February 2015
In This Issue:
Recent Cases in Community Association Law
Owner’s Storage Shed Violates Building Restrictions
Owner Required to Remove Junk from Yard
Association Does Not Own Property It Believed Was Common Area
Virgin Islands Condominium Act Does Not Mandate Percentage Interest Vote Allocation
Collection Costs May Include Administrative Fees
All Vegetation in Community Is Subject to Height Limitation
Association’s Delay in Providing Corporate Records to a Member Is Reasonable
Condominium Association Unable to Provide Handicap Parking Because All Spaces Were Limited Common Elements
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Recent Cases in Community Association Law

 Law Reporter provides a brief review of key court decisions throughout the U.S. each month. These reviews give the reader an idea of the types of legal issues community associations face and how the courts rule on them. Case reviews are for information only and should not be applied to other situations. For further information, full court rulings can usually be found online by copying the case citation into your web browser.

Owner’s Storage Shed Violates Building Restrictions

Sellers v. Woodfield Property Owners Association, No. SD33312 (Mo. Ct. App. Jan. 29, 2015)

Covenants Enforcement: The Missouri Court of Appeals declined to apply a rule regulating the approval required to impose new restrictive covenants to the adoption of building restrictions which were authorized by the declaration.

The Woodfield subdivision in Nixa, Mo., is subject to a declaration of restrictions, covenants and conditions (declaration). The declaration provides that no structure can be built or remain on a lot other than one single-family dwelling unless it’s approved by the architectural committee (AC), which is a committee of the Woodfield Property Owners Association (association).

The declaration also provides that the AC is to establish guidelines for developing a “residential community which is harmonious and aesthetically pleasing.” The AC established such guidelines by adopting the original developer’s building rules and requirements (building requirements).

Stanley Sellers purchased a home in Woodfield in 2011. Shortly after his purchase, Sellers built an outdoor kitchen with the prior approval of the AC. He next began building a storage building for lawn equipment, this time without seeking the AC’s approval. The AC contacted Sellers and informed him the storage building violated the building requirements, which provide that “[s]torage buildings or utility buildings are not allowed.”

Sellers sought a waiver from the association and the AC. The association declined to amend the building requirements to remove the restriction, and the AC also denied his request for approval. Sellers sued the association, asking that his storage building be declared not in violation of the declaration.

The trial court found in the association’s favor, finding the building requirements were validly in effect when Sellers purchased his lot. Sellers appealed.

The appeals court had previously held that a new restrictive covenant adopted by only a majority vote of the homeowners is invalid and unenforceable if it imposes a new burden on property owners. The rationale for this rule is that entirely new covenants should not be imposed by a majority of owners “amending” the declaration under the declaration’s amendment provisions.

The appeals court held the amendment rule did not apply to this case because the declaration charged the AC with establishing architectural guidelines. Thus, any new rule established by the AC was preauthorized by the declaration. Moreover, the building requirement was already in effect when Sellers purchased his home, so there is no new restrictive covenant of which Sellers can complain.

Sellers’ final argument rested on a belief that a blanket prohibition on accessory buildings is unreasonable because the AC must exercise discretion on a case-by-case basis. The building restrictions, however, did not prohibit all accessory buildings, only storage and utility buildings. The building restrictions simply required that all accessory structures be approved by the AC. The AC’s approval of Sellers’ outdoor kitchen is further evidence that it had not practiced a complete ban on accessory structures.

The appeals court noted that the building requirements should be a comfort to the Woodfield owners because “they remove some measure of opportunity for arbitrariness” from the AC’s actions. The trial court’s judgment was affirmed.

©2015 Community Associations Institute. All rights reserved. Reproduction and redistribution by CAI members or nonmembers are strictly prohibited.

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Owner Required to Remove Junk from Yard

Fan v. Summerlakes Property Owners Association, Inc., No. 29A05-1405-PL-219 (Ind. Ct. App. Jan. 27, 2015)

Covenants Enforcement: The Indiana Court of Appeals upheld an injunction against a lot owner requiring the owner to remove unsightly wooden pallets from his yard and ordered the owner to pay the association’s legal costs.

