Questionable Dialogue Deleted from Condo Association Board Meeting Recording

J.J. from Florida writes:

Dear Mister Condo,

I serve on the Board of Directors as Vice President of a Florida condominium. Recently, the Secretary of the Board relayed via email that she had deliberately removed from tape dialogue between the President and Property Manager during a board meeting. Is this an illegal or actionable matter?

Mister Condo replies:

J.J., since I am not an attorney, I cannot offer you legal advice in this column. You should speak with a qualified community association attorney in your state (there are many!) for a legal answer. Let me offer some friendly advice instead. Do you know what kind of statements were deleted? For instance, “How about that Marlins game last night?” and the associated banter that accompanies such a statement is hardly scandalous or of interest to the association. Even off the cuff remarks about anything other than association business are hardly of interest to unit owners or other Board Members. If the dialogue was specifically about association business and you suspect foul play is going on, you should certainly speak to an attorney and describe what you know to have happened. Presumably, you were at the Board Meeting and know what was said. Minutes of Board meetings are the official record of what happened. Motions, votes, and so on. If it isn’t in the Minutes, it never happened. If you suspect foul play, take action. If not, let it go, and keep an eye on the situation. If this is an ongoing problem, there may be more to it than meets the eye. All the best!

Difference Between Condo Committee Member Versus Board Member

C.C. from Florida writes:

Dear Mister Condo,

If I am on a committee (not board member) in my condo, am I allowed to solicit a rule that our committee may want to change? Should a particular change of a rule (not statute) go for board approval, then said board approves rule change, then it goes out to owners for a vote. Prior to owner’s vote, can I solicit facts or opinions as a committee member?

Mister Condo replies:

C.C., thank you for the question. However, since the question is kind of vague, I cannot give you a definitive “yes” or “no” answer. Committees derive their existence from the Board, the group of democratically elected leaders from within the community. Unless the charter of the committee gives the committee power from the Board to solicit rule changes, I would say that “No, you cannot solicit a rule change or solicit owner’s opinions or try to influence their vote in any way”. However, if your charter is to actually solicit owners’ opinions on rules and regulation that might need changing, then my answer would be “Yes”. Let me suggest the following hypothetical. Let’s say my Board asks me to serve on the Beautification Committee. I don’t care for the pine trees on the property and I think we should have oak trees instead. My job would be to offer a report to the Board on why Oak trees would be better than the pine trees. If the Board agrees, it would draw up the resolution and make the decision. If I went around and asked my fellow unit owner if they would support my desire to have Oak trees replace the pine trees, I am overstepping what was asked of me when the Board appointed me to the Beautification Committee. I hope that answer suffices and guides you in the right direction. Given your level of interest and activity, my guess is you would make a fine addition to the Board, C.C.. After all, getting involved on a Committee is the most common path to a position on the Board. Good Luck!

Condo Board Weighs in on Allowing Double Parking for Motorcycles and Cars in One Space

J.S. from Chicago writes:

Dear Mister Condo,

I was recently elected to my HOA board. Some residents have been inquiring about a rule that we have (in our rules and regulations) regarding parking motorcycles/Vespas in a parking spot WITH a car. So long as they fit within the lines and do not cause an issue for neighboring parking spots. The garage is enclosed and unit owners own their parking spots. The board is willing to change the rule, but does not want to be breaking some type of fire code, city (Chicago), or state (IL) law or ordinance by allowing this type of double parking. Do you know if there would be any issue with us removing this rule to allow people to park a car and motorcycle in one parking spot? Thanks!

Mister Condo replies:

J.S., welcome to the Board! As a rule, parking lots are owned by the association, a private organization, and are free to do with their parking areas as they see fit. City fire codes and ordinances are another matter altogether so before you go changing any association rules, I would encourage you to speak with a local expert (a fire marshal, perhaps) who can give you the lowdown on what, if any, ordinances you may be violating by changing the parking rules. If you read my column on any type of regular basis, you will see that parking issues are always a concern at condominiums and other high-density housing areas. Too many vehicles, too few spaces. Once you have the OK from local officials, think long and hard about making any change to the parking rules. Folks that purchased into your association do so with a certain set of rules in place. While I appreciate the desire of motorcycle and Vespa owners to park their bikes within their spaces, there was never an expectation that they should be able to do so when they purchased. Even well-intentioned residents will occasionally “go over the line” with a wheel or handlebar or make it difficult for a neighboring parking space to be easily accessed. My advice to you is to leave well enough alone and leave the parking rules as is. However, if the number of bike owners is a majority and the rule needs to change, so be it. Either way, I wish you the wisdom of Solomon and Good Luck!

