What happens to completed phase of neighborhood / CC&R's when builder goes out of business and another builder comes in?

in our neighborhood the builder "Dominion homes" went out of business, the phase I live in was completed 2 years ago and the developer refused to release it to the home owners and instead attached the completed phase to another development down the road (which later they connected at the back by expediting the building of phase 4, 5 and 6 so they could be connected) Dominion when out of business, without any notification to the home owners Pulte homes is now the builder of the phases attached to the other neighborhood. According to the CC&R's phase II should have been released to the homeowners to take over the HOA but instead a management company hired by Dominon took control. Now that Dominion is no longer the builder, shouldn't the completed phase be released to the home owners of Phase II? OR does Pulte homes simply get to come in and retain control? This doesn't seem right, especially since all the $$$ collected for "green space" and "entrance maintenance" has nothing to do with our neighborhood as our entrance is maintained by Phase 1 HOA.

IF the CC&Rs no longer apply in relation to the new builder, how do I go about declaring this to get our money removed from their hands and in the hands of Home owners in Phase II so WE see the $$$ applied to OUR neighborhood instead of this new builder taking it to apply to theirs?

Hi Mark:

Welcome to HOATalk

Your State appears to not have some HOA laws that are prevalent in other states. The following are links for information in your state.

Horizontal Property Law:
http://www.lrc.ky.gov/Statutes/chapter.aspx?id=39147

Kentucky Condominium Act:
http://www.lrc.ky.gov/Statutes/chapter.aspx?id=39147

Your issue is most likely going to be covered in your governing documents and which will depend on what they say with regards to your issue. In most states as Tim noted the developer inherits the developer rights as noted in the governing documents.

In my state the developer is required under the State Law to “reserve” the right to add new units (a.k.a. lots in single family subdivision) in the CCR’s. If developer did not reserve then could not attach to another subdivision phase down the road. On top of the links I noted above you might want to look at your other State Laws with regards to real estate and real estate fraud.

Otherwise you need to potentially schedule a consultation with a couple of attorneys in your local area. Make some calls as some will offer a short 20-30 minute consultation at no charge. If you choose this route be sure to have a list of questions and copies of documents and pertinent information … be prepared and use time wisely.

I am curious because you are in OH, your original developer of your "dominion" wasn't of the same name was it? Because if so and they missed filing there, they would have missed filing here. Nobody was even told developers were being changed, I found out by walking the entire development to the front of the new development and saw the name on the model home. surprise!

heck we didn't know our developer was the 2nd one either, our section was a multi development by numerous builders not just the original. looking at the original deed restriction and comparing it to the new developer recorded for the rest of the development, it's like looking at our restriction written in Crayola compared to the new developer that made the original look like a generic copy and paste writings.

It's not just the filings being late or whatever, when a developer makes up a HOA, there is a time limit the city gives them to either complete their development or add sections into them as they grow in size. That was Flaw one of their legal issues with our section.

Their HOA developer seemed to had waited over the 10year agreement to even bother filing a new plan for the development they took over or assumed it. 4 Months too late for them, then they had all the legal issues of all the documents which none of them even made a mentioning of a HOA deed restriction anywhere except the original deed restriction recorded which was full of holes everywhere in it. It's almost seems it was done that way on purpose because of the bigger builder buying up the property around his planned multi builder development.

Guess the original builder got the last laugh now. Nothing against HOA's if their like 500k dollar houses but not for an avg 150k house community's. People don't realize their not worth it, now after paying tax's they have to foot the bill for what they've already paid in tax's. in plowing, street/storm water sewage and street lighting repairs. not like it's a common everyday expense but when it happens, their goanna wished they were never in a HOA for a 150k house. That has nothing to offer except monthly dues and unexpected money costing issues and Restrictions.