Summerlakes is a subdivision in Hamilton County, Ind., which is governed by Summerlakes Property Owners Association, Inc. (association). The property is subject to a declaration of covenants and restrictions (declaration).

Rong Fan owns a home in Summerlakes, and he had a contentious relationship with the association. On January 13, 2014, the association’s property manager observed and photographed several wooden pallets propped against a tree in Fan’s front yard. By e-mail, the manager asked Fan to move the pallets out of view. Fan took the pallets to the backyard and propped them against another tree.

On January 28, the manager found the pallets could still be seen from the road and the neighbor’s driveway. That same day, the association filed suit for injunction (an order prohibiting or mandating certain action) against Fan, seeking compliance with the declaration. Fan contacted the association’s attorney, arguing the case was meritless and vowing to fight the association as he had in the past.

The declaration requires that a lot owner must maintain the lot at all times “in such a manner as to prevent the lot from becoming unsightly, specifically including the removal of all debris or rubbish.” The declaration prohibits owners from accumulating refuse on the lot. Further, the declaration prohibits any other condition that detracts from or diminishes the subdivision’s appearance.

At the hearing, Fan did not deny the pallets remained in his yard, but he claimed they had been moved to a far corner of his large backyard and could not be seen from the road. In March, 2014, the trial court granted a permanent injunction against Fan that ordered him to remove the pallets and all other rubbish from his lot immediately. The trial court also awarded the association legal fees and costs in the amount of $5,290.52. Fan appealed.

Fan argued the pallets did not amount to a declaration violation because they were not left in public view and were not trash or rubbish. He indicated his daughter might use them for an art project.

The appeals court found the trial court’s determination that the pallets constituted rubbish and detracted from the subdivision’s appearance was supported by the evidence. Even Fan described the pallets as “junk” at the hearing. The trial court’s decision was not clearly erroneous, as is required to overturn the trial court’s judgment on a factual matter.

The appeals court refused Fan’s request to review the evidence. Even when viewed in the light most favorable to Fan, the evidence still showed that the pallets were large, plentiful, unsightly and visible from the sidewalk and neighbor’s lot. The appeals court further noted that the declaration restrictions against unsightliness did not apply solely to rubbish in public view. Rather, the declaration restricts rubbish whether it can be seen from the street, sidewalk or neighboring lots.

An award of attorney’s fees is erroneous only if it is “clearly against the logic and effect and the facts and circumstances.” The appeals court did find an error in the attorney’s fee calculation:  the association incurred $2,000 in fees before the pallets were first observed, and this amount should not have been included in the fee award for the pallet violation. However, the appeals court noted that the association had incurred additional legal fees after the trial defending the judgment, which should be included in the amounts awarded to the association.

The trial court’s grant of the injunction was affirmed. The appeals court remanded the case to the trial court with directions to revise the fees that should be awarded.

©2015 Community Associations Institute. All rights reserved. Reproduction and redistribution by CAI members or nonmembers are strictly prohibited.

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Association Does Not Own Property It Believed Was Common Area

Le Oceanfront, Inc. v. Lands End of Emerald Isle Association, Inc., No. COA14-287 (N.C. Ct. App. Dec. 31, 2014)

Documents: The North Carolina Court of Appeals determined that a subdivision developer did not convey oceanfront property to the association.

Lands End is a subdivision on Bogue Banks, a narrow barrier island in the Atlantic Ocean within the Town of Emerald Isle, N.C. The subdivision is governed by Lands End of Emerald Isle Association, Inc. (association).

The subject of the lawsuit is a strip of land that lies between the subdivision and the ocean consisting of more than 14 acres (the strip). The strip’s southern boundary is the ocean’s mean high water mark. Both Le Oceanfront, Inc. (Le Oceanfront) and the association claim ownership of the strip.

