Sunday, July 10, 2011

Have an inspection rule in place before you need it!

There are certain rules that every community should have in place such as a rule regarding the official location for posting notices, a rule regarding hurricane shutters and a rule regarding participation at meetings. Perhaps no rule is more critical than a rule outlining how the inspection of the association's governing documents shall be conducted.

If you have ever been confronted with an inspection request for an incredibly large amount of documents going back 20 years from a person who finished reviewing many of the same documents the previous month, you will realize the importance of having a reasonable inspection policy in place prior to receiving that request.

It is important to remember that a reasonable document inspection policy can benefit both the board and the owners. It takes away any guesswork and possibly any games that future boards and owners may wish to play.

So what should your community consider having in your Document Inspection Rules and Regulations? Following are some suggestions:

● A reiteration of the statutory requirement that inspection requests be made in writing;

● A requirement that the request be sufficiently detailed to allow the association to retrieve the records requested. Catch-all phrases like "all" or "since the beginning of time" do not allow the association to easily comply within the statutory 10-day time period to produce the documents before penalties ensue;

● A limit on the numer of times any particular owner can inspect the association's records each calendar month. Is three times a month enough? How about four? The point is that if your community is large, there are only so many hours in the day and days in the week to accommodate everyone's requests;

● Identify which hours are available for inspections. A board expecting document inspections to only take place during a narrow one-hour period is not reasonable; neither is an owner expecting to inspect documents at midnight. Pick a time frame that makes sense for all;

● Understand that some owners only want to look at the documents and others want to copy them as well. Make it easy for those wishing to copy the documents to do so. Allowing owners to bring their own scanners and/or use a smartphone to snap a picture of the document they wish to review makes sense and cuts down on their costs and the association's time;

● Put a limit on the number of times the same document can be inspected in a one month period to avoid nuisance inspection requests. Since owners can obtain copies as discussed above, it is better to make such a copy which allows him or her to review the document as many times as needed in the comfort of their own home rather than continuing to go back to inspect same over and over; and

● Keep an inspection log of who made the request, which documents were inspected, which documents were copied and in what manner, the date, location and time of the inspection and all persons present during the inspection.

The most important item for boards and managers to remember is that the association's governing documents belong to the members. Reasonable inspections of those documents should be encouraged rather than discouraged.

1 comment:

  1. Excellent points and, as a Professional Community Association Manager who has had to deal with these request, I will add just a few considerations:

    First, it is generally someone who is already angry about something who makes the documents review request. Therefore, this is a potential litigant and should supervised, as such. We never leave them alone with the records and we have a fee schedule, including the hourly rate for monitoring the inspection and gathering documents.

    The next comment, in support of your view that homeowners should be encouraged to view records is that there are a number of website templates that allow uploading of meeting agendas & minutes, governing documents, insurance decs, contracts and such so owners can look til their hearts are content.

    You are absolutely right--the time to create the policy is before you receive the first request.