ARC Authority?

I am the current chairperson of the Architectural Review Committee in our neighbor. It is roughtly 230 homes. I have owned here for 16 years and been involved on the ARC for many of those years.

The ByLaws dictate that 5 members are appointed by the BOD and direct our responsiblity as, "In order to control design and location of houses and other improvements to be construction, erected, placed or installed (hereinafter “improvements”) upon the lots in the Subdivisions, an Architectural Review Committee (hereinafter “Committee”) is hereby created for the purpose or reviewing approving suggestion changes to, and rejecting plans and specifications for such improvements (regardless of when such improvements are made) and the landscaping of each lot and performing all obligations and responsibilities the Restrictive Covenants impose on the Committee."

Further, the Covenants state, "The design, location and complete construction plans (hereinafter "plans") of all improvements on each lot (regardless of when such improvements are made) and the landscaping of each lot must be approved in advance by the Architectural Review committee, hereinafter referred to as the "Committee," which Committee is established pursuant to the Bylaws. No building, fence, wall, bulkhead, dock, pier, pool, outbuilding, driveway or any other accessory feature to the dwelling or any other structure upon any lot shall be commenced, erected, placed, maintained or altered on any lot or combination of contiguous lots, nor shall the grade or elevation or physical characteristics of any lot, combination of contiguous lots, or portions of a lot or lots thereof be altered in any way whatsoever, until the proposed building plans, specifications, exterior colors and finishes, site and grading plans (showing the proposed location of such building or structure, drives, parking areas and proposed alterations to the grade, elevation or physical characteristics of the site) and the construction schedule have been approved in writing by the Committee."

In addition, the covenants state, "The Committee's refusal to approve any such plans, location or specification may be based by the committee upon any ground, including purely aesthetic and environmental considerations, that it, in its sole and uncontrolled discretion, shall deem sufficient."

These statements are what we have always considered the core of our responsiblity and authority. There are of course, many other statements in the covenants that give specific directions as to what is allowed and what isn't, regarding many topics. The ARC has always felt these directives, unless it states otherwise, are non negotiable parameters. There is also a clause in the covenants that states, "Enforcement of these Restrictions may be at law or in equity against any person or persons violating or attempting to violate any covenant, condition or restriction herein contained."

We have recently completed a nearly 2 year ARC Guideline Revision project, as our previous Guidelines were very inadequate. We are in the middle of a new phase of building (it will be our last, but there are still many lots to be built on) and that has created many problems as many people are new to the area and don't understand the desired architecture for our community (we are in NC and this is a community of Southern, Low Country Homes).

To make things official, we submitted our completed Guidelines to the BOD expecting them the review and approve them. This BOD are all new to the community (all less than 3 years residents). They want to 'change things', make things 'more updated', improve the 'antiquated requirements'. Without any consultation with the ARC, they have recently called several community meetings regarding ARC Guidelines, put several items out to the entire community, regarding ARC things that the covenants state are ARC responsiblities, for a community vote. They state they want to change many things in the Guidelines that are in the covenants (that change would require a 2/3 vote of the community). All members of the ARC feel they are exceeding their authority in being involved and trying to dictate the parameters of the ARCs guidelines for certain home improvement projects. In fact many people in the community are worried about the direction that the community is heading.

I have asked the managment company for a legal review to determine if the BOD are overstepping their authority. The BOD of would have to grant the approval for this expense, for legal consult. The management company is really not very well versed in our covenants. In fact, they actually stated that they couldn't know the specifics of all the covenants of all the communities that they manage. We have not asked for the approval for the legal consult, as we feel that would be the last resort. Talking to the BOD (we did request a meeting) was not fruitful as they essentially lied to us. In fact, wiithin less than 2 weeks, they sent out another email blast to the community with 2 items to be voted on, once again without any consult with the ARC, othat directly affects historic ARC decisions that have been in play since the beginning of the community.