Condo Owner Seeks Access to Reserve Study

G.H. from Fairfield County writes:

Dear Mister Condo,

Is the most recent Reserve Study that the BOD uses to determine owner’s monthly contribution to the HOA reserve fund one of the business documents that any owner has the right to review and/or have a copy of?

Mister Condo replies:

G.H., as a shareholder in the corporation, you have the right to review any and all official records of the association. The Reserve Study is prepared for the association at the Board’s request. Unlike Minutes of a meeting, it is not created by the association but, rather, for the Board to be used as a guide to make sure the proper level of Reserves is being collected to keep the association fiscally sound as the years go by and the common elements deteriorate. It can be argued that since it is a tool for the Board and not an actual record of the Board, it may not be freely available to association members. However, if you request a copy (at your expense), I would think most Boards would allow it. There may be a record inspection fee and there might also be a “per page” copy fee. Reserve studies can be lengthy so it could get a little pricy. Do you know what firm performed the study? You might be able to request an electronic copy of the document which would save you both time and money. If you are fully denied access to the document, you might want to speak with an attorney and see if there is any other way to compel the document from the association. I might also ask you why you need it. If you trust the sitting Board members to properly care for the association’s fiscal needs, the Reserve study is simply a tool to help them do so. Your annual budget, which you most certainly have a right to inspect, will show you what they are doing with that information. I would guess a healthy Reserve Fund contribution would be somewhere around 30% of common fees. If the Board is simply using a 10% number, then it is likely they are following FHA guidelines and not the Reserve Study. Kudos to you for paying attention. Most condo owners simply submit their common fees and hope for the best. Good luck!

Condo Developer Transition Turmoil

S.C. from Litchfield County writes:

Dear Mister Condo,

Our Board does nothing. No communication, they don’t respond to our questions very well, they are not transparent when they communicate among each other (which is not too often) and my biggest beef, they refuse to fix our crumbling infrastructure (roads, outside siding, fascia boards, etc.). It’s one delay, one excuse after another and this has been going on for almost 3 years. Money is tight, they do not properly fund our community yet they are raising the dues and still operating with a negative balance. No one on the board lives here full-time and the president and one other member work for the developer. Clearly, their priorities are not in sync with the homeowners. Most residents will not say a word for fear of being the bad one or simply a case of extreme apathy. I want to round up the troops and have all the board members (well, 3 out of 4) removed. Having been the president of the association and property manager, I have plenty of experience.  I do not know what kind of reaction I will get but I do know there will be some support. Any response from you would be great and I look forward to it. Thank you.

Mister Condo replies:

S.C., I am sorry that your condo Board is not performing to your expectations. However, from what you have told me, the association is still under developer control so the Board truly has limited power during this time period. Once control is handed over to the association, things will change because no one will be beholden to the developer. The association governs itself and many of the items you discuss can be addressed through democratic elections of interested and able volunteers. Now, if the developer has broken covenants with the owners and you think a lawsuit is in order, you might want to discuss your situation with an attorney. However, new owners like you describe may not go along with spending money to sue the developer so you may just need to wait until the developer transition period is complete. If I have misread your letter and the developer transition is already complete, you simply need to elect new leaders for your community. You will need volunteers ready, able, and willing to serve. They will need training and support. You should also consider hiring a community association attorney verse in developer transition, and accountant, and a property manager if needed. The developer’s team was there to support the developer, not the community association. Getting the right folks in place is vitally important to your association’s success. Your local CAI Chapter can help you find the resources you need. Visit http://caict.org to learn more. Good luck!

Condo Reserve Study Reveals Major Shortage

B.P. from outside of Connecticut writes:

Dear Mister Condo,

Our new condo management company did a projection study. Unit owners received a letter stating that each unit will be assessed $50,000 payable over a 30-year period unless we vote to take over inside and outside of our units. Is this legal?

