Court Opinion

ID: 4210442
Source: CourtListenerOpinion
Date Created: 2017-10-10 19:06:41.136151+00
Date Added: 2024-06-11T09:23:12.541726
License: Public Domain

IN THE SUPREME COURT OF THE STATE OF DELAWARE

BETHANY MARINA                         §
TOWNHOUSES PHASE II                    §
CONDOMINIUMS, INC.,                    §
                                       §   No. 2, 2017
      Petitioner Below,                §
      Appellant,                       §   Court Below: Superior Court
                                       §   of the State of Delaware
      v.                               §
                                       §   C.A. No. S15-C-01-019
BMIG, LLC,                             §
                                       §
      Respondent Below,                §
      Appellee.                        §

                          Submitted: September 20, 2017
                          Decided:   October 10, 2017

Before VALIHURA, VAUGHN, and SEITZ, Justices.

                                       ORDER

      This 10th day of October, 2017, having considered the briefs and the record

below, it appears to the Court that:

      (1)    Bethany Marina Townhouses Phase II Condominiums, Inc. (“Condo

Association”), a condominium owners association located in Ocean View,

Delaware, and BMIG, LLC, a successor in interest to the original condominium

developer, have each appealed a Superior Court’s decision addressing disputes

between the parties over development rights and assessments in the condominium

complex. In this order, we affirm the Superior Court’s judgment that (a) the land
designated for the eleven undeveloped units was expressly excluded from the

condominium Declaration, and thus BMIG may develop the land into eleven

condominium units as contemplated by the Declaration Plan; (b) the easement

granting the developer the right to build the additional eleven units remains in force;

and (c) BMIG must pay all future assessments for boat slips it owns, as well as costs,

including interest, associated with collection. We reverse, however, the Superior

Court’s ruling that BMIG owns the land dedicated to five condominium features—

the pumping station, pump house, pool, pool house, and stormwater management

ponds.

      (2)    Bethany Marina, Inc. is the original developer of the condominium

complex. It recorded a declaration on February 14, 1996, establishing a plan to

develop seventy-seven units on 10.57 acres as a condominium complex in Sussex

County, Delaware (“Declaration”). The Condo Association was the incorporated

condominium association for the complex. After encountering financial troubles

while building the project, in February 2005, Bethany Marina, Inc. sold its interest

as developer to Spicer/Hill through a liquidating trust. Spicer/Hill purchased the

interest with loans from K Bank. Spicer/Hill also ran into financial troubles, and in

2008, K Bank foreclosed the mortgage and sold all interests as developer to BMIG,

LLC, the current developer (“BMIG” or “Developer”).

                                          2
       (3)     The Declaration established an “expandable” condominium complex

with the intent to develop the property in two phases.1 Phase One included the land

described in Schedule A attached to the Declaration encompassing “all

improvements and recreational amenities thereon, together with the one (1) building

composed of six (6) units”2 described in Schedule B. Phase Two included “the

remaining fourteen (14) additional buildings to be built in the future on the land

described and excepted from submission under the Unit Property Act as identified

and designated by unit number in Schedule A, composed of seventy-seven (77)

units.”3 The Declaration did not define the specific metes and bounds of the

undeveloped parcels but did identify their locations in the Declaration Plans.4

       (4)     At the time the developer filed the Declaration, the condominium

“consist[ed] of six (6) units located in one building.”5 The land required to build the

additional fourteen buildings and seventy-seven units of Phase Two was expressly

excluded from the Declaration.6 The developer contemplated that as the seventy-

1
  App. to Opening Br. at 17 (Declaration ¶ 3) (“This condominium . . . shall be an expandable
condominium as hereinafter provided for.”); Town of Windham v. Lawrence Sav. Bank, 776 A.2d
730, 732 (N.H. 2001) (“By declaring an expandable condominium, a developer may submit land
to the condominium while reserving the right to expand the condominium by later adding more
land.”).
2
  App. to Opening Br. at 17 (Declaration ¶ 2(v)).
3
  Id. (Declaration ¶ 2(w)).
4
  Id. at 77–109.
5
  Id. at 20 (Declaration ¶ 6(a)).
6
  Id. at 32 (Schedule A) (excepting from the Declaration “the parcels of land required to build the
proposed additional buildings consisting of seventy-seven (77) additional units”); see Ryan James
Realty, LLC v. Villages at Chester Condo. Ass’n, 893 A.2d 661, 664 (N.H. 2006) (“If the