In 1974, the subdivision developer filed eight maps depicting the subdivision, which laid out the location of the proposed lots, streets, common areas, open spaces and other features. Two of these maps (the 1974 maps) depict subdivision sections adjacent to the strip. The developer also recorded a declaration of covenants and easements (declaration) in 1974, which referenced the 1974 maps. In the 1980s, the developer filed correction maps (the 1980s maps) that depict portions of the strip.

The maps indicated that the subdivision would contain about 300 residential lots, 45 of which would be beachfront lots bounded by the strip. Other parcels were also depicted as bounded by the strip, including the clubhouse lot, open space and common area paths.

In 1988, the developer conveyed to the association the open spaces and common areas depicted on the recorded maps (the 1988 deeds).

In 2004, Karen and Horace Johnson and Nora and Richard Williams (the individual plaintiffs) purchased two beachfront lots. They believed the property they were buying extended through the strip all the way to the ocean. Over time, the individual plaintiffs installed sand fences; planted sea oats; built decks, walkways and gazebos; paid the town’s beach nourishment assessments as oceanfront owners; and gave the town easements for beach nourishment projects over the portion of the strip in front of their residences.

The association began to receive inquiries about encroachments into the strip by structures installed by homeowners. In 2005, the association sent a letter to all beachfront lot owners claiming ownership of the strip.

In 2010, the association pumped excess stormwater into the strip in front of the individual plaintiffs’ residences. The association asserted it had been pumping excess stormwater into the strip since the 1990s.

In 2011, the individual plaintiffs formed Le Oceanfront. They contacted the developer, who had not been involved in the subdivision for more than a decade, to acquire ownership of the strip. By quitclaim deeds executed in 2011 and 2013, the three developer entities conveyed whatever interest they had in the strip to Le Oceanfront.

In 2011, Le Oceanfront and the individual plaintiffs filed suit against the association, asserting several claims related to the strip, including a request that the court declare Le Oceanfront the strip’s owner. The association counterclaimed for a judgment that it was the owner or, in the alternative, for an easement over the strip.

The association filed a motion for summary judgment (judgment without a trial based on undisputed facts) in 2013, which the trial court granted. Le Oceanfront and the Johnsons appealed.

The association claimed it acquired the strip through the 1988 deeds. However, the 1988 deeds did not specifically reference the strip or contain a metes and bounds description of the strip. Rather, the 1988 deeds convey to the association “[a]ll streets and other common areas as described” in the declaration and the maps.

When interpreting a deed, courts must give effect to the deed’s clear and unequivocal terms, and courts may not speculate as to what the grantor intended. Therefore, the appeals court examined the declaration and the maps for evidence as to the common areas conveyed by the 1988 deeds.

The declaration defines common area as all property dedicated to the private use of the subdivision lot owners and property referred to as open spaces on the 1974 maps. The declaration also describes common area as all property contained in the 1974 maps except for the individual platted lots.

The appeals court found nothing in the 1974 maps to indicate that the strip was considered part of the subdivision. The strip was clearly outside the property being surveyed for the 1974 maps. Portions of the strip are shown on the 1974 maps, but they were shown in a location map to depict the relative location of the surveyed property. The 1974 maps omit much of the strip’s boundary. The 1974 maps do not identify any portion of the strip as common area, while other parcels were identified as streets, open space or common area.

The 1980s maps contain notes indicating that they are intended to correct certain aspects of the 1974 maps. There is nothing in the notes indicating that one of the corrections was to include the strip. The 1980s maps depict portions of the strip, but much of this is covered by the surveyor’s seal and notary signature.

The 1980s maps also do not show the entire strip. The appeals court found the failure to show the strip’s entire southern boundary or any of its eastern boundary evidence that the developer did not intend to include the strip in the 1988 deeds. The 1980s maps do not identify any portion of the strip as common area, and there is no statement of dedication of the strip. Accordingly, the appeals court held that the association did not acquire title to the strip by the 1988 deeds.

The appeals court vacated the trial court’s grant of summary judgment to the association. However, it made no determination as to whether the association had an easement in the strip because there appeared to be unresolved factual issues. The case was remanded to the trial court to determine the existence and scope of any such easements and the rights of the parties in the strip.

