Rent Real EstateDeciphering Homeowner Association Bylaws
Question: I serve on the board of a homeowner
association and was cautioned not to interpret the meaning of our bylaws or the
state and local laws that apply to homeowner associations. I felt like I need a
magic decoder ring. Am
I getting good advice?
Answer: The board has the duty to enforce the
bylaws and is not expected to be an expert in the law according to the
"Business Judgment Rule". The
Business Judgment Rule protects the board as long as decisions are made based
on reasonable research, expert advice and no conflicts of interest.
From time to time, however, it is wise to consult with a knowledgeable
attorney. Some older documents may contain provisions that violate current
federal or state law, like restrictions against children or zoning
ordinances. Many governing documents lack structure, are difficult to read
(too much legalese) or lack a table of contents. If so, it may be time to
redraft them to make them more user friendly. A knowledgeable attorney
(defined as one who specializes in this kind of law) can be invaluable in
redrafting the documents. Do not attempt amending the documents alone.
Even if the board performs the rewrite, always have a knowledgeable attorney
review the work before approving and filing. When hiring an attorney to do
the work, ask to see a sample of their work. The last thing you would want
is another set of undecipherable documents.
Another area where bylaw interpretation gets critical is in the case of
potential litigation. If the association is being threatened with a
lawsuit, it"s time to get a legal expert. Even though the bylaws may
provide for recovery of legal costs, when a judge and jury is involved, this
is not a given, and the association may not win. In many such cases,
compromise is the prudent path and the board often needs outside perspective
to get to that point.
The governing documents are the constitution of your homeowner association.
Treat them with the respect they are due. When you aren"t clear on a point
or if they need updating, get expert advice. You can keep your secret
decoder ring for Captain Marvel messages.
For more information on this subject, see www.Regenesis.net.