A Las Vegas attorney Friday said the Nevada Supreme Court gave a legal victory to homeowners associations and their residents when it ruled that “house flippers” who fully paid off liens to quickly sell their investments at huge profits cannot now recoup some of that money. Read more………….
HOA liens are first in line
On September 18, 2014, the Supreme Court of Nevada issued its decision in SFR Investments Pool 1, LLC v. U.S. Bank,1 in which the court considered the competing priorities of the holder of a first lien and the purchaser of property at a homeowner association’s foreclosure sale. The decision in SFR Investments comes on the […]
N.J. Supreme Court: Fort Lee co-op board violated man’s free-speech rights in leafletting case
The New Jersey Supreme Court ruled Wednesday that the free-speech rights of a resident of a high-rise co-op building in Fort Lee were violated when the co-op’s board barred him from distributing leaflets under the doors of his neighbors. Read more………
Failure to Check DMV Records Rendered Search for Defendant Inadequate (FL) – HOA Foreclosure
In this Home Owners Association (HOA) lien foreclosure case, the Plaintiff was unable to locate the Defendant for service. HOA’s attorney filed an affidavit for service by publication, alleging: Read more……….
The Maryland Condominium Act Contains Specific Requirements For Adopting Rules and Regulations
While the governing documents of some condominiums contain procedures for the adoption of rules and regulations, most do not. As a result, it is often assumed that rules and regulations may be adopted in the same manner as any other enactment by the condominium’s board of directors or other governing body. Read more………..
Building lawsuits could be reformed (CO)
Homeowners in Colorado are bracing for another attempt by the Legislature to curb construction-defects lawsuits in an effort to spur the development of affordable housing. Read more………..
Washington Court of Appeals Enforces HOA’s Dues Increase Approval Requirement
The Washington Court of Appeals issued a published opinion earlier this year that enforced an approval requirement for dues increases contained in a homeowners association’s bylaws. Read more……….
Architectural firm to pay $5.3M over leaky Stonington Commons condos (CT)
The internationally acclaimed architectural firm that designed the luxury Stonington Commons project in the borough has been ordered to pay the project’s developers more than $5 million for designing windows and doors that leak. Read more…….
Dispute over landscaping repairs results in personal penalties against condo directors and a fascinating governance war story
Court decisions holding corporate directors personally liable for acting in bad faith tend to be few and far between in Canadian jurisprudence. The recent Ontario Court of Appeal decision in Boily et al v Carleton Condominium Corporation 145 et al, 2014 ONCA 574, did just that. Although at first blush Boily appears to deal with […]
New Condominium Exemption To The Interstate Land Sales Full Disclosure Act
As we previously reported, a significant amendment to the Interstate Land Sales Full Disclosure Act (ILSA) becomes effective on March 26, 2015. HR2600 adds an exemption from registration for a “condominium unit.” This is a so-called “b” exemption, meaning the anti-fraud rules of ILSA will still apply to condominium unit sales. This alert provides an […]
Condo Associations Must Ensure That Accepting Partial Payments from Delinquent Unit Owners Won’t be Considered Payment in Full
Condominium association budgets suffer significantly when unit owners become delinquent in paying assessments. Moreover, the burden for those unpaid assessments falls on the responsible unit owners who must make up the shortfall in the next yearly budget, which often results in higher assessments across the board. For this reason it is important that associations have […]
Dispute Over Landscaping Repairs Results in Personal Penalties against Condo Directors and a Fascinating Governance War Story
Court decisions holding corporate directors personally liable for acting in bad faith tend to be few and far between in Canadian jurisprudence. The recent Ontario Court of Appeal decision in Boily et al v Carleton Condominium Corporation 145 et al, 2014 ONCA 574, did just that. Read more………
Court rulings in unpaid HOA fees raise risk in RMBS, SFR deals
A new report from Moody’s Investors Service spotlights how recent rulings by the highest courts in Nevada and Washington, D.C. on unpaid HOA fees raise risk in residential mortgage-backed securities and single-family rental securitizations. Read more……..
