Anderson v. Council of Unit Owners of Gables on Tuckerman Condominium

BATTAGLIA, J. In the present case, we are presented with the question of whether a condominium council of owners under the Maryland Condominium Act, Section 11-101, et seq., of the Real Property Article, Maryland Code (1974, 2003 Repl.Vol.) (“the Act”), is required to repair or replace property of an owner in an individual condominium unit after a casualty loss. We shall answer in the negative. I. Introduction This appeal consists of two separate underlying cases that were consolidated by the Court of Special Appeals, which we have followed. Although the facts of the underlying cases are different, they present the same legal issue.

Dianne Anderson, Individually, et al. v. Council of Unit Owners of The Gables on Tuckerman Condominium, No. 271904, Circuit Court for Montgomery County The Gables on Tuckerman Condominium, located at 5800 Tuckerman Lane in Rockville, Maryland, was established by declaration, bylaws and plats recorded among the land records of Montgomery County in August of 1987. The Council of Owners of The Gables on Tuckerman (“Council of Gables”) is ⁵⁶⁴ the unincorporated association of all owners that was established by its Bylaws. 1 ⁵⁶⁵ Dianne Anderson owned a two-level town home in The Gables. 2 At all times relevant, the Council of Gables carried a master condominium insurance policy on the property with a deductible of $10,000 per occurrence; Ms. Anderson was insured by a condominium owners “Condocover” policy issued by Erie Insurance Exchange (“Erie”). 3 In July of 2004, the water heater on the upper level of Ms. Anderson’s home began leaking and water flowed through the ceiling into the kitchen, “causing severe water damage to the carpet and walls of the unit,” amounting to $6,358.23. No other condominium town home was affected, nor was any other part of the structure damaged. Ms. Anderson requested that the Council of Gables repair or provide proceeds to repair the damage.

The Council of Gables declined, and subsequently, after Ms. Anderson paid the $250.00 deductible, Erie paid for the repairs. ⁵⁶⁶ Dianne Anderson, individually, and Erie filed a two count complaint in the Circuit Court for Montgomery County, seeking to recover $6,358.23, the amount expended to repair her home. In Count I, they alleged that the Council of Gables breached its duty under Section 11-114 of the Maryland Condominium Act 4 to purchase property insurance on all common elements and units, and in case there was a deductible, apportion that deductible as a common expense, when the Council of Gables refused Ms. Anderson’s request to pay for the remediation, repair or replacement of the damaged portion of her home. Count II alleged that the Council of Gables breached its fiduciary duty by refusing to repair the damage. Ms. Anderson and Erie later amended their complaint by adding that the Council of Gables “negligently” breached its duty under the Condominium Act in Count I and also filed a Motion for Partial Summary Judgment, to which the Council of Gables responded.

The Circuit Court treated the Council of Gables’ response as a Cross-Motion for Summary Judgment. The court conducted a hearing on January 22, 2007, and thereafter, Judge William J. Rowan, III granted the Council of Gables’ motion, denied Ms. Anderson’s and Erie’s motion, and entered judgment in favor of the Council of Gables. Ms. Anderson and Erie appealed to the Court of Special Appeals on January 26, 2007. ⁵⁶⁷ Erie Insurance Exchange, et al. v. The Council of Unit Owners of Bridgeport Condominium, No. 03724, Circuit Court for Prince George’s County The Bridgeport Condominium, located at 809 9 Cherry Lane in Laurel, Maryland, was established by declaration, bylaws and plats recorded among the land records of Price George’s County in January of 1988. The Council of Owners of Bridgeport Condominium (“Council of Bridgeport”) 5 is the unincorporated association of all owners that was established by the Bylaws that govern The Bridgeport Condominium. 6 ⁵⁶⁸ Charles and Cindy O’Carroll (“the O’Carrolls”) owned a home in The Bridgeport Condominium, which they rented to Velma Kiawu. 7 The O’Carrolls also were insured by a condominium owners “Condocover” policy issued by Erie; the ⁵⁶⁹ Council of Bridgeport carried a master insurance policy with a deductible of $25,000 per occurrence. 8 On an evening in March of 2003, a grease fire erupted, which caused the ceiling sprinkler system to engage.