I could not be more avaialbie or flexible with my time. Every email that is exchange with the president of the BOD I state to contact me via email, text or phone call if needed. Nearly every email from the president has been laced with antagonism and it seems a need to be the authoritative figure.

Further, we are part of the NC Planned Community Act. This act states, "Except as provided in the declaration, in the bylaws, in subsection (b) of this section, or in other provisions of this Chapter, the executive board may act in all instances on behalf of the association." We feel that because the ByLaws and the covenants give us clear direction and authority, this is outside of the realm of the BOD's authority.

I found this site and thought I would see if anyone had any insight.

Well said. The title of the committee is ARC Architectural REVIEW Committee, which are not elected but appointed by the Board who are elected.

For our association, the ACC committee meetings monthly and makes recommendations to the Board. The Board then approves the recommendations. We've never overturned an ACC decision to date, but always have the right. It is nice for the ACC because it gives them plausible deniability if they reject an ACC application and the homeowner gets ticked off. They can simply say - talk to the Board, it was them who made the decision, not us.

It also ensures that the ACC is not making decisions that are different than what the Board wants.

I will say that our Board takes a strong interest in ACC applications and they would not hesitate voting different than an ACC decision if so inclined.

Thanks to everyone that has responded.

Over the years, our ARC has functioned very independently. In fact, our ByLaws nor our Covenants actually state there is to be a liaison to the ARC from the BOD. Many years we have functioned without a liaison if the BOD failed to appoint one. The ARC has always been fully responsible for all the submittals, decisions, record keeping, BUA calculations, etc. as has been carried out since the responsibilities were turned over, from the declarant, to the community.

Ours is a community of custom homes, on nice size lots. The ARC was formed when the declarant sold his last lot in the last of the initial phases. I have the original collectioin of person notes taken by the first ARC members that detail the initial decision making processes. They carefully reviewed and incorporated the pertinent information included in the governing documents into the first set of guidelines. Then they added additional needed information after discussing with the declarant and deciding what the overall vision for the community was to be going forward. (The declarent is temporarily back in the picture because he added to the community with the most current phase). All the current homeowners have historically followed these guidelines with very few people having an issue. The covenants are tied to our deeds and there is an expectiation that there will be ARC review and approval for each new build and improvment.

The ARC has always looked at the job as extremely important. The community is beautiful and the ARC works very hard to maintain the high standards that have been set.

It has always been determined that since the ByLaws state that our responsibilities are to, "control design and location of houses and other improvements to be construction, erected, placed or installed (hereinafter “improvements”) upon the lots in the Subdivisions" it is the committees decisions, culled together since the formation of the first committee, In addtion, I don't know how the statement, which the covenants specifically state, "The Committee's refusal to approve any such plans, location or specification may be based by the committee upon any ground, including purely aesthetic and environmental considerations, that it, in its sole and uncontrolled discretion, shall deem sufficient" can be misinterpreted. If the ARC is charged with the 'control and design of houses, etc.' and something can be denied in the ARCs 'sole and uncontrolled discretion', how can the board change the specifics that has been the historic precedence for decisions as determined by the ARC?

The covenants specifically state, "Fences are to be of a design as declared by the declarant or if the declarant so declared, by the ARC." Fences are something that the BOD has taken upon themselves to rewrite the guidelines and in many cases the 'rewrite' is very incorrect. They have no understanding of fences or their setbacks, in fact ony one even has a fence. There was no discussion with anyone on the ARC regarding the expectations of fence placements. The revised guidelines that we have completed are very thorough and even have schematics included for approved fence styles. They have 'rewritten' the guidelines to state that a homeowner has to install a fence 4' from their property line. In addition, our covenants specifically state that fence setbacks are to be determined by the ARC on a case by case basis. Homeowners often submit a request for installation on the lot line, and it is often approved, as it should be.