Nevada district court bars foreclosure sale of first lien HUD-insured mortgage
Recently, a federal district court held that a homeowners association (HOA) foreclosure sale is not valid against HUD-insured loans. The District Court noted that the Ninth Circuit has held that federal rather than state law applies in cases involving FHA-insured mortgages to assure the protection of the federal program against loss, state law notwithstanding. […]
Time Limit on Filing Certain Construction Lawsuits Extended (IL)
A recent Illinois Appellate Court decision extends the time period in which a certain type of legal claim can be made against a general contractor on a construction project. The decision, 15th Place Condominium Association v. South Campus Development Team, LLC, holds that the time limit for filing a lawsuit claiming breach of an express […]
“Payment in Full” – Be Careful- It May Be! (FL)
Negotiating a check which indicates “payment in full,” may estop the Association from collecting any more funds from that owner, regardless if they legally owe more. Recently, a Florida Appellate Court ruled that an Association’s cashing of a check which included a restrictive endorsement (e.g., paid in full) is considered the full accord and satisfaction […]
Local lawmakers work towards HOA legislation (SC)
Local law makers are working on a draft bill for HOA legislation. The bill will focus on three trending issues they feel would hold the most significance on the floor while helping the most people. A top concern for some law makers is to make sure people know what they are signing up for when it […]
Residential Condominium Association And Its Management Company Immune From Liability For Improper Removal Of Snow/Ice Patch Caused By Defective Awning (IL)
Plaintiff was a resident of a condominium whose common areas were owned and maintained by the defendants. She slipped and fell in a common area on a patch of ice that had formed because water dripped from an overhead awning and froze on the walkway Read more……….
Condo Dispute Wastes a Million Dollars? (Canada)
The Court of Appeal released its decision in the Boily saga in late October. For those of you that are unfamiliar with Boily, it is the case where the board and a group of owners disagreed on various changes to the common elements. The owners commenced an application against the condominium and directors. Read […]
Sides in Burlingame (CO) lawsuit still millions of dollars apart in dispute
The sides involved in a construction-defect lawsuit related to building materials used in the first phase of the Burlingame Ranch affordable housing project remain $3 million apart from a settlement, a court filing made Friday says. Read more………
California court blames Northstar for flooding neighbors
Truckee-area homeowners say an opinion by a California appeals court vindicates their longtime claims that the Northstar Village resort development is responsible for flood damage in their condominium community. Read more………
Ask CCOC: What Are The Rules For Property Manager Registration
We have a management company who has 3 property managers and we can only find 1 registered with the Department of Consumer Protection Should the individual who is not registered but managing our property continue to provide these services. Read more…….
Spa Castle neighbors sue over worry that condo views will be ruined by nude-friendly Manhattan (NY) resort
In papers filed in Manhattan Supreme Court, the condo board of the Ritz Tower at 465 Park Ave. says Spa Castle’s too-high renovations to an eighth-floor roof of the Galleria Building next door are ruining residents’ views — and the naked people aren’t even there yet. Read more……..
Tax Cases (And Rulings) Of 2014: A Big Break For Home Builders
This was more than just marketing chatter, however, as Shea invested significant funds – upwards of 30% of total budgeted costs, in some developments — in the amenities – such as pools, golf courses, and clubhouses –for each neighborhood. In addition, Shea was held to its promise by state and municipal law, which required the […]
Nevada Supreme Court Clarifies Right to Construction Defect Remedies Involving Residential Units with Previously Occupied Spaces
In Oxbow Constr., LLC v. Eight Judicial Dist. Ct., 2014 Nev. LEXIS 109, 130 Nev. Adv. Rep. 86 (Nev. Oct. 16, 2014), the Nevada Supreme Court considered issues regarding class-action certification and the availability of remedies under Nevada construction defect statutes. Read more……….
