Throttling Back

As many of you know, our HOA is in a lawsuit. This is over an Amendment to the Covenants that took place last year. They cannot settle out of court, because the issue is voiding the amended covenants. The HOA attorney's position is that the Board doesn't have the authority to do this. Has anyone heard of an HOA, filing amended covenants with the county ever being able to void them if they agreed that they were Amended incorrectly? Is there a way for this not to have to go to court?

The Amendment was not an Amendment and Restatement, though that was the intent. There is no verbiage anywhere in the document that states the former Covenants are "stricken in their entirety" or "shall be amended in whole hereafter to read. The single reference on the document is:

WHEREAS, BY THE APPROVAL OF THESE CHANGES AND AMENDMENTS BY A MAJORITY OF THE NOW OWNERS, THE COVENANTS AND RESTRICTIONS HEREINABOVE REFERENCED ARE CHANGED AND AMENDED AS FOLLOWS:

Then it lists the new covenants.

So, does this mean that any of the covenants in the old document that are not showing in the new document are still alive and kickin?

I bet the document is titled something to affect "Restated and Amended Declaration of Covenants, Conditions and Restrictions for XXX Subdivision". It then usually will have various Recitals such as the one you noted above. I had an HOA where we did this for our CCR's. The intent with this type document is to Restate the Original CCR's with some Amendments to them agreed to by the members of the Association. Ours was done to resolve litigation when we had a developer illegally amend the CCR's. We had to put back items which was illegally removed and made some other small changes the owners allowed for the developer.

If it is titled as such and filed with the Country Records it then REPLACES the prior CCR's and all prior Amendments. It then becomes a legal document and contract attached to property titles. The BOD would not have any authority to turn around and remove the document as your attorney stated. To fix you need to Amend the CCR's or redo again as Amended and Restated, obtain proper votes and signatures of owners, and file a corrected set of documents. If everyone agrees they are incorrect and have problems then there should be no problem getting votes and signatures to fix.

This is such a complicated story and I'm looking to figure out a way to resolve it.

We are a subdivision, 4 sections, each section covenanted seperately no sections annexed into another. All 4 sections had the same 1981 covenants.

The Board decided they wanted to amend the covenants and established a committee to do just that.

The Board chosen attorney who says he's associated with CAI reviewed the amendments and was given the responsibility to do the recitals, he failed to include in the recitals, (whereas on or about, XXXX executed restrictive covenants on Section) Sections 3 & 4. The Board included in the HOA membership, Sections I & II, but also left out 3 & 4. The closing statment states, "NOW THEREFORE, the following restrictions, covenants, reservations and easements are hereby imposed upon the above-referenced lots and sections of XXXXXXX subdivision.

All 4 sections of the subdivision voted the amendments, the intent was that they affect all 4 sections, but by the document they amend only 1 & 2. We cannot ammend for another 10 years, per the amended covenants!

A neighbor went to an attorney. The attorney's read of what happened, was that they either changed only Sections I and II, or they changed all 4 sections (he told my neighbor to get in writing what the boards position was on all 4 sections being under the amended covenants, because if the Board stated that it amended all 4 sections and was viewed by the board as a Restated Amendment and not an amendment then sections 3 & 4 no longer have any covenants!!!!!) My response to my neighbor about the attorney's comment was "I don't care what the Boards intention was, what was delivered to the membership and voted on was a document amending only 2 sections. Boards intention be danged. This is what they delivered, this is what was voted in.

Ironically, none of these issues are in the lawsuit. These have been discovered over the past year. The Board won't answer anyone on who is under which set of covenants or if they believe everyone is under one set.

So my thought process was, if this was only an amendment as stated and there is no verbiage in the amendment that voids the former covenants, then those things still in the old document would be alive. One of those things that may be alive is the provision that we can amend outside of the 10 year period with 75% petition consent of the total votes of the Association that was in the old amendment. We didn't carry it forward, but we didn't kill it either.

The Board should be able to file another amendment based on the same vote to cover sections 3 & 4.


Can you provide that language?

Typically when such statements are posted, it turns out to be misinterpretation.

I realized what this section said.

Are you saying that the draft document that was voted on specified sections 1 & 2 only?

OR

Are you saying that the draft document voted on didn't address any sections and what was filed only addressed sections 1 & 2?

Either way, it's a very messed up situation that will likely require the courts to rule.

The document references only sections 1 and 2. The Recitals address the history of sections 1 & 2
The membership in the HOA is only section 1 & 2

Because the document clearly addresses 1 & 2, it is impossible to stretch it to Section 3 & 4. I know how this happened. Everybody has always addressed the Covenants as Section 2. That is because it was originally placed on section 2 and the same set was referenced for sections 3 & 4. 9 years afterwards, Section 1 (which really isn't called section one, it's the name of the subdivision as per the platt, so I guess really, since there is no Section 1, these covenants don't even apply to that section) decided to accept the same covenants. They've gotten so used to referencing homes on the one side of the road as section 1 and on the otherside, section 2, that when they met with the attorney that's all they gave him. However, the attorney should have insisted that he be allowed to research the subdivision, but maybe he did and they declined. AND THIS IS WHAT YOU GET>

Again, without reading the documents involved, It's hard to offer a actual opinion.

Depending on the wording within the all recorded documents, it's possible that only the changes affect sections 1 & 2 and the original covenants are still intact (as written) for sections 3 & 4. The problem is, if this is the case, the Board would have effectively split the Association documents.

There was one development I looked into where the Developer messed up big time and, unknowingly, had a set of documents for each section. Hence, it would be possible for section 1 to amend their documents but that change would not apply to any other document.
This was caused by the way he recorded the documents for each section.

Whereas, the covenants as of December 31, 2015 will be at the end of the 10-year extension, a majority of the now owners do hereby agree to change, amend, extend the covenants as amended and changed for an additional (10) year period with automatic renewal for successive periods of ten (10) years, unless a majority of the then owners agree to change the covenants in whole or in part

Renee,

All this is saying is that the document will automatically renew every 10 years as is, unless the owners change it.

The owners may change (amend) it at any time. Tomorrow if they wanted.
They do not have to wait for the 10 years renewal time frame.

What you provided is basically standard language for all CC&Rs.

Tim, that issue has been tried in multiple courts. the 10 year period establishes the time the existing covenants are effective. Yes, we could amend them now, but they wold not go into affect until 1/1/2026.

Janet,

The questions being asked have nothing to do with the lawsuit. The issues on the lawsuit are about whether it was amended according to the bylaws and the covenants.

Questions being asked now are OK, we have these covenants, if I were to sell my home today, tell me which of these covenants are on my land, so I can provide the right set of documents to the buyer. I asked a tremendous number of questions regarding the HOA to the sellers before I bought.

The intent of the Board was to amend covering all sections. The document amends only 2 of the 4 sections. The board refuses to say which way they are treating them. Imagine the liability to the seller right now. They have a 50/50 chance of being wrong.

Janet, One home has been sold. This is why I though we would just have all 63 homeowners in these two sections do a Signature petition consent to recind and replace.

Having been in a lawsuit myself ... some items you state do not make sense. If one of the guys who are in the lawsuit would drop based on your statement then he could potentially have his attorney request Mediation to settle based on those statements. The Board does not have to take a stance one way or another before a possible mediation. The items you mention regarding the Board would be reviewed and possibly settled in that situation. Conversations during mediation are supposed to be confidential. The membership would only need to know the overall details if their vote is needed to settle based on Restating the Original CCR's. Mediation is not really to place blame on one side or another, but to settle a case.