Tag Archives: Communications

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.!

Can the Condo Board Require Visitor Sign In?

M.T. from outside of Connecticut writes:

Dear Mister Condo,

Does a condominium board have the right to make my visitors sign in and out at the concierge desk even when I say I do not want this?

Mister Condo replies:

M.T., yes, the association has the right to know who is on the property. Even though you own your unit, you do not own the common grounds, which are subject to the rules and regulations of the association, which is governed by your Board. Many associations require not only names but also vehicle information of visitors. Condominium associations are not public property. The association has a right, and often a need, to know who is on the property and for what purpose. All the best!

Are All Condominium and HOA Documents the Same Regarding Common Elements?

J.J. from New Haven County writes:

Dear Mister Condo,

Hi Bob, I just listened to the podcast about the alligator in the condo fountain (http://askmistercondo.com/alligator-in-the-condo-fountain/)! I have a question that I am hoping you can answer. But, a little on me. I have been involved in the community association maintenance business since 1978, with the last 17 years as a general contractor specializing in condo buildings repair and capital improvements. I have worked for various management companies over the years. Some good and some not good. My question is I understand the laws have changed some years back in regards what the association is responsible for as far as maintenance. When I started, I learned the association covered to the drywall. Now. I am hearing the association covers a lot more inside the unit. I ask managers and no one either knows or won’t give me a straight answer. Can you help so I may service my associations with correct knowledge?

Mister Condo replies:

J.J., the answer literally varies from association to association so there isn’t a “one size fits all” answer. Additionally, I know of some associations that have modified their rules based on “how we’ve always done it” situations, regardless of what their governing documents say. Also, we have a few different types of common interest communities operating in our state and each has their own peculiarities. Condominiums are the most common and your explanation of from the walls in is quite common to describe what the unit owner is responsible for. Planned Unit Developments (PUDs) are also common in our state and often have the same type of rules. Cooperatives (coops) are also plentiful and have similar but not exactly the same rules. Homeowners or Property Owners Associations (HOAs and POAs) are also common but seldom get into the unit interiors. These groups are typically about architectural conformity and shared common amenities (a clubhouse, pool, beach, etc.) Within each of these groups are additional subsets (Adult Communities, 55 and over, Assisted Living, and so on). As you can imagine, each has their own set of governing documents and each has their own specifics on who owns and maintain which elements.

As a contractor to an association, you are going to handle the work assigned to you by the association. You should ask the association where the association responsibility ends and the unit owner responsibility begins. Short of you taking the time to read all of their governance documents, you would have to operate under the assumption that they know what they are talking about. If you complete their work order, and they pay you for your work, it is of no concern to you if they need to then bill an individual unit owner for work you did on their behalf. If they are asking you to bill a unit owner for work you performed at their request, I would ask them to change that arrangement for the sake of your business relationship with the association. You know the association will pay you for work you have contracted with them. You have no way of knowing if a unit owner is going to pay you for work done to their unit at the association’s request. After all, they didn’t hire you. I know haven’t given you a “cut and dry” answer here but that is the nature of the industry. Keep doing the great work you’ve been doing and I am sure the issues of responsibility for maintenance will work itself out, association by association. Good luck!

What is a “Reasonable” Amount of Time for A Condo Record Request Inspection?

L.L. from Massachusetts writes:

Dear Mister Condo,

How long should I wait to view my condominiums financial records? I requested to see them 6 business days ago.

Mister Condo replies:

L.L., as a unit owner you have the right to inspect just about all of your association’s records, including the financial records. Typically, the records need to be available during normal business hours or within a “reasonable” time. That is where the real answer to your question lies. What you consider “reasonable” and what the keeper of your records considers “reasonable” may vary so the key is likely for you to remain vigilant but patient. If the record keeper fails to provide you with access, your recourse is to sue. I am not an attorney nor do I offer any legal advice in this column. My friendly advice is to ask again and ask what the association considers as a “reasonable” amount of time to honor the request. My guess is you’ll get access to the records when the other party is available to accommodate your request. Keep in mind the records are owned by the association. If you wish photocopies, you may be charged for the service as well as a small fee for the employee’s time for assisting you. Good luck!

