Maintenance and Indemnity Agreements

CathyB7 (Colorado)
Posts: 25

Posted:

Related to small HOA - less than 100 condos. We allow, with approval of ARC, homeowners to put up awnings, install fencing, storm doors etc. on the exterior of their units which is considered common property. Concern: we approve an owner to put up an awning (example) then the unit is sold. A big storm comes through, and awning is ripped away from building. Because our Maintenace Insurance Obligation chart shows the exterior of the unit is the responsibility of the HOA, the new owner wants the HOA to replace the awning. We even have a section that calls out owner installed awning but pushback is that 'he' (new owner) didn't install it.

We have been told by our attorney that we should have a Maintenance and Indemnity Agreement signed along with each ARC request which would cover the HOA. The one we were given (from a PM company) is about 3 pages long and basically has homeowner name, address, LOT number, statement that an ARC request was submitted (all specifications attached) and sections pertaining to maintenance, insurance, liens, etc etc etc. and this needs to be notarized by the homeowner and a board director. This agreement would then be sent county for legal recording. It would then become part of the real estate package for any new homeowner - in essence passing responsibility to the new homeowner.

While we agree we may need to have something, this seems like overkill and a burden on both homeowner and on the ARC. Attorney has also suggested we go back to the HO's that have submitted ARC requests in the past and have them complete the same. Thoughts on this type of form: does anyone use it? has it been useful? Shortened version? etc, would be appreciated.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

Think there is some confusion here. A HOA only APPROVES fences/awnings or other external items. They do NOT maintain, own, or install them. The HOA only APPROVED the owner to install the awning. After that it is whomever owns the home.

Now the HOA can have these items removed if in violation or not approved. They send the owner the bill for doing so. If left unpaid the HOA can lien for that money owed. As for the HOA being responsible NOPE.

Former HOA President

CathyA3 (Ohio)
Posts: 6,299

Posted:

I agree with your attorney. It's not overkill - it's to prevent exactly the situation you have right now.

In addition, many condo CC&Rs spell out exactly what is part of the "unit" (ie, owned and maintained by the condo owner) and what is "common elements" (owned and maintained by the condo association).

The problem is that there is probably language stating that the association maintains the exterior, and you've allowed condo owners to install their stuff on the exterior, which muddies the waters. You need some kind of legal lingo - either via amending your CC&Rs or by creating the maintenance and indemnity agreement which must be signed by the owner in order to receive permission - that clarifies the "mud".

You may also want to consult with your insurance agent because you may have muddied those waters as well.

Personal opinion: I don't think the new owner has a leg to stand on because he bought the condo as it was, warts and all. But your legal language (or lack of) may put the responsibility onto the association. Blame previous boards who allowed owners to install personal junk on common elements.

PatJ1 (North Carolina)
Posts: 568

Posted:

Quote:

Posted By MelissaP1 on 02/10/2022 3:57 AM
Think there is some confusion here. A HOA only APPROVES fences/awnings or other external items. They do NOT maintain, own, or install them. The HOA only APPROVED the owner to install the awning. After that it is whomever owns the home.

Now the HOA can have these items removed if in violation or not approved. They send the owner the bill for doing so. If left unpaid the HOA can lien for that money owed. As for the HOA being responsible NOPE.

Melissa. These are condos, not SFH. It is my understanding that when an approved modification is made to, in this case, attached to community property, maintenance becomes the responsibility of the HOA.

Many years ago a prior board allowed owners to screen in their porches. Without approval as far as we know. No one maintained them. We are now removing the screened in porches to replace old wooden railings with aluminum. Railings are located on the inside of the screening.

We asked our attorney if we can remove them, he said yes. Most were so old they needed to be removed anyway. He also said that if someone provides an approved ARC request to call him for further review if they questioned a replacement after the new railings were installed. We stated that we would not approve any screened in porches in the future.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

It does not matter if condo or sfh. The HOA only approves it does not own nor maintains. It can remove if violation or in bad condition. The new owner is responsible not the HOA.

Former HOA President

AugustinD
Posts: 3,698

Posted:

Quote:

Posted By CathyB7 on 02/09/2022 7:01 PM
Related to small HOA - less than 100 condos. We allow, with approval of ARC, homeowners to put up awnings, install fencing, storm doors etc. on the exterior of their units which is considered common property.

