New Neighborhoods–Preemptive Rights and Balcony Restoration

New Neighborhoods

By Gary A. Poliakoff and Ryan Poliakoff

Preemptive Rights and Balcony Restoration

Dear Poliakoffs,

My mom moved into an assisted living facility and was no longer able to pay her dues and assessments on her condominium.  She quit claimed the unit over to my brother. The condominium association will not acknowledge his ownership, even though it was a legal transaction. He continues to pay all his maintenance fees and assessments on time, even though they have told him that he cannot use the facilities (pool, golf course), as the board did not approve the transfer. He recently got the new coupons and asked that our mother’s name be changed to his and they refused to do so, unless the annual assessment is paid in full ($5,200)–then they would think about it. This condo is his inheritance. Do they have the legal right to say no to his inheritance? Why would they do so if he were not paying his assessments on time? Would they rather have no money, because our mother certainly can’t pay the dues?  Signed, S.A.

Dear S.A.,

Most condominiums have what is known as a “preemptive” right, or a right of first refusal. This means that they have the right to either approve the transfer of a unit or provide an alternative buyer under the same terms and conditions by which the owner sold the unit. The courts have consistently upheld these rights, ruling that it is not an unlawful restraint on the transfer of property rights (which, ordinarily, are held sacrosanct), as the seller is made whole. Of course, the association cannot use its right for discriminatory purposes, such as the denial of ownership based upon race, religion, sex, national origin, or familial status. That said, most condominium documents also make an exception when the transfer is to a spouse or an heir. So the first thing to do is to read the condominium documents to see if the association has the right to approve the transfer to your brother, and whether that right has any exceptions.

As an aside, if the condominium is a “community for older persons,” which precludes residency by an individual below the age of 55, then your brother might indeed have the right to own the unit but may not be allowed to occupy the unit until reaching age 55.

Now, the Condominium Act prohibits a condominium from collecting common expenses in excess of three months at a time, except in the case of certain delinquencies. So the association demanding that your brother pay a full year’s assessments in advance of the board making a decision is certainly against the law.  Assuming that this is just a dispute over transfer rights, we feel that the board should probably quit playing games and, given the circumstances, acknowledge your mother’s bequest and accept that your brother now owns the unit.

Dear Poliakoffs,

I bought my condo twelve years ago with a balcony enclosed by sliding windows.  We were just informed by our association that 90% of us are in violation of city code.  How could this be?  Well it seems that, twenty years before I purchased my unit, these balconies were open, and they were later changed to their current design.  How could these changes occur without building permits or compliance with building codes? The association refuses to take responsibility, instead telling us that we have to pay thousands of dollars to restore our balconies to their original condition.  I do not feel that I should be responsible for these changes, since I purchased my condo in good faith from the previous owner.  Do I have any recourse?  Signed, B.T.

Dear B.T.,

While statutes of limitations would preclude community associations from retroactively seeking to compel unit owners to restore their units after thirty years, municipalities are not similarly restricted.  If the enclosure of a balcony or patio was done without permits and not in compliance with local zoning and building codes, the governing municipality can compel unit owners, including those who purchased their unit with the unapproved alteration already in place, to restore the unit to an “as built” condition in accordance with the approved building codes.  Your only recourse would be against the person who sold you your unit, but then only if you reserved the right to do so in a purchase agreement which specifically stated that the right survived the closing; otherwise the provision of the purchase agreement merges into the deed, causing your rights against the seller to be extinguished.

As for the association, most balconies are either owned elements, or limited common elements for which the unit owner has sole maintenance responsibility.  It is not unusual or improper that you would have the responsibility to maintain and restore your balcony to its original condition.  Your real dispute is with the owner who made the modification without city approval.

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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