Posts Tagged ‘condominium’

How Much Money Can A Condo Board Member Spend on Behalf of the Association?

Wednesday, October 16th, 2013

L.L. from Fairfield County writes:

Dear Mister Condo,

What is the law regarding the autonomous spending limit of a board director?

Mister Condo replies:

L.L., although I am not an attorney, I am not aware of any law that limits the amount a Board Director may spend on behalf of the association. I thought that association by-laws might address the issue but I wasn’t certain so I checked with a community association attorney who specializes in such matters who had this to say:

“If by “autonomous spending limit” you mean how much one board member can use or pledge for condo business, the limit is whatever the board decides to authorize that member to spend. There is no specific statute on this, and most bylaws wouldn’t cover it either except to require one or more authorized signatures on checks and contracts.”

All the best!

Condo Board vs. Hot Tubs; The Battle Continues!

Tuesday, October 15th, 2013

J.Q. from New Haven County writes:

Dear Mister Condo,

Hot tubs are allowed at my condo according to our CCR. However, I have requested to install one on my deck and am being denied by the Board. How can it be denied if the CCRs allow it?

Mister Condo replies:

J.Q., hot tubs have been getting condo owners and condo association in hot water for years. Unit owners that wish to install a hot tub are usually quite passionate about their desire to do so. Boards that have had problems with previous unit owners who installed improperly or failed to maintain once installed hot tubs are usually the reason the Board tries to prevent new installations. Suffice to say that if the CCRs are on your side, you may be able to prevail but you should be prepared for a battle. Boards can cite architectural compliance issues, safety issues, insurance issues, and more to prevent an unwanted hot tub from being installed. You may find that you even need to hire an attorney to bring suit against the Board to allow you to install your hot tub. Even then, there is no guarantee that you will prevail. If the hot tub is that important to you, by all means, pursue your dream. If it really doesn’t matter, I might suggest you let it go. The Board is charged with protecting the community and surely has its reasons for not wanting the hot tub installed. All the best!

Lack of Proper Reserve Funds Stops Condo Mortgage from Closing

Monday, October 14th, 2013

D.G. from New Haven County writes:

Dear Mister Condo,

I am purchasing a condo and I was supposed to close on my loan today. However, the bank contacted me last week and informed that the condo is not currently meeting the 10% budget reserve required by the FHA guidelines. My loan is a conventional 30 year fixed, and is not FHA backed. Why is this guideline preventing me from receiving the loan? How likely is it that I can find another lender that may look past the reserve issue?

Mister Condo replies:

D.G., I am sorry for your mortgage loan closing troubles. I wish I could tell you that you are describing an isolated incident but the truth is that I am hearing more and more about missed condo closings due to mortgage issues every day. The government shutdown, which has effectively stopped condominium associations from renewing or applying for FHA certification certainly isn’t helping matters any. I am not certain how your lender is offering you mortgage money that isn’t FHA-backed (almost all are) but, clearly, they are still applying the same guidelines as an FHA-backed loan which makes sense as almost all lenders will turn around and sell your mortgage to a secondary market after your loan has closed. The secondary purchaser will certainly require that the loan is FHA eligible so that is the likely reason the condo’s lack of FHA certification has halted your loan from moving forward. Unfortunately, unless you can find a source for the mortgage that isn’t FHA-backed or reselling the mortgage to a secondary market, I think it is unlikely that you will find financing at this time. Once the federal government is reopened and the FHA is taking applications for certification, the current owner can ask the Board of the condo to seek certification. Of course, the Board is under no obligation to do so and may not even be able to if their Reserve Fund is not properly funded. This limits both buyers and sellers to purchasers who will either pay cash or secure funding through a non-FHA approved third-party vendor. I am afraid it isn’t pretty no matter how you look at it. Best wishes.

Who Pays for Interior Condo Damage Caused by Leaky Roof?

Friday, October 11th, 2013

K.H. from Fairfield County writes:

Dear Mister Condo,

The association of my Condo has failed to fix the roof properly over the years and has done patch work to fix spots here and there.  In June, we had heavy rain. Water came in to my condo and has damaged my windows, cabinets, flooring and back splash in my kitchen.  The Board states that the interior is my responsibility.  However, the roof repairs have been neglected for years because they did not want to spend the money on properly repairing the roof.  Should they be paying to fix the damage in my kitchen?  Thank you!

