2015 Condo and HOA Laws – Fines

June 22, 2015

By Curtis G. Kimble.

This year was another busy year at the Utah legislature for the HOA world.  Many changes and additions were made to the statutes that govern condominiums, community associations and nonprofit corporations.  As always, refer to the UtahHOALaws app on your iOS device or Android device, or on the web at utahhoalaws.com for the current HOA statutes.

The most significant changes that affect HOAs are laws that:

  • Change how fines must be levied and collected,
  • Require board meetings to be open to the association membership,
  • Change what rental restrictions may be adopted by an association after May 12, 2015,
  • Set forth requirements and procedures for record keeping and making records available to members.

Fines.  

Utah Code 57-8a-208 for community associations (non-condo HOAs), and Utah Code 57-8-37 for condos, provides certain requirements for levying fines.  These laws went into effect May 12, 2015.

Before assessing a fine, the board must give the owner a written warning that:

  1. describes the violation;
  2. states the rule or provision of the association’s governing documents that the owner’s conduct violates;
  3. states that the board may assess fines against the owner if a continuing violation is not cured or if the owner commits similar violations within one year; and
  4. if the violation is a continuing violation, states a time that is not less than 48 hours after the day on which the board gives the owner the written warning by which the lot owner must cure the violation.

Then, a board may assess a fine if:

  1. within one year after the board gives written warning, the owner commits another violation of the same rule or provision identified in the written warning; or
  2. for a continuing violation, the owner does not cure the violation within the time period that is stated in the written warning.

Subsequent fines.  If permitted by the association’s governing documents, after the board assesses a fine against an owner, the board may, without further warning, assess an additional fine against the owner each time the owner:

  1. commits a violation of the same rule or provision within one year after the day on which the board assesses a fine for a violation of the same rule or provision; or
  2. allows a violation to continue for 10 days or longer after the day on which the board assesses the fine (thus, there must be a 10-day period between fines for continuous violations).

Note, as indicated for “subsequent fines,” it is important to have a schedule of fines or fining policy in place in the governing documents (if not in the CC&Rs, then in the rules or separate policy) that allows for levying more than one fine for the same violation without having to repeatedly provide notice first.  Contact us for help with that, if needed.

In my next post, I’ll discuss the new laws on open meetings and rentals.

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New 2014 Utah HOA Laws

May 16, 2014

By Curtis G. Kimble.

A few new HOA laws went into effect earlier this week on May 13.  They are not too substantial and shouldn’t significantly alter your way of doing business, but they’re important to know about and comply with.

1.    S.B. 147 deals with rental restrictions.

This bill amended Utah Code Section 57-8-10 and enacted 57-8-10.1 in the Condo Act, and amended 57-8a-209 in the Community Association Act.  It prohibits an association from requiring a homeowner to:

A.  obtain the association’s approval of a prospective renter; or

B.  give the association:
(i) a copy of a rental application;
(ii) a copy of a renter’s or prospective renter’s credit information or credit report;
(iii) a copy of a renter’s or prospective renter’s background check; or
(iv) documentation to verify the renter’s age.

There is an exception if the association’s CC&Rs “prohibits or restricts occupancy of the lots by a certain class of individuals, the association may require a lot owner who owns a rental lot to give the association” those items in B above.  So, for instance, a 55 and older community could require a homeowner to give the association documentation to verify that at least one occupant is 55 or older.

2.    H.B. 26 deals with fines.

This bill amended Utah Code Sections 57-8a-208 and 57-8a-301 in the Community Association Act, and made a minor change in 57-8-37 and 57-8-44 in the Condo Act.

Appealing a Fine.  In the Community Association Act, it limits how and when an owner can appeal a fine that’s levied against the owner.  An owner has 30 days to request a hearing after a fine is levied, and then the owner has up to 6 months to appeal the fine by bringing a court action to challenge the fine.

When the Fine Becomes a Lien.  It further requires that a fine does not become a lien against a lot until, basically, seven months after the fine is levied (because the owner has 30 days to request a hearing before the board and then 180 days after that to bring a court action).   If, after that time, the owner has not sued to challenge the fine in court, the fine becomes a lien against the owner’s lot (if the owner has sued within that time, the fine does not become a lien until the court action is over).    Previously, the owner only had 14 days to request a hearing, an unpaid fine became a lien just like assessments (no 6-7 month waiting period), and the owner was not limited in the time they had to file a lawsuit to challenge the fine.

