Azim Hameed featured in the "Ask the Legal Professionals" section of the Phoenix Business Journal

Is a "transfer fee" provision in a declaration of covenants, conditions and restrictions or a declaration of condominium enforceable in Arizona?

Recently enacted A.R.S. §33-442 states, with some exception, transfer fees payable to third parties and liens to secure such payments are unenforceable. The statute applies to commercial and residential real estate. The statute may curb transfer fees created by some developers for no purpose other than to increase the profitability of the entity receiving the fee. The statute does not bar all transfer fees. A transfer fee paid to a condominium or homeowners' association for a specified use by the Association relating to the property, including for payment to a management company with actual responsibility for the property, is permissible as is a fee payable to a separate nonprofit corporation for the sole purpose of supporting recreational activities within the Association.