Mister Condo replies:

K.H., I am sorry that your unit faced water damage. I can only imagine the horror of having windows, cabinets, and flooring ruined by water. Of course, now that the damage is done the real question is who is on the hook for the clean-up expense? I hope you have homeowner’s insurance (HO6 here in Connecticut) or this could be a very expensive lesson in why you need it.

Regardless of your assessment of the Board’s history of repair on the roof, generally speaking, their responsibility ends where your unit interior begins. The condo association is generally responsible for insuring the common elements of the condo; unit owners are responsible for insuring unit interiors and contents. So, to that end, the Board is correct in telling you that the interior is your responsibility. However, if you have insurance to cover the damage, your insurer should pay for the repair and then, at their discretion, they could go after the association (or the association’s insurer) for damage caused by negligent repair. That would be very unlikely in my opinion as you have mentioned that the association has done repairs to the roof which would indicate they are trying to maintain the roof’s integrity. If the roof is long overdue for repair or replacement and the Board had taken no action to maintain or upkeep the roof that would be a different story.

Do you know when the current roof was initially installed? Is it still under warranty? If it is past its serviceable life it may be time for replacement. If the replacement has been budgeted for that should be no problem. However, many communities have opted to keep their common fees low and have not saved adequately for aging elements like a roof. That could mean a special assessment is on the way to pay for the new roof. Still, better to pay for the new roof than face the consequences of another water intrusion event. All the best!

Volunteer Condo Leader Issues in Volunteer State!

Thursday, October 10th, 2013

C.P. from Tennessee writes:

Dear Mister Condo,

We retired and moved to a condo to simplify our life. We love our condo, but are becoming frustrated with things being done by the Board. They insist on having 4 HOA meetings a year, and do not inform us of anything to be on the agenda or voted on. It’s as though the only people who get to vote are those who go to all the meetings. I believe in fairness and the right to vote for everyone. Now they have even said they get to choose one of our 3 directors themselves. Also, they do a budget but don’t send us a proxy with it to vote on it. Any suggestions?

Mister Condo replies:

C.P., greetings to you and all our friends in the “Volunteer State”. Thank you for writing and welcome to the world of condo living. Like many retirees, you were probably drawn to the condo lifestyle for ease of living and simple maintenance and upkeep tasks delegated to paid staff. The billboards sure make it look wonderful, don’t they? What they don’t show is the potentially challenging part of the equation which is governance. A group of elected volunteers is tasked with interpreting the association’s by-laws as well as state law on community association governance. While the end result is often good, there are times when situations like yours occur.

I am not an attorney so please accept this following advice as friendly and not legal. All states have laws that govern the establishment of condominiums and other community association properties. Within these laws are the outlined rights of unit owners, including such rights as voting powers and budget ratifications. Closer to home, your own condo documents (that big packet of papers you were provided when you purchased) will detail how the community is to be governed and what rights are included with unit ownership. I would be very surprised if the process of elections and annual budget ratification details are not included. FYI, in the event of a resignation or vacancy, the Board very likely does have the power to fill the vacancy of the Board by making an appointment. However, they are not likely empowered to pass a budget without a vote of the unit owners and the notice of that vote should need to be provided in advance of the meeting and allow for proxy voting.

Additionally, you have a local resource in Tennessee that you should seek out for advice and guidance. The Community Associations Institute (CAI) has a state chapter with an excellent website. You should visit them at http://www.caitenn.org/ to see what education and resources they have for you locally. IF things get really difficult, they even have a list of attorneys who specialize in community association law. You can see that list at http://www.caitenn.org/directory.php?type=4&par1=3&par2=ATTORNEYS. I hope it doesn’t come to that for you but it’s nice to know there are professionals available if you need them. All the best!

Where Can I Learn About Condo Laws in Connecticut?