Smoke, fire and water damage resulted; carpet, walls, blinds, cabinetry and a microwave in the O’Carrolls’ home were damaged in the total amount of $12,157.14; the damage was confined to the O’Carrolls’ home and the structure of the condominium was not affected. The O’Carrolls asked the Council of Bridgeport to repair or replace the damage, which the Council of Bridgeport declined to do; subsequently, after the O’Carrolls paid their $250.00 insurance policy deductible, Erie paid for the repair or replacement. Erie, to its own use and to the use of the O’Carrolls, filed a three count complaint in the Circuit Court for Prince George’s Court, seeking to recover $12,257.14, 9 the funds expended to repair the condominium. Counts I and II contained the same allegations as that filed in the Anderson case, while Count III alleged negligence against Ms. Kiawu.

Erie and the O’Car-rolls subsequently amended their complaint by adding an allegation that the Council of Bridgeport “negligently” breached its duty under the Act in Count I, 10 and also filed a Motion for Partial Summary Judgment. The Council of Bridgeport filed a motion in opposition, which was treated by the Circuit Court as a Cross-Motion for Summary Judgment. The court conducted a hearing on March 30, 2007, and thereafter, Judge Sherrie L. Krauser o f the Circuit Court for Prince George’s ⁵⁷⁰ County denied Erie’s and the O’ Carrolls’ motion, granted the Council of Bridgeport’s motion and entered judgment in its favor. Erie and the O’Carrolls appealed to the Court of Special Appeals on April 27, 2007.

The Consolidated Appeal The intermediate appellate court granted the parties’ Joint Motion to Consolidate Appeals on September 19, 2007, and subsequently, this Court issued, on its initiative, a writ of certiorari prior to any proceedings in the intermediate appellate court. Anderson v. Council of Unit Owners of The Gables on Tuckerman Condo.; Erie Ins. Exch. v. Council of Unit Owners of Bridgeport Condo., 402 Md. 352 , 936 A.2d 850 (2007). The Appellants, Ms. Anderson, the O’Carrolls and Erie (“the Owners”) presented the following issue: Does the Maryland Condominium Act, Md.Code Real Property, § 11-101 et. seq., in particular, § 11-114, require a condominium association to repair or replace the damaged portions of an individual condominium unit following a casualty loss?

We hold that the Maryland Condominium Act does not require a condominium association to repair or replace property of an owner in an individual condominium unit after a casualty loss.

II

Standard of Review In considering a trial court’s grant of a motion for summary judgment, this Court reviews the record in the light most favorable to the non-moving party. Bednar v. Provident Bank of Maryland, Inc., 402 Md. 532, 542 , 937 A.2d 210, 215 (2007); Rhoads v. Sommer, 401 Md. 131, 148 , 931 A.2d 508, 518 (2007) (“We review the record in the light most favorable to the non-moving party and construe any reasonable inferences that may be drawn from the facts against the moving party”); Harford County v. Saks Fifth Ave. Distribution Co., 399 Md. 73, 82 , 923 A.2d 1, 6 (2007) (In reviewing a trial court’s decision on a motion for summary judgment, “we seek to determine whether any material facts are in dispute and, if they are, we resolve them in favor of the non-moving party”); ⁵⁷¹ Serio v. Baltimore County, 384 Md. 373, 388-89 , 863 A.2d 952, 961 (2004); Lovelace v. Anderson, 366 Md. 690, 695 , 785 A.2d 726, 728 (2001) (In reviewing a grant of the defendants’ motions for summary judgment, “we must review the facts, and all inferences therefrom, in the light most favorable to the plaintiffs”). If no material facts are placed in genuine dispute, this Court must determine whether the Circuit Court correctly entered summary judgment as a matter of law.

See Maryland Rule 2-501(f); 11 Bednar, 402 Md. at 532 , 937 A.2d at 216 ; Saks, 399 Md. at 82 , 923 A.2d at 6 ; Prop. and Cas. Ins. Guar. Corp. v. Yanni, 397 Md. 474, 480 , 919 A.2d 1, 5 (2007); Standard Fire Ins.

