This is too Much

Facts

Montana Developer of three condominium-hotels at Big Sky Ski Resort sold units subject to Declarations that required “all unit owners to use [Developer], or an agent designated by [Developer], as their exclusive rental agents,” when renting out their condominiums.  The Declarations also provided that “Unit owners may decline to renew the rental management contract with [Developer] after three years, but only if 75% of unit owners vote to end the contract with [Developer].”  Of course, Developer also owned all of the commercial units, which constituted 22% of the voting units, and several residential units, practically making it impossible for 75% of the unit owners to do anything that the Developer didn’t want.

Continue Reading Claims for When Developers Have TOO Much Control of Association
Money on Fire

Facts

A 50-unit association with multiple buildings had a fire in Building Five in December of 2018.  The interior and exterior repairs were estimated at about $1.4 million. Insurance proceeds were only $933,000, meaning there were insufficient proceeds of about $500,000 to make the needed repairs.  The board voted not to obtain a loan to cover the short fall.  As a result, one of the unit owners filed suit alleging, among other things, breach of fiduciary duty and violation of the applicable statute and governing documents by “failing to maintain the requisite insurance coverage.”  The unit owner ought summary judgment and argued the association was required to promptly repair his unit and the building.  The association argued it only had to insure the building exterior and that the condominium documents were ambiguous.   

Continue Reading Insufficient Insurance Costs Association LOTS!!!
Chicken

Facts

The Kittingers moved into the Sleepy Hollow Subdivision in 2016, a planned community, and kept four hens in a coop located in their backyard. At the time, Sleepy Hollow had a restrictive covenant in place which specifically stated:

No animals, livestock or poultry of any kind shall be raised, bred or kept on the building site, except that dogs, cats or other household pets may be kept, provided that they are not bred or maintained for any commercial purpose.

Their neighbors, the Bryans, commenced legal action against the Kittingers and alleged the hens’ presence in their yard was in violation of Sleepy Hollow’s restrictive covenant. The trial court ruled in favor of the Bryans in late 2019, agreeing that the hens violated the restrictive covenant as a matter of law and therefore the Kittingers could no longer have the hens at their home. In making this determination, the trial court relied on the simple language of the covenant: “no… poultry of any kind” is allowed.

In early 2020, Sleepy Hollow recorded an amendment to their covenants, allowing for up to five (5) hens for non-commercial use. Based on this amendment, the Kittingers sought relief from the court’s prior ruling which restricted their ability to have hens.

Continue Reading Chickens and Covenants
Documents

In 2022, the Wisconsin legislature adopted additional provisions to the Condominium Ownership Act that affect all Wisconsin condominium associations.  Because the new statutes require condominium associations to take affirmative action, your association needs to be aware and get prepared.

The changes are found in Wis. Stat. Section 703.20, primarily.  The language regarding the financial and operational records condominium associations were required to keep per Section 703.20 used to be very general in nature, so much so that for our condo association clients who were nonstock corporations, we would look to provisions in the Nonstock Corporations Act (specifically, Sections 181.1601-.1603) for greater detail and guidance on the records that associations should keep.  With the recent changes to Section 703.20, this is no longer the case; in fact, Section 703.20(5) now states that those nonstock corporate records statutes (Sections 181.1601-.1603) no longer apply to condominium associations.

Continue Reading Recent Changes in the Wisconsin Condominium Ownership Act that Affect Your Association: Record Keeping, Financial Records, Audits, and Website Requirements
House Tape Measure

Facts

The Association was established in 1925 to manage land owned by a local Elks Club.  In 1929 the Association began selling individual lots within the subdivision.  Since then, the subdivision consisted of both individual lots held in private ownership and common property held by the Association.  The Association, including the common areas and facilities, was managed by a five-person board.  The bylaws authorize the board to adopt rules and regulations.  Unlike most modern associations, the bylaws also contain the declaration of covenants, conditions, and restrictions (CC&Rs).  Article 16 of the bylaws requires owners to seek board approval prior to constructing any structure on their lot.  In 1990, Moretto took title to a lot.  In 2018, the board created an architectural review committee (“ARC”) and a set of architectural guidelines (“Guidelines”).  “These Guidelines created detailed restrictions on individually owned lots, including restrictions regarding building height and setbacks as well as design-control restrictions regarding exterior lighting, building materials, and landscaping.”  All owners were required to comply with the Guidelines by submitting any plans to the ARC, who would then recommend to the board whether to approve the plans.