Wednesday, October 9th, 2013

L.S. from New Haven County writes:

Dear Mister Condo,

I am a second-year Board member at my condo. I keep hearing about new laws and changes to laws that have an impact on the relationship between the Board and the unit owners. As far as I know, my fellow Board members and I are doing a good job running the place but I am concerned that we don’t have all of the information we need to make sure we are in compliance with state law. Is there a central place where all of this legal information is available?

Mister Condo replies:

L.S., thank you for your service and thank you for your question. Volunteering to serve on your Board is a noble venture and I wish you and your fellow Board members continued success. There have been several changes and additions to laws that effect Common Interest communities in Connecticut over the past few years. First and foremost is the Common Interest Ownership Act (often referred to as CIOA). It expanded unit owner’s access to information and records of the association among other things. This past year, new laws were enacted that cover a wide range of topics such as required community association manager licensing, priority liens on units that are delinquent in common fee payments, budget ratification procedures and more. Keeping up with these laws can be tricky and even well-meaning Boards such as yours can find themselves on the wrong side of the law if they don’t keep current on these matters.

On Thursday, October 17th, the Connecticut Chapter of CAI (CAI-CT) will be holding a legislative symposium at Oronoque Village in Stratford from 2:30 to 6:00 p.m. to address this very issue. While the topics covered are too many to list here, it is fair to say that this one afternoon will cover you and your Board from soup to nuts on legislative issues facing today’s condominium volunteer leaders. You can read much more about the event here as well as register – http://caict.org/legsymSESSIONS.html.

I can’t recommend this event highly enough as this one day investment can save your Board from a years’ worth of legal troubles. I know I’ll be there and I hope you will too. All the best!

People Who Live In Glass Condos… Who Pays for the Windows?

Tuesday, October 8th, 2013

R.Z. from California writes:

Dear Mister Condo,

Our CC&R’s have a conflict.  We are a high rise building. First the CC& R’s say “The Unit Owner shall be responsible for the repair and replacement of Windows “enclosing” an Owner’s Residential Unit, frames and tracks and exterior screens of glass doors and windows.

In the same section it says “The Association shall be responsible for maintaining the exterior of and repairing and replacing all doors on the exterior boundaries of a Residential Unit and all windows” surrounding” the Residential Units.

Most units are all glass.  What is the difference between “enclosing” the Residential Unit and “surrounding” the residential unit? The bottom line is we don’t know who owns the windows replacement responsibility.

Mister Condo replies:

R.Z., East Coast Greetings to you! Differences and doublespeak in covenants, conditions and restrictions and by-laws, rules and other condo documents are unfortunate in that they often leave a lot of room for misinterpretation between unit owners and the Board that governs the association. Even worse, when the association is not certain of what is their responsibility and what is the unit owner’s responsibility it is very difficult to develop a Reserve Fund to account for future repairs and improvements. That being said, it would be a great idea to have a third party offer a legal interpretation and have that ambiguous wording amended so that there is no mistake moving forward. Your use of the phrase “most units are all glass” has me thinking that glass that is part of a building exterior is likely owned by the association but glass doors and windows may be the responsibility of the individual unit owners. Of course, I am not an attorney and I can’t claim to be familiar with California law on Common Interest Communities. However, I do know a great place you can turn to for help. There are 8 chapters of the Community Association Institute in your state. You can find the whole list here: http://www.caionline.org/chapters/find/Pages/list.aspx. I think you are from the greater San Diego area. If so your local Chapter’s website is http://www.cai-sd.org/. You may wish to contact them and ask for an attorney referral so you can have a local legal expert interpret your documents and give your community a definitive answer. Far better to spend the money on a legal opinion now than to end up defending a lawsuit in court at a later date when the windows and doors need to be replaced. Best wishes!

Are There Condo Parking Laws?

Monday, October 7th, 2013

N.B. from New Haven County writes:

Dear Mister Condo,

Is there a law about parking that the home owner on how many spots they get?