                                                3
seven units were built and sold, it would annex the land to the condominium to

include the new units by filing amendments to the Declaration. The developer’s

right to annex land for the unbuilt units under the Declaration appears under the

heading “Expansion”:

       (a) Right to Expand. The Developer and any successors in title
       thereto shall have the absolute right, without consent of the Council or
       any Unit Owner or the holder of any lien on any Unit, at any time and
       from time to time, to be exercised prior to the 29th day of August, 2005,
       to annex to the land and the improvements constituting the property of
       BETHANY MARINA TOWNHOUSES PHASE II CONDOMINIUM,
       as the same are described and identified by legal description on
       Schedule A . . . . [A]nd thereby to submit to each and everyone [sic] of
       the provisions of this Declaration and the Unit Property Act, any land
       owned by the Developer which is currently excepted out and from
       submission under the Unit Property Act, and which land underlies the
       remaining units to be built as excepted on said Schedule “A.”7

The deadline to annex land to the condominium complex without unitholder consent

was later extended to August 29, 2010.8 After the expiration date, the Declaration

and the Unit Property Act require the developer to obtain the consent of all

unitholders before further annexing any land.9

condominium is an ‘expandable condominium,’ the declaration must contain an explicit
reservation of the option to add land to the condominium, a legal description of the ‘additional
land,’ which is the land that may be added to the condominium, and numerous other provisions.”).
7
  App. to Opening Br. at 18 (Declaration ¶ 5(a)).
8
  Id. at 71. The Seventh Amendment was “erroneously titled as [the] Sixth Amendment.” Id. at
73.
9
  Id. at 27–28 (Declaration ¶ 20); 25 Del C. § 2229. The parties have assumed, as has the Court,
that the Unit Property Act, 25 Del. C. § 2201 et seq., and not the Delaware Uniform Common
Interest Ownership Act, 25 Del. C. § 81-101 et seq., applies to their disputes under the Declaration.

                                                 4
       (5)    The Declaration also included an easement to build the undeveloped

parcels, which was “perpetual during the continued existence” of the

condominium.10 The Developer reserved:

       an easement to construct fourteen (14) buildings and the remaining
       portion of the first building as delineated on the said Declaration Plan,
       and all of the necessary parking lots, walks, and other appurtenances
       requisite to service some or all of said fourteen (14) buildings and the
       remaining portion of the first building and to provide for the necessary
       ingress and egress to said building.11

       (6)    Over time the developer executed a series of eight amendments to the

Declaration. The original Declaration and seven of the amendments submitted the

land and improvements associated with completed units to the condominium

Declaration.12 As the amendments were recorded, they continued to except out of

the Declaration the “parcels of land required to build the proposed additional

buildings.”13 Further, in the Declaration and all amendments submitting land, the

developer excepted out the “pumping station” and “pump house.”14 The third and

subsequent amendments submitting land also excepted out the “pool,” “pool house,”

10
   Id. at 35–36.
11
   Id. at 36 (“Grant of Easement”).
12
   The seventh amendment extended the expiration date for the Developer’s right to unilaterally
annex units and amend the Declaration. Id. at 71–72. All other amendments submitted land and
improvements associated with developed units. Id. at 42–70, 73–76.
13
   Id. at 32, 42, 46, 51, 56, 62, 68.
14
   Id.

