Tag Archives: Communications

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!

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!

Providing a Copy of Condo Lease Agreement is S.O.P.

G.D. from New York writes:

Dear Mister Condo,

My question is “Are we, as owners, required to give a copy of our lease agreement with a tenant and her Social Services information to the board?” It’s not a co-op. We own our unit and I feel her information is not their business. Am I right? Thank you.

Mister Condo replies:

G.D., I do not think that you are correct in this matter. Keep in mind that I am not an attorney nor am I an expert in New York community association law. For a legal opinion, kindly consult with a locally qualified attorney. As a general rule, the Board of any common interest community has a right and a need to know who is living in their buildings. There are generally rules on leasing that require a unit owner who is leasing their unit(s) to provide a copy of the lease with all parties named to the Board or managing agent so that there is a record of who does and doesn’t belong on the property. There are sometimes restrictions on the use of common amenities on leased units as well and the lease is the legal document that may allow a tenant to use things like a workout room or community pool or clubhouse. The lease may also restrict the owner of the unit from using these same amenities during the time that the lease is in effect. There are also insurance issues, emergency contact issues, and more that require copy of the lease to be in the Board or managing agent’s possession. There are also restrictions on short-term rentals or AirBnB type arrangements. Providing a copy of the lease also shows that you are not in violation of the covenants you agreed to when you purchased. Finally, there are many common interest communities that place a cap or limit on the number of units available for lease at any given time. By providing a copy of the lease, you are demonstrating that you are not in violation of these provisions as well. If you find that the Board or managing agent has used any of the information in the lease in an inappropriate manner, you may have recourse. Other than that, providing a copy of the lease is really in the best interest of you, your tenant, and the association. Good luck!

Small Condo Governance Issues

R.G. from Litchfield County writes:

Dear Mister Condo,

We live in a three-unit condo. One unit is held in a Trust and the President resides in this unit along with his adult son. Our governing documents dictate that one person from each unit is the “director” and is allowed one vote. My spouse is the secretary and we are told by the President that, therefore, I am not allowed to vote, only my spouse is. My first question is does this right to vote change from meeting to meeting? Or does the same person always vote? The son, who is a resident only, conducts the meetings, directs the contractors, is rude at meetings and also makes impromptu decisions that everyone is afraid to challenge. My second question is what rights does he have as a resident? Can he speak up at meetings? Can he tell other unit owners what to do? How would one go about this situation without hiring an attorney? Our personal situation does not allow us to move, although it is an obvious solution.

Mister Condo replies:

R.G., smaller associations like yours have all of the same rules and regulations found inside their governing documents as larger associations have. Without hiring an attorney, you should give a good read to your documents and pay particular attention to rules on voting and representation at meetings. One vote per unit is common but many times any owner of a unit can speak, just not vote. If your wife is acting as Secretary and therefore a voting Board member, you may be limited to attendance only at these meetings as she is the voting party for your unit. Whatever the documents dictate is what should be followed. It shouldn’t change meeting to meeting although there may be times when a souse cannot attend so the other spouse would have the duty and ability to vote. The same is true for your directors. Do the governing documents dictate who can serve on the Board? Unit owners only? If so, the son cannot run the meetings or serve as President. If not, no harm, no foul. If you don’t challenge any of his decisions, guess what? He will keep making those decisions. Rudeness says more about him than you but that can be pretty annoying. If his momma didn’t teach him to be polite, there isn’t too much you or I can do to help him. I realize that hiring an attorney may seem too expensive and I don’t think that you will need to if you study your documents and arm yourself with information. Sometimes the threat of a lawsuit is as powerful as a lawsuit. If he does anything too outrageous, let him know you are consulting with an attorney to question his decisions. If that doesn’t get his attention, then it may be time to actually hire the attorney. Let’s hope it doesn’t come to that. Good luck!

Condo “Marketing Fee” Forces Unit Owners to Use Condo’s Designated Realtor

S.Y. from outside of Connecticut writes:

Dear Mister Condo,

Our condo board discriminates against unit owners who want to list their unit for sale outside the condo realtor. If you list with the condo’s realtor, the realtors commission of 6% is paid from the condo’s 10% “marketing fee” levied when a unit sells. If you use your own realtor, you pay the 10% condo “marketing fee” plus 6% to the realtor.

