SteveH20 (South Carolina)
Posts: 32
Posts: 32
Posted:
A couple months ago I posted a question regarding the transfer of common areas to the HOA and the developer's obligation to insure these areas were in good condition. I finally found the answer (at least in SC) and it is not a law but the result of a SC Supreme Court ruling. I am passing it on to this forum as it could be very good information for all HOAs still communities under developer control. I have talked to several attorneys and none mentioned this ruling.
The excerpt below is from a South Carolina Supreme Court in 2002 regarding the transfer of common areas to the POA (HOA). In this case they cited a 1993 court ruling in which it was noted the common areas must be in good condition when transferred or sufficient funds transferred to the HOA to effectuate any needed repairs.
* In Goddard v. Fairways Dev. Gen. Partners, 310 S.C. 408, 426 S.E.2d 828 (Ct. App. 1993), the Court of Appeals held that the developer of a planned unit development ("PUD") owes a fiduciary duty to the property owners association and its members, much like that owed by promoters of a corporation to investors. As such, the developer has a responsibility to insure that the common areas are in good repair at the time they are conveyed to the property owners association or to provide the association with funds sufficient to effectuate any needed repairs to those areas. Id. at 414, 426 S.E.2d at 832.
The full text of the South Carolina case, Dunes West vs. Georgia Pacific, can be read at the following link.
http://www.judicial.state.sc.us/opinions/displayOpinion.cfm?caseNo=25453
The excerpt below is from a South Carolina Supreme Court in 2002 regarding the transfer of common areas to the POA (HOA). In this case they cited a 1993 court ruling in which it was noted the common areas must be in good condition when transferred or sufficient funds transferred to the HOA to effectuate any needed repairs.
* In Goddard v. Fairways Dev. Gen. Partners, 310 S.C. 408, 426 S.E.2d 828 (Ct. App. 1993), the Court of Appeals held that the developer of a planned unit development ("PUD") owes a fiduciary duty to the property owners association and its members, much like that owed by promoters of a corporation to investors. As such, the developer has a responsibility to insure that the common areas are in good repair at the time they are conveyed to the property owners association or to provide the association with funds sufficient to effectuate any needed repairs to those areas. Id. at 414, 426 S.E.2d at 832.
The full text of the South Carolina case, Dunes West vs. Georgia Pacific, can be read at the following link.
http://www.judicial.state.sc.us/opinions/displayOpinion.cfm?caseNo=25453