Awnings, fencing and storm doors translate to various fasteners connecting to common property. Every hole drilled into common property by an owner or an owner's contractor; every anchor bolt screwed in; and so on; alters the common property. The alteration is meaningful, especially as the years go by and owners install all manner of items. Observations:

-- Now who has maintenance responsibility for what, when it comes to the fasteners, has become unclear. Liability issues most certainly arise. E.g. the awning falls down on an elderly person in a walker. The elderly person breaks a hip. Oops, to say the least. Who has liability? I can guarantee the HOA Board that the elderly person's attorneys and insurers will go after the deep pockets, which will include the HOA's insurance, and if the insurer balks, well there's 100 owners a victim of the HOA Board's incompetence can pursue.

-- Whether the covenants grant the Board the authority to allow individual owners to alter the common property is questionable. It's as if the Board/ARC is converting common property to limited common property. Do the covenants permit the Board/ARC to make such a conversion? Or should an amendment (requiring a vote of the owners) have been done first?

-- The attorney here appears to be doing her/his best to address a bad situation. Do what the attorney says.

-- I also recommend asking the attorney about the matters I describe above. Has the Board/ARC been acting in violation of the covenants? Should the Board/ACC continue to allow owners to fasten all manner of stuff to the common property? In this day of energy crisis, maybe. Awnings reduce the air conditioning needed. Storm doors reduce the amount of heating needed.

-- My former COA prohibited attaching anything to common property.

CathyB7 (Colorado)
Posts: 25

Posted:

Many thanks to all that responded. I appreciate your insights. I now have a way forward with our attorneys.

KerryL1 (California)
Posts: 14,550

Posted:

We are a multis-story condo building. Our covenants, Cathy, do not permit any unit to install anything that penetrates the common areas. This includes the exclusive use (limited use) common area balcony walls, ceilings, railings, window frames, etc. The clear & important reason is that any penetrations can be a source of water intrusion in the common areas and even into units.

IF an owner applied to install an awning, they'd be turned down.

So, any US flags must be lashed to a balcony rail; TV dishes must be on tripods or supported some other way.

Since your HOA does seem to allow items to be attached to the common area, yes you need written ARC guidelines and a 3-page form seems very reasonable. Recording the modification makes sense. On this form you also want all contractor info. You want to protect your common areas and other condos. You probably want to modify your Maintenance Obligation chart to make clear any add-ons are the Owners responsbility.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Cathy raised an interesting point. In a townhouse association (4 side by side town homes) I was a member of, the association was responsible for exterior building shell maintenance. The BOD made a change to the docs allowing an owner to install an awning (with some restrictions) over their deck(s). As part of the approval process the owner had to agree that any damage done to the exterior of the building was at the owners expense.

So now the owner that installed the awning sells his unit. New owner. So a storm come along and rips the awning off and does some damage to the exterior of the building. New owner claims he is not responsible for the damage and the HOA is responsible for the damage.

The basic question is: Does the original owner's agreement to pay for any damages pass to the new owner making the new owner responsible for damages?

CathyA3 (Ohio)
Posts: 6,299

Posted:

Quote:

Posted By JohnC46 on 02/10/2022 1:36 PM
Cathy raised an interesting point. In a townhouse association (4 side by side town homes) I was a member of, the association was responsible for exterior building shell maintenance. The BOD made a change to the docs allowing an owner to install an awning (with some restrictions) over their deck(s). As part of the approval process the owner had to agree that any damage done to the exterior of the building was at the owners expense.

So now the owner that installed the awning sells his unit. New owner. So a storm come along and rips the awning off and does some damage to the exterior of the building. New owner claims he is not responsible for the damage and the HOA is responsible for the damage.

The basic question is: Does the original owner's agreement to pay for any damages pass to the new owner making the new owner responsible for damages?

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Not a lawyer, but I believe that in this case if the new owner did not want to be responsible for the awning, they should have negotiated the removal of it as part of the sales agreement. If they did not do this, then they own it and are responsible according to the terms governing the installation of that awning.

OP's problem is that there apparently was no written agreement. And it's entirely possible that according to the CC&Rs, the association *is* responsible for maintaining whatever stuff condo owners decide to attach to the common elements. The association may be able to argue that the CC&Rs never intended to force owners to pay for their neighbors' personal items, but if it isn't in writing...

