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515A.3-104 TRANSFER OF SPECIAL DECLARANT RIGHTS.
(a) No special declarant rights (section 515A.1-103(18)) created or reserved under sections
515A.1-101 to 515A.4-117 may be transferred except by an instrument evidencing the transfer
recorded in every county where any portion of the condominium is located. The instrument shall
be recordable and is not effective unless executed by the transferor and transferee. If additional
real estate is transferred by the declarant, the transferee shall be deemed to receive all special
declarant rights with respect thereto and shall be subject to any obligations imposed by the
declaration respecting the additional real estate so transferred.
(b) Upon transfer of any special declarant right, the liability of a transferor declarant is
as follows:
(1) a transferor is not relieved of any obligation or liability which arose before the transfer,
and remains liable for warranty obligations imposed by sections 515A.1-101 to 515A.4-117.
Lack of privity does not deprive any unit owner of standing to bring an action to enforce any
obligation of the transferor;
(2) if a transferor retains any special declarant right, or if a successor to any special declarant
right is an affiliate of a declarant (section 515A.1-103(2)), the transferor is subject to liability for
all obligations and liabilities imposed on a declarant by sections 515A.1-101 to 515A.4-117 or by
the declaration arising after the transfer and is jointly and severally liable with the successor for
the liabilities and obligations of the successor which relate to the condominium; and
(3) a transferor who retains no special declarant right has no liability for any act or omission
or any breach of a contractual or warranty obligation arising from the exercise of a special
declarant right by a successor declarant who is not an affiliate of the transferor.
(c) In case of foreclosure of a mortgage or cancellation of a contract for deed or sale under
the bankruptcy act or receivership proceeding or the foreclosure of any other lien against any
unit owned by a declarant in the condominium, a person first acquiring title to all the units
being canceled, foreclosed or sold, succeeds to all then existing special declarant rights except
the special declarant rights with respect to additional real estate, unless the mortgage or other
instrument or proceeding also covers additional real estate.
(d) The liabilities and obligations of persons who succeed to special declarant rights are
as follows:
(1) A successor to any special declarant right who is an affiliate of a declarant is subject to all
the obligations and liabilities imposed on any declarant by sections 515A.1-101 to 515A.4-117
or by the declaration.
(2) A successor to any special declarant right, other than a successor described in paragraph
(3) or (4), who is not an affiliate of a declarant, is subject to all obligations and liabilities imposed
on a declarant by sections 515A.1-101 to 515A.4-117 or the declaration, except that the successor
is not subject to liability for misrepresentations or warranty obligations on improvements made
by any previous declarant, or made before the condominium was created, or for a breach of
fiduciary obligation by any previous declarant.
(3) A successor to only a right reserved in the declaration to maintain models, sales offices,
and signs (section 515A.2-117), if the successor is not an affiliate of a declarant, may not exercise
any other special declarant right, and is not subject to any liability or obligation as a declarant,
except the obligation to provide a disclosure statement and any liability arising as a result thereof.
(4) A successor to all special declarant rights, who is not an affiliate of a declarant and who
succeeded to those rights pursuant to a deed in lieu of foreclosure or by reason of subsection
(c), may declare an intention in a recorded instrument to hold those rights solely for transfer to
another person. Thereafter, until transferring all special declarant rights to any person acquiring
title to any unit owned by the successor, or until recording an instrument permitting exercise of all
those rights, that successor may not exercise any of those rights other than the right to control
the board of directors in accordance with the provisions of section 515A.3-103 for the duration
of any period of declarant control, and any attempted exercise of those rights is void. So long
as any successor declarant may not exercise special declarant rights under this subsection, the
successor declarant is not subject to any liability or obligation as a declarant other than liability
for acts and omissions under section 515A.3-103.
(e) Nothing in this section subjects any successor to a special declarant right to any claims
against or other obligations of a transferor declarant, other than claims and obligations arising
under sections 515A.1-101 to 515A.4-117 or the declaration.
History: 1980 c 582 art 3 s 515.3-104; 1986 c 444

Official Publication of the State of Minnesota
Revisor of Statutes