IMPRESSION: The ruling in Great Am. Ins. Co. v. State Parkway Condo. Ass’n, No. 17-cv-3083 (N.D. Ill. Sept. 11, 2018), should serve as a cautionary tale to Condo and HOA boards.

DETAILS: In Chicago, a unit owner of a condominium located at 1445 North State Street filed an Illinois state discrimination claim in 2007 against the State Parkway Condominium Association (“SPCA”) for failure to accommodate his hearing disability during SPCA Board meetings.  The SPCA defended the claim under its 2006-2007 Non-Profit Management and Organization Liability Insurance Policy (“policy) issued by Travelers Casualty and Surety Company of America (“Travelers”).

A settlement between parties was reached in September 2007; but six months later, the SPCA sued the same unit owner in an entirely unrelated matter. Continue Reading “Related Wrongful Acts” Can Exhaust an Association’s Liability Insurance Policy Limit

Issue:  If your association was destroyed by fire or some other hazard, and it did not make sense to rebuild, how would the funds be divided?

Problem.  Odds are that you don’t know the answer.  The fact that you don’t know should scare you.  Is every unit in your association worth the same amount?   I doubt it.  Do you each pay the same amount in assessments?  Does that control?  What does your declaration say about the distribution of insurance proceeds if the unit owners elect not to rebuild?  Do you understand what it says? Does it even make sense? Continue Reading Why You NEED to Amend Your Association Declaration Insurance Provision Before You Have a Loss

A big thank you to all that attended our recent Spring 2018 Association Academy and made the event a success. For those of you who were unable to attend, don’t worry, you can still catch us on YouTube!

We’ve made our Association Academy available for viewing. Click on the links below to learn more.

As always, if you have questions on any of these topics, do not hesitate to contact the Husch Blackwell LLP Condominium and HOA Law Team.

Time and time again we hear that one of the biggest challenges in conducting annual Association meetings is simply achieving a quorum (in other words, getting enough butts in the seats). Without a quorum, business cannot be conducted, votes cannot be taken, and the Association’s operations are virtually stymied. The Association is forced to adjourn the meeting, and start the painful process of going door-to-door and begging for proxies all over again. Continue Reading Conducting a Successful Annual Meeting (Through Creative Use of Proxies, and Other Ideas…)

It has been said that insurance is the only product that both the seller and buyer hope is never used. That certainly rings true when it comes to community Associations’ insurance policies, but it does not diminish the need for Associations to protect themselves and their unit owners from an ever-widening array of damages they could suffer. Wis. Stat. § 703.17 requires Condominium Associations to obtain insurance against potential hazards, but only discusses scope by saying that the Association must acquire insurance “for not less than full replacement value of the property insured against.” Continue Reading It’s Never Too Late to Ensure Your Association is Properly Insured

Governing Documents for Condominium and Homeowner Associations don’t age well. They are not like a fine wine.  They are more like cheap cheese.  Remember, they were likely written by a developer who really only cared about them until it had sold all of its units or lots (assume 10 years or less).  So if your documents were written before 2008, it is unlikely that they have anything in them to deal with:

  1. Emotional Support Animals;
  2. Drones;
  3. Short Term Rentals (AirBnB was founded in 2008 in San Francisco);
  4. Medical Marijuana; or
  5. Unit or Lot Owners buying insurance to cover a large insurance deductibles that could be assessed against them if their actions cause an insured loss.

Continue Reading Our Governing Documents Have Aged Nicely

In Wisconsin condominium associations are required to insure all of the property (other than the personal property) of the unit owners. (See, Sections 703.17(1) and 703.02(14) Wis. Stat).  Many unit owners worry (needlessly I would contend) that their neighbors have improved their unit more than they have and then argue that they don’t want to pay the insurance for those improvements.  Ignoring for the moment that those improvements also likely increase the value of their neighbors unit and therefore increase the value of their unit, which they are more than happy to accept, this argument simply misses how insurance companies actually insure condominiums in Wisconsin.  The law requires all of the property to be insured.  The law requires that the insurance be paid as a common expense.  (Section 703.17(1) Wis. Stat).  Accordingly, arguing over who has to insure what, considering the clear language of the statute, wastes both the time and resources of an association.  However, there is something a board of directors can do to increase the insurance it provides unit owners without any material cost to the association.  To adequately explain where these savings can be obtained, I first need to explain how insurance companies currently charge premiums and pay condominium claims in Wisconsin. Continue Reading Free Money from your Association Insurer

I have written before on the subject of associations’ continuing struggle to convince enough unit owners to attend owner meetings in order to meet quorum requirements, and otherwise to simply get business done. Recognizing that not every condominium association may be ready to take the step to convert to “E-voting,” another way to ease the burden of low-owner attendance at meetings is the proper use of directed proxies or absentee ballots. While similar in concept, the two are legally distinct and it is important for associations to understand the differences to determine which process they can use. Continue Reading Directed Proxies vs. Absentee Ballots: What is the Difference and Can Our Association Use Them?