Condos.  There is nothing much new for condos.  The Condo Act already required that a fine does not become a lien against a unit until, basically, seven months after the fine is levied (because the owner has 30 days to request a hearing before the board and then 180 days after that to bring a court action) and limited an owner to a 6 month period to challenge the fine in court, but it’s now clear that if the owner has sued within that time, the fine does not become a lien until the court action is over.

3.    H.B. 350 deals with removal of board members.

This bill amended Utah Code Section 16-6a-808 in the Nonprofit Corporation Act.  This section provides the requirements to remove a board member (director) from office.  The old section was problematic because (a) it didn’t defer to the association’s bylaws if the bylaws provided a different method for removing a director (the Nonprofit Act should let associations decide for themselves how they want certain things handled and should simply be a default when an association’s bylaws are silent on an issue), and (b) it led to a great deal of confusion because it was not clear how many votes were necessary to remove a director when directors were elected by a plurality vote (where the candidates receiving the most votes win).  Most homeowner associations use plurality voting for electing directors.

The new law states that “unless otherwise provided in the bylaws,” a director may be removed by the vote of a majority of the members entitled to vote.  So, the provisions in your bylaws will govern and apply first and foremost, but if your bylaws are silent, more than 50% of the members have to vote to remove a director in order for that director to be removed from office.

The Utah HOA Law App has been updated with all the new laws and will automatically update on your iphone or Android device when you open the app.  iPad app users will have to update the app itself, which should be available in the App Store in the next week or two.


Can Enforcing the CC&Rs Equally and Consistently Ever be Illegal?

January 30, 2013

By Curtis G. Kimble.

Has your board ever faced a demand for a “reasonable accommodation” by a disabled resident?  Have you ever heard of a “reasonable accommodation”?  What about a request for a modification to a unit or common area to accommodate a disability?  As explained by the following excerpt from our Utah HOA Law app, if certain requirements are met, granting the request for accommodation or modification is not optional, and enforcing a covenant or rule in such a case can actually be illegal.

Excerpt from RKW’s Utah HOA Law app:

The federal Fair Housing Act prohibits discrimination by landlords and HOAs, as well as others associated with providing housing whose discriminatory practices make housing unavailable (or restrict the use of housing) to persons because of:

•   race or color
•   religion
•   sex
•   national origin
•   familial status, or
•   disability

. . .

Discrimination Based Upon Disability

The Fair Housing Act prohibits discrimination on the basis of disability in all types of housing transactions.  It’s important to realize that discrimination against disabled persons is unlike any other type of discrimination.  At the core of the policy against discrimination is the concept that everyone should be treated equally.  The Act, however, requires that housing providers give special treatment to the disabled when it is necessary to allow them to have an equal opportunity to enjoy their dwellings.

Reasonable Accommodations.

Specifically, a disabled person is entitled to “reasonable accommodations” (exceptions) in the rules, practices, or services of a housing provider (including an HOA) that are necessary for a disabled individual to use or enjoy a dwelling.  So, while uniform enforcement of the governing documents and rules is crucial as a general principle in an HOA, such uniform enforcement is actually against the law when a rule interferes with a disabled person’s use and enjoyment of their dwelling.  For instance, an HOA has a “no pets” policy.  A resident who is deaf requests that the HOA allow him to keep a dog in his unit as a reasonable accommodation.  The resident explains that the dog is an assistance animal that will alert him to several sounds, including knocks at the door, sounding of the smoke detector, the telephone ringing, and cars coming into the driveway.  The HOA must make an exception to its “no pets” policy to accommodate this resident.

When considering a request for a “reasonable accommodation,” an HOA must normally evaluate whether: (1) the individual is disabled, (2) the requested accommodation is reasonable, and (3) the requested accommodation is necessary for the individual to use or enjoy a dwelling.

1.  Disabled.  An individual can be disabled in one of three ways. A disability is: (a) a mental or physical impairment which substantially limits one or more major life activities, (b) a record of having such an impairment, or (c) being regarded as having such an impairment.

The term mental or physical impairment may include conditions such as blindness, hearing impairment, mobility impairment, mental retardation, alcoholism, drug addiction (but current drug users are not considered disabled), chronic fatigue, learning disability, head injury, and mental illness.  The term major life activity may include seeing, hearing, walking, breathing, performing manual tasks, caring for one’s self, learning, speaking, or working.

