## Facts

- A developer created the Westwood Planned Unit Development (PUD) in Lane County, Oregon, by recording a declaration of covenants, conditions, and restrictions (CCRs) that ran with each lot and bound successors.
- The CCRs required each lot owner, by accepting a deed, to pay annual and special assessments to the Westwood Homeowners Association (HOA) to fund maintenance and common-area services.
- The CCRs provided that unpaid assessments were secured by liens in favor of the HOA.
- Owners of 15 lots became delinquent on property taxes, and Lane County acquired title to those lots through statutory tax foreclosure under ORS chapter 312.
- After acquiring title, the County did not pay HOA assessments, and the HOA sued to foreclose its assessment liens.
- The trial court granted summary judgment to the HOA, the Court of Appeals affirmed, and the Oregon Supreme Court granted review.

## Issues

1. Whether ORS 312.270(1), vesting tax-foreclosed property in the county “free from all liens and encumbrances,” extinguishes recorded PUD servitudes, including covenants to pay HOA assessments.

## Decision

- The Oregon Supreme Court affirmed summary judgment for the HOA.
- The court held that recorded PUD servitudes survived tax foreclosure, and the County took title subject to the CCRs, including the obligation to pay assessments.
- The court concluded that ORS 312.270(1)’s “free from all liens and encumbrances” language did not eliminate the servitude-based assessment obligation, even though nonpayment could be enforced through liens.

## Legal Principles

- Recorded CCRs in a planned community can create servitudes that run with the land and bind successors in title, including affirmative obligations such as paying HOA assessments.
- Under ORS 312.270(1), tax foreclosure clears monetary claims and security interests characterized as “liens” or “encumbrances,” but does not necessarily extinguish servitudes that define rights and obligations attached to the land.
- A servitude-based obligation to pay HOA assessments is conceptually distinct from the lien device used to enforce nonpayment; the enforcement lien may be removed by foreclosure rules, while the underlying servitude may remain binding on the property and successor owners.
- Statutory language vesting title “free from all liens and encumbrances” is construed in context and does not extend to PUD servitudes absent clear legislative direction.

## Conclusion

The Oregon Supreme Court held that Lane County’s tax-foreclosure title was subject to the Westwood PUD’s recorded servitudes, including the continuing obligation to pay homeowners association assessments, because ORS 312.270(1) did not extinguish the servitude regime embedded in the CCRs.


Westwood Homeowners Ass’n, Inc. v. Lane Cnty., 318 Or. 146, 864 P.2d 350 (Or. 1993)