BobD4 (up north)
Posts: 1,002

Posted:

Quote:

Posted By CathyB7 . . . We have been told by our attorney that we should have a Maintenance and Indemnity Agreement signed along with each ARC request which would cover the HOA. . . . This agreement would then be sent county for legal recording. It would then become part of the real estate package for any new homeowner - in essence passing responsibility to the new homeowner. . . . . this seems like overkill and a burden on both homeowner and on the ARC. . . . Thoughts on this type of form: does anyone use it? has it been useful? Shortened version? etc, would be appreciated.

C.E.M.A. Common element modification BY-LAW and Agreements

1 - Respectfully, your attorney is ABSOLUTELY CORRECT.

But how many existing trespasses will be skated onside ? Or at least will willingly be brought retroactively into compliance until some sorta scofflaw erected item is blown away by winds ? Or injures someone or starts a fire ? etc . . .

2 - 23 years ago my jurisdiction ( with 11,000 condo corporations ) enacted a model to legalize what would otherwise be TRESPASS.

And would otherwise arguably be TOTALLY BEYOND the authority of any Board of Directors or property manager or ignorant Big Shot to purport to authorize.

It empowered Boards to formally contract ( on behalf of the condo corporation ) with applicant owners to modify common element components eg balcony enclosures, patio works etc.

Into Agreements to be registered onto title at applicant expense, it further REQUIRED Boards to impose prudent entrenched conditions eg prior submission of ( engineering ) details for approval, indemnification by the applicant, duty to maintain & restore, requirement to comply immediately with corporations Orders etc.

It also imposed a duty to submit to A.D.R.( mediation / arbitration ) disputes about such Agreement, outcomes to expressly be lawfully enforceable by charge-backs lienable as unit contributions.

Bottom line, it imposed a CEMA tool which could UNIFORMLY treat every concurrent applicant the same way in principle, with prudent protections for the general ownership.

3 - By-law power

Amongst the accompanying further legislative amendments was authority for an express procedural By-Law power to create a CEMA by-law uniformly for every application.

Your attorney may be able to let you know how much your relevant legislation authorizes both of these.

4 - There is no body of statisticals about how many scenarios got legalized as a result.

But arguably both have at least raised awareness about what SHOULD be done. . .

TimB4 (Tennessee)
Posts: 21,059

Posted:

We always included in our disclosure statement anything the owner installed is the responsibility of the new owner to maintain, repair and replace. We then list those items.

CathyA3 (Ohio)
Posts: 6,299

Posted:

Further thoughts:

The maintenance issue will probably depend on the classification of owner-installed items on the common elements. Are they part of the unit, or are they common elements or limited/exclusive use common elements?

The owners of these items who want the association to maintain them probably enjoy exclusive use of them, which argues against their position. My Declaration has a section on Unit Owner Rights and Responsibilities, which says in part that all owners are entitled to use all of the common elements for any purpose for which they're intended, and that no owner may interfere with another's ability to use the common elements. Things like awnings clearly benefit only the owner of the unit to which they're attached, functioning like limited common elements (which in my community owners must maintain, repair and replace at their own expense). In other words, if you want the association to maintain it, you have to share it with your neighbors.

The problem that the OP is having is that it sounds like there is no legalese defining these user-installed items, either in the CC&RS or in a maintenance agreement. Thus the lawyer's suggestion that the association develop such an agreement and require owners to sign it in order to receive approval.

There is still the issue of damage done to the common elements if owners are allowed to use installation methods that penetrate exterior walls, foundations or roofs - which others have mentioned. IMHO such installations should not be approved no matter what the owner is willing to sign, since the cost of repairs will very likely fall on someone else.

LaskaS (Texas)
Posts: 1,025

Posted:

bob im interested in learning more about how the cema was implemented.

80% of our condominium 2nd floor unit owners have enclosed their balconies. Originally, there was some architectural approval process. But in the past 10 years. Many units have their second floor balconies enclosed without the approval . The result is that the exteriors of some building are a hodgepodge of miss match.

How costly would it be to implement a cema requirement for all owners who have inclosed their balconies.