©2015 Community Associations Institute. All rights reserved. Reproduction and redistribution by CAI members or nonmembers are strictly prohibited.

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Virgin Islands Condominium Act Does Not Mandate Percentage Interest Vote Allocation

Frank v. Enrietto, No. 13-4537 (3rd Cir. Jan. 7, 2015)

Documents/Association Operations: The Third Circuit Court of Appeals held that the assignment of one vote per unit in an association’s bylaws did not violate the Virgin Islands Condominium Act.

Bluebeard’s Castle Hilltop Villas is a condominium in the Virgin Islands that is managed by Bluebeard’s Condominium Association (association). Some of the units are committed to interval ownership (time-shares) and divided into one-week units.

Unit owners John Enrietto and Mark Farrell sought election to the board of directors at the October 2005 election, but they were declared the losing candidates. Enrietto and Farrell later learned that the votes at the election were calculated on the basis of each unit’s percentage interest in the condominium common area rather than on the one vote per unit method prescribed by the bylaws. Enrietto and Farrell also learned they would have won the election if the votes had been counted under the “one unit, one vote” method.

Enrietto and Farrell sued the winning candidates–Ira Frank, Kenneth Drew, Richard Cornell, Nicholas Goodpaster and Peter Davit (collectively, the defendants), arguing that the method used for counting votes violated the bylaws. The defendants filed a motion for summary judgment (judgment without a trial based on undisputed facts), asserting that the counting method used complied with the Virgin Islands Condominium Act (VICA), which took precedence over the bylaws.

The bylaws provided that one vote would be assigned to each unit. For time-share units, the unit’s one vote would be divided by 52 so that each owner of a one-week interval would be assigned 1/52 of the unit’s vote.

VICA requires that each condominium declaration include “the percentage of undivided interest in the common areas and facilities appertaining to each apartment and its owner for all purposes, including voting.” VICA also provides that the bylaws may contain provisions dealing with board elections.

The trial court denied summary judgment, ruling that the bylaws controlled and the votes had been incorrectly counted. The defendants appealed to the Appellate Division of the Virgin Islands District Court, which found that VICA does not mandate percentage voting and upheld the trial court’s judgment. The defendants appealed the case further to the Third Circuit Court of Appeals.

While the Third Circuit Court concluded that VICA controls, it also found that VICA does not mandate percentage voting. Thus, the bylaws were not in conflict with VICA.

The defendants argued that the phrase “including voting” following VICA’s mandate that the declaration include each unit’s percentage interest required that the percentage interest be applied to voting. The Third Circuit Court disagreed, finding that the statute could be read to mean that the declaration must contain each unit’s percentage interest for any purpose for which the percentage interest is relevant. This may include voting purposes, but it may also include other purposes, such as an owner’s rights in a deed.

The Third Circuit Court held that VICA’s plain language does not mandate percentage voting. Further, VICA specifically provides that the bylaws may contain election provisions, but it does not direct the association to adopt a particular voting method. Thus, if the condominium documents use another method of counting votes, then the association would simply not use the percentage interest for voting purposes. Accordingly, the votes for the 2005 election were improperly counted.

The judgments of the District Court and the trial court were affirmed.

©2015 Community Associations Institute. All rights reserved. Reproduction and redistribution by CAI members or nonmembers are strictly prohibited.

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Collection Costs May Include Administrative Fees

Anselmi v. Shendell & Associates, P.A., No. 12-61599-Civ-Williams (S. Dist. Fla. Jan. 7, 2015)

Documents/Association Operations: The U.S. District Court for the Southern District of Florida determined that including administrative fees for the association’s manager in a collection demand did not violate the Fair Debt Collection Practices Act.

Luz Marina Anselmi owns a unit in the Bonaventure Condominium, which is managed by Bonaventure Condominium Association, Inc. (association). Anselmi became delinquent in amounts owed to the association. In accordance with the board’s collection policy, the association’s management company, West Broward Community Management (West Broward), forwarded Anselmi’s account to the association’s attorneys, Shendell & Associates, P.A. (Shendell), to begin collection proceedings.