Co. v. Berrett, 395 Md. 439, 451 , 910 A.2d 1072, 1079 (2006); Ross v. State Bd. of Elections, 387 Md. 649, 659 , 876 A.2d 692, 698 (2005). In the present case, there is no genuine dispute of material fact. In statutory interpretation, our primary goal is always “to discern the legislative purpose, the ends to be accomplished, or the evils to be remedied by a particular provision, be it statutory, constitutional or part of the Rules.” Barbre v, Pope, 402 Md. 157, 172 , 935 A.2d 699, 708 (2007); Gen. Motors Corp. v. Seay, 388 Md. 341, 352 , 879 A.2d 1049, 1055 (2005).

See also Dep’t of Health & Mental Hygiene v. Kelly, 397 Md. 399, 419-20 , 918 A.2d 470, 482 (2007). We begin our analysis by first looking to the normal, plain meaning of the language of the statute, reading the statute as a whole to ensure that “ ‘no word, clause, sentence or phrase is rendered surplusage, superfluous, meaningless or nugatory.’ ” Barbre, 402 Md. at 172 , 935 A.2d at 708 ; Kelly, 397 Md. at 420 , 918 A.2d at 482 . See also Kane v. Bd. of Appeals of Prince George’s County, 390 Md. 145, 167 , 887 A.2d 1060, 1073 (2005). Further, an interpretation should be given to the statutory provisions that does not lead to absurd conse ⁵⁷² quences.

See Roskelly v. Lamone, 396 Md. 27, 53 , 912 A.2d 658, 673 (2006); So. Easton Neighborhood Ass’n v. Town of Easton, 387 Md. 468, 495 , 876 A.2d 58, 74 (2005); Smack v. Dep’t of Health & Mental Hygiene, 378 Md. 298, 305 , 835 A.2d 1175, 1179 (2003) (“[T]he statute must be given a reasonable interpretation, ‘not one that is illogical or incompatible with common sense.’ ”). If the language of the statute is clear and unambiguous, we need not look beyond the statute’s provisions and our analysis ends. Barbre, 402 Md. at 173 , 935 A.2d at 709 ; Kelly, 397 Md. at 419 , 918 A.2d at 482 ; City of Frederick v. Pickett, 392 Md. 411, 427 , 897 A.2d 228, 237 (2006); Davis v. Slater, 383 Md. 599, 604-05 , 861 A.2d 78, 81 (2004).

If, however, the language is subject to more than one interpretation, or when the terms are ambiguous when it is part of a larger statutory scheme, it is ambiguous, and we endeavor to resolve that ambiguity by looking to the statute’s legislative history, case law, statutory purpose, as well as the structure of the statute. Barbre, 402 Md. at 173 , 935 A.2d at 709 ; Kelly, 397 Md. at 419-20 , 918 A.2d at 482 ; Smack, 378 Md. at 305 , 835 A.2d at 1179 ; Mayor & City Council of Baltimore v. Chase, 360 Md. 121, 129 , 756 A.2d 987, 991-92 (2000). When the statute is part of a larger statutory scheme, it is axiomatic that the language of a provision is not interpreted in isolation; rather, we analyze the statutory scheme as a whole considering the “purpose, aim, or policy of the enacting body,” Serio, 384 Md. at 389 , 863 A.2d at 961 ; Drew v. First Guar. Mortgage Corp., 379 Md. 318, 327 , 842 A.2d 1, 6 (2003), and attempt to harmonize provisions dealing with the same subject so that each may be given effect.

Bowen v. City of Annapolis, 402 Md. 587, 613-14 , 937 A.2d 242, 258 (2007); Magnetti v. Univ. of Md., 402 Md. 548, 565 , 937 A.2d 219, 229 (2007); Clipper Windpower, Inc. v. Sprenger, 399 Md. 539, 554 , 924 A.2d 1160, 1168 (2007). The ambiguity in this case results from comparison of the statutory language involving the coverage of a master policy held by the council of owners with the duty of the condominium council to repair the condominium. Under Section 11-114(a)(1), the council of owners is required to maintain insur ⁵⁷³ anee on the entire condominium property, “the common elements and units, exclusive of improvements and betterments installed in units by unit owners,” but under subsection (g), the council of owners is responsible for repairing or replacing “any portion of the condominium damaged or destroyed.” (emphasis added). The word “unit” in (a)(1) creates the ambiguity upon which this dispute rests, and we must look at the entire regulatory scheme of the Condominium Act and its legislative history to illuminate the Legislature’s intent.