Would a current board have any authority to insist the units that didn't follow one of the two accepted enclosure methods redo their enclosure to conform to the accepted standard. Or did the association lose the ability to enforce any standards by not doing anything at the time.?

LaskaS (Texas)
Posts: 1,025

Posted:

bob im interested in learning more about how the cema was implemented.

80% of our condominium 2nd floor unit owners have enclosed their balconies. Originally, there was some architectural approval process. But in the past 10 years. Many units have their second floor balconies enclosed without the approval . The result is that the exteriors of some building are a hodgepodge of miss match.

How costly would it be to implement a cema requirement for all owners who have inclosed their balconies.

Would a current board have any authority to insist the units that didn't follow one of the two accepted enclosure methods redo their enclosure to conform to the accepted standard. Or did the association lose the ability to enforce any standards by not doing anything at the time.?

BobD4 (up north)
Posts: 1,002

Posted:

Quote:

Posted By LaskaS bob im interested in learning more about how the cema was IMPLEMENTED . . . How costly would it be to implement a cema requirement for all owners who have inclosed their balconies. Would a current board have any authority to insist the units that didn't follow one of the two accepted enclosure methods redo their enclosure to conform to the accepted standard. Or did the association lose the ability to enforce any standards by not doing anything at the time.?

CathyB7 Col : . . . . We have been told by our attorney that we should have a Maintenance and Indemnity Agreement signed along with each ARC request which would cover the HOA . . . . . . Attorney has also suggested we go back to the HO's that have submitted ARC requests in the past and have them complete the same

BobD (up north) . . . C.E.M.A common element modification BY-LAW & AGREEMENTS - 23 years ago my jurisdiction ( with 11,000 condo corporations ) enacted a model to legalize what would otherwise be TRESPASS. And would otherwise arguably be TOTALLY BEYOND the authority of any Board of Directors or property manager or ignorant Big Shot to purport to authorize . . . .

LaskaS TX :

1 - The CEMA tools were "implemented" here in 1998 by the legislative enactment of Ontario's Condominium Act, 1998, S.O. 1998, c. 19 https://www.ontario.ca/laws/statute/98c19 . What is section 98 "Changes made by owners” has for 5 years been awaiting proclamation of a tweaking to be contained in “Modifications made by owners”.

The Act is silent as to any directly compulsory application against historically past tense scofflaw violations.

In perspective, any purported Board approvals before May 5 2001 - if - IF - DONE WITHOUT DECLARATION AMENDMENT - would themselves arguably have been illegal voodoo anyway.

Plenty of owner changes like balcony enclosures etc occurred without even bothering to obtain the extra-legal approvals purportedly granted by a Board !

CEMA speaks to what should be done fairly now, with protection for the general ownership

2 - The CEMA tools do not directly speak to prior or unauthorized illegal "Changes". Nothing stops a scofflaw from now applying & paying for a unit-specific CEMA. Nor getting a "group treatment" where an optional CEMA By-law has been passed with one vote more than 50 % of total votable units.

Hopefully CathyB7's attorney's recommendation is backed by Colorado law & jurisprudence. If not it's respectfully just as invalid as the purported voodoo "authorizations" in my own jurisdiction before May 5 2001. ( That's if an owner's common element changes even happened to have been so purportedly "authorized" . . .)

3 - Enforcement here - if any - has been left to the civil justice system IF anyone even tries.

As I had mentioned there are no stats.

There are also less than a dozen formal judicial outcomes about it within my jurisdiction, one including a backyard HOT TUB scenario ( ruled NOT itself a modification, but its privacy screen & statue were ruled unauthorized ! OK : neighbours have to see a fat hairy body in postage stamp-sized backyard tub; it's legal without authority but the screens etc would NOT be . . . )

4 - COST TO ENFORCE :

Could vary widely & go into a Twilight Zone. One lawyer-owner's expensive fight over a $ 625 charge-back ( to pay for removal of trespassing front-door flower box ) got her ordered to undergo a "capacity to litigate" court Order & career-killing Vexatious Litigant designation. That's without her merits even being heard. Interim costs against her passed $100 K ( Canadian ).

