Friday, October 30, 2009

Recruiting HOA Board Members: How to Succeed

One of the most difficult parts about community association operations is how to groom leadership for the future. While my friends at and and some of their followers may believe that directors all need to be thrown out and that most boards are "Condo Commandos" the vast majority of directyors I jhave dealt with in almist 30 years(!) of this practice would gladly step aside if someone half as dedciated and hard working as they are would volunteer.

From a Political Science perspective, I cna see how Communism failed, partly because the party could never afford to groom leadeers, as the leaders would then be powerful enopugh to replace one set of tyrants with another, commmunity associations are more like local governments in New hamoshire, where citizen initiatives and citizen inout are apramount.

Of course there is the element of complexity that has been introduced by our friends in the Legislature over the past 10+ years, as well as the DBPR, and the notion of th e"carefree lifestyle" that has always sold people on Florida, when it comes right down to it, it seems that the more dedicated job the directors do and the more well run the community is, the less likely it is that others will take their turn at the helm. Read on for how one community did it....

This from our friends at

For a new article we asked board members from around the country to share their tips on recruiting good HOA board members. This week's tip is from Karla Jo Helms, a board member at Sunset Point Town Homes in Clearwater, Fla.

She told us, "I get people to volunteer by picking the happiest, most productive people I know--because in my observation, happier, busier people get things done and complain the least-- and elicit their help by pushing their "responsibility buttons."
In other words, most people want to help, so asking them to help is pretty easy.

"But I also tell them that one thing to think about is that if they don't help, someone else will step up to do the job in a
way that could make their lives hell. It's happened. You know the people who have nothing better to do than to sit on their porch or by their window and document every tiny infraction, making the neighborhood a living hell. That usually does the trick.

"Another key factor is the property manager. We hire a real stickler for the law and any rules that could get us in trouble with state or federal agencies if not followed. I like that. It's his job to make sure rules are followed, handle most everything for the board, keep us in line, and let us know the law. That's a big factor in getting volunteers.

"If you don't have a property manager, the board's workload is much greater, and your likelihood of getting and keeping
volunteers will be much lower. We pay $500 per month for ours, but he saves us soooo much money every year with insurance negotiations, hiring workers, handling all our potential liability issues, and so on. And I don't get homeowners coming to my door to tell me anything. It all goes to the property manager."

Karla Jo concluded, "It didn't used to be this easy for us. The recipe for us has been having great volunteers who get things done, reserves in the bank, and making sure the laws and rules are followed. It's a pretty happy neighborhood now."

Find out what four more board members and association experts had to say about their experience. Read our new article:

Sunday, October 25, 2009

What else is new? Defective construction shows up in NYC condos

This is from the New York Times:

October 25, 2009

Your New Condo Leaks? Join the Club

ROOFS and windows that leak whenever it rains.

Heating and air-conditioning units that can’t quite heat or cool the entire building.

Balconies with flaking concrete and wobbly railings.

These kinds of complaints have become more and more common in recent months, according to lawyers and engineers who represent owners of sleek new condominium units across the city.

They say the wave of development in New York City that started in 2004 and crested in mid-2007 has resulted in a wave of accusations about defective construction and building design.

“There’s always an underlying number of lawsuits about defects,” said Stuart M. Saft, a real estate lawyer and the chairman of the Council of New York Cooperatives and Condominiums, “but about a year ago the number started to increase. And over the next two years there’s going to be an explosion, because of all the buildings that were built at about the same time.”

He noted that buildingwide problems often don’t become apparent until people have lived in a building for a while. Legal action is often delayed because sponsors typically control a condo board for a year or more after a building opens and can block attempts by residents to file complaints.

But since condo owners have a three-year statute of limitations for suing a developer or construction contractors for negligence, many people who moved into new buildings in 2007 — when about 7,000 condos came on the market — are realizing that they will soon run out of time.

A negligence lawsuit charges a sponsor or contractor with causing harm or damage to condo owners. If the owners believe a written agreement has been violated, another legal strategy is to sue a sponsor for breach of contract. The statute of limitations for breach of contract is six years.

Lawyers at several firms said that the volume of condo defect work had doubled in the last year, adding up to dozens of buildings with construction problems. In most cases, the condo owners hire lawyers to add muscle to their complaints, in the hope of getting the necessary work done. In a few instances they have filed suits. Lawyers say that condo owners are reluctant to talk about the defects in their buildings, fearful that publicity will decrease the value of their properties.

