Insuring the Uninsured at this New Jersey Condominium

L.R. from Sussex County, NJ writes:

Dear Mister Condo,

There is ONE owner who refuses to acknowledge any monthly updates and won’t pay. It appears that his portion of the master insurance policy is coming up. We are in high risk as this guy doesn’t carry any insurance and an incident had to be absorbed by association through the master policy. Now our insurance policy premium has more than doubled in cost, adding insult to injury to the innocent. Decent owners are left paying the bill. I am the new President of the Association. In the past, no one ever had any policy in place for any non-compliance issues. I am assuming I can do more in terms of this owner. Can we require him to purchase a policy? Can we charge him back any additional costs incurred by the Association that are caused by his lack of insurance? It was voted as well that all owners have homeowners insurance. He ignored that and the association paid out on a claim as I mentioned. Now the master policy is huge. Shouldn’t this unit owner have to pay a penalty?

I have an additional question regarding the coupling of the two separate buildings and possible emancipation. Lots of property is involved. I see the deed reflects mine and I also pay the highest property tax! It seems some things evolved for the advantage of previous owners! What can I do? Blessings!

Mister Condo replies:

L.R., blessings to you as well, my friend. Congratulations on becoming President of your condo association. It sounds like you may have your work cut out for you. Please understand that I am not an attorney and that my advice is to be taken as friendly. You may wish to consult an attorney for a proper legal opinion in this matter. That being said, you need to begin with your condominium documents and see what they have to say about requiring adequate homeowner’s insurance to be in place by the unit owner. If the condo documents do not address the requirement, you may need to refer to New Jersey state law. Again, this is an area where consulting an attorney may make the most sense. If your documents require that all unit owners maintain adequate homeowners insurance and this unit owner failed to do so, you will likely be able to bring suit against the unit owner for all of the financial hardship caused. If your documents do not require this insurance then you may be out of luck. You mention that a recent vote was held to require homeowners insurance for unit owners. That may cover you moving forward but may not be any use to you in recovering damages from the previous claim. Again, my best advice is for you to speak with a local attorney verse in community association law in your state. You can find several great ones here: https://cainj.org/tag/attorneys/

While you are speaking with the attorney about your insurance issues, why not inquire about your building emancipation question as well? When real estate project like condominiums are planned, there are very legal documents filed with your local municipal authority. These documents outline the relationship between the buildings and the corporation built to crate the real estate entity. The deeds, taxes, mortgages, and more are issued based on these documents. Changing them is a major headache and, generally, not worth the time, effort, and legal costs associated with doing so. However, if you are being taxed unfairly, you certainly have the right to find out why and see if there is something that can be done (perhaps a reevaluation of your unit?) to correct the situation. Again, you really need the advice of an attorney to see if that is feasible. All the best!