2.  Reasonable.  To be reasonable, an accommodation cannot impose an undue financial or administrative burden on the HOA and the benefit of the accommodation to the disabled person is weighed against the burden on the housing provider.  Those things are determined on a case-by-case basis taking various factors into account, such as the cost, the resources of the provider, the benefit of the accommodation, and whether alternatives would meet the disability-related needs.

3.  Necessary.  For a requested accommodation to be necessary for the individual to use or enjoy a dwelling, the requested accommodation must affirmatively enhance a disabled plaintiff’s quality of life by ameliorating the effects of the disability.  In other words, there must be a nexus between the disability and the requested accommodation.

Modifications.

The Act also requires an HOA to permit a disabled person to make reasonable modifications to the common area or to a unit in order to afford that person full enjoyment of the premises.  The modification is made at the disabled person’s expense (unless it is to be used by anyone other than that person, or if the HOA requires more expensive materials or options than those proposed by the owner, the HOA pays the difference).  This is in contrast to an accommodation. Accommodations are made by the housing provider (HOA) and can result in an expense to the HOA (unless it creates a financial burden on the HOA).

The same three criteria applicable to reasonable accommodations (disability, reasonableness, necessity) must be met or the HOA is not required to allow the modification.

HUD has given examples of modifications that are typically considered reasonable, which include:

1. widening doorways to make rooms more accessible for persons in wheelchairs;
2. installing grab bars in bathrooms;
3. adding a ramp to make a primary entrance accessible for persons in wheelchairs; or
4. altering a walkway to provide access to a public or common use area.

. . .

This is a tricky area that can be counter-intuitive for boards.  A board should be familiar with and understand the above concepts, but this is definitely one area where a qualified attorney should be consulted prior to a board making any final decision to grant or deny a request for reasonable accommodation.


Your Single Family Definition Could Land You in Hot Water

October 3, 2012

By Curtis G. Kimble.

The U.S. Department of Housing and Urban Development (HUD) announced recently that it is charging a Florida homeowners association (HOA) and its management company with violating the Fair Housing Act by telling a family of eight that they had too many people living in their townhouse and threatening to evict them if they didn’t reduce the number of occupants based on an occupancy policy that permitted only six people to live in a four-bedroom home.

The federal Fair Housing Act makes it unlawful to deny housing or impose different rental terms and conditions based on disability, race, national origin, color, religion, sex, or familial status. Overly restrictive occupancy policies may unlawfully discriminate against families with children by preventing them from living in a home.

“Homeowners associations and management companies have an obligation to ensure that their occupancy standards do not violate the Fair Housing Act,” said John Trasviña, HUD Assistant Secretary for Fair Housing and Equal Opportunity. “HUD is committed to taking action against anyone who unlawfully denies housing to families because of the number of children in the family.”

If a federal judge finds discrimination did occur, the homeowners association and the management company could face up to $16,000 in fines plus damages.

This issue frequently arises as a result of the enforcement by an association of a requirement in the CC&Rs that a unit or lot be occupied by a “single family.”  If the definition of “single family” is too restrictive or narrow, the association could be faced with a discrimination claim and hefty fines from HUD or from the Utah Anti-discrimination and Labor Division.

HUD will look at and often defer to a local ordinance for permissible restriction on occupancy.  In the case above, the county permits up to eleven occupants in the townhome.  So, the Association was not able to point to that ordinance as a defense.  HUD also looks at the size of the unit and number of bedrooms to determine if an occupancy restriction is discriminatory.  In this case, the Association only allowed one and a half people per bedroom.  At least two people per bedroom should be allowed generally (although other factors are relevant, as well).

Pay to Play, Literally?

In a separate matter, HUD charged a Massachusetts condominium association and property management company with discriminating against families with children.  HUD accused them of unlawfully charging fees to parents for allowing their children to play in the common area.

The families were informed by the Association that they were being fined $10 a day for two days for children playing in the common area, $10 a day for two days for allegedly causing damage, $25 to reimburse for the damage and $437.50 for attorney fees. Prior to this, the families had not received any fines or warning, and when an adult resident was having a party on the common grounds, no fine was issued.

It’s illegal to impose different rules and restrictions on families with children, unless they are directly related to issues of safety or health, but even then, caution must be exercised.  Always consult a qualified attorney when adopting or enforcing restrictions that may trigger a discrimination issue.


