Are present owners now the Declarant?

Our condominium's Declaration, first paragraph:
THIS DECLARATION, and the exhibits which are attached hereto and made a part hereof, are made and executed this _ _ _ day of _ _ _, 1991 by (developer), hereinafter called the "Declarant", for itself, its successors, grantees and assigns, pursuant to the provisions of the Indiana Horizontal Property Act.
Later comes -
22. Rights of Declarant.
Notwithstanding anything contained in this Declaration, or in the By-Laws of any rules and regulations as may be adopted from time to time by the Board of Directors, the Declarant is irrevocably empowered to sell, lease, rent and/or mortgage Units and portions thereof to any purchaser, lessee or mortgagee approved by it in its sole discretion and Declarant shall have the right to transact any business necessary to consummate sales or rentals of Units or portions thereof including, but not limited to, the right to maintain models, have signs, use the Common Areas and Facilities and show Units.

The situation: The developer sold all the units long ago and is, essentially, out of the picture. A number of unit owners feel we have too many rentals (30% or more; a loan officer said we should try to get closer to 20%) and would like to institute restrictions. An owner/renter said at a meeting that the right to lease and rent belongs to all owners and is *irrevocable,* based on Section 22. Nowhere in the Declaration (or elsewhere) does it say that owners have this right. Must this be explicitly stated to be so, or does Declarant's "successors, grantees and assigns" mean present unit owners?

The Declarant is the Developer (just as your document defines it).

A Homeowner is a "member" and that is likely also defined within your governing documents.

Section 22, which you cited, gives specific rights to the Declarant not to the membership.

Any rental restrictions you adopt will likely have to grandfather existing renters. Rental restrictions will have to have hardship clauses and the Board will have to actually define "hardship". Additionally the restriction will have to define how it's determined who can rent and who can't, and how that list rotates if there are more people wanting to rent than the restriction allows.

The best rental restriction I have seen was simply specifying that no lot may be rented during the first two years of ownership. This keeps investors out of the development but still allows owners to rent later down the road. This also keeps the Association from having to develop and administer a rental rotation policy.

Frank

I am not nor do I play a lawyer.

Yes the Declarants rights can override anything.

That said the CC&R's usually dictate when the Declarant has to turn control over to the owners and lose their control. It is usually when so many units are sold or before a speficic date in the future. Our Covenants say when the 85.6th% unit is sold (as in closed on) or on June 1, 2018, the Declarant has one year to turn control of the HOA over to the owner elected BOD. We are expecting the one year notice any day now.

Once the turnover takes place, the Declarant no longer has Declarant rights. Even if the Delarant holds onto a few units or is still building, he becomes another owner. No more nor no less.

In some states I suppose it could be possible for the Covenanats to say the Declarant still controls until he sells the very last unit and if he never sells the last unit, then he could still be in charge. This is when it could get legally hairy.

Hope this helps.

Thanks for the info & feedback. I believe 75% Yeas of owner votes are needed to amend the Declaration, so the proposal will have to win over some owner/renters (+ get *all the owner/residents* to a meeting to vote!), so grandfathering in will likely have to be part of the proposal, although I am not aware that it or "hardship" stipulations are required here in IN. I will try to read through the Declaration carefully ASAP and report back here if I find anything of substance.

I did find some interesting IN case law and somewhere in here is a lawyer joke waiting to burst out- the plaintiffs suing their HOA were both lawyers who, in one case, asserted that an off-hand remark about the smell of the renter's ethnic food was proof of discrimination... which impacted on the larger issue (or something). Whatever the details, the lawyers lost both cases despite the fact that the rental restrictions were added *after* they bought/"invested in" their unit.

South Bend, Indiana (Sep. 15, 2008)
Clark v. Oakhill Condominiums Association Inc et al - Document 64
(HOA prevails- lease restrictions added *after* investor bought unit)
http://law.justia.com/cases/federal/district-courts/indiana/inndce/3:2008cv00283/54867/64

Clark v. Oakhill Condominiums Association Inc et al - Document 107
(March 31, 2011; Same parties/similar issue (but with discrimination being the focus) -
http://docs.justia.com/cases/federal/district-courts/indiana/inndce/3:2008cv00283/54867/107/0.pdf?1301675677
"Laura and Stephen Clark bought a condominium in the Oakhill development in South Bend, Indiana, in June 2004 as a rental property investment. When the Oakhill Association’s bylaws were amended in March 2007, the Clarks and their company, Sejco Ventures, LLC (the condominium’s title holder), sued the condominium association and its individual board members in this court alleging housing discrimination."