MARYLAND'S HIGHEST COURT STRIKES DOWN LAW THAT
EXTINGUISHES UNREGISTERED GROUND RENTS

 

By Andrew Levy, Esq. General Counsel - Capitol Title

   In 2007 the Maryland legislature enacted a law that required the owners (landlords) of ground rents on residential properties to register each ground rent owned with the State Department of Assessments and Taxation and provided that a failure to register revoked the rights of the ground rent owners and extinguished their ground rents. In a decision handed down this week by the Maryland Court of Appeals, the court struck down the part of that law that extinguished the ground  ground rents as a result of a failure to register.  The court held that the law constituted "an unconstitutional taking of the ground rent owners' private property without just compensation."   The requirement for registration of ground rents was upheld but a failure to register will not extinguish the ground rents.  The holders of ground rents remain entitled under the law to (i) establish a lien and foreclose upon any lien created on property on which the ground rent is more than six months in arrears (delinquent); and (ii) institute a civil action against the leasehold tenant seeking a money judgment for the amount of past due ground rent.