Issues concerning small condominiums
A small condominium is usually one with two to four units. While there should be recorded condominium documents, it is common for small condominiums to not have a management company nor require monthly condominium fees to be paid. Instead, many times, the only ongoing cost of the condominium is the master insurance policy which may be due once a year. In this case, all parties can contribute their percentage share of the premium whether that is 25% or 50% as the case may be. The master insurance policy should be an “all in” policy that covers the units as well as the common areas but it is strongly recommended that each unit owner obtain his/her own insurance to cover the contents of the unit (furniture and furnishings) as well as the liability within the unit. These separate policies are usually inexpensive, maybe costing several hundred dollars per year per unit depending upon the contents and limits of liability.
With the real estate values on the increase and the strict mortgage requirements of some lenders, it is recommended that monthly condominium fees be assessed and collected to demonstrate to a lender that there is an active and involved condominium association. Many mortgage lenders require condominium questionnaires to be completed as part of the lending process for a prospective buyer of a condominium in one of these complexes. Having such an informal set up can be a disadvantage to prospective buyers who are seeking such financing. Therefore, a more formal system of monthly condominium fees is recommended.
Additionally, items of repair or those requiring substantial improvements such as a new roof or heating system or house painting, require the expenditure by the unit owners of additional monies over and above the usual insurance costs. If the unit owners were paying a small amount every month to towards a “reserve” account (or rainy day type fund), those monies could accumulate and be paid towards these unexpected costs when they arise. These monies could also be applied towards any increases in insurance premiums.
Therefore, it is recommended, that monthly condominium dues be established and/or even a quarterly fee can be established that earmarks money into a “reserve” account for those unexpected items. In the alternative, a special assessment would be levied that will require a large expenditure on each unit owner. Having monies in an account for such purpose could assist in addressing these costs.
Condominium documents for a small complex including the rules and regulations should be simple. Each unit owner should be a trustee and decisions on issues affecting the condominium should require a 100% vote.
Common issues that arise in any condominium complex, especially in a small complex, involve noise, smoking, pets, trash, snow removal, tenants and collection of monies and should be carefully addressed in the master deed or condominium bylaws.
Issues in mixed use condominium
You may live in a residential condominium unit located above a commercial restaurant. Issues will arise depending upon the restaurant’s use of its premises. Such issues may involve more noise because of capacity or music or type of restaurant being operated. The unit owners should make every effort to meet and attempt to address such issues. There can be large costs of legal fees to each party who opposes reasonable requests by the restaurant operator and there should be alternatives discussed to keeping the premises as quiet and enjoyable for the residents as possible.
Agreements can be drafted by Attorney Gold-Alexander for which the residential and commercial unit owners must comply with and those agreements can provide for costs if there are breaches of those agreements. In any case, if there is a breach of such an agreement, unit owners will initially be responsible for paying legal fees and costs of any actions. If the agreement provides for the winning party to be reimbursed, then the unit owner may be able to be reimbursed after they prevail and the case is ending.
New issues such as Home sharing sites, service pets and smoking including the use of marijuana.
Such home sharing sites such as Airbnb and HomeAway are beginning to have an impact on a unit owner’s use of its unit and the common areas. Short term rentals of strangers can have an effect of one’s use and enjoyment of his or her unit. For instance, people moving in and out with luggage or a group of visitors coming and going can be disruptive. Such rentals can violate a city or town’s zoning laws and can have an impact on the association’s insurance coverage or taxation by the city or town. If the majority of the unit owners wish to prohibit such uses, then they must enforce existing rules that may prohibit such use or implement new rules to prohibit such uses. If such rules are in place, the unit owners may need to meet for a special meeting to address such uses or the trustees may need to enforce the prohibitions through fines to the particular unit owner.
You may be in a “No Pet” building but then a unit owner or lawful tenant shows up with a “service pet”. There is much controversy concerning service pets because many believe that such pets are not true “service pets” to the particular occupant. In order for the service pet to be demonstrated as such, legitimate medical documents must be produced. Additionally, the condominium association cannot discriminate against the particular unit owner requiring the service pet so the association walks a fine line in enforcing rules concerning service pets.
Finally, many condominiums are “No Smoking” buildings or smoking may be designated in certain areas of the condominium complexes. With marijuana becoming legal in Massachusetts, this presents a whole new series of issues with the smoking of marijuana. While the state has made it legal, it still remains illegal under Federal Law. Some may argue that smoking is smoking whether it be tobacco or marijuana and that such smoking can be designated to an outside area. However, such a permitted use of marijuana by the condominium association could be subject to Federal violations. These matters should be carefully reviewed and implemented or not after consultation with an experienced condominium lawyer.
Attorney Deborah Gold-Alexander with over thirty years’ experience can be retained by the unit owners and/or condominium association to assist in navigation this course through current and new changes regarding condominium law.