Water leaks and climate control problems top the list of complaints. Many of the recently built glass towers are especially prone to temperature issues, because air-conditioning units are too small to combat the punishing summer sun, and heating systems can’t make up for a lack of insulation during the cold months.

But lawyers and engineers said that they had also come across buildings with more serious defects that violate the city’s building code. The most common code violation involves inadequate fire-stopping components — building materials that are used to fill empty spaces where fire or smoke can spread between floors and apartments.

Howard L. Zimmerman, an architect whose firm is checking about 35 new condo buildings for construction problems, said that his workers had found fire-stopping violations in about a third. He said his firm has clients in buildings of five to 300 units, throughout Manhattan and in Brooklyn and Queens.

According to Mr. Zimmerman, the most common problem is found behind the walls of apartments, where, say, no caulking material has been used to seal a two-inch space between a pipe and a concrete wall. That unsealed space, he said, “is where smoke and fire can travel quickly,” and it could also allow smells to float through a building. “Odor migration has been a tremendous problem, and if you buy a $3 million apartment, you probably don’t want to smell your neighbor’s smoking or the restaurant downstairs.”

Mr. Zimmerman says that the Department of Buildings can miss these kinds of lapses because architects or engineers hired by the sponsor are allowed to vouch for certain aspects of construction. “There was supposed to be somebody on the job who signed off that this was all installed before the walls got covered up,” he said. “As nutty as it sounds, just because you have a certificate of occupancy doesn’t mean you have a building that’s code compliant.”

He and real estate lawyers said that even when a condo board discovers building code violations, it is often reluctant to alert city officials because the board then becomes responsible for correcting the problem as well as for paying any fines.

James P. Colgate, an assistant commissioner at the Department of Buildings, says that condo boards are not under any obligation to report code violations. But when they do, the department may decide to investigate whether an engineer or architect improperly certified work at the building.

As for problems like water leaks, Mr. Colgate said that a certificate of occupancy was not the same thing as a guarantee. Such a document “certifies that the building is substantially in compliance with rules governing its construction,” he said, “and even if workmanship in a building may not be superb and you get those kinds of issues, the building might still be in compliance.”

When a building is clearly out of compliance, talk quickly turns to lawsuits.

Steven D. Sladkus, a real estate lawyer at Wolf Haldenstein Adler Freeman & Herz, said that he represents an Upper East Side building where the developer put only one layer of wallboard between the floors, instead of the two layers required by city code to create a fire-resistant barrier. “The board knows that’s a serious code violation, and it’s prepared to do the work and sue the developer and hope for reimbursement,” he said.

Mr. Sladkus said that the board hoped that the New York State attorney general’s office, which oversees condominium offering plans, would press the sponsor to do the work.

It will be expensive and disruptive, he added, since contractors will have to remove ceilings and recessed lighting to install the fire-stopping materials.

At the Slate Condominium, a 12-story glass-walled tower in Chelsea where in 2007 one-bedroom apartments sold for as much as $1.4 million and two-bedrooms for as much as $1.9 million, the condo board filed a lawsuit in March accusing the sponsor, Chelsea Luxury Condos, of using defective materials and of not living up to promises made in the offering plan.

“The unit owners have not only personally observed a number of defective and unsafe conditions in the building, but they have suffered a plethora of dangerous conditions,” the suit states. The complaint lists incomplete fire-stopping in hallways, and uneven floors and water damage in various places. Problems common to individual units include warped floors and balcony doors, nonworking electrical outlets, rusted kitchen faucets and water leaks.

Most people moved into the 26-unit building in 2007, and the apartment owners took control of the condo board in April 2008. Debra Guzov, the lawyer representing the condo board, would not comment on the case.

Anna A. Higgins, the lawyer representing the sponsor, said the sponsor had hired its own engineer to inspect the building, and “our position is that the problems listed are mostly punch-list items and are not considered defects, but things that are under warranty and therefore the responsibility of the subcontractors.”

The sponsor has, in turn, brought several of its building and electrical contractors into the suit as third-party defendants, charging they were negligent. “This is a reputable building and company,” Ms. Higgins added. “And they take these matters very seriously.”

The sheer volume of new buildings that went up during the condo construction boom is the main reason for the increase in defective buildings, lawyers and engineers said.

“It happens in every cycle,” Mr. Saft said. “At the beginning of the cycle, workers are underemployed, then suddenly they’re busy, and at the height, there are too many projects and not enough workers. Then what happens is shoddy workmanship, and when you have sponsors running out of money, they start to cut corners.”

