Monday, March 2, 2009

New to Condominium Ownership/
Board Membership?

Welcome to condominium life!

What's that, a deer-in-headlights look on your face? Didn't know what you got yourself into? Thought you were buying a home? Figured the board seat would be a good place from which to get even with your neighbor?

At the risk of repeating myself, welcome to condominium life.

Yes, you did buy a home. Perhaps yes, you did agree to serve on its board of directors. And what you did also was join a corporation. It's probably a not-for-profit corporation, but a legitimate, regulated, fully licensed-to-do-business Washington State corporation.

Homeowners are stakeholders in the corporation with obligations, responsibilities and duties to themselves and to other stakeholders -- the neighbors -- and if you joined the board, guess what? You are chartered with serving the corporation's business with a 'fiduciary duty', meaning a duty of loyalty to the association, and a duty of ordinary care for its business. (This precludes your using your position to abuse the association or anyone in it.)

Okay, now we're into it. Condominium ownership and board membership are legal situations in which you find yourself, so you are well advised to read the legal documents that permit you to act, require you to act and forbid you to act.

You mean the U.S. isn't a free country after all? Yes, of course, you had the choice of buying into a condominium housing situation. Or not. You had the choice of serving on the corporation's board of directors. Or not.

And here you are.

Be bold. Take the first step. Read your declarations. These are the govering documents for your condominium. They include your Covenants, Conditions and Restrictions (CC&Rs), the Articles of Incorporation (or association if you are not incorporated), By Laws, and Rules and Regulations.

If you serve on a board, here's your chance to re-read your declarations. A great suggestion is to read them with two highlighter pens. As you read, highlight all the 'shall' words with one colour and all the 'may' words with another colour.

Tip: Verify that the declarations that you are reading are the official, final, and filed versions of the documents; that include amendments, additions and deletions that have occurred over time. Your declarations are filed with the county, and you can buy copies of them.

Become familiar with, or generate your own index to help you use these documents as reference. (The most convenient option is to be able to refer to your governing documents digitally, and use the power of electronic search to find the paragraphs you need.)

When you deal with an issue, look everywhere for language that pertains to that issue, and language may appear in all your governing documents. Sample index entries might be, rentals, insurance, meetings, voting, assessments and so forth.

Board members are responsible for million-dollar-companies.

These ideas and concepts may be relatively new for rural or more-rural areas of Washington State. The locale of your condominium does not lessen your professional responsibility, whether you are an owner or a board member.

Living in a tight-knit community is often the norm in rural and more-rural geographies. Condominium living then can be viewed as a more formal implementation of this existing pattern.

There is only one truism for me about community living, and here it is: I'd rather live in a community where we look out for each other, understand how my life style can affect the neighbors, and know that for me, a viable, breathing condominium community is the healthiest structure in which I can make my home.

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