The TWO MILLION DOLLAR buckshee illegal GABLE : a Toronto townhouse buyer bought a unit with a buckshee illegal 3rd story gable outrageously installed by the seller / Declarant. Only an engineer discovered what had been missed by realtors & paralegals; she refused to let the Board dismantle it at their own expense, touching off more than a decade of litigation that eventually hit the Court of Appeal & the press.

Her Board was left with the right to dismantle the illegal gable at their expense. Wonder how easy it will be for her to eventually sell ? Was this worth over a decade of litigation ? But illustrates that - IF CONTESTED - retroactive enforcement could be a Twilight Zone . . .

5 - LACHES / ACQUIESCENCE / SITTING ON ONE'S RIGHTS ?

Scenarios may vary widely & unpredictably based on state laws / state jurisprudence / unique factuals of each case etc. ie could be "eccentric" or "idiosyncratic" in outcomes . . . Aren't lawyers neat !

MelissaP1 (Alabama)
Posts: 13,836

Posted:

Let me tell you about how a tree fell across two yards and onto a house in our HOA. The tree was a tall Southern Pine that was diseased by pine beetles. The tree had frozen and quickly thawed. It fell not on the house of the yard it was in but the on the house next door. The house it was behind had no insurance. The house it fell on did. (Only got the back kitchen area of the house not all of it). It also fell across the fence between the two homes.

Where did the HOA pickup at in this? We cleared up the debris of the tree. Which cost about 1500. Our deductible for insurance was 20K. It was well below the threshold of the HOA insurance deductible coming straight out of our budget.

Now I got jumped on for this severely. There were people whom believed that the HOA should have paid for the house damage. There were some that believed we had to replace the fence. It was believed the tree that fell was on common property and thus the HOA owned the tree... The list goes on and on about what the HOA should and should have done. All were upset about my paying out the 1500.

The reality is. We just gave approval for the fence to be installed. Not our responsibility to rebuild it. We were responsible for cleaning up the mess it left on the common property lawn. Along with the tree debris that were on the common property. After that, it was up to the homeowner's insurance to battle it out. The owner with insurance had their insurance pay out the claim for their damage. The next door house could have been responsible for the deductible and/or additional damages. Which that neighbor's insurance would have gone after them. Havig no insurance just mean it was going to come out of their own pockets. As for the HOA? We did our part by cleaning up the debris left behind.

The owners did try to get the HOA to pay at one point. Which I told them that is up to your own insurance company to come after the HOA after they pay out your claims. If the HOA was responsible then by golly their insurance company would have gladly submitted their bill to us.

So don't go thinking you have responsibilities you don't need to have. Talk to your insurance company about scenerios and not a lawyer. The insurance companies ultimately will be the ones fighting the battles. Not everyone coming to the HOA with a claim means the HOa is responsible. Pick your battles and stay within the lines.

Former HOA President

BobD4 (up north)
Posts: 1,002

Posted:

Quote:

Posted By BobD4 on 02/12/2022 5:30 PM

Posted By LaskaS bob im interested in learning more about how the cema was IMPLEMENTED . . . How costly would it be to implement a cema requirement for all owners who have inclosed their balconies. Would a current board have any authority to insist the units that didn't follow one of the two accepted enclosure methods redo their enclosure to conform to the accepted standard. Or did the association lose the ability to enforce any standards by not doing anything at the time.?

CathyB7 Col : . . . . We have been told by our attorney that we should have a Maintenance and Indemnity Agreement signed along with each ARC request which would cover the HOA . . . . . . Attorney has also suggested we go back to the HO's that have submitted ARC requests in the past and have them complete the same

BobD (up north) . . . C.E.M.A common element modification BY-LAW & AGREEMENTS - 23 years ago my jurisdiction ( with 11,000 condo corporations ) enacted a model to legalize what would otherwise be TRESPASS. And would otherwise arguably be TOTALLY BEYOND the authority of any Board of Directors or property manager or ignorant Big Shot to purport to authorize . . . .

LaskaS TX :

1 - The CEMA tools were "implemented" here in 1998 by the legislative enactment of Ontario's Condominium Act, 1998, S.O. 1998, c. 19 https://www.ontario.ca/laws/statute/98c19 . What is section 98 "Changes made by owners” has for 5 years been awaiting proclamation of a tweaking to be contained in “Modifications made by owners”.

