Recording HOA Rules with Register of Deeds

Started by MarkL10 • 12 replies • 2301 views

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MarkL10 (North Carolina)
Posts: 2

Posted:

Hi. Our Board recently adopted a set of rules and guidelines for Architectural Standards. Our CCRs and by-laws grant the board power to do so, without a membership vote, provided they are not contrary to any requirements in the other HOA governing documents (in addition to CCRs and bylaws, NC HOAs are governed by planned community and non-profit acts and county ordinances).

My question is in regards to recording the rules and guidelines with the county register of deeds office. There is nothing in the governing docs and/or the NC or county statutes that requires the board to do so. My concern is that, if this one set of rules is recorded with the register, then I think it sets precedence that other rules should be as well (community use rules, etc.). I also think it may also usurp the board’s authority for other actions, because it gives the appearance that the rules are an amendment to the CCRs, which do require a membership vote and filing with the register.

We intend to distribute the new guidelines both electronically and via postal mailings, in addition to posting on the website. The ASC guidelines also require the ASC to provide a copy to all new owners upon becoming a member. So I see no advantage to recording them with the register of deeds office.

We have a meeting with the HOA lawyer to determine the best course of action, but am wondering if any other associations have experience with recording their Board passed rules/actions with the register of deeds or other local government authority? Thanks for your help.

NpS (Pennsylvania)
Posts: 4,216

Posted:

Hi Mark
By statute in PA, CC&Rs must be recorded to be effective. Bylaws and Rules do not. Other states have different requirements.

We don't record anything that isn't required for several reasons:
1. The Register of Deeds charges us a premium of $10 per house;
2. While this board would be diligent, we cannot speak for the next group of board members;
3. Our CC&Rs, Bylaws, and Rules are all posted on our website.

Electronic and postal distribution should be sufficient to put your membership on notice of any changes. Your new member requirement takes care of any ownership changes.

Sikubali jukumu. Read all posts at your own risk.

LarryB13 (Arizona)
Posts: 4,099

Posted:

Mark,

In AZ we have no requirement to record bylaws, rules, or other internal documents and I do not recommend doing so if not required by law.

As you correctly noted, once you start recording you will need to record each and every amendment.

I think there is also a psychological barrier created by recording internal documents. That is, by recording the documents they become chisled in stone in the minds of everyone and are unlikely to be revised because that would be tampering with official records. As you noted, there is always the possibility that members will come to believe that amending subordinate documents requires the same process as amending the CC&R's.

One thing we are required to record in AZ that I would recommend whether required in your state or not is a statement as to how to contact the HOA either directly or through a management company. Even though it will require a new statement each time contact information changes, the benefits outweigh the costs. In our case we found having that information in public records allowed title insurers and escrow agents to contact us during escrow and vastly reduced the number of persons who claimed they did not know there was an association.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Although not "required" its a good idea to make them public record. Makes the documents publicly available for every buyer/seller forever.

If your registry allows you to file them under the HOA name, go for it. If the registry requires the same document to be filed for each house, forget it. Too expensive.

KerryL1 (California)
Posts: 14,550

Posted:

I'm with NpS & Larry. Don't record them. I would, imo, give the impression that they cannot be changed or that thy'd be very difficult to have.

Having them on your web site is sufficient. That's where ours are and they are on our Home page so that any current owner and prospective buyer can read them

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Our Bylaws plus our Rules & Regulations are filed with our Covenants against the deeds. I would not have filed the R&R's as they can be a fluid document and can be changed by the BOD.

In SC we get a one time charge to file (I think it is $25) not a charge per home.

LarryB13 (Arizona)
Posts: 4,099

Posted:

Quote:

Posted By SteveM9 on 06/27/2015 10:55 AM
Although not "required" its a good idea to make them public record. Makes the documents publicly available for every buyer/seller forever.

Therein lies the problem: you would be recording one version of a document that is likely to be amended many times in the future. Whatever your bylaws say today, they are not perfect; an event in the future will require that they be amended. By recording them your board would obligate all future boards to have to record amendment after amendment.

There is also another more basic problem to consider: Despite the CC&R's being recorded, how many buyers profess ignorance? As in, "I did not know there was an HOA!" The evidence is that buyers are not reading those documents that are required to be recorded either by statute or common law. Why should we think they will read, much less care about, the bylaws if they are recorded?

I see almost no benefit to recording bylaws, rules and regulations, or any other internal documents and a lot of costs for doing so.

CyrstalB (Maryland)
Posts: 457

Posted:

Quote:

Posted By MarkL10 on 06/27/2015 7:04 AM
Hi. Our Board recently adopted a set of rules and guidelines for Architectural Standards. Our CCRs and by-laws grant the board power to do so, without a membership vote, provided they are not contrary to any requirements in the other HOA governing documents (in addition to CCRs and bylaws, NC HOAs are governed by planned community and non-profit acts and county ordinances).

My question is in regards to recording the rules and guidelines with the county register of deeds office. There is nothing in the governing docs and/or the NC or county statutes that requires the board to do so. My concern is that, if this one set of rules is recorded with the register, then I think it sets precedence that other rules should be as well (community use rules, etc.). I also think it may also usurp the board’s authority for other actions, because it gives the appearance that the rules are an amendment to the CCRs, which do require a membership vote and filing with the register.

We intend to distribute the new guidelines both electronically and via postal mailings, in addition to posting on the website. The ASC guidelines also require the ASC to provide a copy to all new owners upon becoming a member. So I see no advantage to recording them with the register of deeds office.

We have a meeting with the HOA lawyer to determine the best course of action, but am wondering if any other associations have experience with recording their Board passed rules/actions with the register of deeds or other local government authority? Thanks for your help.

As already stated, you could be causing more headache than benefit by recording them as suggested. And I would caution you to remember when the attorney gives you a recommendation, more than likely it will be one that involves them in some way so that they make money. That is the way they roll, billable hours and the like. I'm sure there are one or two lawyers who would do not work that way, but I've yet to find them!

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Quote:

Therein lies the problem: you would be recording one version of a document that is likely to be amended many times in the future.

Its unlikely your CCR's will be amended. Bylaws yes, CCR's no.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

FYI: Typically the developer has already recorded the CCR's with the deed registry. So it is public record and new board members cannot simply change the CCR's without a very good paper trail and in some states you would need to record any amendments/changes as well in order to be valid as one member said.

MarkL10 (North Carolina)
Posts: 2

Posted:

Thanks everyone for the advice and input. Since the guidelines are likely to change, as most of you mentioned, think we'll avoid the issue of having to amend the filing by not filing with the registar. Also I think they'll be readily accessible by posting on the association website. Thanks again for the advice.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Mark,

You should initially provide a printed copy to all members along with placing them on the website.

Depending on your States disclosure laws, you should also include a copy with every disclosure package the Association puts together for a seller.

KerryL1 (California)
Posts: 14,550

Posted:

Tim's right. The new policy should go by US mail to all owners unless your HOA has a way to send them electronically to many of your owners.

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