Monthly Archives: May 2017

Required Audit for Condo Association

J.B. from outside of Connecticut writes:

Dear Mister Condo,

Are condo associations required to get an audit?

Mister Condo replies:

J.B, that is a great question! Very few states have legislated audits for condo associations as state law. That leaves the association’s governance documents. Many call for an audit in some type of timely interval; many do not. Unless the governance documents expressly call for an audit, the association is likely to audit as it sees fit, if at all. For smaller associations, an audit can be too costly or the Board may feel no need as the dollars involved are so small there really isn’t much chance of the money going missing. For larger associations, an audit is almost a requirement as there can be millions of dollars in play. Generally speaking, larger associations are more likely to have audit requirements as part of their governance documents. It is certainly recommended and a best practice to help keep theft and embezzlement at bay. Check your documents and see what they say. If they are silent on audit requirements and you feel they are needed, ask your Board to consider adding an amendment that requires an audit every so many years. You may just be helping your association develop its own best practice. By the way, auditors that specialize in condo and HOA accounting are often members of your local chapter of CAI. Be sure to check there when looking for a qualified and experienced auditor. Good luck!

Condo Denies Disability Parking Request

S.B. from outside of Connecticut writes:

Dear Mister Condo,

Can the condo association deny a request for disability parking especially since the condo is on private property?

Mister Condo replies:

S.B., you may have noticed that there are many questions and answers about disabled and handicapped parking on my website. It is a serious matter, to be sure, but the answer remains the answer. It depends. Generally speaking, since condominiums are private property, there aren’t too many restrictions on how they parcel out their parking lots. If the unit came with deeded parking (a specifically assigned parking space that is part of the deed of the property), then the unit owner has exclusive use of that space or spaces. All other parking is usually owned by the association and can be used as they see fit. If a request for a handicapped space is made of the Board, the Board should review the request and determine if it is reasonable to grant the request. For most associations, since parking is usually in high demand and short supply, they can claim that dedicating association parking for handicapped use creates and undue burden on the association. If the unit owner in question has deeded parking and is simply looking for additional dedicated parking, they are often out of luck. Of course, to be safe, I usually recommend that the Board consult with the association attorney to make sure no local, state, or federal laws are being violated if the Board decided to deny the request for dedicated handicapped parking. Handicapped parking seekers often cite the Americans with Disabilities Act (ADA) as their grounds for requesting the handicapped parking. However, the ADA does not deal with privately owned parking lots such as those found in typical condos. Exceptions are if the association is renting out the clubhouse or has amenities that are also open to the public for a fee. Then the rules change. Other than that, the Board is usually free to use the association-owned parking as they see fit. All the best!

Responsibility for Broken Sewer Pipe in Converted Condo

J.R. from outside of Connecticut writes:

Dear Mister Condo,

Who is financially responsible for replacing broken sewer pipe in a unit that was converted from an apartment to a condo? The complex was built in the 1960s. The condo’s new owner discovered the broken drain line subsequent to purchase and closing. Thanks.

Mister Condo replies:

J.R., the short answer is “it depends”. What it depends upon is who owns the sewer pipe? If it is part and parcel of the common area owned by the association, then it is likely the association’s responsibility to maintain and repair as needed. If, however, the pipe is owned by the unit owner (which would be very rare), it may fall upon the unit owner to maintain and repair. The condo’s governance documents are the place to turn for your answer. Typically, in conversions, unit owners purchase from the “paint in”, meaning they are only responsible for what is inside of their unit. If a toile line breaks inside the unit, the unit owner is responsible. If the sewer pipe is beneath the unit or buried in a common wall shared with other unit owners, it is likely the responsibility of the association. Either way, I hope if gets fixed quickly. Regardless of who owns it, I’ll bet it stinks! All the best!

Condo Unit Owner Seeks Approval for New Air Conditioning Unit

C.L. from Massachusetts writes:

Dear Mister Condo,

I live in on the top floor of a 30-unit Condo just outside of Boston. The building is actually two, 3-story 15-unit buildings facing each other across a nicely landscaped courtyard. There is a paved back alley behind each building separating the building from other single and multi-family homes. The alleys are used for trash and recycling, as well as a couple bike racks.