The Act is silent as to any directly compulsory application against historically past tense scofflaw violations.

In perspective, any purported Board approvals before May 5 2001 - if - IF - DONE WITHOUT DECLARATION AMENDMENT - would themselves arguably have been illegal voodoo anyway.

Plenty of owner changes like balcony enclosures etc occurred without even bothering to obtain the extra-legal approvals purportedly granted by a Board !

CEMA speaks to what should be done fairly now, with protection for the general ownership

2 - The CEMA tools do not directly speak to prior or unauthorized illegal "Changes". Nothing stops a scofflaw from now applying & paying for a unit-specific CEMA. Nor getting a "group treatment" where an optional CEMA By-law has been passed with one vote more than 50 % of total votable units.

Hopefully CathyB7's attorney's recommendation is backed by Colorado law & jurisprudence. If not it's respectfully just as invalid as the purported voodoo "authorizations" in my own jurisdiction before May 5 2001. ( That's if an owner's common element changes even happened to have been so purportedly "authorized" . . .)

3 - Enforcement here - if any - has been left to the civil justice system IF anyone even tries.

As I had mentioned there are no stats.

There are also less than a dozen formal judicial outcomes about it within my jurisdiction, one including a backyard HOT TUB scenario ( ruled NOT itself a modification, but its privacy screen & statue were ruled unauthorized ! OK : neighbours have to see a fat hairy body in postage stamp-sized backyard tub; it's legal without authority but the screens etc would NOT be . . . )

4 - COST TO ENFORCE :

Could vary widely & go into a Twilight Zone. One lawyer-owner's expensive fight over a $ 625 charge-back ( to pay for removal of trespassing front-door flower box ) got her ordered to undergo a "capacity to litigate" court Order & career-killing Vexatious Litigant designation. That's without her merits even being heard. Interim costs against her passed $100 K ( Canadian ).

The TWO MILLION DOLLAR buckshee illegal GABLE : a Toronto townhouse buyer bought a unit with a buckshee illegal 3rd story gable outrageously installed by the seller / Declarant. Only an engineer discovered what had been missed by realtors & paralegals; she refused to let the Board dismantle it at their own expense, touching off more than a decade of litigation that eventually hit the Court of Appeal & the press.

Her Board was left with the right to dismantle the illegal gable at their expense. Wonder how easy it will be for her to eventually sell ? Was this worth over a decade of litigation ? But illustrates that - IF CONTESTED - retroactive enforcement could be a Twilight Zone . . .

5 - LACHES / ACQUIESCENCE / SITTING ON ONE'S RIGHTS ?

Scenarios may vary widely & unpredictably based on state laws / state jurisprudence / unique factuals of each case etc. ie could be "eccentric" or "idiosyncratic" in outcomes . . . Aren't lawyers neat !

1 - An act of God : a Hurricane rips out thousands of trees. Then drops them willy - nilly like toothpicks . And who even knows whose particular tree smashed the tractor shed ?

An Act of a negligent human : winds sweep down a tree with priorly noticeable decay, possible loss of foliage , indicators of distress etc . . . Or neighbour property . . . fences private or boundary-lined . . . etc gets smashed when something improperly affixed or bad-anchored gets torn away. A shortfall of standard of care by one ( or concurrently more than one ) ``occupiers`` bearing some sorta duty of care about the source premises.

2 - ``THE INSURER TOLD ME``

Respectfully, such advice can be dubious at best. That`s unless such insurer or employee happens to also be personally licensed as an attorney or paralegal ( by state professional regulators ) to practise law or deliver prescribed legal services under supervision, .

Nor ( as unqualified legal advice ) insured by the professional regulators.

3 - And what exactly DID the ``ìnsurer`` actually advise, that`s even if technically correct at first instance ?

Have heard one too many claims of ( unsupported ) alleged advice that either WOULD BE WRONG or WOULD NOT HAVE BEEN GIVEN had there been accountability and a knowledge of all relevant factuals & law.

3 - What folks unlawfully put on common element property, may eventually have worse consequences than merely looking bad or inconsistent. It`s a reasonable expectation that Boards should competently protect the common assets & do so consistently.

the alleged insurer advice ns to be is correctly understood

BobD4 (up north)
Posts: 1,002

Posted:

erratem : delete the dangling text at the end