See Kelly, 397 Md. at 419-20 , 918 A.2d at 482 ; Mayor & Town Council of Oakland v. Mayor & Town Council of Mountain Lake Park, 392 Md. 301, 316 , 896 A.2d 1036, 1045 (2006); Smack, 378 Md. at 305 , 835 A.2d at 1179 ; Chase, 360 Md. at 129 , 756 A.2d at 991-92 .

III

Discussion A condominium is “an estate in real property” that “typically involves an apartment building or other structure consisting of two or more separate apartments or units,” i.e., “horizontal property” or multi-story “stacked units.” See 1 Patrick J. Rohan & Melvin A. Reskin, Condominium Law and Practice Section 1.03[l][a] (2007). See also 4 Thompson on Real Property 233 (2d ed. 1994) (“It has been stated that the condominium concept established the creation of a set of vertical boundaries separated into horizontal apartments, units, floors or stories.”). However, as the notion of a condominium has evolved, it has come to also refer to “[tjown houses,” “offices,” and even “stores” with the appropriate recorded declaration, bylaws and condominium plat. 1 Condominium Law and Practice at Section 1.03[l][a]. See also Wendell A. Smith, Creating a Planned Community: First Steps, Probate & Property 18 (July/August 1993) (“The condominium form of ownership can be used for almost any type of physical structure, including multistory apartment buildings, attached townhouses, detached single-family dwellings or other nonresidential or mixed use projects.”).

In Ridgely Condominium Ass’n v. Smyrnioudis, 343 Md. 357 , 681 A.2d 494 (1996), we provided an overview of ⁵⁷⁴ the condominium form of ownership, explicating that an owner has a “hybrid property interest”: A condominium is a “communal form of estate in property consisting of individually owned units which are supported by collectively held facilities and areas.” Andrews v. City of Greenbelt, 293 Md. 69, 71 , 441 A.2d 1064 (1982). The term condominium may be defined generally as a system for providing separate ownership of individual units in multiple-unit developments. In addition to the interest acquired in a particular apartment, each unit owner also is a tenant in common in the underlying fee and in the spaces and building parts used in common by all the unit owners. 4B Richard R. Powell, Powell on Real Property ¶ 632.1[4] (1996). A condominium owner, therefore, holds a hybrid property interest consisting of an exclusive ownership of a particular unit or apartment and a tenancy in common with the other co-owners in the common elements.

Andrews, supra, 293 Md. at 73-74 , 441 A.2d 1064 ; see also Starfish Condo, v. Yorkridge Serv., 295 Md. 693, 703 , 458 A.2d 805 (1983); Black’s Law Dictionary 295 (6th ed.1990). Ridgely Condo. Ass’n, 343 Md. at 358-59 , 681 A.2d at 495 (footnote omitted). See also Jurgensen v. New Phoenix Atlantic Condo.

Council of Unit Owners, 380 Md. 106, 115-16 , 843 A.2d 865, 870 (2004). The owner, therefore, possesses two distinct, separate property interests. She or he owns a fee interest in her or his individual property, comprising the exclusive right to use and occupy it. Discussing stacked-unit condominium regimes, Professor Richard R. Powell, in his treatise Powell on Real Property, defined the critical features of a condominium unit: One easy way to visualize a condominium unit is as a cube of air, the tangible boundaries of which are usually the finished side of the interior sheetrock, ceilings and floors----[T]he condominium unit is generally seen by owners as the “inside” of their structure while the shell and “outside” of the building is a common element....

A typical condominium ⁵⁷⁵ unit consists of: the finished side of all interior walls, floors, partitions and ceilings; windows; kitchen cabinets and fixtures. 8 Richard R. Powell, Powell on Real Property Section 54A.01 [2] (2000); 1 Condominium Law and Practice at Section I. 08[l][b] (“The unit is also referred to as an airspace, i.e., a fixed block cut out of a three dimensional space. The airspace is owned by a unit owner, while other blocks of airspace above, below or beside the unit might be owned by other unit owners.”) and Section 1.03[2][a] (“[T]he unit may be thought of as a block of airspace surrounded by walls, a floor and a ceiling. Often the legal description of the unit will utilize the walls, floor and ceiling as the legal boundaries of the airspace. In such a case, the unit’s boundaries are established by the location of the walls, floor and ceiling.

