytical purposes, the Court divides the slander of title claim into two component 

parts. First, SPH maintains that the Association’s liens slandered the title of the 16 Other Units 

(all of which SPH sold in the spring of 2012), forcing SPH “to lower the closing price for each 

Unit by the dollar amount of the liens claimed by the Association” and ostensibly damaging SPH 

to the tune of $58,800 (the total amount by which the closing prices of the 16 Other Units were 

lowered to account for unpaid assessments). (Doc. 27, at 14.) SPH argues that it “is entitled to 

recover that amount as damages” in Count Three. (Id.) This is not a viable slander of title claim 

because (i) the Association’s statement that assessments were owed on the 16 Other Units was 

not false (the Court having concluded that the original $400 monthly assessment was valid and 

enforceable as to the completed units); (ii) there is no evidentiary support for a finding that the 

Association’s statement that assessments were owed on the 16 Other Units was malicious;34 and 

(iii) SPH has no proof of special damages because the assessments paid at closing for the 16 

Other Units were, in fact, due and owing, such that SPH did not incur damage by virtue of their 

payment.

 

owing to the Association.” (M. Cooper Aff., Exh. A.) If that statement (which was published in 

Baldwin County Probate Court records) was false and malicious, and caused special damage to 

SPH, then SPH could maintain a slander-of-title claim against the Association, notwithstanding 

the nominal release of the liens.

34 See Folmar, 856 So.2d at 809 (“The act against which a slander-of-title action is 

taken must have been false and malicious when it was performed.”). Malice is a critical element 

of the cause of action; indeed, Alabama law recognizes that “a rival claimant is conditionally 

privileged to disparage another’s property in land by an assertion of an inconsistent legally 

protected interest in himself.” Alabama Power Co. v. Laney, 428 So.2d 21, 22-23 (Ala. 1983) 

(citation omitted). To constitute the requisite malice to sustain a slander-of-title claim, a plaintiff 

must come forward with “proof that [the defendant] intentionally disparaged [the] plaintiff’s title 

to the property slandered or recklessly disparaged [it] without information sufficient to support a 

bona fide belief in the veracity of the disparaging statement.” Roden v. Wright, 646 So.2d 605, 

611 (Ala. 1994) (citations omitted). “Malice does not equate with negligence.” Id. No 

reasonable factfinder could conclude on this record that the Association lacked information 

sufficient to support a bona fide belief in the fall of 2011 that assessments were due and owing 

on the 16 Other Units, which had been completed and on which not a dime’s worth of 

assessments had ever been paid by anyone, even as owners of the 7 Sold Units were paying $400 

every month in assessments.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 29 of 36
-30-

Second, SPH maintains that the Association’s liens and statements concerning due and 

unpaid assessments support a slander-of-title claim on the “remaining bare land that currently 

has no Unit on it,” inasmuch as “SPH has been unable to sell that property because of the 

existence of those public filings.” (Doc. 27, at 14.) This aspect of SPH’s slander-of-title claim 

flunks the special-damages element of proof. Under Alabama law, “[s]pecial damages may be 

demonstrated by proof that defendant’s disparagement of plaintiff’s title to the slandered realty 

interrupted, or injuriously affected, some dealing of the plaintiff with his property.” Harrison v. 

Mitchell, 391 So.2d 1038, 1041-42 (Ala.Civ.App. 1980) (citation and internal quotation marks 

omitted). SPH has come forward with no evidence that it has been damaged by the 

Association’s statement that assessments were due and owing on the unimproved land where the 

63 Unbuilt Units were contemplated; therefore, this claim must fail.35

For all of the foregoing reasons, the Association and Cooper’s Motions for Summary 

Judgment will be granted as to Count Three of the Complaint, and SPH’s claim against them for 

slander of title will be dismissed.

