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The Community Counsel - Our Blog for Your Association

insurance_checklistBudget season is a great time to review the association’s insurance coverage.  Although comprehensive, quality insurance coverage can be a significant expense, it is typically far less expensive than paying out-of-pocket for the litigation expenses and/or damages incurred in the event of a loss.  And, your association must carry at least the minimum coverage required by its governing documents, and, for condominium associations, as required by the Georgia Condominium Act. 

 

Below is a “checklist” of the coverage that you should always maintain for the association:

Property.  Provides financial reimbursement in the event of damage to covered property.

annual_membership_meeting_9-18-17As fall approaches, many community association managers and Boards of Directors begin preparations for what can be one of the more stressful times of the year in the community association world: annual membership meeting season.   In an effort to make this annual meeting season a little easier for your community, we’ve compiled a list of some of the more common annual meeting terms and their plain English definitions in this handy “Cheat Sheet”:

Meeting Notice:   The written notice sent to members before the annual meeting advising them of the date, time and place of the meeting.   An association’s Bylaws generally contain specific requirements as to how many days before the meeting the notice must be sent, how the meeting notice must be sent, and what information the notice must contain in addition to the meeting date, time and place.   If the Bylaws do not state any such requirements, the annual meeting notice must be sent at least 21 days prior to the annual meeting for associations subject to the Georgia Condominium Act (the “Condo Act”) or the Georgia Property Owners Association Act (the “POAA”); and for all other associations, at least 10 days, but no more than 60 days prior to the annual meeting (if notice is sent by other than first class or registered mail or statutory delivery, then it must be sent at least 30 days prior to the meeting). 

exculpatory-clauses_8-16-17_ver2Crime happens.   And, when it happens within a community association, the association will oftentimes get drawn into civil lawsuit seeking millions of dollars.   While an association cannot prevent being named in a wrongful death lawsuit, it can do certain things to help protect itself from liability in such suits.   One of those things is obtain the proper liability insurance. Another is to ensure that an association’s Declaration contains an exculpatory clause stating the association does not have a duty to provide security on its premises.

The contrasting results of two Georgia Court of Appeals cases highlight the importance of such an exculpatory clause.   The tragic facts of the cases, Bradford Square Condominium Association, Inc. v. Miller (decided in 2002) and Camelot Club Condominium Association, Inc. v. Afari-Opoku (decided in 2017), are strikingly similar.   Both cases involved criminals following a condominium resident into the condominium, and attacking and killing the resident during a robbery attempt. However, the resulting civil wrongful death lawsuits filed against the condominium Associations ended with very different verdicts for the Associations.   In the Camelot Club case, the jury found the Association to be partially responsible for the victim’s death, and liable for paying 25% of a $1,625,000.00 jury verdict.  In contrast, the Georgia Court of Appeals in Bradford Square found that the Association was not liable for the victim’s death, and the victim’s widow was awarded no money.

leg-update-2_pic_7-19-17On July 1, 2017, Senate Bill 46 became law, granting community associations in Georgia new statutory rights to require that their association’s Developer turn over control of the association to the homeowners. Previously, the Georgia Condominium Act provided condominium unit owners some rights to require that their condominium Developer turn over control. However, Senate Bill 46 expands these rights for condominium unit owners and for the first time extends the same expanded turnover rights to owners of lots in homeowners associations, including both homeowners associations subject to the Georgia Property Owners Association Act (“POAA”) and those that are not.