In August 2011, Shendell sent a collection demand letter to Anselmi, which included $50 for administrative fees in its list of amounts due to the association. Anselmi filed suit against Shendell, alleging violations of the federal Fair Debt Collection Practices Act (FDCPA). Specifically, Anselmi alleged that Shendell failed to specify the amount of the debt, misrepresented the amount owed and unfairly attempted to collect more than was lawfully owed.

FDCPA prohibits a debt collector from misrepresenting the amount owed and attempting to collect more than the amount owed. A debt collector also is prohibited from using unfair or unconscionable means to collect or attempt to collect a debt,” unless the amount is expressly authorized by the agreement creating the debt or the amount is otherwise permitted by law.

Anselmi argued that Shendell did not identify any condominium document that obligated her to pay $50 in administrative fees. Anselmi did not dispute that the association had the general right to recover from her its costs resulting from the collection of her delinquent assessments, along with attorney’s fees, interest and late charges. However, she argued that the demand letter had already identified $6.03 as costs, so the $50 in administrative fees must be something other than costs.

The association’s management agreement with West Broward authorized the administrative fees. West Broward’s agent testified that a $25 fee was charged when West Broward sends a demand letter to a delinquent owner to account for the time and effort of researching the account, creating and sending the demand letter and posting the account. Another $25 is charged when the account is turned over to the attorney and covers West Broward’s time to assemble and print the account history and send a letter to the attorney.

The condominium declaration specifically provided that delinquent owners were responsible for all costs, including reasonable attorney’s fees, incident to collecting the delinquency. The declaration also provided that each unit owner is bound by the management agreement. Further, the Florida Condominium Act authorizes an association to collect the costs incurred during the course of collecting on a delinquent account.

The term “all costs” is expansive and includes any costs that can reasonably be considered to collect the debt. FDCPA does not require an agreement to specify every possible way a cost or fee could be determined.

The court held that, based on the declaration and the management agreement, the association was authorized to collect the $50 in administrative fees. Therefore, the demand letter would be a FDCPA violation only if labeling the $50 charge as “administrative fees” rather than “costs” was a material misrepresentation.

To be material, the statement must influence the consumer’s decision or ability to pay or challenge the debt. Liability under FDCPA is limited to “genuinely false or misleading statements that ‘may frustrate a consumer’s ability to intelligently choose his or her response.’ ”

The court found the administrative fees listed in the demand letter were not incorrect, unfair, material or misleading. Accordingly, the court granted summary judgment to Shendell.

©2015 Community Associations Institute. All rights reserved. Reproduction and redistribution by CAI members or nonmembers are strictly prohibited.

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All Vegetation in Community Is Subject to Height Limitation

Lightner v. Shoemaker, No. 70746-9-I (Wisc. Ct. App. Dec. 22, 2014)

Documents/Covenants Enforcement: The Wisconsin Court of Appeals overturned a trial court’s finding that a height restriction did not apply to natural growth trees.

Birch Bay Village is a residential community in Whatcom County, Wisc., with a golf course, marina, lakes and other common property. Several of the Birch Bay lots have sweeping views of the surrounding mountains and the community amenities. Birch Bay is managed by Birch Bay Village Community Club, Inc. (association).

George Lightner purchased Lot 31 in Birch Bay in April 1987. At that time, Lightner enjoyed a virtually unobstructed view from his lot. Lot 29 is adjacent to and downhill from Lot 31. In 1987 trees were growing on Lot 29 near the common boundary line, many of which were well above six feet high. At the time, Lot 29’s owner either topped the trees or gave Lightner permission to do so to protect Lightner’s views.

In February 1999, Chad Shoemaker purchased Lot 29, which contained 42 cedar trees. Shoemaker planted arborvitaes along the property line adjacent to Lot 31. The cedar trees and the arborvitaes grew to more than six feet, obstructing Lightner’s view.

