Community associations often face competing priorities when it comes to governance, maintenance and risk management to name two. While most boards understand the importance of addressing these issues, deciding how to proceed is not always straightforward. Below are common challenges associations face, along with two potential solutions, and guidance on when each may be most effective.
Issue: Maintenance Responsibility Confusion
Solution #1: Maintenance and Insurance Chart
Provides a practical, accessible guide by setting out, component by component, whether the owner or association is responsible. Reduces confusion, minimizes disputes, and saves money by preventing repeated conflicts.
Best for: Communities whose declarations already allocate responsibility in broad terms but fail to address specific components, leaving owners and boards in frequent conflict.
Solution #2: Declaration Amendment
Has a binding legal effect and can resolve ambiguities or omissions in the governing documents themselves. Unlike a chart, which offers guidance but does not change the declaration, an amendment permanently clarifies or establishes responsibility.
Best for: Associations with persistent disputes caused by ambiguous or missing language in the declaration, where a chart would not be sufficient to resolve underlying confusion.
Issue: Insurance Coverage Questions
Solution #1: Insurance Audit
Reviews both the governing documents and the association’s current insurance policies, (including liability, property, director and officer, workers’ compensation, and endorsements) to identify gaps, overlaps, and unnecessary coverage. Ensures the association is adequately protected without overspending.
Best for: Communities that already maintain insurance coverage but want to confirm adequacy, eliminate gaps, and ensure premiums are not being wasted.
Solution #2: Declaration Review
Examines the governing documents without evaluating current coverage. A simpler, more limited tool that establishes a baseline for what coverage is required.
Best for: Associations preparing to purchase coverage for the first time or considering a change in providers, where the priority is understanding what the governing documents require.
Issue: Dealing with Troublesome Owners
Solution #1: Code of Conduct/Harassment Policy
Establishes enforceable standards of behavior for all community members, staff, and vendors. Provides the association with a consistent framework for addressing harassment or decorum issues.
Best for: Communities facing ongoing or widespread behavioral concerns, or those seeking to proactively establish expectations to prevent future issues.
Solution #2: Cease and Desist Letter
A targeted enforcement tool used against a single individual who is interfering with association operations. Reactive rather than proactive.
Best for: Associations dealing with one specific owner whose conduct is causing significant disruption or risk.
Issue: Water Leak Issues
Solution #1: Insurance Deductible and Claims Submission Policy
Clarifies who pays deductibles, how claims should be submitted, and how overlapping responsibilities will be handled. Reduces disputes and provides a clear roadmap for insurance claims.
Best for: Communities where water leaks are occasional but maintenance and insurance responsibilities overlap, creating confusion.
Solution #2: Water Leak Policy
Sets out practical steps for owners and the association to follow when a leak is detected, ensuring quick response and coordination.
Best for: Communities where insurance allocations are already clearly established in the declaration, but confusion arises around response procedures when a leak occurs.
Issue: Governing Document Updates
Solution #1: Limited Amendment
Intended to revise a single issue, such as correcting a maintenance allocation, or implementing leasing restrictions.
Best for: Associations with governing documents that are otherwise clear and functional, but require one or two updates to better reflect current practices or community preferences.
Solution #2: Amendment and Restatement
Replaces the existing declaration in its entirety with a modernized version. Incorporates changes in the law, removes inconsistencies with other governing documents, and improves readability and usability for boards and owners.
Best for: Communities whose governing documents are older (often 20+ years), legally outdated, or no longer accurately reflect the operation of the association.
The needs of each community vary, and the right solution depends on your association’s unique circumstances. Whether an issue calls for short-term tool or a comprehensive overhaul, thoughtful planning ensures the association is well positioned for long-term success.
Should you have any questions concerning the tools discussed herein, or wish to obtain additional information, please do not hesitate to contact an Altitude attorney at 303.432.9999 or [email protected].