Friday, June 25, 2010

When the Board Should Really Call the Association Attorney – Part II

To continue from yesterday, here are some further examples of situations that really require a call or meeting with the association attorney:

•You are considering amending your documents with a restriction that might be considered controversial. Prime examples would be “55 and over” age restrictions, leasing and sale restrictions, vehicle and pet restrictions, mandatory club membership and guest occupancy restrictions among others. Any time you tell your owners what they can and can’t do with their property and the common areas, expect pushback. Consulting your attorney first will help you consider how much pushback to expect and what the board’s stance should be. There is almost nothing new under the sun in terms of these kinds of restrictions and there are usually cases on point out there. Reviewing those cases with legal counsel before proceeding down the same path will save you money and potential heartache down the road or will bolster your commitment to making a similar change in your community.

•You are considering purchasing or selling property on behalf of the association, changing the parking space designations or the boat slip assignments. All of these matters are sensitive to owners and must be handled with sensitivity. Real property conveyances should be handled by an attorney who can prepare the proper documentation and review any title concerns with the association.

•You want to pursue an owner for a violation. Before threatening certain action in your demand letter, please make sure you have the authority to do what you threaten. You also might have more tools at your disposal that you might employ to resolve the violation which should also be discussed in that demand. Sending a premature or incorrect demand letter puts the association in an inferior posture later in the game.

•Your community has suffered damage as a result of a fire, flood, tropical storm, hurricane or other casualty. This is one area where many boards think they know it all. In fact, the cards are stacked against a volunteer board in terms of maximizing their recovery on an insurance claim. Most boards fall prey to common industry myths that they will be canceled or their rates raised if a claim is made. In fact, coverage cannot be canceled for those reasons. A board’s primary function is to maintain, repair, replace and insure the common areas and association property. Not only should a board consult with its attorney immediately after suffering a loss, it should consult with him or her prior to placing coverage to ensure that the coverage limits and true cost to owners is understood.

•You are served with a Recall Petition. You might not have followed the advice listed above if you find yourself on the receiving end of one of these. There are certain statutory and documentary procedures that must be strictly followed to properly effectuate recall.

•Finally, whenever you think you should call your lawyer, follow your gut instinct and call!

1 comment:

  1. Regarding non-commercial personal vehicle restrictions, what examples case law allows or prohibits restrictions? Put another way, at what point would the court restrictions unreasonable. As in Eagles vs Vizzi where the court ruled "such a result would be unreasonable,
    and would impose severe restrictions upon homeowners' use of their private property." Can this finding be generally applied?

    Thank you.