However, a unit’s boundaries may not involve any part of the building.”) (footnoted omitted). See also Sea Watch Stores Ltd. Liab. Co. v. Council of Unit Owners of Sea Watch Condo., 115 Md.App. 5, 11 , 691 A.2d 750, 752-53 , cert. granted, 347 Md. 253 , 700 A.2d 1214 , and dismissed as improvidently granted, 347 Md. 622 , 702 A.2d 260 (1997), in which Judge Dale R. Cathell, then writing for the Court of Special Appeals, noted that, “All a condominium is, is a vertical, rather than horizontal, subdivision of one of the incidents of real property, the airspace.... [T]he condominium statutes did not create a new real property. They simply created another way to own airspace....” 12 ⁵⁷⁶ The owner also possesses an undivided percentage interest, as a tenant in common, with the other owners, in the condominium’s common elements, which, may include the land, foundations, columns, supports, walls, roofs, halls, lobbies, stairs, entrances, recreational areas, parking lots, gardens and installations for utilities.

The common interest represents the residual rights that the unit owners have in the property. The unit owners collectively own, as tenants in common, the entire condominium property, minus the airspaces consisting of the units. The rights to individual units are, in a sense, carved out of the tenancy in common. 1 Condominium Law and Practice at Section 1.03[l][b] (footnotes omitted). Common elements can be further subdivided into limited common elements, which are allocated for the exclusive use of one or more, but fewer than all, owners, such as, for example, designated parking spaces, balconies, terraces or patios, as well as general common elements, such as grounds and roads.

Id.; 8 Powell on Real Property at Section 54A.01[2] (“Generally speaking, ‘condominiums’ equal units plus common elements owned by unit owners. ‘Common elements’ generally equal everything other than units--- ⁵⁷⁷ ‘Limited common elements’ consist of those common elements whose usage is reserved for one or fewer than all unit owners----Patios and decks may be limited common elements. The clubhouse, roads and grounds may be [general] common elements.”) (footnote omitted). See also Garfink v. Cloisters at Charles, Inc., 392 Md. 374 , 391 n. 8, 897 A.2d 206 , 216 n. 8 (2006) (noting that owners “can be said to have a tenancy in common in the general common elements, i.e., the exterior of her condominium unit, with all of the other Condominium unit owners”); Sea Watch Stores, 115 Md.App. at 40 , 691 A.2d at 767 (stating that common elements would include the “portion of a partition wall between two units that is outside the boundaries of either unit”). 13 We are called upon in this case to determine whether a condominium council of owners is required under the Maryland Condominium Act, 14 Section 11-101 et. seq. of the Real Property Article, Maryland Code (1974, 2003 Repl.Vol.), to repair or replace what has commonly been thought of as property included in an individual condominium unit, after a casualty loss. Specifically, this case involves Section 11-114, which imposes the duty upon the council of owners to maintain insurance on the entire condominium property, “the common elements and units, exclusive of improvements and better ⁵⁷⁸ ments installed in units by unit owners,” and also only imposes the duty that “[a]ny portion of the condominium damaged or destroyed ... be repaired or replaced promptly by the council of unit owners.” Maryland Code (1974, 2003 Repl.

Vol.), Section ll-114(a)(l) and (g) of the Real Property Article (emphasis added). Originally enacted as the Horizontal Property Act 15 by 1963 Maryland Laws, Chapter 387, Maryland’s initial condominium law contained a provision relating to insurance on the condominium, which stated: The co-owners may, upon resolution of a majority, insure the building against risks, without prejudice to the right of each co-owner to insure his condominium unit on his account and for his own benefit. The premiums for such insurance on the entire building shall be deemed common expenses. Maryland Code (1957, 1963 Supp.), Section 134 of Article 21.

Nonsubstantive amendments were made in' 1972. See 1972 Maryland Laws, Chapter 349. In 1974, the Act was recodified as Section 11-101 et. seq. of the Real Property Article and renamed the Maryland Condominium Act. 16 See 1974 Maryland Laws, Chapter 641. The insurance provision was also amended to provide in part: (a) The declaration or bylaws may provide for the repair or reconstruction of a condominium in the event of damage to ⁵⁷⁹ all or part of the condominium, for insurance coverage on the condominium by the council of unit owners and by the individual unit owners, and for the allocation of available insurance proceeds for repair and reconstruction....

