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My condo association has charged maintenance fees in excess of my percentage interest. Can I sue under NJ Consumer Fraud Act?

Montclair, NJ |

When I purchased my unit in 2007, my Association certified my monthly assessment as $420.14 per month. I later learned that the total Association monthly assessment is $35,674.96. My percentage interest in common expenses is 1.03682 percent, so my monthly payment should be only $369.89. There are no provisions in our master deed or by-laws for any other charges. This information was confirmed by a CPA hired by the Association to perform an audit.

The Association misrepresented a material fact in connection with the sale of real estate being offered to the general public. The CFA does not require proof of intent to mislead, only the capacity to mislead. I relied on the information provided by the Association and have an ascertainable loss inasmuch as I have overpaid each month.

I have approached my Board about the matter, explaining that they must adhere to the Master Deed and that they cannot arbitrarily charge unit owners what they feel is "fair." I have demanded that they correct my monthly assessment, but they have refused. Now I'm planning to sue to get my money back and compel them to adhere to our Master Deed. I'm interested in the CFA because it mandates the reward of treble damages and the recovery of legal fees to a prevailing plaintiff. Since New Jersey follows the American Rule, I'm open to any other routes by which I can recover my legal fees.

Attorney Answers 1


In addition to the master deed and bylaws, it may be helpful to look at the public offering statement as well. Without reviewing the relevant documents, it's difficult for an attorney on this website to determine whether the Consumer Fraud Act applies. Consult an attorney in your area who practices consumer protection law. You can also file a complaint with the Office of Consumer Protection (OCP) at Their response will help you determine whether the Consumer Fraud Act applies in your case.

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To simplify, the HOA makes a representation to both the Seller and the prospective Buyer the amount of the monthly assessment. That amount is described on the "Seller's Property Condition Disclosure Statement" as well as on the HUD-1 form. I'm really asking for additional interpretations of the CFA (I already know my interpretation). The CFA states, "The act, use or employment by any person of any unconscionable commercial practice, deception, fraud, false pretense, false promise, misrepresentation, or the knowing, concealment, suppression, or omission of any material fact with intent that others rely upon such concealment, suppression or omission, *in connection* with the sale or advertisement of any merchandise or real estate, *or with the subsequent performance of such person as aforesaid*..." While the HOA did not sell the property themselves, they did provide information *in connection* with the sale. Moreover, the assessment is relevant to "the subsequent performance of such a person [HOA]," as the HOA collects assessments for the purposes of making repairs to common elements, hiring services, etc. on behalf of the unit owners. The public offering statement is not a legal instrument. Any amounts included in such a statement are immaterial, as the Board is responsible for determining the assessment based upon an operating budget and covenants of Master Deed, which clearly state how my assessment is to be calculated. That notwithstanding, the facts contained within the public offering statement are consistent with the Master Deed, although the original assessments are much lower since it's been 25+ years since the HOA was formed. Finally, with the purchase of my unit came membership in the Association. Pursuant to NJSA 15A:7-2, memberships of a corporation are personal property. As a member of a non-profit corporation (the HOA), I was defrauded with respect to my monthly dues.

Dewitt Clearwell Liu

Dewitt Clearwell Liu


I understand the public offering statement is not a governing document. The master deed, bylaws, and certificate of incorporation are. Nevertheless, for purposes of consumer fraud, I don't believe a document needs to be a "legal instrument" to prove that there was fraud. A misrepresentation on a billboard or subway ad can fall under consumer fraud. However, I understand your point. I'm not a consumer protection attorney so I'm sorry I can't give you an answer with respect to the Consumer Protection Act. Given that no other attorneys have responded to this question in the last 5 days, my guess is that it's not an easy one to answer. I would have to reiterate that you seek out the assistance of an attorney who is familiar with New Jersey consumer protection laws.



Unfortunately, Avvo did not give me the option of selecting "Consumer Fraud" as a category when I asked the question—probably because it uses a keyword algorithm to make only certain categories available. I'll re-ask the question in a different manner to try to draw attention from consumer fraud experts. Thanks for for reply.

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