New Neighborhoods–Incidental Damage, Material Alteration in an HOA and Language on Proxies

New Neighborhoods

By Gary A. Poliakoff and Ryan Poliakoff

Incidental Damage, Material Alteration in an HOA and Language on Proxies

Dear Poliakoffs,

I have recently discovered damage to my condo in North Palm Beach.  Immediately, I sent a letter to my association.  The president called me last week, and an engineer and a contractor saw the damage.  I was told that there would be scaffolding on the outside of the building near my third floor apartment to make the repair.  The damage is on the ceiling between a screen and the glass sliding doors approximately six inches inside the screens.  The concrete work is to be covered by the association.

My question to you is whether I should be expecting the screen removal and replacement and sliding door removal and replacement to be taken care of by the association?

How do I handle this, and what might I do to be sure that I do not get charged for these expenses?

Thank you for any input that you might be able to give me.  Signed, R.T.

Dear R.T.,

The association should pay for any incidental damage caused by them in making necessary repairs to your unit.  This would include, in your case, the removal and replacement of the screen and sliding door.  It’s their responsibility, and they should cover the bill.

Dear Poliakoffs,

I read your informative column every week and I was particularly interested in your article published on December 10, 2011. This article commented on HOA law as it pertained to a subdivision governed by HOA covenants and restrictions, where the documents were silent regarding material alterations.

Your answer to a question asked by J.R. stated that a material alteration to a common area would require the written consent of 100 percent of the association’s members.

Please advise where I may access this legal information. Is it from Florida law or statute? I am writing from an unincorporated subdivision in Flagler County with a mailing address of Flagler Beach.

Also, please advise where I may purchase your book–New Neighborhoods – The Consumer’s Guide to Condominium, Co-op and HOA Living.

Thank you for your time and attention.  Signed, G.B.

Dear G.B.

First, thank you for asking about our book!  New Neighborhoods is available from bookstores everywhere—if they don’t have it in stock, it’s easy to order.  You can also find it at most large online bookstores, as well as in electronic format for the Amazon Kindle, Sony e-Reader and Apple iPad.

The question you asked is a good one because, when dealing with homeowner’s associations and the HOA Act, the Law is not as clear as it is in a condominium setting.  In a condominium, the vote to approve a material alteration is whatever percentage is provided in the documents, or if the documents are silent then the approval required is 75% of the entire membership. But HOA law is less clear. A recent case held that where the modification to the common areas was material, the actions of the association was “ultra vires,” which means, “acting outside the corporate authority;” which is why we said 100% approval would be required. Other cases have held that if the net effect of the change is to change the fundamental character of the community it is not permitted without 100% approval. In contrast, there are non-material changes that many argue can be made by the board without unit owner approval. So the answer to your question is that it depends upon the nature of the modification that is being made. To help solve this problem, any HOA documents that do not provide limits on the board’s authority when it comes to making modifications to the common areas should be amended to clarify when membership approval is required, and by what percentage vote.

Dear Poliakoffs,

I have a question regarding limited proxies, but I could not find the answer.

May the proxy form sent to owners by the board of directors for voting on an amendment include a statement in bold type on the proxy form stating, “The Board Recommends a Yes Vote”?

I thank you in advance for your opinion.  Signed, A.M.

Dear A.M.,

We do not know of any ruling that would preclude the board from putting the bold recommendation on the face of the proxy.  That said, readers should remember that for any proxy dealing with the waiver of reserves the following bold print must appear on the face of the proxy:

WAIVING OF RESERVES, IN WHOLE OR IN PART, OR ALLOWING ALTERNATIVE USES OF EXISTING RESERVES MAY RESULT IN UNIT OWNER LIABILITY FOR PAYMENT OF UNANTICIPATED SPECIAL ASSESSMENTS REGARDING THOSE ITEMS.

Gary A. Poliakoff and Ryan Poliakoff are co-authors of New Neighborhoods—The Consumer’s Guide to Condominium, Co-Op and HOA Living.  Gary Poliakoff is a founding principal of Becker & Poliakoff, P.A., and Ryan Poliakoff is the Vice President of Management at AKAM On-Site.  Email questions to condocolumn@becker-poliakoff.com.  Please be sure to include your hometown.

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