                                              5
and “storm water management pond[s].”15 After the eighth and final amendment,

there were three undeveloped buildings not subject to the Declaration, with the units

identified as numbers 51 through 53, 60 through 64, and 112 through 114.

       (7)     In June of 2014, BMIG began to develop one of the remaining parcels.

The Condo Association objected, informing BMIG that the right to add land to the

condominium expired on August 29, 2010, and that the Declaration prohibited

further development without the existing unitholders’ approval.

       (8)     As to the boat slip assessments, when BMIG purchased the interest as

developer of the condominium project, it also purchased eleven boat slips, identified

as I, M, S, 158 through 164, and 172.16 On October 25, 2011, the Condo Association

filed a complaint against BMIG seeking payment for past assessments associated

with ownership of the boat slips, totaling $25,250. The parties settled on December

21, 2011. BMIG paid $21,760 and, according to the language of the settlement

agreement, “confirm[ed] and agree[d] that it is obligated to pay, and shall pay, any

and all future monthly assessments for the boat slips due and owing under the

15
   Id. at 51, 56, 62, 68. The amendments use “pond” in the singular, while BMIG argues it is
entitled to “ponds” plural. Answering Br. at 31. There are three ponds in the Declaration. Because
our conclusion is the same regardless, we assume the ownership of all three ponds is at issue.
16
   Id. at 173–74.

                                                6
Declaration and Code of Regulations.”17 BMIG failed to pay any assessments after

the settlement. As of December 31, 2015, the assessments due totaled $35,370.41.18

      (9)    On November 27, 2014, the Condo Association filed a petition in the

Court of Chancery requesting (1) specific performance of payment for future

condominium assessments and (2) payment of condominium assessments due and

owing under the Declaration. BMIG filed a motion to dismiss for lack of subject

matter jurisdiction, alleging the claim sought a legal remedy for breach of contract

and not specific performance.19 The Condo Association stipulated to transfer the

proceedings to the Superior Court. BMIG filed its answer and counterclaim, seeking

declaratory relief for rights to develop the undeveloped parcels, ownership of five

condominium features, and the validity of the easement. Both parties filed for

summary judgment based on a stipulated record.

      (10) The Superior Court held BMIG could develop the eleven remaining

parcels free of the Declaration’s restrictions because the land associated with the

unbuilt units was expressly excepted from the Declaration and subsequent

amendments. According to the court, the August 29, 2010 deadline to submit land

to the condominium had no effect on BMIG’s development rights, and thus the

unitholders’ consent was not required to build the units. The Superior Court also

17
   App. to Answering Br. pt. 2 at 283, ¶¶ 2(D), 5.
18
   Bethany Marina Townhouses Phase II Condos., Inc. v. BMIG, LLC, 2016 WL 4016759, at *2
(Del. Super. Ct. July 27, 2016).
19
   App. to Appellant’s Reply Br. at 22.
                                           7
held BMIG could enforce the easement to build on the undeveloped parcels because

the easement continued in force as long as the condominium development existed.

In addition, the Superior Court held BMIG owned the pumping station, pump house,

pool, pool house, and stormwater management ponds because they were excepted

from the Declaration as amended. Lastly, the court required BMIG to pay the

assessments, legal costs, late fees, and rebilling fees because BMIG agreed to pay

all future assessments in the Settlement Agreement and thus “ha[d] no defense” to

the Condo Association’s claim.20 Both parties appealed. This Court reviews the

Superior Court’s order granting summary judgment de novo.21

       (11) The Declaration controls the relationship between the Condo

Association and BMIG, as Developer.22 “As with any other contract, the intent of

the parties to a condominium declaration or code of regulations must be ascertained

from the language of the contract. Where that language is clear and unambiguous,

this court will accord that language its ordinary meaning.”23 Our responsibility,

therefore, is to interpret the plain language of the Declaration as it pertains to the

land, easement, and features.

