In a decision that has renewed the faith of condominium law practition-ers in our state’s judicial system, the New Jersey Appellate Division recently issued a strongly worded opinion in Port Liberte II Condo. Ass’n v. New Liberty Residential Urban Renewal Co., 2014 N.J. Super. LEXIS 19 (App. Div. Jan. 21, 2014) (approved for publication on Jan. 31, 2014). That decision has prevented a grave injustice and disallowed defendants in a multi-million dollar construction defect lawsuit to use the plaintiff-association’s bylaws as a weapon to defeat liability.
In what has been exclaimed as a “big win” for condominium associations and unit owners, the Appellate Division has determined that a condominium board’s decision to file suit against those responsible for construction defects cannot be assailed by third parties based on a prelitigation voting requirement in the association’s bylaws. Designed to protect the financial interests of the unit owners, the bylaws cannot be used by defendant developers and contractors to suppress those very same interests. Non-homeowners, therefore, do not have standing to challenge unauthorized or procedurally defunct decisions of the board of trustees.
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