Andrew P. Brucker, a real estate lawyer with the New York law firm of Schechter & Brucker, said that the boom had prompted people with no experience in real estate to start building condos. “When the market was hot,” he said, “anybody who had a couple bucks suddenly became a developer, thinking they’d get rich. When the market was strong, if you complained about something, sponsors would fix it, but then the market started to tank and brand-new buildings aren’t selling out, so there’s no money to do that anymore.”

The more unusual problems that Mr. Brucker has encountered include a building whose developer built an illegal pool and another whose developer put the building’s electrical system in a closet inside an apartment. The pool, he said, was never approved by the Buildings Department and may have to be removed. The electrical closet may also be illegal, because it may not be easily accessible in an emergency. In both cases, the solutions will entail costly projects.

When it becomes clear that a building has problems that go beyond punch-list items — a kitchen drawer, say, that won’t stay shut or a closet door that sticks — the first thing owners should do is hire an engineer.

“You have to get a top-to-bottom assessment of the building — the interior, the exterior, all the systems,” Mr. Sladkus said. “That creates a record and tells the board where things stand.”

The sooner this is done, the better, he added, because it takes away a sponsor’s potential claim that problems were caused by the apartment owners. Depending on the size of the building, an engineering report could cost $10,000 to $50,000.

Filing a lawsuit is usually a last resort because it can be costly and take years to resolve. Lawyers say the condo board’s first course of action should be to try to negotiate with the sponsor, with a goal of having the sponsor make the repairs or pay a settlement to get the work done.

If that fails, lawyers said, a condo board can file a complaint with the attorney general’s office, which can help to mediate a dispute and press developers to make repairs. The office can, but rarely does, file its own lawsuit against a developer. But lawyers say that the attorney general has been inundated with complaints; it can take months just to find out if the office will take on a building’s case.

“The attorney general will look at life, health and safety issues and things like whether a temporary certificate of occupancy is current,” said Jeffrey S. Reich, another real estate lawyer at Wolf Haldenstein. “But it’s hard to get them motivated to roll up their sleeves on minor issues.”

Lawyers believe that the attorney general’s office is more likely to act on behalf of smaller buildings, because it recognizes that litigation could be prohibitively costly for buildings with relatively few unit owners.

That presumption is well illustrated by one case in which Mr. Reich represents the owners in a large luxury building that he had hoped the attorney general would see to. But, he said, “the sponsor’s attorney went to the attorney general and said they should not take the case because the apartments are larger than regulation basketball courts and the owners are titans of finance who are fully capable of pursuing it in court.”

Mr. Reich said he was able to persuade the office to keep pursuing the complaint only because an aspect of law was involved that could not be addressed in court because it fell under the attorney general’s jurisdiction.

A spokeswoman for the attorney general encouraged condo owners facing building problems to contact the office’s real estate finance bureau.

The attorney general’s Web site states that when the office receives a written complaint about a building, “we usually demand that the sponsor provide a written response to the allegations. Sometimes, this alone causes the sponsor to repair the defects.”

If that fails, the site states, the office may send its own engineers to inspect the property or have the two sides jointly hire an engineer or architect to evaluate the building and suggest solutions.

Sometimes, even when an early settlement offers the promise of resolution, unit owners still end up in court.

At the Broadway Arms, a 12-unit building that opened in Williamsburg, Brooklyn, in late 2004, the owners took control of the condo board fairly quickly. When they noticed the leaking roofs, shoddy balcony railings and a faulty ventilation system in 2005, they hired an engineer to review the building.

By July 2006, the condo board had reached an agreement with the sponsor, Broadway Driggs Associates, to fix many of the problems the engineer had found. But Alan Winkler, the condo board’s lawyer, said that the work was never completed and that the board decided to sue the sponsor in late 2008 for failing to live up to the offering plan and the settlement agreement.

Mr. Winkler said that the sponsor had repaired the balconies and done some work on the building’s upper roof, but that a lower roof still had leaks, and various problems persisted in the common areas. “At this point,” he said, “there shouldn’t be any contention as to whether this work needs to be done.”

The sponsor denied the charges in court filings and has accused its building contractor of walking off the job. The contractor in turn has denied that in court papers and has claimed that the sponsor owes him $200,000.

Charles L. Mester, the sponsor’s lawyer, said, “A lot of the problems were fixed and it’s just an opinion of some other experts that what was done should have been done another way.” He added that the $200,000 figure “has no basis in anything.”

Five years after they moved into the building, the owners “would like to resolve this quickly,” Mr. Winkler said. “But they want to make sure they get the value they were promised for their units when they bought it.”