Mister Condo replies:

B.P., I’ve never heard of such a thing but that doesn’t make it illegal. The whole idea of a condominium association is that the association is responsible for all common elements, which includes the exterior of the buildings. Individual unit owners do not own the building exteriors so they are not directly responsible for the care and upkeep of them. I say “not directly” because unit owners do have to do two things to make sure their properties are well maintained. The first is to pay their common fees on time. Common fees are the lifeblood of the association and include a contribution to the Reserve Fund, which is where the money to maintain the common elements should eventually come from. Second, and equally important is that unit owners need to elect responsible folks to govern their association. The Board is directly responsible for overseeing the upkeep of the association. They typically do so by hiring outside contractors and management companies to implement this duty but they are the ones representing the association in all matters regarding maintenance and preservation of the association’s common elements. Your governance documents clearly spell out the duties of the association with regards to common elements. If I had to guess, I would say that the communication you received is not properly communicating the message of a Reserve Fund contribution. $50K contribution over 30 years is a little less than $140 per month. Without knowing the amount of assets your association needs to maintain, I would say that is not an unreasonable number for monthly Reserve Fund contributions. I would hope that your association is already collecting these Reserves as part of your monthly common fees. If not, this letter may have been meant to serve as a warning that there is going to be an increase to your common fees to cover the necessary Reserve Fund contribution needed to maintain the community. The “projection study” conducted by the management company may have actually been a “Reserve Study” and they are simply conveying the results of the study. Either way, your association needs to build a healthy Reserve Fund so future repairs can be afforded. Every single common element is aging as we speak. Money needs to be collected today for those replacement projects tomorrow. All the best!

HOA Bills Unit Owner for Repair Team’s Lack of Unit Access

J.C. from outside of Connecticut writes:

Dear Mister Condo,

The unit above me leaked into my garage. The owner happens to be on the Board of Directors. He is having the HOA pay for it. Now, I got a bill from HOA that my tenant was not home for them to do the work.

Mister Condo replies:

J.C., well this is certainly a series of unfortunate events. I am sorry for your troubles. Typically, the association carries insurance for damage caused by your fellow unit owners. The fact that this unit owner serves on the Board of Directors is irrelevant unless you are alleging wrongdoing on the part of the Director. From what you have told me, I do not see any wrongdoing here. The Director is also a unit owner and protected by the same association insurance that you are. The HOA dispatched a repair operation to your unit, which is what they are supposed to do. Was their communication between the HOA, the repair firm, and you or your tenant? If so, and your tenant agreed to be home when the repair team was dispatched yet failed to be there, I can see where the HOA would assess a fee to you for the cost of the repair team not being allowed access to your unit. If there was no communication that a repair team was coming and they are still charging you, I would challenge that fee and maybe even speak to an attorney about the fee to see if it is something you could sue over. Chances are the amount in question is too small to sue over. The bottom line is that you want the repairs to your unit made so work with your HOA to make sure that happens. If your tenant can’t be there, you may have to be there yourself to make sure the repair team has access. All the best!

Complacent Condo Owners Liable for Board’s Poor Performance

F.M. from outside of Connecticut writes:

Dear Mister Condo,

I joined the board a year ago. The other board members are there for decades, not by vote but because we never reached the minimum quorum to carry out an election. After investigation, I found several flubs in the past decisions that led us to severe loss to our condominium. One of them, amounts to almost $300,000 in losses with the cost of irrigation water. The association has been paying the local utility company by the highest water rate when it should be 70% lower if they had applied with the utility company for a lower rate based on the size of our property. The lower rate was available since 2008 and it was very easy to learn about. Another issue is the roofs of our buildings. The wooden shakes were replaced in 2004 after damages caused by a hurricane. However, as I learned, the wooden shakes replacement was not done by Standard Building Code. The association did not hire an architect or engineer to guide them in the reconstruction process. As a consequence, the roofs were replaced by local contractors and are now in very bad shape, will not last much longer and the overall aspect is detrimental to our property values. Another issue is the most recent, and involves the resurfacing of our tennis court that had been in bad shape and useless for years. The association knew that the ground soil was sinking and that the soil needed to be addressed beforehand. Instead, they approved a cheap painting for $7,000. The tennis court is visibly off level. Considering the way decisions are made by the board, I am afraid that our condominium will suffer further downgrades if action is not taken to remove and replace the board members. Because of the last recession, more than 50% of our units are now rental units. It will not be an easy task to obtain signatures of 75% of all property owners to remove the board members. My question is whether a legal action to compel them to leave is a valid option.

