Tim Arel: Adding Bylaws
It is not impossible to amend your association documents, but it isn't easy.
There is a hierarchy of legal authority for all community associations. At the top is the applicable state or local law. If the law spells out certain requirements, the association must adhere to them.
But lawmakers recognize that this is an evolving area of the law, and do not impose too many restrictions or burdens in the statute. Instead, the law defers to the second level of authority, the association's governing documents. In your case, it starts with the condominium declaration. That is the legal document recorded among the land records in the jurisdiction where the property is located. It is the document that creates the condominium.
The declaration describes with specificity the property, and many of the important details: the boundaries of the units, the things that will make up the common elements (including limited common elements), a determination of the unit owner's percentage interest in the common elements, the purposes and restrictions on the use of the property, provisions for easements and provisions concerning assessments and liens against the units and the liability of the unit owner for payment of the common expenses.
The third level of authority is the bylaws. The document, for all practical purposes, is the constitution of the association. The bylaws contain the rules for self-government of your association, including how the board directs the affairs of the association, administers policies outlined in the bylaws and generally oversees upkeep and administration. The bylaws also cover such matters as requirements for meetings, voting, the manner in which the budget should be prepared, the determination and handling of assessments, including special assessments and the filing of assessment liens, the nature of insurance coverage, and restrictions on the use of the units and the common areas.
The lowest level of authority is the rules and regulations adopted from time to time by the board of directors.
Your board wants to make changes regarding leasing and pets. Let's look at each issue separately:
• Pets: What do your bylaws say? If there is language permitting pets, the board cannot adopt a rule that would prohibit pets in the future. To make any such change, a bylaw amendment is required. Generally, to amend association bylaws, a supermajority vote of the membership (ranging from two-thirds to three-quarters) is required. As you suggested, it is not easy.
However, if your bylaws permit owners to have pets, the board can adopt rules and regulations governing their ownership and maintenance. For example, the board could require that all pets be registered with the association, that all pets be on a leash anywhere on community property and that owners are liable for fines if pets are unruly
But the board cannot -- by rule or regulation -- prohibit pets. That would require a bylaw amendment.
• Leasing: This is a controversial area for many community associations. Boards of directors -- and mortgage lenders -- do not want too many renters. The secondary mortgage market imposes percentage limits on the number of investor owners, ranging from 40 to 60 percent of the membership.
Again, a board of directors must be guided by the bylaws. If renting is permitted in the bylaws, the board cannot pass a rule that prohibits owners from leasing out their units.
However, the board can impose reasonable restrictions. For example, the board could require that all owners and tenants sign an addendum to their leases, stating that the tenant has been provided a copy of the association documents and that the tenant agrees to abide by those documents. The board could also require that the landlord and tenant acknowledge that the board of directors can take legal action against a tenant for violations of the association legal documents. Or the board could require that the landlord and tenant agree that if the landlord is not paying the condominium fee, the tenant would upon demand pay his rent directly to the association, instead of to the landlord.
But the board would have to obtain a bylaw amendment to restrict the number of tenants that can live in the complex, or to prohibit all leasing.
Amending your legal documents takes time, a lot of work and dedicated owners who are willing to canvass and lobby the other owners on the merits of a proposed amendment.
Typically, the board of directors initiates the process. It drafts the language, and after conferring with legal counsel, circulates the proposal to all owners. The board should hold an informational meeting at which interested owners can be given the rationale for the proposal and can discuss whether such an amendment is needed.
Only after such a meeting should the board call for a vote. Some associations prefer to have a vote taken at the annual meeting, while other boards call a special meeting solely to vote on the proposed amendment. That is a political decision best left to the board's discretion.
Also, some bylaws require that each owner's mortgage lender receive a copy of a proposed amendment, and, in some cases, that some percentage of those lenders consent to the amendment.
Some amendments aren't controversial. For example, errors often are found in original documents that can be corrected only by amendment.
Other proposed amendments will stir up the membership, however, and ones concerning pets and leasing are among them. Board members should consider what they can do by rule and regulation before tackling such issues by amendment.
More about Tim Arel



Comments