I’m looking to install a mini-split a/c unit and am having difficulty getting my condo board to approve the installation of the outdoor compressor unit. I’ve suggested placing the unit on our flat roof, working with our roofing contractor to ensure that the installation would not harm the roof, nor void the roof’s warranty. Our Condo board rejected that because they claim that historically the board has not allowed for the use of the roof and did not want to set a precedent for other requests to the use of the roof.

I also suggested installing in the back alley (used for trash, recycling, bike racks and a couple outdoor grills). They rejected that idea because of a noise concerns and the setting a precedent for future requests for a/c compressors (and tripping over it, but that seems so laughable it’s hard to even retype it).

Any ideas how other condo associations deal with mini-split a/c compressors either on the roof or in non-landscaped, back alley space? Suggestions on how to present the value of mini-split a/c (more efficient, cheaper, better functioning and quieter than window units) to our board? Thanks for your advice!

Mister Condo replies:

C.L., “we’ve always done it that way” is a very common response to proposals from unit owners as to why their request is denied. Additionally, the Board has to deal with future requests that will cite your variance as an example of why they need to approve further modifications. It is a sticky wicket at best and the Board is well within its rights to refuse any building modification that wasn’t part of the original specification of the property, meaning technologically advanced and advantageous upgrades such as your mini-split A/C compressor will very likely be rejected by the Board. Not because it isn’t useful or chock full of benefits but because it causes a change to the architectural look and feel of the association. That is a Pandora’s Box the Board is wise to avoid unless they want to deal with other such requests in the future. I have no data to share regarding how other Boards handle similar requests but I will say that it does depend on the mood and composition of the Board. In other words, if you have tried and true Board members who are used to saying “No” to requests that modify the look of the association, I wouldn’t expect them to suddenly start singing a different tune. If there are enough owners who agree with your proposal, it may mean getting them on to the Board where they can do something about it. Understand this, though, while your proposal seems harmless enough and will yield cost saving and other benefits, that is not the duty of the Board. There charge is to protect and maintain the association. Enhancements are often the hardest thing to sell to the Board. Enhancements that change the look or use of common elements are often defeated. Good luck!

Unapproved Remodel to Upstairs Condo Damages Downstairs Unit

L.S. from outside of Connecticut writes:

Dear Mister Condo,

The question I have is this, I live in a condo that has 4 units per bldg. I own mine. These condos were built in the late 50’s maybe early 60’s. Unfortunately, there is an HOA fee of 150 dollars a month and the outside of the buildings look horrible. They really need to be painted and new front and rear doors placed. The front porch is falling apart. The condos were not built like the newer ones are. Someone purchased the upstairs condo and decided that they would remodel the whole condo. There was a wall removed and other major repairs without a permit that has caused damage to my condo. I spoke to a contractor who looked at the damage and informed me that if we were to try to fix it, it would cause more damage. The upstairs condo would receive damage also. I am just wondering who should pay for the damage. The owner knows that there were issues and he wanted his handy man who caused the damage and himself to look at it. I am not sure what good that would do. Should I file a claim with my insurance company and let them fight it out or is there another way to deal with this? Am I going to be stuck with a huge bill?

Mister Condo replies:

L.S., you certainly have a lot going on inside your 4-unit building. Let me address each item separately. First up, the HOA isn’t maintaining the property as they should. There is no reason for painting to go undone other than there is no money in the Reserve Fund for the project. You mention a fee of $150. If that fee isn’t enough to cover operating expenses and set aside money for routine maintenance like painting and door replacement, there will need to be a Special Assessment and/or an increase to common fees. Neither option is popular but that is the only way to get the association back on track so it can fulfill its duty to maintain the building exteriors.