Copyright 2009 The New York Times Company

Monday, October 12, 2009

ARC Guidelines for HOA's

In July 2007 the Legislature modified the requirements for enforcable ARC guidelines: I have a video explaining the issue , click here.

This from a California court:

Member Must Pay Association's Attorney Fees

Facts: A member obtained the approval of the association to build a house, a retaining wall, and a barn on his lot located in the community. The governing documents require that work on any construction projects must be completed within a year of approval. Even so, two years after approval, the member still had not begun construction of the house, and the association gave the member notice that it would begin mediation proceedings to resolve the construction delays. The member did not heed the notices, the mediation proceedings fell through, and the association sued the member, requesting an injunction to require him to stop construction on the improvements on his lot and to substantially build the house within the year. The association requested further that if the member did not substantially build the house within the year, then the association would have access to the member's property and would be able to tear down the improvements on his lot.

The trial court, in its ruling, provided specific deadlines for the member to meet. If the member did not meet these deadlines, the association was allowed to come onto the property and demolish the half-completed structures. The court also awarded attorney fees to the association. These orders were made pursuant to California state law, which states that in an action to enforce governing documents, the prevailing party shall be awarded its attorney fees. Because the association did not receive the exact injunction it requested, the member appealed the attorney fee award.

Ruling: A California appeals court agreed with the lower court's decision to award the association with attorney's fees.

Reasoning: The appeals court ruled that the trial court's ruling embodied the association's “main” litigation objective. The association clearly received a more favorable judgment at trial, one that contemplated demolition. And the court stated that even after the modified injunction, demolition of the member's structures remained a substantial possibility.

My Take: members always almost always take the position that "It's better to ask for forgiveness than permission" and argue that an order requiring removal of an improperly built home constitutes "economic waste" I beg to differ; if you want enforceable requirements, get squared away ASAP with your policy under the law, set objective standards, and enforce them...REMEMBER: there is no such thing as "ugly" any more....

Insurance Company not required to defend personal injury suit

This from my friends at Community Association Management Insider

This must have been a horribly maintained" pool....

Facts: A member was injured as a result of exposure to unsafe sanitary conditions in the community swimming pool. Specifically, the member contracted a viral infection from contaminants in the swimming pool's water. The viral infection was identified as the coxsackie virus, which was contracted from ingesting the community's swimming pool water. According to an expert's report, proper chlorination of swimming pool water is an effective way to kill harmful microbes, including the virus that caused the member's injury.

The member sued the association for damages, and the insurer then asked a judge for a ruling without a trial stating that it had no duty to defend the association against the member's lawsuit. The insurer relied on the language of the association's policy. The policy contained a pollution exclusion that stated that the insurance did not apply to “bodily injury which would not have occurred but for the discharge release or escape of pollutants at any time.” The policy defined “pollutant” to mean any solid, liquid, gaseous contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals, and waste.

Ruling: The Florida district court granted the insurer's request for a judgment without a trial in its favor.

Reasoning: As defined under the plain language of the policy, the meaning of the term pollutant includes contaminant. And the court stated that cases from its jurisdiction have ruled that similar pollutant clauses encompass microbes such as the ones that injured the member. The evidence showed that the substance in the swimming pool was a viral contaminant and a harmful microbe. Therefore, the pollutant exclusion applied in this case.

First Specialty Ins. Corp. v. GRS Mgmt. Assocs., August 2009

Tuesday, October 6, 2009

Some sanity in foreclosures

We have often been before judges who have "compassion" for "the little guy" when foreclosures take place; often these become situations where "helping " one person burdens others who actually are responsible and pay. Here's what the Third District Court of Appeal had to say about one trial judge who wanted to show "compassion"...emphasis is mine...

Third District Court of Appeal
State of Florida, July Term, A.D. 2009
Opinion filed September 30, 2009.
Not final until disposition of timely filed motion for rehearing.
No. 3D09-2405
Lower Tribunal No. 08-7159
Republic Federal Bank, N.A.,
Joseph M. Doyle and Blanca Alicia Doyle,
On Petition for Writ of Certiorari to the Circuit Court for Miami-Dade
County, Valerie Manno Schurr, Judge.
Carlton Fields and Matthew J. Conigliaro (St. Petersburg) and Charles M.
Rosenberg, for petitioner.
Barry L. Simons, for respondents.
Before GERSTEN and LAGOA, JJ., and SCHWARTZ, Senior Judge.
SCHWARTZ, Senior Judge.