Ill Condo Renter Has Car Towed

L.H. from Fairfield County writes:

Dear Mister Condo,

I rent a condo in a complex that has an Association and also a building management company. My car was recently towed without any prior notification to me – no phone call, no email, no letter, no knock on the door. I have not been driving my car since September of 2015 for medical reasons, and in October of 2015, someone from the Association put a note on my car because it hadn’t been moved for a month. I called the building management company and informed them about my medical issue. I never heard back from building management. So yesterday without notice the car was towed. I haven’t yet been told where the car is, who towed it, or what I might need to do to get it back. BTW, I’ve rented this unit for 10 years now, and have NEVER been introduced to ANYONE on the Association and none of the members have ever made it their business to get to know me. What are my legal rights in this issue? Thanks.

Mister Condo replies:

L.H., despite your status as a long-term renter in this condo, you are still bound to follow all of the rules of the association as is every other unit owner, renter, and any other resident. That includes the parking rules, which can be quite challenging to enforce. I agree with you that this is an unfortunate situation that could have been handled better but if your car was parked in violation of association rules, the association has the right and the responsibility to enforce the parking rules so that all community members may enjoy the parking area. I am not an attorney so I do not offer legal advice in this column. I do not personally believe you have legal rights in this situation as you violated the parking rules by leaving your vehicle parked on the association-owned parking grounds for far too long a period of time. I am not sure why you would have any expectation to be introduced to anyone on the Board of the association. They represent the unit owners and are elected by the unit owners at unit owner meetings. As a renter, you aren’t a unit owner. Your relationship is with the owner of your unit; not the association. If you feel your legal rights have been violated, by all means, contact an attorney who could better advise you of your options. In the meanwhile, the management company should be able to tell you where your car has been towed. You will likely need to pay for the towing and/or storage fees to get your car back. Once you do, you should make alternate arrangements for the long-term storage of your car. Otherwise, it will likely be towed again in accordance with the rules of parking in your condo. Good luck!

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!

Role of the HOA Board versus the Property Management Company

E.P. from outside of Connecticut writes:

Dear Mister Condo,

Grateful to discover this resource! Looking for material that outlines the role of management versus the role of the HOA board. As president, I’m raising it as a priority for this year to seek balance, lessen frustration and increase communication between the two. We have a hi-rise with 24/7 staff. Our largest budget expense is the management contract and salaries and benefits. It’s also our largest source of waste if people aren’t clear on their roles. Direct me to best practices, please!

Mister Condo replies:

E.P., congratulations on taking charge of this issue. I am glad you found this resource as well. The basic information to impart on your unit owners and residents is that the management company acts as the Board’s agent in enforcing the rules and regulations of the association. The Board is the governing body that is responsible for all aspects of association governance and directs the work of the management company. The Board is solely responsible for the policies and rules that the management company enforces at the Board’s request. It is important to note that the Board is made up of democratically elected volunteer members of the HOA. The Management Company is employed by the Board. The best resource I am aware of discussing these roles is the Board Member Toolkit, a free download from the Community Associations Institute. Get the download here: https://www.caionline.org/_layouts/15/download.aspx?SourceUrl=/HomeownerLeaders/ResourcesforHomeownerLeaders/CAI.BoardMemberToolkit_2014.pdf I think you will find it perfect for what you are looking for! All the best!

Condo Owner with Irregular Personality Disorder Exhibits Disruptive Behavior

S.H. from outside of Connecticut writes:

Dear Mister Condo,

What to do when owner refuses to listen to reason due to a psychological disorder that the family has no control over. Aside from an irregular personality disorder, they pay fees on time, just very disruptive daily, due to disorder.

Mister Condo replies:

S.H., this is an interesting question for several reasons. I am certainly sorry that you have a unit owner who is causing daily disruptions. I am sure the person living with the psychological disorder and his family face a daily struggle to manage. The only actions that can be taken by the association are to enforce the association’s rules about peaceful living. The term “disruption”, while polite, really doesn’t tell me too much about what is actually happening. Is the person abusive to other residents? Is association property being damaged? If no rules are being broken, then there isn’t too much the association can or should do. If rules are being broken, then the association has every right to serve notice, have a hearing, issue fines, and so on to enforce the association’s rules. Of course, this individual cannot be singled out as the only person breaking rules. If other unit owners are breaking the same rules, all need to be cited unless the association wishes to face possible discrimination charges from the unit owner or his family. My best advice is to look closely at your rules to determine if any are being broken. If they are, consult with the association’s attorney about the best way to enforce the rules without creating a discriminatory action. If the disruptive behavior ever gets to the point of assault or battery, it is time to call the police. Personality disorder or not, no unit owner has the right to abuse another unit owner. All the best!