20
   Bethany Marina Townhouses Phase II Condos., Inc., 2016 WL 4016759, at *2.
21
   Lank v. Moyed, 909 A.2d 106, 108 (Del. 2006).
22
   Council of Dorset Condo. Apartments v. Gordon, 801 A.2d 1, 5 (Del. 2002) (“A condominium
declaration and its accompanying code of regulations together form no more than an ordinary
contract between the unit owners (and, initially, the developer), created under the statutory
framework of the Unit Properties Act.”).
23
   Id.

                                             8
       (12) The Condo Association argues the Superior Court erred in finding

BMIG had the right to develop the remaining land. The Condo Association points

to paragraph 5(a)’s fixed deadline to annex land and improvements to the

condominium without the consent of the condominium council or the unitholders.24

According to the Condo Association, once the deadline expired, BMIG lost the rights

to develop the excluded land. The Condo Association also argues that Schedule A

of the Declaration limited the excepted property to the land “required to build” the

remaining unbuilt condominium units.25 Because the deadline passed to annex land

to the condominium without further unitholder consent, the argument goes, there

were no longer any units to add and thus no land “required” to build them. Thus,

the Condo Association contends, BMIG’s right to develop the parcels “for any

purpose” expired.26

       (13) BMIG concedes the deadline expired to expand the condominium

without consent, but argues it does not affect BMIG’s right to build out the remaining

undeveloped parcels in the condominium. We agree. Under paragraph 5(a) of the

Declaration, the Developer can

       annex to the land . . . [and] submit to each and every one of the
       provisions of this Declaration and the Unit Property Act, any land
       owned by the Developer and which is currently excepted out and from

24
   App. to Opening Br. at 18 (Declaration ¶ 5(a)).
25
   Id. at 32 (Schedule A).
26
   Opening Br. at 12.

                                                9
       submission under the Unit Property Act, and which land underlies the
       remaining units to be built . . . .27

Once the deadline expired, unitholder consent was required to add the undeveloped

units to the condominium complex. But, BMIG does not seek to add the land and

unbuilt units to the condominium regime. Instead, BMIG intends to develop the

land and unbuilt units independent of the condominium established by the

Declaration. Thus, the deadline has no effect on BMIG’s development rights.28

       (14)      The Condo Association also argues that, under the Declaration, the

unitholders were “assured there would be no further development” after the

expiration date when they purchased their units.29                      A plain reading of the

Declaration, however, shows the unitholders were only assured that after August 29,

27
   App. to Opening Br. at 18 (Declaration ¶ 5(a)).
28
   See N & P Partners, LLC v. Council of Unit Owners of Bayberry Woods Condominium, 2006
WL 456781, at *2 (Del. Ch. Feb. 22, 2006) (finding where partners had not submitted the land to
the condominium regime, they continued as the sole owners of the two parcels). Commentators
are in agreement with this interpretation. One treatise explains, “[t]he developer who has not been
contractually obligated to construct the later phases and add them to the condominium may decline
to do so and use the land for other purposes . . . .” Richard Linquanti, Specific Types of
Condominiums, Fl. Condo. & Cmty. Ass’n L. § 5.24 (Fl. Bar, 3d ed. 2016). Another commentator
notes that “rarely will the condominium owners want the developer to build new units that are not
a part of the original condominium (and thus beyond the board’s ability to enforce compliance
with condominium’s restrictions).” Kuehnle, et al., Oh. Condo. L. § 11:5 Timing Limitations
(2016); Kuehnle, et al., Baldwin’s Oh. Prac. Real Est. § 30:29 Timing Limitations (Mar. 2017).
The solution taken by condominium associations, he notes, is either to extend the Developer’s
deadline to annex units or to decide “that it is in the best interest of the association to purchase the
property.” Kuehnle, et al., Oh. Condo. L. § 11:5 Timing Limitations (2016). After the right to
unilaterally annex land expires, the property “can only be purchased by and conveyed to the
association”—it cannot be conveyed unilaterally. Id. § 23.1 Authority to Purchase and Sell Real
Estate.
29
   Opening Br. at 19.