The Declaration of Rights, Reservations, Restrictions and Covenants of Birch Bay Village (declaration) contains two restrictions governing trees. It first provides that, to preserve “natural growth” in accordance with the developer’s development plan, no trees or shrubbery could be removed unless approved in writing by the association’s architectural control and maintenance committee (ACC). The declaration further provides:

No trees, hedges, shrubbery or plantings of any kind whatsoever in excess of six feet in height shall be placed, planted or maintained on any of the said property, nor shall any such tree, hedge, shrub or planting be allowed to grow in excess of such height, without written permission of the [ACC].

Lightner asked Shoemaker to trim the trees to six feet or cut them down altogether. Shoemaker refused. Lightner then sought assistance from the association. The association also asked Shoemaker to trim the trees; again, Shoemaker refused. The association ultimately told Lightner it was an issue to be worked out between the neighbors.

The declaration provides that, if the association fails to take appropriate action to enforce the covenants and restrictions within a reasonable time, an owner may pursue the violation. So, Lightner sued Shoemaker in February 2011.

The trial court interpreted the restriction as requiring that only “human-planted” trees or shrubs be trimmed to six feet because of the paragraph’s clear intent to preserve natural growth. It found the words “or maintained” in the height restriction as meaning that only “placed or planted” trees are subject to the height restriction. The trial court found that the cedar trees on Lot 29 were naturally occurring and, therefore, not subject to the height limitation. The arborvitae planted by Shoemaker was subject to the six-foot limitation. Lightner appealed.

The appeals court determined that the clause regulating tree removal was intended to preserve natural growth but was not absolute because it was conditioned on the development plan. To find that all natural growth must be preserved would render the reference to the development plan meaningless, which a court may not do when interpreting a restriction.

However, the appeals court found the height restriction absolute and applicable to all plants because the clause does not state an exception for natural growth. The appeals court held that it was an error to interpret the words “or maintained” as creating an exception to the height restriction for natural growth.

The appeals court upheld the trial court’s conclusion that the arborvitae was subject to the height restriction. It also upheld the trial court’s finding that the restriction did not create view rights because it addressed vegetation, not views. In addition, the declaration granted the ACC the unfettered discretion to waive the restriction. This is clear evidence that no absolute view rights or easements were intended. However, the appeals court reversed the trial court’s conclusion about the cedar trees. The case was remanded to the trial court to consider appropriate treatment for the cedar trees in accordance with the development plan.

©2015 Community Associations Institute. All rights reserved. Reproduction and redistribution by CAI members or nonmembers are strictly prohibited.

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Association’s Delay in Providing Corporate Records to a Member Is Reasonable

Clark v. The Ryan Park Property and Homeowners Association, 2014 WY 169 (Wy. Dec. 30, 2014)

State and Local Legislation and Regulations: The Wyoming Supreme Court found an association’s delay in providing requested corporate records to a member reasonable and in good faith, precluding an award of attorney’s fees and costs under the Wyoming Nonprofit Corporation Act.

Fern and Travis Clark own property in Ryan Park, Wyo., and are members of The Ryan Park Property and Homeowners Association (association). The Clarks sued the association, claiming the association denied their repeated requests for corporate records. The Clarks sought an order requiring the association to allow them to inspect and copy certain records pursuant to the Wyoming Nonprofit Corporation Act (act) and sought an award of costs and attorney’s fees.

Prior to a hearing, the association told the trial court it had already complied with the Clarks’ request. Nevertheless, the Clarks wanted an order because they had not received all of the requested documents. They also asserted a right to recover their costs and attorney’s fees.

The trial court proceeded with the hearing, and afterward, entered an order granting the Clarks’ motion. The court ordered that, “[a]s the parties have agreed, and as has already been done, the [Association] shall make available for copying and inspection those records requested by the Clarks that are in existence and in its possession or in the possession of its agents and which can be reasonably obtained.”

In its order, the trial court quoted Section 1604(c) of the act, emphasizing a portion in bold:

(c) If the court orders inspection and copying of the records demanded, it shall also order the corporation to pay the member’s costs, including reasonable counsel fees, incurred to obtain the order unless the corporation proves that it refused inspection in good faith because it had a reasonable basis for doubt about the right of the member to inspect the records demanded.