The current BOD wants to totally remove 'opinion' out of the ARCs decision making process and disallow any use of 'aesthetics' in relationship to ARC decisions. This is impossible. The comically thing is, they just approved and installed street signs that were the most expensive options because they are 'attractive' or rather 'aesthetically' pleasing, in other words. This is okay and street signs aren't even permanent. However, the ARC isn't expected to use 'aesthetics' to approve a permanent structure.

In the last probably 3 years there have only about 4 denials and most of those we were able to work with the homeower to reach an acceptabe compromise, which was for the better of the community, beyond a doubt.

I am not, by any means, on an ARC search for a power trip. In fact, out of frustration in regards to the lack of respect toward the ARC from the BOD, I am running for the BOD, so maybe I will be able to effect a change in the impression and increase the understanding of how the ARC functions. The ARCs current concern is that we don't want the current BOD to revise the ARC guidelines so that they aren't even close to reflecting the parameters that have lead this community to be what it is today, and then actually make them active. This is very concerning because we are in a very active build time for us. We have handled over 50 new builds in the last 2 years and although things have slowed down with the increase in interest rates, I still expect many new builds to occur in the next year.

From my understanding the NC Planned Community Acts requirements/rules come first, unless something is specifically designated in the Restrictive Covenants. The president is said to have authority over everything to do with the Association, unless otherwise directed in the Covenants. So why does the president, and how can they have authority over decisions, like fence design and/or setbacks if the covenants clearly deliniate those as the ARCs responsiblities. Furthermore, if the covenants give the ARC 'sole and uncontrolled discretion' to make a decision how can the BOD overrule that?

that's one sure way to change things, lol. You might not think you are on a power trip but the action you propose are exactly what people on a power trip woudl do. just saying.

I can assure you that my concerns, and willingness to volunteer many hours of my time, are based only on the desire to maintain the quality of our community.

I am not exact sure what you are meaning the 'action you propose'? Exactly what 'actions' are you speaking of? Volunteering to serve on the BOD?

I feel strongly that the current BOD are outside of their area of authority and are making decisions that will be detrimental to the community. As a resident aware of the history of the community and the current ARC chairperson, I would feel negligent if I were to sit back and not make every effort to protect the value of, not only my property, but my neighbors, as well.

fun fact of the day! #1 reason HOA boards are sued is what? ARC issues!

so back to the question..... does your ARC allow for variances? if so you have no leg to stand on. the BOD can decide on a variance and you are SOL. If you dont' believe me refer to the legal text I previously posted.
There is a really good legal book from NC bar you can get an online copy for around $60 well worth the money. probabaly better to buy that and use real world case law then your opinion , good luck.

"Without any consultation with the ARC, they have recently called several community meetings regarding ARC Guidelines, put several items out to the entire community, regarding ARC things that the covenants state are ARC responsiblities, for a community vote. They state they want to change many things in the Guidelines that are in the covenants (that change would require a 2/3 vote of the community). All members of the ARC feel they are exceeding their authority in being involved and trying to dictate the parameters of the ARCs guidelines for certain home improvement projects. In fact many people in the community are worried about the direction that the community is heading."

Correct me if I'm wrong but the quote above seems to be what has you bothered the most. From my perspective, I give the Board high marks for calling several community meetings and soliciting feedback on the ARC guidelines. I also see absolutely nothing wrong with them asking for a vote on any change that they may want to propose even if it completely changes the roll of the ARC committee in a way that you absolutely hate. You have the right to rally the troops and try and get the community to vote down the proposed changes. If you lose then so be it and you need to accept it.

On a personal note, I sense in your replies that you are hung up on "that's the way it's always been done" and if you are not open to change you may find being a Board member very hard to swallow.