                                                  10
2010, no further units would be annexed to the condominium without their consent.30

Thus, we affirm the Superior Court’s decision that BMIG may develop the parcels

to construct additional units.31

       (15) As to the easement, the Condo Association argues the Superior Court

erred in holding BMIG can use the easement to construct the units. The Declaration

granted the developer an easement “to construct fourteen (14) buildings . . . and to

provide for the necessary ingress and egress to the said building[s].”32 The Superior

Court noted that “[t]he easement itself has no time limitation for construction.”33

And the Declaration states the easement is “perpetual during the continued

existence” of the condominium—which still exists.34                   The Condo Association

30
   One treatise explains that when future phases are voluntary on the part of the Developer, the
Declaration must put unitholders on notice that the development is not guaranteed. LINQUANTI, at
§ 5.50. The Declaration consistently describes the undeveloped parcels as “proposed” additional
units, which put the existing and future unitholders on notice of their possible but not guaranteed
development status.
31
   We note that BMIG is not free to develop the parcels however it sees fit. In the Declaration, the
developer reserved the land for the sole purpose of developing additional units in accordance with
the condominium regime. Thus, further development of the unbuilt parcels is limited to the
construction of units contemplated by the Declaration plan, including its architectural guidelines.
Whether these units are annexed to the condominium is at the discretion of the Condo Association.
In addition, the Condo Association argues the Declaration does not specify the precise locations
of the parcels, and thus “it is unclear how such lands could ever be identified.” Id. at 23 n.3. But
as the Superior Court noted, the Declaration Plans contain sufficient detail to determine the
parcels’ locations. Bethany Marina Townhouses Phase II Condo., Inc., 2016 WL 4016759, at *1.
Property is insufficiently described when there is no “information from which one can determine
a description of the property.” Caswell Cove Condo. Ass’n, Inc. v. Milford Partners, Inc., 753
A.2d 361, 364–65. (Conn. App. 2000). Here, the Declaration Plans provide sufficient information
to determine the parcels’ locations.
32
   App. to Opening Br. at 35.
33
   Bethany Marina Townhouses Phase II Condominium, Inc., 2016 WL 4016759, at *2.
34
   App. to Opening Br. at 36.

                                                11
concedes that the easement was “strictly tied to future development of the

condominium,” but argues that it expired when BMIG’s right to develop the property

expired. BMIG’s right to develop the property did not expire, and thus neither did

the easement required to complete the development.35 We affirm the Superior

Court’s decision that the easement remains in effect.36

       (16) Turning to the features in the condominium complex, the pump house

and pumping station were excepted from the condominium in the Declaration and

all subsequent amendments. But the original Declaration Plan, dated January 23,

1996, states the pumping station is “to be conveyed to Sussex County.”37 And the

First Amended Declaration Plan, dated February 21, 1996, and all subsequent plans

confirm that it was “conveyed to Sussex County.”38                     The Second Amended

35
   Cf. Harbour Pointe, LLC v. Harbour Landing Condo. Ass’n, Inc., 2009 WL 455731, at *8 (Conn.
Super. Ct. Jan. 23, 2009), aff’d, 14 A.3d 284 (Conn. 2011) (holding that if the reserved property
was “not added to the Association they would be benefited by an easement across Association
property”); Caswell Cove Condominium Ass’n, Inc., 753 A.2d at 365 (holding that the Developer
did not have the right to the undeveloped property and thus did not have the right to the associated
easement).
36
   Because the perpetual easement also provided the “necessary ingress and egress to said
building,” the easement will remain after development as necessary to access the units. App. to
Opening Br. at 36. We note that “it is the duty of the owner of the easement . . . to maintain and
repair the easement.” Porter v. Delmarva Power & Light Co., 1990 WL 47352, at *4 (Del. Super.
Ct. Apr. 6, 1990). Thus, “those entitled to use land subject to an easement jointly have obligations
for maintenance proportional to their use.” Sandie, LLC v. Plantations Owners Ass’n, Inc., 2012
WL 3041181, at *9 (Del. Ch. July 25, 2012).
37
   App to Opening Br. at 77–78.
38
   Id. at 91–92. In addition, shading indicates property excepted. The pumping station is not
shaded in any of the Declaration Plans.