E. Claim Brought by Marion Cooper.

In addition to the claims that SPH brought against Cooper in its original Complaint (all of 

which have been addressed and resolved supra), Cooper leveled a claim of her own against SPH, 

pursuant to the “Alabama Litigation Accountability Act and Rule 11.” (Doc. 5, at 18.) Her 

stated grounds for asserting such a cause of action are that SPH refused to dismiss its claims 

against her for denial of access and slander of title and that SPH “should be liable to Cooper for 

 35 To be sure, SPH asserts in its brief that “SPH has been unable to sell that property 

because of the existence of those public filings.” (Doc. 27, at 14.) There is, however, no 

evidence of record from which a reasonable factfinder could draw any nexus between the 

Association’s statement that assessments are due on the property, on the one hand, and SPH’s 

failure to sell the property, on the other. Counsel’s ipse dixit that such a causal relationship 

exists cannot be credited on summary judgment, in the absence of citations to evidence that 

might reasonably support it. See generally Odom v. Southeast Supply Header, LLC, 675 F. 

Supp.2d 1105, 1110 n.3 (S.D. Ala. 2009) (observing that counsel may not include in factual 

recitations certain “facts” not supported by record citations); Taylor v. Holiday Isle, LLC, 561 F. 

Supp.2d 1269, 1275 n.11 (S.D. Ala. 2008) (“Unadorned representations of counsel in a summary 

judgment brief are not a substitute for appropriate record evidence.”). On this record, there is 

simply no evidence linking the Association’s claimed assessments with SPH’s purported 

inability to sell the land; therefore, there is no proof of special damages, and no claim for slander 

of title is cognizable here.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 30 of 36
-31-

monetary sanctions, reasonable expenses and attorney’s fees” for having pursued such claims

“without reasonable grounds, for improper purpose, and without factual support.” (Id.) Both 

SPH and Cooper seek summary judgment on this claim.

Insofar as it purports to be a claim brought under Rule 11 of the Federal Rules of Civil 

Procedure, Cooper’s counterclaim is procedurally improper. The appropriate vehicle for raising

a Rule 11 issue is a motion, not a counterclaim. See, e.g., Hooker v. Dallas Independent School 

Dist., 2010 WL 4025877, *10 (N.D. Tex. Oct. 13, 2010) (denying leave to file counterclaim 

because “Rule 11 does not create a cause of action that may be presented by counterclaim”); 

Wapato Heritigate, LLC v. Evans, 2008 WL 4148871, *1 (E.D. Wash. Aug. 29, 2008) 

(dismissing defendant’s Rule 11 counterclaim as “procedurally improper”); Collins v. Allen, 

2005 WL 1073369, *2 (S.D. Ohio Mar. 16, 2005) (explaining “clear state of the law that a 

violation of Rule 11 does not constitute a separate cause of action”); Lenoir v. Tannehill, 660 F. 

Supp. 42, 44 (S.D. Miss. 1986) (“It appears clearly beyond question that Rule 11 by its express 

terms only permits an attorney procedurally to raise a claim for sanctions through a motion.”). 

Accordingly, SPH’s Motion for Summary Judgment is granted insofar as it relates to the Rule 11 

portion of Cooper’s counterclaim.

Under the Alabama Litigation Accountability Act, Ala. Code §§ 12-19-270 et al. (the 

“ALAA”), a court shall award “reasonable attorneys’ fees and costs against any attorney or 

party, or both, who has brought a civil action, or asserted a claim therein ... that a court 

determines to be without substantial justification.” Ala. Code § 12-19-272(a). The phrase 

“without substantial justification” is defined in the ALAA to mean a claim that “is frivolous, 

groundless in fact or in law, or vexatious, or interposed for any improper purpose, including 

without limitation, to cause unnecessary delay or needless increase in the cost of litigation.” Ala. 

Code § 12-19-271(1). Cooper also seeks relief against SPH under the ALAA.