§ 15.06. The Raintree Decision
In 1995, our NC Supreme Court affirmed an architectural committee’s power to accept or reject
building proposals provided such decisions are not made arbitrarily and are made in good faith.
44

The decision refined the standards set out in Boiling Spring and introduced additional keys words
such as “arbitrariness” and “bad faith” to the lexicon of architectural committee decision-making.
The owners in Raintree were sued when the architectural committee for their community rejected
their vinyl siding application and they still continued to install the vinyl siding. The trial court
denied the association’s motion for summary judgment in their action for injunctive relief and
the case went to the jury, which decided in favor of the owners. On appeal, the Court of Appeals
affirmed the verdict below; however, Justice Frye, writing for a unanimous Supreme Court,
overturned the Court of Appeals and the trial court, holding that the defendants had failed to show
that the architectural committee had acted arbitrarily or in bad faith.
45

The owners in Raintree attempted to argue that the plaintiffs were “closed-minded”
because the architectural committee had rejected other vinyl siding applications in the past and the
committee had “made up its mind” before it had ever seen the owner’s application. The owners
introduced photographs that showed that vinyl siding looked like wood and also introduced other
evidence tending to show that the vinyl siding was of good quality and was not objected to by
neighbors.
46
Such evidence, however, was insufficient to create a material issue of fact for trial in
the Supreme Court’s opinion. In rejecting the owner’s arguments, the Supreme Court stated, “this
evidence is not sufficient to show the plaintiff acted arbitrarily or in bad faith.”
47
To the contrary,
the Raintree Court found the actions of the architectural committee to be reasonable and in good
faith. In Raintree, the Supreme Court stated the following:
[T]he uncontradicted evidence shows that the ARC [Architectural Review
Committee] on three occasions considered defendants’ application for vinyl siding
despite the fact that it had previously found the material unacceptable, that the
members of the ARC visited defendants’ house and looked at the vinyl siding
before making a decision, that the ARC conducted a study and found that the vinyl
siding was not appropriate for North Raintree, and that previous applications had
been rejected for that reason. The evidence also showed that the ARC consistently
found that vinyl siding was not appropriate for this section of Raintree because the
general theme of the community was a natural, contemporary style, whereas vinyl
siding conveyed a colonial or traditional style.
48
The
Raintree case is the modern standard by which all architectural committees are judged.
The key concepts behind such decisions are “good faith” and “arbitrary and capricious.” The
committee’s decision must be made in good faith and must not be arbitrary or capricious. “Good
faith” is characterized as “an honest belief, the absence of malice and the absence of design to
defraud or to seek unconscionable advantage . . . .”
49
“Arbitrary” is defined as “an unreasonable
manner, as fixed or done capriciously or at pleasure.”
50
In short, if a committee’s decision is not
arbitrary and capricious and is not made in bad faith, it will be affirmed, regardless of whether and
how vehemently the applicant disagrees with it. Inevitably, owners will argue that a committee’s
decision denying its proposal is arbitrary, but so long as the committee’s decision is even subjectively

We have recently had a very beligerent new owner in the process of a new build. He was literally threatening in messages to both me and the PM rep. He requested a large project (prefab shed) that has never been approved and a fence placement that has never been approved. We followed the historic precedence, which is clearly stated in the Guidelines, and denied his fence request, but approved it for the placement that followed the specifics in the guidelines. His foundation was approved to be one material, another was applied. When he was sent a reminder letter to either submit a change request or apply the approved finish he state that, given all of the above scenarios we were being 'arbitraty and capricious'.

I have never known the ARC to make any decision that would fall under the definition of 'arbitrary' or 'capricious', during my years on the committee or not. The committee always works to try to be unstanding but fair and consistent and takes the decisions seriously, as they should be.

My HOA docs state the ARC works at the pleasure of the BOD and the BOD can fire the ARC members for any reason. tread carefully if yours say the same.

If a homeowner is outraged because he can't put up a chain link fence and sues, who gets sued: the board, the AC, or both?

get a 2/3rd vote and change what needs changed IMHO.

I totally support this comment. There was one amendment (major change) to our covenants several years ago. We can't even get a quorum to send/bring in their votes for the BOD members, it will takes feet on the ground to get a 2/3 vote, that is for sure. It isn't that the current ARC has an issue. nor should we, if the majority of the homeowners really want to change something, it is the lack of team work and the seemingly subversive methods of the BOD that are a major concern. If I am elected to the BOD I hope to change that. If there are rules (and there are), the expectation should be that they apply to everyone, equally.