                                                12
Declaration Plan and all subsequent plans state the pump house is “to be removed.”39

Thus, if the notes on the Declaration Plans are accurate, the Developer does not own

the land associated with these features and cannot reclaim them by later amendment.

But if the notes on the Declaration Plans are not accurate, then they belong to BMIG

because they were excepted from the condominium in the Declaration and all

relevant amendments.

       (17) As for the pool, pool house, and stormwater management ponds, the

Declaration Plans establish their locations on condominium property prior to being

excepted.40 In Council of Unit Owners of Pilot Point Condominium v. Realty Growth

Investors,41 the Court of Chancery explained that buildings constructed on already

submitted land belonged to the condominium and thus were subject to its declaration

and the Unit Property Act.42 Similarly, the pool, pool house, and stormwater

39
   Id. at 93–94. The original and First Amended Declaration plans do not state the pump house is
to be removed. Id. at 77–78, 91–92. In addition, the pump house is not shaded in the original and
First Amended Declaration Plans, but it is shaded in all subsequent plans.
40
    The Second Amended Declaration Plan established the location of the first stormwater
management pond on May 4, 1998, and the Third Amended Declaration Plan established the
location of the other two on July 7, 1998. Id. at 51, 93–96. The Fourth Amended Declaration Plan
established the location of the pool and pool house on February 4, 2000. Id. at 100. All three
features were established on condominium property, and these plans were executed before the
third amendment was executed on February 24, 2000, which was the first document to state these
features were excepted. Id. at 51.
41
   436 A.2d 1268, 1279 (Del. Ch. 1981), aff’d, 453 A.2d 450 (Del. 1982).
42
   Id. (“In this situation, the entire 17.35 acre tract was submitted to the provisions of the Act.
When the 28 Phase I town houses were subsequently constructed on a portion of the tract, they of
necessity had to become unit property subject to the provisions of the Act. The only thing that is
lacking is that the declaration has not been properly amended for record so as to reflect the
proportionate undivided interest of those 28 units in the common elements.”).

                                               13
management ponds were constructed on submitted condominium land before the

third amendment attempted to except them out. Consequently, the unitholders had

a percentage interest in the features that could not be revoked without their consent.43

Thus, we reverse the Superior Court’s ruling that these features were on land validly

excepted from the Declaration.

       (18) Turning to the Superior Court’s decision granting the Condo

Association’s Motion for Summary Judgment, BMIG argues first that the Superior

Court erred in asserting jurisdiction because the transfer of the case from the Court

of Chancery to the Superior Court did not “automatically transform” the specific

performance claim into a breach of contract claim.44 According to BMIG, the Condo

Association did not amend its pleadings to specifically assert a breach of contract

claim instead of a claim for specific performance, and therefore the Superior Court

did not have jurisdiction.45          This Court, however, determines subject matter

jurisdiction by examining “the allegations in the complaint viewed in the light of

what the plaintiff actually seeks and not necessarily what is pleaded.”46 Here, the

43
   25 Del C. § 2229; App. to Opening Br. at 27–28 (Declaration ¶ 20).
44
   Appellee’s Opening Br. at 39; see Chavin v. H. H. Rosin & Co., 246 A.2d 921, 922 (Del. 1968)
(“The right to compel the specific performance of a contract is a purely equitable remedy, and is
given in substitution of the legal remedy of compensation when it is inadequate.”).
45
   Anguilla Re, LLC v. Lubert-Adler Real Estate Fund IV, L.P., 2012 WL 1408857, at *5 (Del.
Super. Ct. Mar. 28, 2012) (“[T]his Court does not have subject matter jurisdiction to order specific
performance.”).
46
   Chateau Apartments Co. v. City of Wilmington, 391 A.2d 205, 207 (Del. 1978).