(b)(1) Unless otherwise provided in the declaration or bylaws, in the event of damage to or destruction of a condominium, the council of unit owners promptly shall undertake to repair or reconstruct it, and all cost of the repair or reconstruction in excess of available insurance proceeds shall be a common expense. Maryland Code (1974, 1974 Supp.), Section 11—111 (a)—(b)(1) of the Real Property Article. Nonsubstantive amendments were made the following two years. See 1975 Maryland Laws, Chapters 108 and 786; 1976 Maryland Laws, Chapter 348.

In 1977, the Governor’s Commission to Study the Laws Governing Condominiums (“the Commission” or “the Commission on Condominiums”) was created by a Joint Resolution of the General Assembly to study problems that had developed in condominium multi-story buildings, their conversions and operations, including “developer sales representations, board of directors administrative problems, management company inexperience, and unit owner non-cooperation.” Press Release, State of Maryland Commission on Condominiums, March 16, 1978. In its preliminary report, issued during the 1978 legislative session, the Commission on Condominiums addressed many of the problems in multi-story developments regarding developers, councils of owners, management companies and owners in connection with new construction, conversions and resales of condominiums. Maryland Commission on Condominiums, Preliminary Report to the 1978 Session (March 16, 1978). Developers, the Commission noted, had been criticized for “fail[ing] to complete promised amenities,” “under-estimating the cost of operation for the condominium,” and “failing] to turn over control of the project to unit owners.” Id.

The Commission also reflected upon complaints about councils of owners including “arbitrary, capricious or prejudiced action in ⁵⁸⁰ enforcement of covenants or rules” and “failure to enforce rules, architectural guidelines, or to protect the common areas against encroachment.” Id. As to the management companies, the Commission iterated that those grievances involved the “failure to deliver promised management services or to monitor subcontractors to assure delivery of maintenance services” and “financial instability or failure, resulting in abrupt end of services to the condominium.” Id. With respect to the owners, the Commission stated that owners had caused problems through “resistance to long-range financial planning or to the segregation of funds into reserve accounts for long-range repairs,” “unilateral architectural alterations being made to commonly-owned exteriors or areas,” “failure or refusal to pay regular assessments or fees,” “failure to maintain unit[s], causing health, safety and/or aesthetic problems, and potential costs to other unit owners” and “apathy to association activities.” Id. Owners also complained, the Commission explained, about “negligent or wilful damage to common areas, thus adding to expenses of association[s] and resulting in increased condo fees,” recognition of the costs, incurred by the council of owners with respect to common areas, that were apportioned to all of the owners collectively.

Finally, the Commission noted some general problems, including the “financial instability of condominium associations because of an absence of long-range financial planning and either failure to set aside reserve funds, or unwarranted dipping into them.” Id. In 1979 and 1980, the Commission conducted meetings throughout the State to further explore the problems. Report of the Governor’s Commission to Study the Laws Governing Condominiums (February 1981). In 1981, as a result of the criticisms of multi-story apartment building conversions, the Commission proposed extensive restructuring and modification of the Condominium Act, which “drew from a number of sources including the Uniform Condominium Act,” in order to abate concerns regarding apartment-to-eondominium conversions and operations.

Id. The General Assembly, thereafter, enacted legislation, the purpose of which was, in part: ⁵⁸¹ FOR the purpose of specifying certain rights, duties, responsibilities and liabilities of lenders, unit owners, developers, and other persons and organizations having interests in condominiums; specifying powers and responsibilities of a condominium council of unit owners, and condominium board of directors; specifying certain conditions of sale of certain condominium units; specifying rights and duties of buyers and sellers of condominium units____ 1981 Maryland Laws, Chapter 246. See also Report on 1981 Condominium Bills to Legislative Services (describing condominium bill as “facilitat[ing] the orderly development of condominiums” and “containing] safeguards to mollify any resultant adverse impact that conversions to condominium regimes might have on [tenants and unit owners]”). Among the changes was the addition of a statutory provision defining the maintenance, repair and replacement responsibilities of owners and the council of owners, ostensibly to address problems identified by the Commission, including owners’ failures to maintain their own properties, “causing health, safety and/or aesthetic problems, and potential costs to other unit owners,” as well as that owners were causing “negligent or wilful damage to common areas, thus adding to expenses of association and resulting in increased condo fees,” and that councils of owners were “failing] to enforce rules ... or to protect the common areas against encroachment.” See 1981 Maryland Laws, Chapter 246.