Judge rules against Frisco HOA (CA), allowing City House to operate while civil case is pending
A district judge’s ruling on Friday effectively allows the nonprofit City House to operate its transitional living program for homeless young adults in a home in a deed-restricted neighborhood in Frisco. District Judge Jill Willis ruled after a hearing on the arguments that a Frisco homeowners association failed to meet its burden for injunctive relief. […]
Amendments to Subdivision Indentures; A Tricky Business of How Far Is Too Far (MO)
Quite frequently, the homeowners association (“HOA”) of a subdivision will want to amend, remove or add provisions to the governing documents, generally called an indenture, restrictive covenants or covenants and restrictions. Changes can be relatively minor, from changing the date of the annual meeting (please, do not schedule for the last day of October, Halloween, […]
South Carolina Supreme Court Issues Decision Limiting Former Developer’s Right to Assign Its Rights or Amend Restrictive Covenants
On October 22, 2014, the Supreme Court of South Carolina issued an opinion upholding a ruling by the South Carolina Court of Appeals that once a developer no longer has a sufficient property interest in a development, it loses its ability to assign developer’s rights or to amend the restrictive covenants for that development. In […]
WI Appeals Court: Fee in Lieu of Room Tax was an Illegal Tax on Condo Owners
Condo owners who did not rent their units to the public paid a “fee in lieu of room” tax to the City of Delevan. Recently, a state appeals court ruled that the fee constituted an illegal tax and the condo owners were not required to pay it. Read more…….
Nevada and D.C. Courts Give Priority of Position to HOA Assessment “Superliens” Over First Mortgages
In late August, the D.C. Court of Appeals rendered a decision in Chase Plaza Condominium Association, Inc. v. J.P. Morgan Chase Bank, N.A., CA-5826-10 (August 28, 2014) determining that a homeowner’s association’s (HOA’s) statutory “super-priority” lien, or superlien, for unpaid assessments took priority of position over other liens, including a lender’s mortgage lien. Read that […]
Washington Supreme Court Limits HOAs’ Ability to Create New Restrictive Covenants
The Washington Supreme Court issued a published opinion this past April that significantly limited the ability of homeowners associations to create new restrictive covenants that have no relation to existing covenants. The case involved a dispute between a homeowners association and a group of owners over the validity of a majority-approved covenant amendment prohibiting short-term […]
Condominium Units Now Exempt from ILSA Registration
On September 26, 2014, President Obama signed H.R. 2600, which amends the Interstate Land Sales Full Disclosure Act (“ILSA”) to exempt condominium pre-sales from the registration requirements of the ILSA. Read more……..
Lakewood’s (CO) challenge to Colorado’s defects law likely to be settled in court
The next venue for Lakewood’s first-of-a-kind measure challenging the state’s much-debated construction-defects law could be a courtroom. Already, various interests — lawyers, builders, municipalities — in the contentious debate over how state law is affecting the construction of new condominiums in Colorado are assessing the legal underpinnings of an ordinance approved early Tuesday morning by […]
A Portion of a Maryland Condominium Assessment Lien Takes Priority Over Mortgages and Deeds of Trust
Under Section 11-110 of the Maryland Condominium Act, in the event of a foreclosure of a mortgage or deed of trust on a condominium unit, a portion of the condominium’s lien for unpaid assessments has priority over the holder of a first mortgage or first deed of trust recorded after October 1, 2011. Read […]
Lakewood (CO) passes construction-defects changes targeting condo lawsuits
The city of Lakewood on Monday became the first Colorado municipality to pass an ordinance that changes the way the state’s construction-defects law works within the city, by a vote of 7-4. After lengthy discussion that included nearly two hours of public comment from those both in support of and opposed to the changes, the […]
New Legislation Affecting Homeowners Associations in 2014 (CA)
The California legislative session has ended with the legislature passing, and Gov. Brown signing, a handful of bills that will affect common interest developments, or, as they are also known, community associations or homeowners associations. CAI’s California Legislative Action Committee, “CLAC,” took positions on the key bills and had some success in amending them to […]
Claims for breach of express indemnity clause in construction contracts subject to 10-year statute of limitations in Illinois
In 15th Place Condominium Association v. South Campus Development Team LLC, the Appellate Court for the First District of Illinois held that a claim for breach of an express indemnity clause within a construction agreement was subject to the 10-year statute of limitations for written contracts instead of the four-year statute of limitations for construction […]
HOA charges to owners legal? (CA)
Although some HOAs don’t know it, the Davis-Stirling Act changed a couple of years ago and is now found in a new section of the Civil Code starting at Section 4000. Today’s column looks at billing issues encountered by HOAs. Read more……..