                                                14
Condo Association seeks a legal remedy for breach of contract. In addition, BMIG

acknowledged this when it moved to dismiss the case from the Court of Chancery

because “the alleged wrong [was] a past breach of contract and anticipated breach

of contract.”47 Thus, the Superior Court properly asserted jurisdiction over the legal

claims.

       (19) Second, BMIG argues the Settlement Agreement “does not create a

contractual obligation for BMIG to pay all future assessments,” but only those “due

and owing under the recorded condominium documents.”48 Because the Code of

Regulations exempts the Developer from paying assessments,49 argues BMIG, no

assessments are “due and owing.”

       (20) “When interpreting a contract, the Court will give priority to the

parties’ intentions as reflected in the four corners of the agreement.”50 The court

must construe the agreement as a whole, “giving effect to all provisions therein.”51

“The meaning inferred from a particular provision cannot control the meaning of the

entire agreement if such an inference conflicts with the agreement’s overall scheme

47
   App. to Appellant’s Reply Br. at 22.
48
   Answering Br. at 41 (emphasis added); App. to Answering Br. pt. 2 at 283, ¶¶ 2(D), 5.
49
   App. to Answering Br. pt. 1 at 124, § 2.
50
   GMG Capital Invs., LLC v. Athenian Venture Partners I, L.P., 36 A.3d 776, 779 (Del. 2012).
51
   Id.

                                              15
or plan.”52 When reading the settlement agreement as a whole, the overall scheme

reflects the parties’ understanding that BMIG would pay all future assessments.

       (21) Paragraph 2(D) states that BMIG “agrees to pay all future assessments

in a timely manner.”53 Paragraph 4 allows BMIG to lease its boat slips “as long as

it is current in payment of the boat slip assessments.”54 Paragraph 5 states that

BMIG’s “obligation to pay any and all boat assessments” is independent of other

disputes; and that “in no event may [BMIG] withhold payment of the assessments.”55

The reasonable interpretation of these clauses, when taken in combination, is that

BMIG agreed to pay all future assessments regardless of the circumstances.

       (22) Third, BMIG argues that if it is obligated to pay the assessments, the

obligation arises from the Settlement Agreement alone because BMIG is exempt

from paying assessments under the Code of Regulations. According to BMIG,

because the Settlement Agreement does not provide for the payment of interest or

fees, BMIG does not have to pay those costs. When BMIG agreed to pay all future

expenses, however, it submitted itself to the penalties for nonpayment under the

governing documents. Under the Code of Regulations, when the condominium

obtains a judgment for the nonpayment of assessments, “such judgment shall include

52
   Id.
53
   App. to Answering Br. pt. 2 at 283, ¶ 2(D).
54
   Id. at 283, ¶ 4.
55
   Id. at 284, ¶ 5.

                                                 16
interest at the maximum amount . . . , reasonable attorneys’ fees to obtain and enforce

such judgment, and costs as fixed by the Court.”56 Thus, we affirm the Superior

Court’s decision requiring BMIG to pay the boat slip assessments and associated

costs.57

       NOW, THEREFORE, IT IS ORDERED that the judgment of the Superior

Court is AFFIRMED in part and REVERSED in part.

                                                    BY THE COURT:

                                                    /s/ Collins J. Seitz, Jr.
                                                           Justice

56
  App. to Answering Br. pt. 1 at 125, § 5.
57
  BMIG also argued it is not liable for boat slips I, M, and S, because they do not belong to the
condominium association. But slips I, M, and S were included in the Settlement Agreement, and
therefore BMIG must pay for them.
                                               17