Thanks for everyone's information and comments.

If homeowners are that apathetic, they may not have the necessary votes to change the percentage - it's not something the board can do.

We've had discussions here in the past about changing CC&Rs. Lawmakers set the bar high for a reason. Once you're at 40% or 50%, you've set the stage for a determined minority of homeowners to control things. Making it easier to change things sounds like a great idea when you support a particular change - but it looks less appealing when it's a change you don't like.

My community requires 75% approval, and we were able to pass amendments without any trouble. And we're plenty apathetic. The trick is having amendments that homeowners think are important and that have broad support. I can totally see a community not getting excited over something that's mostly cosmetic or that seems to be working just fine already.

awesome for your community. Lawmakers set the bar high because they want to give kick backs to the HOA insdustry that pays to help get them elected, not for any other nobel reason. Most communities are able to easily pass amendements with a 75% super majority requirement. Want proof requiring a supermajority makes for gridlock and poor governance? just look at the USA senate. A determined minority of homeowners is some how a bad thing?

HA HA. Most HOA's are already run by a determined minority of homeowners aka the HOA board. The rules make it difficult to kick them out. Want proof, look at the mob that controlled the GA HOA for years and are still using the HOA money to pay lawyers to defend their crooked deeds. You think their hoa docs are somehow special and defective and that is what allowed them to terrorize their neighborhood? No their documents are just like most HOA's and this kind of horror can happen pretty much anywhere.

Wendy

The reason for setting the bar so high is to prevent a small group of "crazies" changing Covenants/Bylaws.

in reality has the opposite effect. small group of crazies rule with impunity because it's so hard to get rid of them.

two years? I think you just proved my point. why should it take 2 years to get rid of crazies, especially if the crazies were just appointed instead of voted in which is so often the case. I assure you the reason our HOA is going to change the rules is to avoid examples like you just gave, which apparently is very common, and not a reason or logical in anyway.

Show me one news article illustrating your above point. I'll show you 100 news stories about hoa disasters caused by crazies that couldn't be removed fast enough. Best one was over an Obama sign that literally bankrupted the HOA. Your advice is not grounded in reality and history. You just throw out ridiculous hypothetical that never occur.

There is some question as to whether the declarant is still the declarant for the first phases. He definitely is for the new phase. The Association is under owner control and has been for 14 years, this does include the new phase, even thought technically the declarant has not turned over this phase to the community.

He does have many votes per lot and he could shut this entire thing down, with just those votes. I have been in contact with him and he is hesitant to get involved. There are less than a dozen lots left for him to sell, and at this point, he just wants to get done and move on to other projects. He is very proud of this community (as he should be) and has stated that he is very pleased with the way the ARC has been functioning and our decisions. Future decisions, regarding new builds could directly affect his ability to sell the remaining lots. In a worse case scenario, I can go to him and appeal to his desire to maintain the scheme of the development as it is now. He could easily step in and make his desires known, in which case, the board, currently, would have no choice but to follow his wishes. This is our last ditch plan, if all else fails.

I will not allow this board to appreciable change the way the ARC has always functioned without a fight. This board consists of all new residents and they do not understand the time, effort, and commitment that many people have invested over many years to make this the community what it is now. The board members are all quick to state how beautiful the houses and the neighbhorhood is, but don't see the connection between the ARCs decision and the current situation. Go figure........

The board can get enough votes to overrule him. Sorry but I bet the vast majority of owners could care less how many homes are paitned white. I bet if everyone voted you'd be in a super minority.

I get it trust what you say not what the media says, lol. or in other words you can't provide a single story from the media or even this board where an HOA got rid of super majority requirements for changes and that latter on was a problem for the HOA. right. you can't come up with one example. but I can come up with hundreds.