Termination vs. Amendment - Take 3

Reposting to get a clean start on a thread:
This is a revamp of the first thread I posted, where I was proposing that termination could be applied to subsets of clauses (e.g. allow some sheds, but not all sheds).

Now I'm just wondering who out there has witnessed use of the "termination" clause to conduct the "removal" of certain clauses.

Our CC&R's document that termination can be done with 51% vote while amendments require 67%. And so, it may be appropriate to "terminated" (i.e. remove) some clauses based on the 51% vote.

I've heard some argue that the "Termination" mentioned in CC&R's always and only refers to the WHOLE document at once, and not just parts of it.

And I've also heard others agree that it can be applied to individual Restrictions, so long as you are just simply "REMOVING" a clear-worded restriction (e.g. "no sheds", removed).

What is the truth here? Is the Termination clause *only* permitted to apply to the WHOLE document at once?

Our TERM clause reads as follows:
29. TERM. The foregoing plat covenants and restrictions,
as the same may be amended from time to time, shall run with the land and shall be binding upon all persons or entities from time to time having any right, title or interest in the Real Estate and on all persons or entities claiming under them, until December 31, 2013, and thereafter they shall continue automatically in effect unless terminated by a vote of a majority of the then Owners of the Lots in the Subdivision; provided, however, that no termination of these covenants and restrictions shall affect any easement hereby created and reserved unless all persons entitled to the beneficial use of such easement shall have consented thereto in writing.

We changed our CC&R's, By-laws, and Articles of Incorporation because terms changed within our HOA. By-laws/Articles of Incorporation (IA) required 75% of owners vote. The CC&R's took 90%. They don't always take the same voting # for changes. Also By-laws don't necessarily need to be filed like CC&R's or IA's. It's one of actual internal documents of the HOA. The others are PUBLIC. However, most of the time by-laws are filed with the CC&R's whether or not required.

Having said that, we modified our HOA's for 5 different things. 1 was removal of ALL references to the Developer. He was long gone for years. 2nd was references to the 2 voting system. 3rd was to reflect we no longer had 1 water meter. Everyone has their own separate water meters. We were able to turn off water if you did not pay. Another thing changed.

We also had a requirement this vote for changes had to be done at a special meeting. Which was not possible. So we had the lawyer draft up an additional document to sign giving up your right to cast your vote at a special meeting. This allowed us to go door to door to collect the necessary votes or take at regular meetings.

It took us nearly 2 years and several thousand dollars to get done. There is a charge to file. Plus the cost of the attorney, document changes, and distribution of the changes. There is NO easy way to do it.

So don't know what your hang up is. The HOA has the power to make it's own rules with the proper votes. If people want certain type of sheds, then feel free to follow the process to make it happen. What is holding you back except doing the leg work of getting the votes and board approval to spend the money?

And people have responded over and over and over and over and you've rejected everything that suggested that you should try another approach. ENOUGH!

Your initial post in the other thread stated, "...any covenant may be *terminated* with only a 51% approval... " The statement in your initial post turns out to be false. So all statements relying on your false statement have little to no value, depending.

Subsequently I requested the easement coveants. You failed to post them.

How do you conclude my original statement was false? Today, I just spoke with a lawyer who will support our individual terminations, and will stand behind it. However, like all of you, he doesn't support my concept of "partial termination" because it looks too much like an amendment. This lawyer will warranty his work, to the point of accepting liability if there is any form of malpractice/wrongdoing accusation, indemnifying our HOA from wrongdoing, as stated in our Declaration (if board is acting under outside paid advice, the whole HOA is indemnified).

Truth in this matter seems to be a matter of viewpoint and opinion.

AugustinD, have you have heard of termination clause being applied to individual restrictions, vs. the Whole document?

The sections on easements alone, #3-#5 is 3 pages of text, and mentions how these will be governed, such as our lake - we are permitted to promulgate usage rules, and our rights to do landscaping, etc. Standard stuff, but clearly can't just "go away with 51% vote".

AugustinD, if it was nonsense, then we wouldn't have received agreement from 2 out of 3 attorneys spoken with to support the termination of our restrictions individually. Maybe it's just an Indiana thing.

The lawyer that claimed it was All vs. Nothing, had me concerned. And wanted to know the experience of others here.

So far, no one in these forums has told us that they've actually seen a termination clause applied to individual clauses.

Per your supplied citation, the CC&Rs in their entirety may be terminated by a majority vote.

Anything else, per your citation, is to be amended per the paragraph that discusses amending the document.

BTW: for any who are interested, here is a link to the first thread:

Subject: CCR Termination vs. Amendments

Brien,

I believe that you will do what you want.

That you are simply looking for validation.

I believe the active posters have provided their opinions.

As you know, you are free to take all, some or none of the opinions offered.

I wish your Association luck.

Actually, the discussion here has made us reluctant to follow the initial proposal. We're probably not going to do that, as it's too fragile.

Now I'm pursuing a modified option, and not many have actually weighed in on this. Although as we go on, I'm getting the feeling that most don't like the piece meal approach either.

I'm not sure how those thinkers justify the final clause of section 29, which clearly associates "no termination" to something less than the whole document, and the inclusion of that clause in effect makes the whole "majority vote" statement meaningless. Additionally, our Declaration actually says "terminated or modified by a majority vote"... I wonder what that means? Why say "modified"?

Brien,

As you should have learned by now, you have to read the paragraph in whole (at least the whole sentence).

Typically, CC&Rs don't include easements.
Most easements are for roads and utilities.