Continue Reading Association Can Adopt Architectural Guidelines
Wrongful Death

Facts

Michael Reddick filed a wrongful death lawsuit against his parents (the owners of the property where he lived) and the neighbor in 2017.  Reddick alleged that his wife fell off an unguarded three-foot high retaining wall on the night of December 30, 2016, while walking her dog, causing her death.  The wall was owned by the neighbor.  The wall was two to four inches from the Reddick property.  The Association never installed or maintained any lights on either the Reddick’s or the neighbor’s property or any other homeowner’s private property.  The members of the Association had discussed the sufficiency of the street lighting in the subdivision during meetings for more than four decades.  The Association installed and maintained five streetlights in the subdivision at or near the subdivision entrance on common grounds.

Continue Reading Association Not Liable for Injuries from Accident on Owner’s Lot
Money House

Facts

Developer recorded a Declaration in 2001 for the 260 Jamie Lane Condominium Association (“Association”) consisting of nine units in what seemed to be one building, with an allocation of the percentage interests based on the square feet of each unit.  Like most Declarations, it provided that “[e]ach Unit Owner shall pay his proportionate share of the Common Expenses … in the same ratio as his percentage of ownership…” with corresponding lien rights if the payment was not made.  The Developer sold five of the units in 2001 upon apparently completing a building within the Association.  The Developer filed an amendment to the Declaration and Plat which stated that the building where the five sold units were, was complete and describing “the proposed units for a different building to be constructed on Lot 1.”  The Developer continued to own the four uncompleted units.  The Association at some point began assessing the Developer for the four unbuilt units, and when the Developer refused to pay, the Association placed a lien on the unbuilt units. 

Continue Reading Developer Liable for Assessments on Unconstructed Units
Public Pool
Facts

Marshall Spiegel, the Unit Owner, had been in constant litigation with his Association for over 20 years regarding various matters surrounding the operation and maintenance of the common areas.  One of these lawsuits sought to establish set dates in which the community pool was to remain open, among other things. Spiegel and Association agreed to resolve the dispute by entering into a settlement agreement which established set dates that the pool was to remain open and it was further agreed that “[Spiegel is] not to post any documents relating to the 1618 Sheridan Road building on the windows of his unit, [or]… immediately adjacent to any windows of his unit … with the intent that such documents be readable to passersby.”

After the settlement had been reached in 2000, Spiegel continued to post 1618 Sheridan Road-related signs on a mannequin located in close proximity to the window of his ground-level unit, including two in 2014, two in 2018, and then at least twice a month beginning in April 2020 and lasting until June 2020. In June of 2020, Spiegel filed a petition to enforce the settlement agreement because the community pool was not open during the agreed upon dates (due to the on-going COVID-19 pandemic). The Association counter petitioned to enforce the portion of the settlement agreement precluding Spiegel from posting signs relating to 1618 Sheridan Road. Continue Reading Can you Agree to Waive your First Amendment Rights?

House & Magnifying Glass
Issue

Does a homebuilder need Association approval of its plans?  NO, unless the condominium documents require it.

Facts

The plaintiff was the builder, Canyon Custom Home Builders (“Builder”).  The defendant was Somerset Condominium Association, Inc. (“Association”).  The Builder wanted to construct on eight vacant lots/units.  The entire Association consisted of 37 units.  Although some units could have single family homes on them, the Builder lots/units were designated for multi-family buildings.  Under the condominium documents the Board was empowered to take various actions, including “to create certain rules for the ‘maintenance, conservation and beautification’ of the Condominium property and the health, comfort, safety, and general welfare’ of the Condominium property’s occupants.”  In 1997 the Association approved an Architectural Control Committee (“ACC”), with the minutes of the meeting reflecting an intent to amend the declaration.  The Board did not amend the declaration to reflect the ACC’s adoption.  In 2012 the Association amended the ACC Guidelines.  The Builder, because the declaration had not been amended, argued it could build whatever was not expressly prohibited by the declaration.  The Association argued that the Builder was seeking to construct multi-family buildings and the 2012 Guidelines are entitled “Guidelines For Single Family Homes and Lake Front Condominium Remodeling and New Construction.”  Builder was not looking to build either single family homes or lake front condominiums. Continue Reading Architectural Control Through Rulemaking Authority is Proper IF YOUR DOCUMENTS ARE PROPERLY WRITTEN

Business Conflict
Facts

The defendant, Lennar Homes developed Martinique at Oasis, a residential community located in Homestead, Florida comprised of 241 homes.  Lennar Homes sold each of the homes in the community to individual homeowners.  Each of the purchase agreements between Lennar Homes and the homeowners contained an arbitration provision, which required the parties to submit any dispute arising out of the sale of the property, including any alleged property damage, to arbitration.  About five years after the first homes were sold, the plaintiff, the Homeowners Association, began noticing potential construction defects in the stucco, stone cladding, and decorative shapes on the exterior of the buildings.  The Association sued Lennar Homes in Florida trial court on behalf of all unit owners in Martinique at Oasis, alleging the issues were caused by defective construction. Continue Reading Homeowner’s Associations Suing on Behalf of Homeowners Must Abide by Arbitration Provisions