Cockroaches, Fires and Grossly Offensive Odors – Hoarding Affects Everyone in a Condominium

April 25, 2012

By Curtis G. Kimble.

It seems to be coming up more and more often – hoarding and the problems it causes in condominiums and other attached housing.  One condominium association I recently spoke with has a unit owner whose hoarding is preventing the effective treatment of a major cockroach problem in the building, which in turn is preventing an adjacent unit owner from being able to rent or sell her unit and is causing others to have to treat and spray for cockroaches at least weekly.

A court of appeals in Tennessee recently approved a board’s request to force the sale of a unit and ruled that the unit owner’s hoarding, and the nuisance and health threat it created, violated the association’s CC&Rs  (4215 Harding Road Homeowners Association v. Harris).  The court unanimously agreed that a forced sale of the unit was not only the appropriate remedy, but “the only remedy” possible since the owner refused to correct the problem and because of the impact on the other residents of the “grossly offensive odors” and other problems the hoarding created.

Before filing the suit, the association had a professional bio-hazard cleanup company that cleans crime scenes and gross filth and hoarding situations come in and spend nine hours one day and fifteen hours the next cleaning the unit.   Multiple odor bombs had to be set off and three commercial dumpsters were filled with massive amounts of filthy debris, molding paper products and rotting food.  Bleach had to be used to clean the mold off the walls and windows and then the unit was repainted.  The property manager personally did thirty-eight loads of laundry for the unit owner.   Other residents pitched in, some paid for the unit owner to stay in a hotel and others brought her meals.

But that solution only lasted a few months before the residents that shared the unit owner’s HVAC air stack were again faced with nauseating, unbearable odors.  This time, the unit owner refused to allow the association to help remedy the problem, despite repeated attempts.

That particular association had a very unique provision  in their governing documents which specifically authorized the association to sell a unit as a remedy for persistent and serious violations of the CC&Rs.  So, this remedy won’t be available to most associations in Utah, but other remedies are available to an association or to an affected unit owner (almost all governing documents prohibit nuisances, for instance).  The Tennessee case highlights the importance of the fact that no single unit owner can be allowed to affect the safety, quality of life and enjoyment of property of the remaining residents.  As discussed in this blog post, hoarding fueled a recent condo fire in Arizona, as well as several others.

As with any enforcement issue, the board, or an affected owner, should start with the least threatening and most amiable methods possible.  In-person conversations, phone calls and letters should courteously explain the problem and ask for compliance, and should only escalate from there if necessary.  The unit owner needs to understand the broad consequences and effect of the problem, including health and safety concerns.  At least two or three letters should be sent clearly identifying the issue and what is needed to cure the problem so there is a paper trail documenting your efforts.

If those efforts are unsuccessful, it’s important to obtain evidence of the problem.  Subjective, general assertions from a neighbor or witness won’t count for much.  It’s important to have specific details described in writing.  And photographs are always best.  Keep a detailed record of everything that transpires relating to the unit and the problem.  If the health department or fire department will come out and issue citations (I’m not necessarily saying they will), that will help a great deal in documenting the problem for a court action.

It’s important to remember that hoarding reflects an illness that needs to be treated with sensitivity.  But, it’s also important to remember that the actions of one person can’t be permitted to destroy the right of every resident to use and enjoy his or her unit.  Use common sense and consult your association attorney as necessary.


Some Topical Updates on HOA Issues

March 16, 2012

By Curtis G. Kimble.

On our Facebook page, we share information, articles, links, and developments in condo and HOA issues, in addition to our more detailed posts on this blog.  For those of you who don’t subscribe to our Facebook page, I thought I’d pass on some recent links and news we’ve shared recently:

  • Condo Association Settles Lawsuit with Veteran over Service Dog  By Erin Alberty | The Salt Lake Tribune

“A Park City condo association will pay $20,000 to a disabled veteran, ending a legal conflict over whether the man should be forced to pay fees to keep a service dog that helps him cope with depression and anxiety.