Mister Condo replies:

F.M., I am sorry for the situation you find yourself in. I am not an attorney so I cannot offer you legal advice as to whether a legal action to compel the Board to vacate their office is a valid option. However, I will tell you that, in my opinion, it is not a valid option for the following reasons. Your association is a privately held, not for profit, corporation. The corporation was founded to govern the association and unless you can cite an explicitly illegal activity, the Board has done nothing legally incorrect. In fact, for decades, the unit owners of your association have returned them to office at Annual Meetings, where democratic elections have been held. Lack of quorum only shows that unit owners didn’t care enough to participate in the governance of their association. Shame on them for doing so as all unit owners have paid the price over and over again for their lack of attendance. If it were me, I would sell my unit and get out before any further financial damage occurred. That is an option available to you. If you wish to remain and try to effect change, you will need to seek other like-minded unit owners to run for election to the Board and get enough votes to win. If you think you have the votes/signatures to force a recall election prior to the Annual Meeting, you can certainly follow the steps on your governing documents to do so. However, with so many absentee owners, I agree with you that would be unlikely. Annual Meetings are typically your best bet for a changing of the guard. You will need to campaign for new Board Members and be sure they are ready to serve. You should reach out to resident unit owners ahead of time and write to absentee unit owners to encourage them to support these new candidates with a proxy vote. Change to association governance comes from within the association. Simply doing an inadequate job of managing the association resources isn’t enough to have Board members removed. It takes a fresh batch of candidates to unseat incumbent Board Members. And guess what? If your fellow unit owners don’t support that change, it isn’t going to happen. Good Luck!

Exterior Rot on Condo Leads to Interior Water Intrusion

R.S. from Missouri writes:

Dear Mister Condo,

I am a condo unit owner for 13 years. I recently experienced my third interior damage leak from rotted siding and decades old flashing. Would the HOA be responsible for the cost of these repairs? My monthly common includes maintenance of the exterior of the unit. Thank you!

Mister Condo replies:

R.S., I am sorry that you have had three different water intrusion events that have caused damage to your unit’s interior. I hope you have homeowner’s insurance to help you mitigate against the losses. It would appear that your condo isn’t being maintained as well as it might if you are experiencing rotted siding. Properly installed flashing may last decades but not if water is getting in behind the flashing. The Board of Directors is charged with maintaining, protecting, and even improving the common elements of the association as outlined in your condo documents. They are also responsible for putting in place a strong fiscal plan that includes building up association Reserves for the eventual replacement of common elements. Have they done that? Is there money in the Reserve Fund to pay for the needed repairs? If not, this problem is only going to get worse as further deferred repairs will lead to more decay and more water intrusion events as you have described. It may be time to have a heart to heart with the Board and fellow unit owners. It may be time for a community association loan to make these repairs and it is most certainly time to raise common fees so that a Reserve Fund can be built for future repairs. This may mean that common fees will rise significantly but if there is no Reserve Fund, they have been artificially low for too long. The HOA is responsible to repairs made to the exterior of the unit. You are responsible for repairs made to the interior, even if they are caused by neglectful maintenance by the association. That is why you have to have insurance for these losses. It’s time to get your condominium association back on track financially or these claims are going to become larger and much more frequent. Let’s hope it doesn’t come to that. Good luck!

Costly Condo Leasing Restrictions

R.F. from Texas writes:

Dear Mister Condo,

Years ago (before I bought my condo in Texas) the HOA passed a Standard Operating Procedure (SOP) and made it mandatory that all rentals go through their onsite management. If I rent my unit out on my own I must pay the full 40% fees + a penalty. Is this even legal for them to force me to use them?

Mister Condo replies:

R.F., leasing restrictions such as the one you have described are not uncommon. Using a particular agent for leasing agreements is one way the Board of the HOA can be certain that all leasing rules and regulations are adhered to. The penalty for not leasing through their agent is designed to discourage the practice and, at a 40% fee plus penalties, I imagine it is particularly effective. While it does seem unfair that you don’t have any other reasonable option for renting your unit other than by using the onsite management company, my guess is that the onsite management company is an excellent and efficient way to keep your unit rented out. Since anyone interested in renting will ultimately end up at their doorstep, there is a greater likelihood that they will rent it out quicker and to a qualified renter. All the best!