As discussed supra, the Court has already found that Cooper is entitled to summary 

judgment on the claims SPH asserted against her. However, that determination is not dispositive 

of the analytically distinct question of whether Cooper may recover her attorney’s fees under 

ALAA. The phrase “without substantial justification” is not a fancy synonym for 

“unsuccessful;” rather, much more is required to prevail under the ALAA. See generally 

Morrow v. Gibson, 827 So.2d 756, 763-64 (Ala. 2002) (“Morrow must have been more than 

‘simply legally incorrect’ to justify an award of attorney fees pursuant to the ALAA. The legal 

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 31 of 36
-32-

insufficiency of his position must be susceptible to a conclusion that no reasonable and 

competent attorney would have advanced the contention that he did.”). Cooper cannot satisfy 

this high bar.

Recall that SPH’s claims against Cooper were that she had wrongfully denied SPH access 

to the Association’s books and records (Count Two) and that she had slandered SPH’s title to the 

property by filing the liens (Count Three). As to Count Two, SPH alleged in the Complaint that, 

“[o]n information and belief, Cooper is handling and/or is in possession of some or all of the 

books and records of the Association” and was holding herself out as an agent or governing 

person of the Association. (Doc. 1, ¶ 18.) As to Count Three, SPH alleged that Cooper’s 

statements in liens she executed as agent of the Association slandered SPH’s title to the property, 

giving rise to personal liability as a matter of Alabama statute.

Cooper argues that Count Three was brought against her “without substantial 

justification” because she “was acting in a representative capacity when she signed the liens.” 

(Doc. 41, at 12; see also doc. 30, at 29.)36 As a matter of well-settled Alabama law, however, 

torts committed by a person in her representative capacity in no way insulate her from personal 

liability. See, e.g., Ex parte McInnis, 820 So.2d 795, 798-99 (Ala. 2001) (“A corporate agent 

who personally participates, albeit in his or her capacity as such agent, in a tort is personally 

liable for the tort.”); Ex parte Charles Bell Pontiac-Buick-Cadillac-GMC, Inc., 496 So.2d 774, 

775 (Ala. 1986) (“In Alabama, the general rule is that officers or employees of a corporation are 

liable for torts in which they have personally participated, irrespective of whether they were

acting in a corporate capacity.”); Prince Hotel, S.A. v. Blake Marine Group, 2012 WL 4711897, 

*5 (S.D. Ala. Oct. 2, 2012) (“If Zatezalo committed that tort, it makes no difference whether he 

did so in a representative capacity or not. Either way, he would remain liable for his own 

tortious conduct.”). Nor is Cooper correct that “the alleged basis for SPH’s slander of title claim 

was eliminated when the liens were released” (doc, 41, at 12). As previously discussed, by 

 36 Cooper’s most strident formulation of this argument is that she “was acting in her 

capacity as agent for the Association, not in her individual capacity, when she signed the liens. 

As such, she never should have been sued by SPH ....” (Doc. 43, at 2.) This is not an accurate 

statement of Alabama law. One who commits a tort in Alabama by slandering the title of 

someone else’s property is not relieved of personal liability merely because she committed the 

tort on behalf of someone else. Abundant authority supports this proposition, and Cooper has 

identified none to the contrary.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 32 of 36
-33-

releasing its liens, the Association did not erase the disparaging statements against SPH’s interest 

in the property; rather, the Association continued to press its position (first expressed by Cooper 

in the liens themselves) that substantial unpaid assessments on that property remained due and 

owing to the Association. Thus, SPH’s slander-of-title claim against Cooper was not rendered 

“without substantial justification” for ALAA purposes simply because Cooper signed the 

allegedly false, malicious statements in a representative capacity, or because the liens were 

subsequently released. No viable ALAA claim can be sustained against SPH for bringing a 

slander-of-title claim against Cooper.

