Thursday, August 15, 2013

Recorded Deed Restrictions and Other Documents

For any HOA organized after October 1, 1995, the Bylaws, Declarations (also called CC&R's) and Articles of Incorporation have to be recorded in the county records where the HOA is located. Prior to that only the Declarations were required to be recorded.  An appellate court issued a ruling stating no restriction can be enforced against a lot owner unless the document is recorded in the county records, so as a precaution most HOAs have recorded their Bylaws and Articles even if they were created prior to 1995.  Subsequent rulings have caused HOAs to record their "Rules and Regulations" as well.  Rules and Regulations, which can be created by a vote of the board of directors, without a member vote, are meant to clarify restrictions and cannot create new restrictions.

To make things more complicated, the courts have said a lot owner is on notice to check for deed restrictions if it is obvious from the general scheme of the neighborhood certain things may not be permitted.  For instance, if every house has clay tile roofs you are on notice you cannot have a different type of roof.  Also, if there is a sign on the entrance with the name of the subdivision, that is a clear sign you should ask about deed restrictions and is sufficient notice.

One issue that comes up often is the waiver of enforcement of restrictions.  When an association fails to enforce a restriction it can lose the right to enforce it in the future through the Doctrine of Waiver.  Some courts have held the period of time to be one year (Third District Court of Appeals), some have held it is a five-year period (Fourth District Court of Appeals), while the Fifth District Court of Appeals said it could be either based on the type of claim sued upon (injunctive relief for specific performance or breach of contract).

An association can enforce a previously waived restriction by issuing what is called a "Chattel Shipping Letter," named after a case by the same name.  It requires the association to pass a resolution by board vote to start enforcing the restriction again and to send a copy of the resolution to all owners.  As a word of caution association should also record such a resolution in the county records.

1 comment:

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