Construction Defect Claims Tackled By Lakewood (CO)
The impact of construction defect lawsuits on condominium development in Colorado has been a hot topic recently. Colorado law treats residential construction differently than non-residential construction. This increases the risk of construction defect claims on residential projects, particularly when there is a homeowners’ association. Read more………
Homeowners association governance regulations proposed
The Charles County Commissioners discussed new regulations for homeowners associations that may spring up from future developments at their Tuesday, Oct. 8 meeting. Charles County attorney Barbara Holtz said the new regulations were proposed to help prevent future pitfalls current homeowners associations, which will not be affected by the proposed additions to county code, have […]
Ruling could impact Citizens Property Insurance rates (FL)
A decision from the state’s highest court over lawsuits could cause Citizens Property Insurance rates to go up. The Florida Supreme Court heard arguments Tuesday about whether the state-funded insurance company should be open to bad faith lawsuits. Read more……..
President Obama signs ILSA amendment into law
President Barack Obama has signed an amendment to the Interstate Land Sales Full Disclosure Act of 1968 into law. The amendment exempts condominium units from filing and registration requirements mandated by ILSA, which was intended to protect consumers from fraud and abuse in connection to the sale or lease of land. Read more………
Florida Supreme Court To Hear Citizens Insurance ‘Bad Faith’ Dispute
In a case stemming from Hurricane Ivan a decade ago, the Florida Supreme Court on Tuesday will hear arguments about whether the state-backed Citizens Property Insurance Corp. can face a “bad faith” lawsuit because of its handling of a damage claim. Read more……..
Condominium Expenditures In Excess of 15 Percent of the Budget Must Approved By Amendment (MD)
Where a residential condominium expenditure results in an assessment increase that exceeds 15% of the amount contained in the adopted budget, the expenditure must be approved in an amendment to the budget, except in cases where the expenditure is required to address a threat to health or safety, or a significant risk of damage to […]
Massachusetts Supreme Court Holds Economic Loss Rule No Bar to Condo Trustees’ Claim for Damages to Common Areas Caused By Building Defects
The Massachusetts Supreme Court ruled that the economic loss rule, which bars recovery of tort damages from the negligent supplier of a defective product when there is no claim of personal injury or damage to other property, does not apply to claims asserted by a condominium association or similar condominium organization seeking compensation for damage […]
New California Law Cuts Solar-Permitting Red Tape
A new law that could help scrub cost from solar inspection, interconnection and permitting was just signed by Calif. Gov. Brown. The law cuts in half the allowable limits homeowner associations can apply to rooftop solar and prevents a city or county from holding up permit review based on the HOA process. Read more…….
Washington Court Rules that Condominium Leasing Restrictions Require 90% Approval
The Washington Court of Appeals ruled earlier this month that 90% owner approval is necessary to amend the declarations of condominiums created after July 1, 1990 in a manner that restricts owners’ ability to lease their units. The Court based its ruling on a provision in the Washington Condominium Act that requires 90% owner approval […]
An Overview of Condominium Defect Litigation in Florida
Due to poor mid-2000’s construction, the area of construction defect litigation is booming. Across the country, numerous owners are grappling with issues of shoddy construction and defective building materials. One of the most common reasons for defect litigation, aside from shoddy construction and poor workforce supervision, results from defective building materials that allow water intrusion. […]
Condo Association’s Demand to Access Units Must Be “Reasonable and Necessary” (FL)
The Florida Condominium Act provides that an association has “the irrevocable right of access to each unit during reasonable hours, when necessary for the maintenance, repair, or replacement of any common elements or of any portion of a unit to be maintained by the association.” Fla. Stat. § 718.111(5)(a). It is tempting for an association […]
Judge dismisses homeowners’ lawsuit against Garden City (UT) over beach access
A lawsuit challenging public access to a segment of Bear Lake’s west beach was dismissed by a 1st District Court judge this week. In June, the Shore Lodge Estates Homeowners Association filed a lawsuit against the Town of Garden City and its mayor, John Spuhler. In the formal complaint filed in court, homeowners say each […]