Departments

Q  I am a member of a community association, and I would like to organize a neighborhood watch program to help prevent crime in the community. My husband is the president of the board of directors. I am worried about liability issues the association might incur as a result of my husband's relationship with the board. Will there be a conflict of interest with my husband's role as board president? Can I organize a neighborhood watch program without the association incurring any additional liability?

Q  I manage a 55-and-older-designated adult community. There has been recent concern that we may not meet the Fair Housing Act limits to maintain our age-restricted designation. Can our association pass a rule that no one under 55 years of age may live in it? If not, can we adhere to the requirement that 80 percent of occupied units are occupied by at least one person 55 years of age or older by passing a rule that says that those 20 percent of units without a 55+ person must be occupied by relatives of a deceased over-55 owner?

Facts: A member sued his association for negligence because the condominium was damaged when the association's subcontractor replaced his roof. The member stopped paying his assessment fees because the association failed to repair his condominium. The association filed a counterclaim against the member. It sought to collect the amount owed by the member or to foreclose on the condominium.

Facts: An association maintains and exercises control over a series of recreational trails on portions of its “common area.” The association's trails connect to a larger system of trails maintained by other associations or by government entities. After citing safety concerns for horseback riders and trail hikers as well as damage to trail fencing, the association installed barriers on its trail entry points to prevent vehicles from using the trails.

Facts: A condo association sued the developer of the condominium for negligent construction and negligent failure to establish an adequate reserve budget for replacement of common elements in the community. There are 102 units in the condominium, and upon the initial sale of 96 of those units, the members signed written agreements with the developer in which they agreed to submit to binding arbitration for claims arising out of the agreements.

A member in a Pennsylvania homeowner's association credits her quick-thinking neighbors and the proximity of a heart defibrillator device to her home for saving her life. On the night of the emergency, she felt faint and collapsed in her house. Her son called 911 and raced to neighbors while staying on the phone with a dispatcher.

On June 12, 2009, the Federal Housing Administration (FHA) announced a new, stricter approval process for condominiums to be eligible for FHA financing. At the time, the FHA's revised lending guidelines were to be effective Oct. 1, 2009. However, since they were announced, the effective date of the new regulations has been twice postponed. Now, the new regulations governing condominium mortgage insurance will be effective Dec. 7, 2009.

The Community Associations Institute (CAI) formed a working group of industry experts to identify specific areas of the FHA regulations that need to be changed. They have prepared a policy position to advocate the changes that are needed. On Oct. 23, 2009, CAI sent comments to David H. Stevens, commissioner of the Federal Housing Administration, to assist the FHA in addressing the current challenges in the mortgage markets. The following are CAI comments and recommendations relating to the proposed regulations that affect condominium community associations:

In these difficult financial times, more and more members are finding the need to sell their homes through the short-sell process as a result of declining home prices and the present state of the economy. For members who owe a lender more than what their properties are currently worth and can no longer make their mortgage payment due to a job loss, divorce, or resetting of an adjustable-rate mortgage, foreclosure seemed like the only alternative—until relatively recently.

Facts: An association obtained insurance liability coverage under two different policies. First, it obtained a commercial general liability policy that provided coverage for property damage. Second, it obtained a directors and officers (D&O) liability policy covering “loss incurred by the association as the result of any claim made against the association for a wrongful act.” The policy defined “wrongful act” as any error, misstatement, misleading statement, act, omission, neglect, or breach of duty committed or attempted by the insured organization.