Maryland Court of Appeals Rules That The Consumer Protection Act Applies to Condominium Resale Certificates And Imposes Potential Liablitly On A Condominium Council And Its Managing Agent
In a unanimous opinion filed on April 30, 2012, the Maryland Court of Appeals has established that provisions the Maryland Consumer Protection Act apply to the information contained in a condominium resale certificate, and a council of unit owners and property manager can be liable for unfair and deceptive trade practices if the information has a tendency to mislead the purchaser, even though they are not party to the sales contract, and even if they have otherwise complied with the condominium resale disclosure requirements contained in Section 11-135 of the Maryland Condominium Act. I have previously written about an earlier decision of the Court of Appeals in the case of MRA Property Management, Inc., et al. v. Armstrong, No. 93, Sept. Term 2007, filed on October 25, 2011. A majority of the Court held that the Maryland Consumer Protection Act applies to purchases of condominium units with respect to the information required to be provided by a council of unit owners in the resale certificate. The Court ruled that, where a council of unit owners and its property management company violate the resale certificate disclosure obligations imposed by Md. Real. Prop. Code Ann. Sec. 11-135, “they engage in unfair and deceptive trade practices ‘in the sale of consumer realty.’” The Court specifically held that such a violation of the Consumer Protection Act can occur even though the defendants were not parties to the sale of the unit, were not “merchants.” 
Subsequently, however, in response to motions for reconsideration filed on behalf of both sides in the appeal, the Court withdrew and agreed to reconsider its opinion. Following re-argument, the Court has now issued its final opinion, holding that the statutory duties to provide the disclosure information required under Section 11-135 of the Condominium Act, “sufficiently implicated [the council and the property manager] in the entire transaction so as to impose liability under the Consumer Protection Act.” (more…)
