Assessments Condominium Financial Governance Legal

Condo Special Assessment Misappropriated


J.M. from Fairfield County writes:

Dear Mister Condo,

We were charged for a special assessment that was for 5 years. At the end of the 5 years, the association kept the additional money and applied it to our so called short fall that we were never notified about. Can they apply money from a special assessment to cover general expenses without a vote or notification? Also, the LLC owns 21 units and only 6 are owner-occupied so every time there is a vote we are outnumbered, what can we do? Thanks!

Mister Condo replies:

J.M., special assessments have their own set of rules as do what happens during the developer transition of a condominium. Since the LLC still owns a majority of the units, I asked an attorney friend of mine who specializes in this area of law for some legal help in providing this answer. Here is what the attorney had to say:

“The declarant owes fiduciary duties to the unit owners while it controls the board, which includes proper management and disclosure of the association’s finances. The declarant is free to exercise its voting power as long as it is honestly serving the association’s best interests and compyling with the governing documents. It’s legal to impose a special assessment to cover a shortfall in the operating budget so long as the procedures in the declaration and bylaws are followed. Notice is always required, but a vote of the unit owners will usually be unnecessary if the assessment is small relative to the annual budget. You and the other unit owners should talk to an attorney to determine whether the declarant violated any procedural requirements or improperly caused the financial problems.”

That sounds like good advice to me, J.M.! Good luck!

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