Tennessee Legislative Update

Tennessee Legislative Update

The Tennessee legislature recently amended its laws governing condominium unit owner’s association liens, effective June 1, 2016, and certain provisions of the Tennessee Identity Theft Deterrence Act of 1999 (“Act”), effective July 1, 2016.


A condominium unit owners’ association (“Association”) has a lien on a unit for any assessment levied against that unit or fines imposed against its unit owner from the time the assessment or fine becomes due, which lien may be foreclosed by judicial action.

A condominium declaration (“Declaration”) may provide that the Association’s lien may be foreclosed in like manner as a deed of trust with power of sale; provided, that the Association must give notice of its action prior to the first publication.  In addition to the unit owner and all lienholders, notice must now be provided to other interested parties and a nominee of record of any unit owner, lienholder or interested party.

Upon a foreclosure action initiated by a lienholder or the Association, the Association will be entitled to proceeds from the foreclosure sale to satisfy the lien up to the extent of the common expense assessments based on the periodic budget adopted by the Association, which would have become due in the absence of acceleration during the six months immediately preceding institution of an action to enforce the lien, but not exceeding 1% of the maximum principal indebtedness of a lien secured by the first mortgage or deed of trust provided that, notwithstanding any law to the contrary:

  • Any foreclosure by the Association of its lien for assessments will be subject to any mortgage or deed of trust encumbering the property and will not extinguish the lien of such mortgage or deed of trust;
  • Upon any foreclosure by the holder of a mortgage or deed of trust, the sale and foreclosure will be subject to the Association lien up to the payment priority amount set forth above; and
  • Any right of foreclosure or priority of the Association will not be transferable and will be extinguished if assigned or transferred to a third party.


Recording the Declaration constitutes record notice of the lien.  Any lien for any assessment under this law is perfected by recording it in the lien book in the register of deeds office in the county where the real property is located.

The above provisions will apply to any foreclosure action initiated on or after June 1, 2016.


The following definitions have been added/revised as they as are used in relation to the release of personal consumer information:

  • “Unauthorized Person” includes an employee of the information holder who is discovered by the information holder to have obtained personal information and intentionally used it for an unlawful purpose.
  • “Breach of the security of the system” means unauthorized acquisition of computerized data (previously unencrypted computerized data) that materially compromises the security, confidentiality, or integrity of personal information maintained by the information holder.


Any information holder must disclose any breach of the security of the system, following discovery or notification of the breach in the security of the data, to any resident of Tennessee whose personal information was, or is reasonably believed to have been acquired by an unauthorized person.  The disclosure must be made immediately, but no later than 14 days from the discovery or notification of the breach, unless a longer period of time is required due to the legitimate needs of law enforcement.

Any information holder that maintains computerized data that includes personal information that the information holder does not own must notify the owner or licensee of the information of any breach of the security of the data immediately, but no later than 14 days from when the breach became known by the information holder, if the personal information was, or is reasonably believed to have been, acquired by an unauthorized person.

The notification required above may be delayed if a law enforcement agency determines that the notification will impede a criminal investigation.  The required notification must be made no later than 14 days after the law enforcement agency determines that it will not compromise the investigation.