AMS reviews all documents after transition. These include the CC&Rs, Bylaws, Reserve Study, Budget, and Insurance. AMS reviews these documents to ensure uniformity and that the Community functions optimally. AMS also evaluates all contracts and expenses to look for potential savings based on scale or relationships.
Enforcement and Disputes
Each owner in a condominium project or planned development has the right to independently enforce the governing documents against any other owner. The mechanism for enforcement is either the court system or alternative dispute resolution depending on the nature of the violation and the dispute resolution provisions of the governing documents. Owners interested in pursuing an enforcement action should consult an attorney.
Yes, associations must enforce their governing documents. In some cases, HOAs have discretion whether to enforce the governing documents if the dispute can be better resolved between a few neighbors. This discretion is removed, and enforcement is mandatory in instances where the governing documents explicitly require association action. But regardless of whether enforcement is mandatory, it is usually advisable for the association to avoid future enforcement problems.
Mortgages and Liens
The term “mechanic’s lien” describes a document that can be recorded with county government by an unpaid contractor or construction materials supplier. The recording of a mechanic’s lien relating to a property effectively prevents the owner from selling or refinancing the property without either paying the bill or establishing in court that the lien is invalid. When construction is performed for an individual owner on his/her condominium unit or planned development lot, the owner’s contractors and construction materials suppliers can record mechanic’s liens against that owner’s unit or lot, but cannot record mechanic’s liens against the common area or against any other owner’s unit or lot. When construction is performed for the association on the common area, the association’s contractors and construction materials suppliers can record mechanic’s liens against the common area and every unit or lot. An owner who learns that a mechanic’s lien has been recorded against his/her unit or lot should consult an attorney.
Most lenders will refuse to make mortgage loans on homes within condominium projects and planned developments unless there are special provisions in the governing documents to protect them. These provisions are designed to ensure that the basic rights and responsibilities associated with the home at the time the loan is made cannot be easily changed. The lender is particularly concerned about changes that might devalue the home such as an increase in the home’s assessment allocation, the removal of a parking or storage space, or an uninsured or underinsured loss. Most lenders review the mortgage protection provisions of the governing documents before they approve a mortgage within a condominium project or planned development.
The Association is required to make all association records available to owners upon reasonable request. The Board may adopt processes for handling owner document requests and may impose reasonable charges for providing copies of documents. Association records include membership lists, governing documents, meeting minutes (association meetings and board meetings), proxies and ballots, budgets, year-end financial statements, tax returns, executed contracts, and insurance policies and documents relating to insurance claims. There are also some association records that should not be produced to protect owner confidentiality; those include documents such as individual owner delinquency reports and confidential owner contact information.