Under the new statutory language, if a Developer fails to take any one of six specified actions, any homeowner or homeowners can, after giving the Developer 30 days’ written notice and an opportunity to cure its failure to act, file a lawsuit in superior court to obtain a court order transferring control of the association from the Developer to the owners.   The six specified Developer failures to act that can trigger the owners’ right to request turnover are as follows:

tax-sale_pic_6-26-17Under Georgia law, the purchaser of a property at tax sale owns the property subject to the right of the prior owner or lien-holder of the property to redeem it by paying the past-due taxes plus statutorily required interest and other charges. If the property is redeemed, ownership of the property reverts back to the owner of the property prior to the tax sale. The right to redeem lasts for at least 12 months, and can last for even longer depending upon how long it takes the tax sale purchaser to take the necessary statutory steps to terminate the right of redemption (the “Redemption Period”).   Given that a tax sale purchaser owns property subject to the chance that the property might be redeemed and ownership restored in the prior owner, we often receive questions from clients as to whether the tax sale purchaser of the property is the real property owner for purposes of liability for community association assessments.

leg-update_pic_6-26-17Condominium developers often develop new condominium projects in phases, adding one portion, or “phase”, of property into the condominium at a time as such phases are constructed until eventually the entire property the developer intends to submit is added into the condominium.   While this process ordinarily occurs continuously until full completion, when the developer is foreclosed upon or otherwise ceases business mid-construction, as frequently occurred during the recent economic downturn, unit owners within a partially built-out condominium project can be left to suffer for the developer’s failure to finish. For example, these owners may pay higher assessments than expected because the total number of units originally intended to share in the common expenses were not built, and/or may be left staring out at the vacant, often unkempt pieces of property that were once intended to be condominium units or recreational area.

budget_smallAs a community association attorney, I attend numerous annual meetings each year for my community association clients. One of the most common mistakes that I see Boards of Directors make at these meetings is incorrectly assuming that the association’s annual budget requires membership approval and holding a vote to “approve” the budget.

In fact, for the vast majority of associations, the Board of Directors holds sole authority to approve the budget, so there is no need to hold a membership vote to approve the budget. Neither the Georgia Condominium Act nor the Georgia Property Owners Association Act requires that a community association hold a membership vote to approve the annual budget or annual assessment. 

electionIt’s summertime and it’s not only the temperature that is heating up.  Although the November election is months away, judging by the campaign signs blossoming on front yards throughout the Atlanta metropolitan area, political campaigns are already in full swing.  Given the number of signs already out there, your community association may justifiably be wondering if it has any control over campaign signs in the community.  For those community associations with Declarations of Covenants containing restrictions regulating signs, the answer is likely yes.  

It is a common misconception that the First Amendment right to free speech prevents a community association from prohibiting political signs within the community.  In fact, Georgia courts, as well as other courts throughout the country, have consistently upheld a community association’s right to prohibit signs, including political signs.  

Popcorn bowl, film strip and ticket. Cinema attributes. Detailed vector illustration.

Community associations are often on the look-out for easy and low-cost events that bring the community together for socializing and fun.  And, what could be easier than a community movie night?  What too many associations don’t realize, however, is that the seemingly harmless act of screening a movie in your community association clubhouse may subject the association to liability for copyright infringement.

To explain, under Title 17 of the United States Code, known as the “Federal Copyright Act,” all movies that you rent at Netflix or Redbox, or that you buy at a store, are copyrighted.  Neither the rental nor the purchase of a copy of a copyrighted work carries with it the right to publicly exhibit the work.  Thus, while no additional license is required to privately view a movie or other copyrighted work with a few friends and family, absent a few defined exceptions, the Federal Copyright Act requires a special public performance license for any public showing of a copyrighted movie.

Television news, newspapers and law firm websites are ablaze with the news that on September 8th, a Federal Judge for the Northern District of Georgia held the process for obtaining a garnishment carried out by Gwinnett County under the Georgia garnishment statute was unconstitutional because it violates the due process rights of debtors.  The news stories create the impression that a creditor will no longer be able to collect a debt after obtaining a judgment.

We have contacted lawyers, judges and state legislators.  All of them are uncertain as to exactly what the order means.  It is simply too soon to tell.  That will emerge as the dust settles. Until that happens, it is unclear if any creditor has the right to file a garnishment.  The prevailing opinion is a creditor/creditor’s attorney is at significant risk of violating the law.  Accordingly, WNCW will place on hold the filing of garnishments.