Many of us want to use our own realtors because the condo’s realtor shows preference to Board members and their friends. If you’ve ever been in a disagreement with the Board, look out, your unit will never sell.

We have considered legal action but this will damage sales prospects for our units.

 

Mister Condo replies:

S.Y., damaged sales prospects aside, I don’t see any other way to remove this obstacle to using a realtor other than the “selected” condo realtor. That being said, I am not sure there is a true legal issue here. The 10% “marketing fee” is a condition for anyone who sells. While I think that 10% is an exorbitant amount to pay for “marketing fees”, from what you have told me it is a rule that has always been in place. Perhaps the Declarant wanted to monopolize all initial sales and resales so the clause was added? Whatever the reason, the 10% is currently the law of the land for your association. How do you and your fellow unit owners feel about this? If there is enough dissent, why not simply vote to have the rule removed? The fee paid by a seller to a realtor is typically negotiated by the seller. Here, the association has already negotiated a permanent seller’s fee of 6% to the realtor, which the association is essentially rebating back to the seller because it is coming out of a 10% “marketing fee” the seller agreed to abide by when he or she originally purchased in to your association. While I will agree that it is a bit questionable, I am not certain it is anything that can be undone by bringing a suit against the association. You have the power to correct the situation by simply eliminating the “marketing fee” or making it 4% (10% – 6%). Either method would leave the unit owner free to select their own selling agent at whatever fee they negotiated. 6% is common but I know of many markets across the country where listing fees are far less. Many times, the real estate market dictates what is a reasonable fee versus a “set in stone” flat rate. Good luck!

Small Condo Board Can’t Get Along!

R.G. from Litchfield County writes:

Dear Mister Condo,

The President of our 3-unit condo would like to go virtual! He no longer wants to have regular meetings and would like to do everything completely by email, with a 24-hour period for responses. Although he claims it is because of lack of civility on everyone else’s part, besides his own, this man is even ruder in emails! My question, however, is on the legality of voting and holding meeting by email. Our by-laws do not mention this as they were first enacted in 1986. What other ways would you suggest our board holds meeting so that there is accountability and respect for all. We have come up with having a mediator and meeting in a more public place. Both were rejected by this man; the first was too expensive, the second, not private enough. We are at our wits end!

Mister Condo replies:

R.G., it is hard to imagine that such a small community would have this type of trouble. 3 units requires that three unit owners sit down monthly or less frequently if the by-laws allow, and take care of association business. There may be no provision for using email or any other form of communication that didn’t exist back in 1986 but that doesn’t mean that the association can’t adopt it, provided no state laws are being violated. The larger issue is that all parties need to agree to this “virtual” meeting and records must be kept as these meetings are official business of the association. Additionally, there will need to be Minutes from these meetings that serve as permanent record of the items discussed and voted upon. In a small association like yours, that sounds like a lot of work. The mediator idea is valid and may make sense to get the association out of its dysfunctional phase and back on track. Ultimately, the three unit owners should find a way to work together to handle the business of the association. You can disagree but not be disagreeable. I am guessing the mediator will help with that process. Good luck!

Informing the State of Newly Elected Board Members

C.W. from Florida writes:

Dear Mister Condo,

I need the form to inform the State of Florida of the newly elected board members. I cannot find it.  Can you help? Very important. Thank you!

Mister Condo replies:

C.W., I am not aware of a requirement of keeping the state informed of the Officers and Board Members of your condominium or a specific form to do so. I am aware of a certification form for newly elected Board members that they must file with the association secretary that they have read the by-laws of the association and that they will fulfill their duties of upholding those by-laws. A sample of that form can be found here: http://www.ccfjfoundation.net/CondoCandForm2010.pdf

Annual corporate filings with the state (tax records and such) may have a place to list officers and/or directors. Those forms are typically filed by the association’s accountant or Treasurer. I am not an expert on Florida community association law as I don’t live in your state but I would ask any of my regular followers to kindly give a more detailed answer if I have overlooked anything. Good luck, C.W.!