The remodeling project is another issue entirely. It sounds like the upstairs unit owner did some unauthorized and unpermitted work on their unit causing damage to your unit. It’s time to speak with an attorney about suing the unit owner for the damage. You should file a claim with your insurance if you have suffered financial damage worth filing a claim over. However, the fault is clearly with the unit owner who did the unauthorized remodel. You governance documents likely spell out what types of repairs and improvements can be made to unit interiors. If they knocked down a supporting wall, you could be looking at a very expensive repair, not to mention the potential danger you are in. I would want to get this taken care of immediately. If they are amenable to correcting the problem at their expense, you may not need to sue but, in my experience, once the dollars start adding up, a lawsuit is almost inevitable. You should be able to recover your damages though and I am hopeful that your upstairs neighbor will do the right thing. Good luck!

Withholding Repairs to Delinquent Condo Unit Owner

M.B. from outside of Connecticut writes:

Dear Mister Condo,

Can a condo board withhold unit repairs to an owner who is delinquent?

Mister Condo replies:

M.B., that is a loaded question with lots of possible answers! Since I am not an attorney, I must recommend that you speak with a qualified community association attorney from your area to determine if withholding repairs is within the association’s rights. Typically, my answer would be that the association has a duty to upkeep and maintain all common elements as they are property of the association and not the individual unit owners. The association’s governance documents clearly state what is the association’s duty to maintain. This would usually include parking lots, landscaping, amenities like pools, sidewalks, roofs and building exteriors. Now, if a unit owner became delinquent in their common fees and needed a roof replaced over their unit, the association would still have to maintain that roof because they own it, not the individual unit owner. Failure to maintain a common element would be akin to cutting off your nose to spite your face. It will still need to be done whether the unit owner living under that roof is delinquent or not. I think the more important question here is what steps the association CAN take to either bring this unit owner up to date with fees or force a foreclosure where by the association evicts the unit owner, and, hopefully, replaces the unit owner with a dues-paying owner. If you haven’t already done so, consult with your association’s attorney and make sure the proper steps are being taken. Good luck!

What to Look for in new Condo Property Manager

D.G. from New York writes:

Dear Mister Condo,

I saw you speak at a recent CAI Long Island chapter meeting. We are looking into a property Management company. What specific and important questions should we include in our Request for Proposal. Also, can you offer some suggestions on important questions to ask Property Manager company during the interview. Thank you for your assistance.

Mister Condo replies:

D.G., thank you for your question and I hoped you enjoyed my presentation. It was my pleasure to address the membership of the CAI Long Island Chapter. I hope to be invited to come back and speak with your group again. I have a new page on the website describing the program if you care to take a look – http://askmistercondo.com/mister-condo-live/

On to your questions. I am happy to learn you are seeking some advice BEFORE hiring a Property Management company. It is not like buying a T-Shirt, where One Size Fits All. There are many different types of Property Management companies and even Property Managers within the company. Obviously, reputation within the industry is important. You should certainly speak with other CAI Chapter members who have hired Property Managers and ask them how pleased they are with their choice. Referrals and reputation play a strong role in Property Manager selection.

Your request for Proposal should include all of the services you want the Property Manager to perform. Will they simply handle your bookkeeping needs? Will they perform on-site inspections? Will they provide Property Maintenance services like landscaping and snow removal? Will they need to provide on-site personnel? For smaller associations, the management needs can be fairly simple. For larger associations, the needs can be quite significant. You should work with your Board to answer the questions before you prepare your Request for Proposal (RFP). Additionally, I know of many community association attorneys who like to be hands-on in the RFP process as they would prefer to help in a pre-emptive manner rather than having to deal with a potential problem that could have been avoided. Something to think about.

During the interview, one of the questions I like to ask is if the Property Manager can describe a recent challenge and how they helped the community overcome it. While this may not be the same challenge your community will face, it may give you an idea of how this manager operates. If you are facing a current challenge, you might want to ask how they would solve the challenge. Again, this will give you an insight as to what to expect once you hire them. Of course, I am a big fan of hiring Property Managers that are active in CAI. That signal me that they are industry professionals and are keeping current on their training. As you know, laws change, technology changes, and the overall methodology changes as well. CAI Member Property Managers tend to be “in the know”, which is a tremendous benefit to their clients. Hope that helps. All the best!