The trial court’s order indicated that it was apparent the association had made reasonable efforts to meet the Clarks’ demands, and the association had a reasonable basis for doubting the Clarks’ right to inspect certain documents, “namely its concerns about the privacy interests of other individual members.” The trial court further opined that the association “has kept as good a set of records as most nonprofit, volunteer organizations” and had done its best to respond to the Clarks’ requests, considering the fact that some of the records were in the possession of others.

Finally, the trial court indicated that it could not conclude the association acted in bad faith or that attorney’s fees or costs were warranted. The Clarks appealed the trial court’s decision not to award them attorney’s fees and costs.

The Clarks contend the finding that the association had made reasonable efforts to satisfy their requests was erroneous. They claimed the association provided partial responses to their requests on a piecemeal basis over nearly eight months. The Clarks also asserted they did not receive certain bank records until after they filed suit.

The association’s president, Donald Brinkman, testified that the association had to obtain the requested bank statements from the bank. The statements provided by the bank did not include cancelled checks or deposit slips, which the Clarks requested. The bank told Brinkman it could provide cancelled checks and deposit slips for an additional cost. After confirming the Clarks were willing to pay the additional cost, Brinkman ordered the documents from the bank. The bank said that some of the documents had to be retrieved from storage in California, and Brinkman testified that it “took a while” to get them. After Brinkman received the documents from the bank, he provided them to the Clarks.

The appeals court found this explanation a reasonable cause for delay. The appeals court found no error in the trial court’s determination that the association made reasonable efforts.

The Clarks next asserted the trial court used the wrong standard when it concluded the association had not acted in bad faith. The Clarks argued the statute requires good faith, and a lack of bad faith is not sufficient. They contended that asserting unsupported privacy concerns did not meet the good faith standard.

At the hearing, Brinkman was asked why the association was hesitant to turn over demand letters sent to delinquent homeowners. Brinkman testified that everything he had learned in his work experience indicated that “you cannot divulge anything of a personal nature about anybody.” He feared that disclosing confidential information that was not public record could create liability for the board. He was worried the letters might be used to embarrass or harass the recipients.

After the trial court entered a protective order covering the demand letters, the association provided the letters to the Clarks. The trial court found the association had a reasonable basis for doubting the Clarks’ right to inspect these letters based on privacy concerns.

The appeals court agreed with the Clarks that a lack of bad faith was not strictly equivalent to good faith. It may have been more precise for the trial court not to use the term “bad faith.” However, the appeals court found that, reading the order as a whole and considering the trial court’s emphasis on the statute’s good-faith language, there was no doubt the trial court applied the correct standard.

The trial court’s decision was affirmed.

©2015 Community Associations Institute. All rights reserved. Reproduction and redistribution by CAI members or nonmembers are strictly prohibited.

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Condominium Association Unable to Provide Handicap Parking Because All Spaces Were Limited Common Elements

Commonwealth of Virginia v. Windsor Plaza Condominium Association, Inc., Nos. 131806, 131817 (Va. Dec. 31, 2014)

State and Local Legislation and Regulations/Powers of the Association: The Virginia Supreme Court found no fair housing violation where a disabled unit owner asked the association to permit him to park in a handicap parking space that was a limited common element of another unit because the association had no right under the Virginia Condominium Act to confiscate the assigned parking of another.

Windsor Plaza Condominium Association, Inc. (association) manages Windsor Plaza Condominium in Arlington County, Va. The condominium contains underground parking garages, and the site plan identifies four handicap parking spaces.

In 1995, the developer assigned and conveyed each parking space as a limited common element, including the four handicap spaces, to the individual unit owners “as a limited common element for the exclusive use of the unit owner of such condominium unit.”

In 2007, Michael Fishel and his wife Eleanor contracted to purchase a unit. Fishel suffers from severe osteoarthritis and must use a wheelchair. Prior to purchasing, the Fishels received a resale package containing a parking diagram depicting the four handicap parking spaces. The package indicated the parking spaces were limited common elements and that all were assigned to individual unit owners.