We treat the petition for writ of mandamus as one for certiorari and deny the

Following a November 4, 2008 final judgment of foreclosure, and after
several delays – caused in part by the filing and the dismissal of a frivolous
bankruptcy petition on the eve of a previous sale and a foul-up or two in the clerk’s
office – the trial court on July 29, 2009, entered an order fixing August 27, 2009,
as the date of the sale. On motion of the defendants, however, apparently on the
basis that in the case, like this one, of the foreclosure of a residence she routinely
grants continuances of the sale rather than see “anybody lose their house,” the trial
judge granted a continuance until October 1, 2009. fn.1

We deny the petition.

Although granting continuances and postponements are, generally speaking,
within the discretion of the trial court, the “ground” of benevolence and

fn. 1 The court’s remarks on the issue included the following:
I was trying to make everybody happy.
. . . .
We have so many foreclosures here and I give
continuances on these sales. I just do.
. . . .
Unless it is so abundantly clear to me that it is just an
abuse of the process, I give extensions on these because I
don’t want anybody to lose their house. If there is any
chance that he can do this deal, get the money and try to
save this home, you know, people are having a hard time
now. They are having a difficult time. Everybody
knows it. Businesses are failing. People are losing
money in the stock market. You know, unemployment is
high. It’s just everybody knows that we are in a bad time
right now and I hate to see anybody lose their home.

compassion fn.2 (or the claim asserted below that the defendants might be able to
arrange a sale of the property during the extended period until the sale) does not
constitute a lawful, cognizable basis for granting relief to one side to the detriment
of the other, and thus cannot support the order below: no judicial action of any
kind can rest on such a foundation. This is particularly true here because the order
contravenes the terms of the statute that a sale is to be conducted “not less than 20
days or more than 35 days after the date” of the order or judgment. § 45.031(1)(a),
Fla. Stat. (2008). See also Kosoy Kendall Assocs., LLC v. Los Latinos Restaurant,
Inc., 10 So. 3d 1168 (Fla. 3d DCA 2009); Comcoa, Inc. v. Coe, 587 So. 2d 474
(Fla. 3d DCA 1991).

The continuance thus constitutes an abuse of discretion in the most basic
sense of that term. As the Court stated in Canakaris v. Canakaris, 382 So. 2d 1197,
1203 (Fla. 1980):
The trial courts' discretionary power was never intended
to be exercised in accordance with whim or caprice of the
judge nor in an inconsistent manner. Judges dealing with
cases essentially alike should reach the same result.
Different results reached from substantially the same
facts comport with neither logic nor reasonableness. In
this regard, we note the cautionary words of Justice
Cardozo concerning the discretionary power of judges:
The judge, even when he is free, is still not
wholly free. He is not to innovate at
pleasure. He is not a knight-errant roaming
at will in pursuit of his own ideal of beauty

fn. 2 See also the term referred to in Cooper v. Brickell Bayview Real Estate, Inc. 711
So. 2d 258, 258 n.1 (Fla. 3d DCA 1998).

or of goodness. He is to draw his inspiration
from consecrated principles. He is not to
yield to spasmodic sentiment, to vague and
unregulated benevolence. He is to exercise a
discretion informed by tradition, methodized
by analogy, disciplined by system, and
subordinated to “the primordial necessity of
order in the social life.” Wide enough in all
conscience is the field of discretion that
B. Cardozo, The Nature of the Judicial
Process 141 (1921).

See Storm v. Allied Universal Corp., 842 So. 2d 245, 246 n.2 (Fla. 3d DCA 2003)
(trial judge refused to preclude plaintiff, who misled and deceived the defendants,
the jury and the trial court, from further litigation “to give the Plaintiff the break of
his life”); Arango v. Arango, 450 So. 2d 583 (Fla. 3d DCA 1984) (trial judge
reduced attorney’s fee award to spouse of attorney on ground of “professional
courtesy”). See also Flagler v. Flagler, 94 So. 2d 592, 594 (Fla. 1957) (“[C]ourts
of equity have [no] right or power under the law of Florida to issue such order it
considers to be in the best interest of ‘social justice’ at the particular moment
without regard to established law.”); Nordberg v. Green, 638 So. 2d 91 (Fla. 3d
DCA 1994) (trial court may not decline to follow controlling law on ground it
considers its application "inequitable" in particular case), review denied, 649 So.
2d 233 (Fla. 1994).

Although we thus thoroughly disapprove of the order, in view of the fact
that the postponed sale is due to take place within a few days of this decision, no
useful purpose will be served by formally quashing the order or ordering the sale to
take place on an earlier date with all the procedural complications which would
then result. For that reason alone, relief will be denied. We do emphasize that
there are to be no further postponements of the sale.

Petition denied.