Is it really a contract?

Michele picqued my curiousity in another thread, and led me to wonder:

We often say that our Homeowners "enter into a contract" when they buy into our HOA's. They get a copy of the rules, and they agree to them when they purchase. Under contract law, a person has the right to alter or change rules and renegoiate until both parties are in agreement (offer, counter offer, counter-counter offer, etc.).

Has anyone ever HAD any HO try this? Perhaps change the words of the rules/contract, and re-offer it to the HOA?

Does any HOA even have something/someone set up to deal with this?

What if I get my CC&R's, read them, and notate on them that I want to have 5 pets, not 4. I change the contract and return it to the HOA for approval. I can do so with a simple pen insert into the CC&R's, and my initials. Anyone had this happen? Could I return it to the HOA with a note: "changes included, assume all is agreed to if i don't hear from you in 48 hours?" Or must i wait for positive affirmation from the board? Could the board be sued for not having a system designed to negotiate contracts in a timely manner (ie, the board didn't respond to the buyer, so I lost my sale)? Should the rules be given with a notice, "absolutely no negotiations or changes will be granted"?

Anyone up on contract law?

(And this is only my second diet coke of the entire day! You should see my mind when i really get caffeinated!)

Brian:

I deal with contracts on a daily basis at work, although I am no where near a lawyer. Our lawyer has always told us not to negotiate on language, just on price, it is either a take it or leave it approach. I guess the HOA could take the same approach, this is our standard contract for homeowners, if you don't like it, don't buy here. I do agree that it is a contract, you are entering into a committment with another entity and it is signed and dated.

In your scenario you can take the contract and mark changes on it and initial it and submit to them. However, for it to be valid the board would have to initial the document also. I think it is assumed with an HOA that these are the rules that you must abide by, although it would be quite interesting to try this once to see what would happen.

I don't see how you could sue them for not negotiating in a timely manner, in this instance you had an opportunity to accept their contract and you chose not to. However, there may be some legal wrangling in there that could happen.

thanks Mary.. seems we toss around the word "contract" and you just showed me four other words that may be just as correct.

Brad,

I agree with all you've said except for your emphatic statement that "it's a contract". IMO, the CCRs are more of a restrictive covenant than a contract. Otherwise, why do judges use property law instead of contract law when handing down decisions pertaining to CCRs? I've never heard of a case where the reverse was true. I'm not saying there haven't been any, I just haven't heard of them. Have you?

Brad,

This topic comes up all to often on the other HOA message groups I'm a member of. I have just come to the conclusion that because everyone knows what a contract is, it's much easier to use than "restricted covenant" which would have to be explained in more depth. At least, that's my opinion on why lawyers, judges, etc refer to CCRs as "contracts". In actuality, it's really both -- a contract and a restricted covenant -- I just think it's more of the latter and that's why property law, instead of contract law, is applied.

Brian, when you purchase a property you enter into a real estate contract. When you purchase property in an HOA you agree to comply with the Declaration of Covenants, Conditions, and Restrictions. No Board of Directors or owner may enter into an Agreement (Contract) with the HOA which violates the CC&Rs (variances can be issued when justifiable).

The CC&Rs may only be amended under the conditions stated in the CC&Rs or in states like Colorado by going to court. The Declaration runs with the land and contain Covenants (agreements) with which you must agree. You enter into these agreements (Contract) with the HOA rather you are aware of it or not.