The U.S. Justice Department sued the Fox Point at Redstone condo association and its management company in November, alleging that Thomas Burton, a combat veteran of the first Gulf War, was forced to move out of his rented condo because the association would not waive its pet fees and insurance requirements for Burton’s service dog . . .”   Read more here

  • Who Prepares Your Association’s Tax Return?   by Lisa Magill, Florida Condo and HOA Law Blog

“A Las Vegas HOA is currently fighting with the IRS over the question of whether $2 million held in the HOA’s savings account is subject to income tax at the rate of 30%.

Associations are generally organized as not-for-profit corporations (some older associations are not incorporated) and therefore must file tax returns like other not-for-profit corporations. Associations are not entitled to tax exempt status like charitable organizations. To be tax-exempt under section 501(c)(3) of the Internal Revenue Code, an organization must be organized and operated exclusively for exempt purposes set forth in the Code. To be tax exempt under IRC 501(c)(4), a homeowners’ association must operate for the benefit of the general public, i.e., it must provide a community benefit – not a benefit to the owners or residents . . .”  Read more here

  • Although written in Virginia, the same principles apply in Utah:  Is It Time for Your Community Association to Audit Its Governing Documents?  By Susan Bradford Tarley.

“Many communities were established 20-40 years ago with governing documents that worked well for the developer, and for the most part the community association. However, many of these governing documents are outdated. Virginia and federal laws pertaining to community associations have changed substantially. If your board of directors has not engaged in an audit of your communities governing documents in the past 5-7 years, it should.

When should documents be amended?  Although there are many reasons for amending documents, these 7 reasons are the most common: . . .”   Read more here

If you would like to see more information, links and updates on condo and HOA issues in addition to the posts on this blog, be sure to like us on Facebook and you’ll see our Facebook posts in your Facebook feed.  A direct link is on the right of this page, or our page can be found here Richards, Kimble & Winn on Facebook


Home Ownership and Second Hand Smoke: the American Dream or a Health Nightmare?

January 20, 2012

By Curtis G. Kimble.

How far can a government or an HOA go to dictate what can and can’t be done inside of a homeowners own home? Is an owner of an attached dwelling or a condominium unit able to do whatever they want within the confines of their home as long as it’s not illegal? Is a homeowner entitled to create and distribute from their home a “Class A” carcinogenic substance, which causes cancer and respiratory diseases and disorders, among other problems and which is able to infiltrate neighboring homes?

This is a question being increasingly asked in other states where some state courts have held that smoke transferring between units is a nuisance. But others have determined that the cigarette smoke is like an odor intrusion, a condition of living in a community environment that residents simply have to put up with – a startlingly misguided mentality considering the fact that the EPA has determined that there is no acceptable level of exposure to Class A carcinogens, and considering that second hand smoke causes serious problems for children, including ear problems, middle ear disease, acute respiratory infections, wheeze illness, slowed lung growth, and more severe asthma, and that 430 American newborns die each year from Sudden Infant Death Syndrome (SIDS) caused by second hand smoke.

Incentives offered by the Federal Government have led cities from Austin to Boston to prohibit smoking in public housing. In 2006, a judge ruled that secondhand smoke could be a breach of “warranty of habitability” under New York law.  At least six California cities and counties have banned smoking in all condo units.

Fortunately for Utah residents who don’t appreciate dangerous and toxic chemicals being forced down their breathing passages, Utah law clearly states that smoke transferring between dwelling units is a nuisance and may be the subject of an action brought by “any person whose property is injuriously affected, or whose personal enjoyment is lessened by the nuisance” and “upon judgment, the nuisance may be enjoined or abated, and damages may be recovered.”

A nuisance under Utah law includes tobacco smoke that drifts into any residential unit a person rents, leases, or owns, from another residential or commercial unit and the smoke drifts in more than once in each of two or more consecutive seven-day periods, and is injurious to health, indecent, offensive to the senses, or an obstruction to the free use of property, so as to interfere with the comfortable enjoyment of life or property.

The Utah Condominium Ownership Act states that restrictions in governing documents “regarding the use of the units may include other prohibitions on, or allowance of, smoking tobacco products.”

The Utah Community Association Act, which applies to non-condo HOAs, states that a rule of an association may prohibit an activity within a dwelling if there are attached dwellings, and the activity creates the potential for smoke to enter another lot owner’s dwelling, the common areas, or limited common areas.

Utah law is at the forefront of the national trend to protect the right of every individual to live in their own homes without being subjected to dangerous and toxic chemicals contained in second hand smoke. Contact us to take advantage of these laws and help your association adopt a policy regarding smoking.


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