With regard to access to books and records, Cooper weakly protests that she “never 

refused SPH’s demand for access to the books and records.” (Doc. 30, at 29.) Let us review the 

record facts: On November 1, 2011, SPH’s counsel sent a letter to the Association’s counsel, 

with a copy to Cooper individually, demanding access to the Association’s books and records 

and fixing a response deadline of November 3, 2011. (J. Cooper Aff., at Exh. M.) SPH 

explained in the November 1 letter that it was making this demand directly of Cooper because 

she had held herself out as an “agent” of the Association in executing the liens, and the 

applicable Alabama statute imposes personal liability on an entity’s agent who refuses access to 

books and records.37 For aught the record shows, Cooper made no response prior to the 

November 3 deadline. She did not promptly notify SPH that she lacked custody or control of the 

books and records. She did not specify that she was not the Association’s “agent” with respect to 

its books and records. She did not notify SPH that she and/or the Association would make those 

books and records available for inspection in a reasonably prompt manner. Instead, Cooper did 

nothing, which could reasonably have been perceived by SPH as a denial of access. Under the 

circumstances, it cannot fairly be said that SPH’s assertion of a statutory claim against Cooper 

 37 The relevant statutory language reads as follows: “Any agent or governing person 

of an entity who, without reasonable cause, refuses to allow any owner or member ... to inspect 

any books or records of the entity shall be personally liable to the ... member for a penalty in an 

amount not to exceed 10 percent of the fair market value of the ownership interest of the owner 

or member, in addition to any other damages or remedy.” Ala. Code § 10A-1-3.32(d).

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 33 of 36
-34-

for failure to provide access to the Association’s books and records was “without substantial 

justification,” so as to give rise to AALA liability on the part of SPH.38

The bottom line is that, while SPH’s claims against Cooper were ultimately deemed not 

to have merit, they were not so lacking in factual or legal justification as to warrant the 

imposition of liability on SPH under the ALAA (or the imposition of sanctions against SPH 

under Rule 11). SPH’s acts of asserting colorable claims against Cooper and refusing to 

withdraw them on opposing counsel’s ipse dixit were not unreasonable, and do not warrant 

imposition of sanctions or shifting of fees on these legal theories. Summary judgment is 

properly entered in SPH’s favor on Cooper’s counterclaim.

F. The Association’s Claims for the Water Bill and Enforcement of Liens.

Finally, the Court pauses briefly to address two throw-in claims asserted by the 

Association against SPH. As Count Three of its Counterclaims against SPH and its Third-Party 

Claims against Vision, the Association has sued them both for “open account” on the theory that 

“Vision’s and/or SPH’s agent or employee turned on the water at the Project without authority. 

As a result, Vision and/or SPH are indebted to the Association for the unpaid water bill.” (Doc. 

5, ¶ 15.) Briefing reveals that “[t]he Association is not moving for summary judgment on that 

claim.” (Doc. 36, at 12 n.3.) However, SPH is. And SPH has submitted record evidence 

showing that “[a]t no time did an agent or employee of Vision or SPH turn water on at the 

 38 Cooper’s alternative arguments on Count Two fare no better. In that regard, she 

suggests that SPH’s decision to sue her was malicious and mean-spirited because SPH did not 

also sue the Association’s bookkeeper, Paula Irwin. (Doc. 41, at 12.) But the record reveals a 

clear good-faith basis for SPH’s decision to treat Irwin and Cooper differently, to-wit: Immediate 

contact from Irwin’s lawyer explaining that she was in a “fix” because SPH was entitled to see 

the records but she was engaged by the Association, not SPH. (J. Cooper Aff., at Exh. N.) No 

such dilemma existed with respect to Cooper. Moreover, unlike Irwin, Cooper did not contact 

SPH to endeavor to work things out prior to the deadline. Likewise, Cooper’s contention that the 

November 15 letter from the Association’s lawyer to SPH’s lawyer demanding that the claims 

against Cooper be withdrawn somehow favors her ALAA claim is without merit. The November 

15 letter was short on specifics but long on rhetoric, as it proclaimed in conclusory terms that the 

Association felt that “it is clear that there are no grounds to support a claim against Mrs. Cooper 

personally.” (M. Cooper, at Exh. B.) Such posturing did not provide meaningful information to 

SPH (such as, for example, facts that she lacked custody or control over the Association’s books 

and records, that she was not authorized by the Association to furnish or withhold them from 

anyone, etc.) that might have prompted it to conclude that its claims against her were without 

substantial justification.

