Recent Court Rulings

Association Obligated to Provide Flood Insurance

Facts: An association maintained flood insurance for five of the buildings in its multi-building property. All five buildings were in flood zones as designated by the Federal Emergency Management Agency (FEMA). The association later decided not to renew the flood insurance policy, citing concerns regarding cost and the allocation of the expense among the other members of the association who lived in the non-flood exposed buildings.

Recent Settlements Illustrate the High Cost of Fair Housing Complaints

Recent cases from California and New York—involving families with children and reasonable accommodation requests, respectively—highlight the importance of staff training in fair housing law in order to avoid discrimination complaints.

Families with children. A California condominium community recently had to pay more than $1.1 million to settle a class action lawsuit involving hundreds of current and former residents with children under 14, who lived there from 2011 through mid-2017.

Unit Owner Had No ‘Actual Controversy’ with Condominium Association

Facts: A condominium unit owner alleged that a board of directors election for the community had been improperly conducted. He claimed that there were statutory violations. He asked a trial court for declaratory relief—that is, a judgment of a court that determines the rights of the parties without ordering anything be done or awarding damages—but the court denied it. The unit owner appealed.

Decision: A California appeals court affirmed.

Member Can’t Prove Nonmembers Were Voting at Meetings

Association Couldn’t Withhold Records Based on ‘Protected’ Status

Facts: A condominium member asserted that a resolution in the governing documents, which classified certain association records as “primary and/or protected records” that couldn’t be inspected by members, was invalid. The member asked a trial court to order the association to produce 10 types of records that she had asked the association to provide, but that it refused to.

Decision: A Pennsylvania trial court invalidated the resolution. It ordered the association to permit the member to inspect and view the documents.

Short-Term Rentals Violated Restrictive Covenant

Homeowners in a planned community asked a trial court for a temporary injunction, prohibiting their neighbors from renting out their home to vacationers for a profit. (A temporary injunction orders a party to do or not do something while a court case is pending.) The homeowners asserted that the rental of the home violated the restrictive covenants of the association, in part because they were using the home for nonresidential purposes—that is, operating a hotel.

Failure to Read Covenant Not an Excuse for Shirking Assessments

Facts: A homeowners association alleged that a homeowner breached the covenant to pay assessments for common area maintenance and other services necessary to operate the community. He had unpaid dues totaling over $15,000. The homeowner contested the reasonableness of the charges. The association asked a trial court for a judgment in its favor without a trial.

Decision: A Pennsylvania trial court ruled in favor of the association.

Homeowners’ Disapproval of Election Doesn’t Invalidate Results

Facts: Two homeowners in a planned community complained about the election and qualifications of the people elected to the board of the association. They became concerned when the developer of the community, in accordance with the bylaws of the association, turned over certain common areas of real property to the association. The bylaws required that members of the association board resign and a new election be held by members of the association after that happened. However, that was not done.

Owner Couldn’t Use Litigation to Amend Governing Documents

Facts: The water pipe serving an owner’s condominium unit was constructed in such a way that it ran through a portion of the ceiling of an adjacent unit prior to entering the owner’s unit. The adjacent unit underwent foreclosure. Subsequently, the utilities in the foreclosed unit were disconnected. Over the course of two years, the portion of the water pipe running through the foreclosed unit froze, broke, and caused damages. The unit owner had the subject water pipe and the damages repaired.

Insufficient Meeting Notice Renders Amendment to Declaration Void

Facts: The board of directors of a condominium association wanted to effectively rewrite its declaration, originally drafted in 1983, because the original document was so outdated that the board felt it was necessary to start over from the beginning. After the declaration had been amended, two condominium members sued the association. The members argued that they hadn’t been given proper notice of the meeting where the proposed amendment would be discussed with members.