To me it's common sense.

I'm done with this and encourage others to be done as well.

C'mon, let this thread die.

And, please don't respond to new ones.

I'm sure this poster has figured out a way to start another thread under another name - if it smells that way, please don't respond to that one, or this will simply start all over, again.

It sounds like we got the 51% required to end this thread and it's individual pieces...

Aye, let it die.

What wasn't that hard? To hire a lawyer to do what you want them to do? Join the club... Most lawyers who tell you that aren't doing you any "favors".

THREAD CLOSED

We'll only do that which has a reasonable argument to support it. Several lawyers agree with us already (who are well established, already have full plates, and aren't hungry for business, willing putting themselves at risk).

Before just dismissing me as someone who just "does what they want", you should carefully consider our argument. For example, if it was "all or nothing" then why would the Declaration specifically choose to phrase it "terminated or modified"? I'd like to hear some answers on this one.

That sentence is what our Declaration says verbatim. So what does that mean to you? (and thank you for your pertinent question)

The conclusion isn't that simple.

Declaration section 11 "Amendments" says post-2014 it requires 75% vote to amend. Then Section 12.3 says post-2014, it's a "majority vote" to "terminate or modify".

So there is somewhat of a conflict here for post-2014 -- Section 11 says 75% to "amend", and Section 12.3 says 51% to "terminate or modify". Both sections have a "post-2014" stipulation.

So to terminate a single restriction, I would assume that Section 12.3 rules, since we're talking about a termination-style modification, since it bothered to say "or modified".

What is your interpretation here?

AugstinD, you are a gem. Thank you for your time here.

Your conclusion is stronger than the conclusion I would arrive at here. Given that Section 11.1 and 12.3 are in the *same* document, and 11.1 specifically states 75% for post-2013 (while it's 90% pre-2014), one might assume that the meaning of "or modified" in section 12.3 might be limited to "modifications that relax covenants" but would not apply to modifications which add new restrictions. At least then it is also fitting to the section header called "duration". So you can use this clause to "weaken/relax/remove" covenants/restrictions, but not make them more restrictive than before the modification. That's my conclusion from this.

Does my comment here modify your conclusion at all?

Please excuse the (901) -- that's supposed to be "90%", but was skewed by PDF to Word text converter.

When a document appears self-conflicting, wasn't sure how the courts would rule. I figured they'd give more weight to an entire section with many words, over another section with two words that imply a conflict. If your conclusion is correct, then what was the point of 11.1 specifying the 75% (if it's 100% ignored)?

So I was giving benefit to common sense here, which is that clearly the author didn't mean to fully nullify that part of section 11.1 with the insertion of these 2 words, "or modified". Also, the location of "or modified" is within the "Duration" clause, which is clearly about termination, not adding new amendments.

So I'd say this "or modified" only applies to modifications that are relaxing/terminating agreements, and never to make things more restrictive.

Also, only 4 lawyers looked at it, and yes, they all were given our 2-page argument along with both docs.

AugstinD, you'd given me ammunition enough to reform our argument to place much more emphasis upon what you are saying here, although I'm planning to propose are more limited interpretation of the "or modified" specification.

What I didn't highlight in our argument (but will now) is the preface of Section 11.1 "except as otherwise provided...".

Thank you very much for sharing your experienced perspective here.

(Edited re-post of my last post)-- In my opinion, Section 12.3 does not throw out all of Section 11.1. Section 12.3 only throws out Section 11.1's percentages. Assuming the document I found on the net matches your document, to modify or amend, several sub-sections of Section 11.1 still must be followed.

-- All competent attorneys will say my conclusion is correct only when a court of appeals says it is correct.

-- There is much more verbiage attached to the 75%, correct? The extra verbiage concerns the possibility that the Declarant is still in control. Your HOA's Declarant is long gone, correct?

-- As I noted earlier today, I believe these Declarations are written by attorneys who use the same template for all Declarations. The attorneys make small adjustments as needed to customize the Declaration to each HOA. Oversights do happen. (But when one thinks an attorney's oversight occurred, one had better dig hard into the document and the legal verbiage to be certain. Attorneys do this for a living. They're not all more experienced than others and I are here. But many are. And I could give a damn if anyone thinks this is arrogant. More than one of us here has rightly corrected a HOA attorney.)

-- Regardless of what I wrote above, I believe a court's "plain reading" is still going to home in on that first statement in Section 11.1 . A lay reader of the Declaration, interested in this topic, would look for other places in the Declaration that say something different than what is in the body of Section 11.1. Indeed, Section 12.3 says something different.I agree you should highlight this. I suppose the developer may have wanted to give the owners more control some 20 years after the establishment of the HOA and after the developer-declarant was gone. I do not find the latter surprising. I would also note that I have not found any HOA docs outside Indiana with phrases like the ones on which you have understandably been focused. It might be worth contacting some of the developers listed at the end of these Indiana HOA Declarations and asking them what law firm prepared their Declaration. Then call the law firm and see what they say their reasoning was; et cetera.

----
From IU's fight song: "Indiana, our Indiana... Indiana we're all for you." And certainly not tech-lame Iowa.

The majority of the commotion here started out with me not realizing how different can be the contract language of governing docs from state to state. I should have provided more information from the docs upfront, and then maybe the proposal wouldn't have been so ill-received. My bad here.

Sorry for the commotion/distress I caused to those who responded. I'll do better next time. We live and learn.

I'll post back to keep folks updated on progress here.