Can the Condo Property Manager Sue Me?

M.Z. from outside of Connecticut writes:

Dear Mister Condo,

Has the property manager the right to fine me or sue in court?

Mister Condo replies:

M.Z., I am sorry you find yourself at odds with your Property Manager and now need to inquire if you can be fined or sued. The answer to both questions is yes, but with a few caveats. Property Managers work for the association and are granted their powers to enforce the covenants of the association by virtue of their contract with the Board to do so. They cannot make up offenses that you can be fined for. If you are in violation of your community’s rules and regulations, the Property Manager can issue you fines as outlined in the governance documents and in accordance with local and state law. In many states, unit owners who have been cited for violating rules must first be summoned to appear before the Board and state their case before the fine is issued.

Suing you is a different matter entirely. As an individual, almost anyone can sue anyone in this country. The Property Manager can follow the Board’s instruction to bring suit against a unit owner for a couple of reasons. The most common is that the unit owner is in arrears with the association. Delinquency of common fees or special assessments are the most common reasons an association would sue a unit owner. An ongoing dispute over architectural compliance issues is another. In both of these instances, the Property Manager is acting on behalf of the Board. If you and the Property Manager got into an altercation (I hope not!) and the Property Manager decided to sue you personally, that is certainly their right.

The bottom line is that you should speak with an attorney if you are being sued. Personally, and professionally, the Property Manager can bring suit against you. You will want to defend yourself. I hope it doesn’t come to that. Good luck!

Condo Insurance Payment to Unit Owner or Association?

S.F. from outside of Connecticut writes:

Dear Mister Condo,

Our building’s exterior was damaged by a falling tree. The claim check for six thousand dollars was made out to one of the condo owners. Should it have been made out to the condo association?

Mister Condo replies:

S.F., I am sorry that one of your buildings was damaged. Typically, the check is made out to whoever holds the policy. So, if the association was the policy holder and the damage occurred to association-owned property, the check is cut to the association. If the unit owner held a homeowner’s policy and that policy covered the damage, the check should have been sent to the unit owner. Building exteriors are almost always owned by the association and covered by an association policy, but exceptions do occur and insurance companies can also make payments directly to vendors or third parties at the policy holder’s request. Without knowing all of the circumstances, I cannot offer an opinion on exactly who should have received the check. However, as long as the damage was repaired and the vendors have been paid, there may be “no harm, no foul” to the association or the unit owners. All the best!

Condo Bullying and Harassment

R.C. from Florida writes:

Dear Mister Condo,

What can unit owners in Florida do when bullied, followed, harassed, watched, threatened, etc. by condo association members and property manager? Especially when a lot of us are elderly and/or disabled physically in some way? Can you at least point me in the right direction?

Mister Condo replies:

R.C., I am sorry you and your neighbors find yourselves bullied, harassed, threatened or otherwise bothered by anyone, let alone the folks who govern and manage your association. True bullying, harassment, and threats are criminal offenses which should be reported to the proper authorities, including your local police department. Short of that, you might want to speak to an attorney who specializes in elder law to see what types of protections you are offered. The Property Manager works for and reports to the Board of the condo. You and your fellow unit owners have elected the Board to serve. If they aren’t doing the job properly, it’s time for a new Board. The condominium’s governance documents spell out the rules, regulations, and enforcement procedures for the condo. I guarantee you that bullying and harassment are not a part of those documents. In my experience, the best remedy for a condo bully is to stand up to him. That may mean removing him or her from his position of authority. It may even mean calling the police or bringing suit against him or her in a court of law. Bullies like victims, not folks who fight back. In Florida, you might want to check out the Department of Elder Affairs website to see if there are local resources to help you as well. You can find the information online at http://elderaffairs.state.fl.us/doea/report_abuse.php. Good luck!