Mister Condo replies:

N.B., I am not an attorney so I cannot guarantee you that there are no laws about how many parking spots a homeowner gets when they purchase a condo but I can tell you that the condo documents and initial blueprints are a good place to start. Usually, condo owners have assigned parking (those numbered spaces found in most condo parking lots) and may also have access to visitor parking. The rules on vehicles vary from condo to condo but since parking is usually at a premium most unit owners are limited to their assigned spot(s) with the Visitor parking reserved for guests of all units. It is also not unusual for condos to enforce their parking rules with fines and even towing when unit owners don’t follow the rules. I get numerous questions about fire zone parking, “T” parking (where one care parks perpendicular to one or more cars), and even cars parking in someone else’s assigned spot. Needless to say, all of these infractions create tension and animosity amongst neighbors and should be avoided. Find out what the rules are at your community and enjoy your parking lot. All the best!

Selective Rules Enforcement by Condo Board

Friday, October 4th, 2013

A.V. from New Haven County writes:

Dear Mister Condo,

Can the association file a complaint against one owner and not the other for breaking the by-laws?

Mister Condo replies:

A.V., the short answer is “it depends”. Boards have some discretion in how vigorously they enforce their own covenants and rules. Depending on the nature of the rule violation, the Board may choose not to take action. However, the Board is not at liberty to pick and choose which unit owners they take action against without facing some very serious consequences in the form of discrimination lawsuits that can be brought upon by the unit owner who the Board is acting against. Let me give an example. If your condo has rules against pet walking on the property and rules against pet noises and received complaints about both items, the Board could decide that enforcing the rule against pet walking isn’t worth pursuing because the pet walking isn’t causing any real harm and the unit owners are picking up after their pets. The Board retains the right to take action even though it does not actively take action at the time of the violation. However, the dog that barks for hours on end creates a noise violation that the Board decides to take action against. This isn’t discrimination; it is just the Board exercising its right to enforce the rules. If there were multiple dogs making noise and the Board only acted against one owner, that owner could claim discrimination because they were unfairly singled out and the other dog owner was not. These are the types of cases that would routinely head to court to be settled.

You didn’t mention which by-laws were being broken so I am not sure if that example is helpful to you. In an ideal situation, all community members would simply comply with the rules and there would be no need for the Board to enact enforcement. I don’t know of too many places where that happens, but wouldn’t it be nice? All the best.

Special Handling for Unit Owner Struggling to Make Common Fee Payments On Time

Thursday, October 3rd, 2013

H.B. writes:

Dear Mister Condo,

Hello. The condo association recently replaced our driveways. The owners now have an extra charge on their monthly fees.  In addition to this, if a condo fee is not made by the 15th, a $25 late fee is added.  I have a family who just cannot do it by the 15th but can by the end of the month because of her husband getting paid every two weeks. I am on the Board of Directors and contacted the other two and they agreed to the family paying toward the end of the month.  I am getting a lot of flack by the rest of the board on this.  Has anyone been through this?

Mister Condo replies:

H.B., raised common fees to cover improvement projects such as driveway replacements happen all the time. Ideally, the common fees would have been higher in advance to cover the repair but that seems to not have been the situation. While I admire your empathy and compassion for the unit owner who is struggling to meet their financial demands in a timely fashion, I can also see where your fellow Board Members are pushing back for offering special treatment to this one community member. Your rules and by-laws are very specific on how and when common fees are to be collected. If you are going to change those rules for just one unit owner, you are setting a dangerous precedent and you are not fulfilling your mission of protecting the community’s common assets, which, in this case, are common fees, the very lifeblood of the community. What about all of the other unit owners who are paying on time? If one or more of them should have similar difficulty, would you waive their late fee and allow them to pay by the end of the month. What if they couldn’t make their payment this month because of a payoff or health issue? By not enforcing a rule that is already in place you are creating more problems than you are solving, in my opinion. The unit owner has a decision to make. They can pay their fees on time or continue to pay an additional $25 late fee until such time as they can make their payments on time. It is no different than any other bill in their life. Their mortgage, their credit card bills, and so on all carry penalties for late payments. Hopefully, they can find a way to make their common fee payments on time (borrow from a friend or family member if need be) and the community can continue to collect the monies they are owed so they can make their payments to all of the other good and service providers that the community relies on to flourish. Good luck!