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 34 of 36
-35-

Rookery III.” (Harmon Decl., ¶ 8.) The Association has made no attempt to rebut this showing. 

Simply put, the record is devoid of evidence from which a reasonable factfinder could conclude 

that SPH/Vision caused the water to be turned on at The Rookery III, much less that SPH/Vision 

bears legal responsibility for that water bill. Accordingly, summary judgment will be entered in 

SPH/Vision’s favor on Count Three of the Counterclaims/Third-Party Claims interposed by the 

Association.

The last loose end is Count Four of the Counterclaims/Third-Party Claims, in which the 

Association seeks enforcement of liens on SPH’s property (described in the pleading as “the 81 

units”) for unpaid assessments pursuant to Alabama Code § 35-8A-316. (Doc. 5, ¶ 27.) The 

Association has previously withdrawn the liens on file with the Baldwin County Probate Court 

pertaining to such property. While § 35-8A-316 provides a statutory mechanism under which a 

lien for unpaid assessments is automatically created, such a lien would exist only for unpaid 

assessments that are due and owing to the Association. The Court having concluded as a matter 

of law that no assessments have accrued as to the 63 Unbuilt Units, the Association is not 

entitled to any lien against SPH’s property for failure to pay such assessments. Nor, by the 

Association’s admission, would it be proper in this action for the Court to enter a lien against the 

16 Other Units for unpaid assessments, because (i) those owners are not parties to this lawsuit, 

(ii) the record shows that all unpaid assessments due and owing for the 16 Other Units were paid

at the closings of said units in early 2012, and (iii) any unpaid assessments arising post-closing 

would not be the legal responsibility of SPH/Vision because it does not own those units. As to 

the 2 Incomplete Units, there is no evidence that these units were sufficiently advanced in their 

construction during the time they were owned by SPH/Vision that they might be classified as

“units” subject to assessments. Even if they were “units,” those 2 Incomplete Units are no longer 

owned by SPH/Vision, and the current owners are not parties herein, such that (once again) it 

would be improper for the Court to enforce liens against those particular units/parcels in the 

context of this action. For all of these reasons, summary judgment will be entered in 

SPH/Vision’s favor as to Count Four of the Counterclaims/Third-Party Claims.

V. Conclusion.

For all of the foregoing reasons, it is ordered as follows:

1. SE Property Holdings, LLC’s Motion for Summary Judgment (doc. 26); Marion 

Cooper’s Motion for Summary Judgment (doc. 29); the Association’s Motion for 

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 35 of 36
-36-

Summary Judgment as to SE Property’s Complaint (doc. 32) are all granted in 

part, and denied in part, and the Association’s Motion for Summary Judgment 

as to its Counterclaims/Third Party Claims (doc. 35) is denied;

2. The Court finds and declares that neither SPH nor Vision presently owes unpaid

assessments to the Association for any units at The Rookery III, and thereby 

grants SPH relief on that portion of its claim for declaratory and injunctive relief 

asserted in Count One of the Complaint;

3. The Court finds and declares that SPH’s request for a declaration that it is 

entitled to access to the Association’s books and records is moot, and thereby 

grants the Association relief under Rule 56 on that portion of SPH’s claim for 

declaratory and injunctive relief asserted in Count One of the Complaint;

4. All other claims, counterclaims and third-party claims asserted by any party 

herein are dismissed with prejudice; and

5. This Order resolving all claims and causes of action joined herein, the Clerk of 

Court is directed to close this file for statistical and administrative purposes.

DONE and ORDERED this 3rd day of January, 2013.

s/ WILLIAM H. STEELE 

CHIEF UNITED STATES DISTRICT JUDGE

Case 1:11-cv-00629-WS-B Document 51 Filed 01/03/13 Page 36 of 36