The Fishels viewed the parking space assigned to their unit and saw that it was not a handicap space and would not meet their needs. The Fishels did not inquire about the availability of handicap parking prior to closing in July 2007.

Soon after closing, Fishel informed the condominium manager that he was unable to park his van in his parking space. Fishel asked for a larger parking space in a better location. In August 2007, the manager informed Fishel that, since all existing parking spaces were individually owned, assigning a different space to Fishel was beyond the board’s authority. The manager told Fishel he was free to trade spaces with another owner, and he offered to post a flyer on a community bulletin board if Fishel wanted to advertise his interest in trading.

Fishel asked the board to reconsider, indicating that he needed a parking space he could actually use. The board asked its attorney how to proceed. In May 2008, the attorney informed Fishel that the association could not force any owner to trade parking spaces.

The attorney offered to help Fishel with a request to the county to reserve a public parking space on the street outside the condominium building. Fishel rejected this proposal because parking on the street would require him to exit his vehicle into traffic. In addition, the curb was steep, and the nearest condominium entrance was not handicap-accessible.

In March 2009, Fishel filed complaints with the Virginia Fair Housing Board (FHB) and the U.S. Department of Housing and Urban Development, alleging the association had discriminated against him in violation of the Virginia Fair Housing Law (VFHL) and the Federal Fair Housing Amendments Act of 1988 (FHAA).

In August 2009, the association attorney informed the Fishels that one of the handicap parking space owners was willing to enter into a licensing agreement that would allow Fishel to use the space. Fishel rejected the offer because the parking space owner wanted the right to reclaim the parking space if the unit was sold or if they had a tenant at some point who needed a handicap parking space.

In May 2010, FHB determined that the association may have engaged in discriminatory housing practice and referred the case to the Commonwealth of Virginia Attorney General. In June 2010, the attorney general filed a complaint on behalf of the Commonwealth against the association, alleging the association— in violation of VFHL—failed to make reasonable accommodations in rules, practices, policies or services that were necessary to afford Fishel equal opportunity to use and enjoy his dwelling. The Commonwealth sought a judgment and an injunction requiring those with the exclusive rights to use the four handicap parking spaces to make those spaces available to all disabled residents.

In November 2010, the Fishels intervened in the lawsuit, alleging the association violated VFHL and FHAA by refusing their request for a reasonable accommodation. The case proceeded to trial in March 2013. After the evidence was presented, the association filed a motion for summary judgment (judgment based on undisputed facts), which the trial court granted. The Commonwealth and the Fishels appealed.

VFHL makes it unlawful to discriminate against any person in the terms, conditions or privileges of sale or rental of a dwelling or in the provision of services or facilities because of a person’s handicap.

The Commonwealth asserted the association discriminated against Fishel because Fishel mentioned to the manager that there was a common element bicycle storage area in the garage that was large enough to be converted into a parking space for Fishel. The Commonwealth argued that parking is a service, and Fishel sought a reasonable accommodation in the association’s rules, practices and policies involved in providing that service.

The appeals court determined the plain meaning of the word “service” does not encompass the condominium’s parking scheme. Rather, service is labor or some useful act performed for the benefit of another. The appeals court held that, as real property, the parking spaces are clearly not acts or labor performed by the association to benefit the unit owners.

Further, while the Commonwealth urged that only minor physical alterations would be required to convert the bicycle storage area into parking, it presented no evidence concerning what would be involved. The appeals court held the evidence concerning the bicycle space did not prove a request for a reasonable accommodation.

The only request for an accommodation the association refused was Fishel’s request for a larger parking space in a different location. The Virginia Condominium Act only permits limited common elements to be reassigned if all property owners affected by the reassignment consent. The appeals court held that the accommodation requested was unreasonable because the association “has no authority to confiscate property belonging to one unit owner and to reassign that property to another.”

The appeals court held the trial court did not err in entering judgment in favor of the association.

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