Substantially similar to Section 3-107(a) of the Uniform Condominium Act (1980), 17 the amendment charged, unless otherwise provided for in the declaration, the council of owners with responsibility “for maintenance, repair, and replacement of the common elements,” while imposing upon each owner the duties of “main ⁵⁸² tenance, repair, and replacement of his unit.” Maryland Code (1974, 1981 Repl.Vol.), Section 11-108.1 of the Real Property Article. 18 In response to the multi-story, apartment building condominium conversion concerns regarding the age of buildings and the economics of repair, the legislation also required the council of owners to obtain and maintain insurance on the entire condominium property, i.e., “the common elements and units, exclusive of improvements and betterments installed in units by unit owners.” See 1981 Maryland Laws, Chapter 246. Mirroring Section 3-113 of the Uniform Condominium Act (1980), 19 Section 11-114, stated, in part: ⁵⁸⁴ (a) Duty of council of unit owners to maintain property and liability insurance.—Commencing not later than the time of the first conveyance of a unit to a person other than a declarant, the council of unit owners shall maintain, to the extent reasonably available: (1) Property insurance on the common elements and units, exclusive of improvements and betterments installed in units by unit owners, insuring against all risks of direct physical loss commonly insured against or, in the case of a conversion condominium, against fire and extended coverage perils. The total amount of insurance after application of any deductibles may not be less than 80 percent of the actual cash value of the insured property, exclusive of land, excavations, foundations, and other items normally excluded from property policies; and (c) Provisions of property and liability insurance poli cies.—Insurance policies carried pursuant to subsection (a) shall provide that: (1) Each unit owner is an insured person under the policy with respect to liability arising out of his ownership of an undivided interest in the common elements or membership in the council of unit owners; (2) The insurer waives its right to subrogation under the policy against any unit owner of the condominium or members of his household; (3) An act or omission by any unit owner, unless acting within the scope of his authority on behalf of the council of unit owners, does not void the policy and is not a condition to recovery under the policy; and (4) If, at the time of a loss under the policy, there is other insurance in the name of a unit owner covering the same ⁵⁸⁵ property covered by the policy, the policy is primary insurance not contributing with the other insurance. (e) Insurance for unit owner’s benefit.—An insurance policy issued to the council of unit owners does not prevent a unit owner from obtaining insurance for his own benefit.

(g) Repair or reconstruction.—(1) Any portion of the condominium damaged or destroyed shall be repaired or replaced promptly by the council of unit owners unless: (1) The condominium is terminated; (ii) Repair or replacement would be illegal under any State or local health or safety statute or ordinance; or (iii) 80 percent of the unit owners, including every owner of a unit or assigned limited common element which will not be rebuilt, vote not to rebuild. (2) The cost of repair or replacement in excess of insurance proceeds and reserves is a common expense. (3) If the entire condominium is not repaired or replaced: (i) The insurance proceeds attributable to the damaged common elements shall be used to restore the damaged area to a condition compatible with the remainder of the condominium; (ii) The insurance proceeds attributable to units and limited common elements which are not rebuilt shall be distributed to the owners of those units and the owners of the units to which those limited common elements were assigned; and (iii) The remainder of the proceeds shall be distributed to all the unit owners in proportion to their common element interest. (4) If the unit owners vote not to rebuild any unit, that unit’s entire common element interest, votes in the council of unit owners, and common expense liability are automatically reallocated upon the vote as if the unit had been condemned under § 11-115 [§ 11-112], and the council of unit owners promptly shall prepare, execute, and record an ⁵⁸⁶ amendment to the declaration reflecting the reallocations.

Notwithstanding the provisions of this subsection, § 11-128 governs the distribution of insurance proceeds if the condominium is terminated. Maryland Code (1974, 1981 Repl.Vol.), Section 11-114 of