Opinion ID: 1395295
Heading Depth: 2
Heading Rank: 3

Heading: Unencumbered Transfer of Common Areas

Text: HKI also assigns error to the trial court's determination that the common facilities are to be conveyed free of liens and encumbrances. [11] In its brief, HKI supports this proposition by a single statement that it has no contractual obligation to do so. We disagree. The HUD Reports unequivocally stated that [a]ll recreational facilities will be transferred to the Owner's Association, free and clear of encumbrances  (emphasis added). This representation is a contractual obligation of HKI. However, a similar representation is not made with regard to other components of the common facilities such as the water system, the roads, or watershed areas. Therefore, we conclude that HKI is contractually obligated to transfer the recreational facilities without liens and encumbrances, but this obligation does not extend to the other common facilities.