E-mail Notice?

Posted on June 10, 2013 by Brian P. McLean

E-mail Notice of Owner Meetings by RCW 64.38 Homeowner Associations

by Brian P. McLean 

The State Legislature amended section 2(c) of RCW 64.38.035, permitting notice by e-mail only when certain conditions are met. The Governor signed Substitute House Bill 1370 (2013) into law on May 1, 2013 (Chapter 108, Laws of 2013).

Section (c) says:

1 (c) Electronic transmission to an address, location, or system
2 designated in writing by the owner. Notice to owners by an electronic
3 transmission complies with this section only with respect to those
4 owners who have delivered to the secretary or other officers specified
5 in the bylaws a written record consenting to receive electronically
6 transmitted notices. An owner who has consented to receipt of
7 electronically transmitted notices may revoke the consent at any time
8 by delivering a written record of the revocation to the secretary or
9 other officer specified in the bylaws. Consent is deemed revoked if
10 the secretary or other officer specified in the bylaws is unable to
11 electronically transmit two consecutive notices given in accordance
12 with the consent.

Anyone know what a “written record” is? May an owner opt-in by e-mail? Is an e-mail a written record? May an owner opt-in by filling out a web-based form? May an owner opt-in by attaching a PDF consent form to an e-mail? May an owner vote by e-mail? (Look to the corporate statutes for that one.) May an owner waive any defense by previously accepting notice by e-mail? By showing up at the meeting? So many questions…

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Can a Condominium Declaration give a Lender in Foreclosure Exemption from Leasing Restrictions? 12 U.S.C.A § 1731b

Posted on June 3, 2013 by Brian P. McLean

Can a Condominium Declaration give a Lender in Foreclosure Exemption from Leasing Restrictions?

Of course it can. But apparently it may not.

We commonly find language in condominium declarations that give a lender in foreclosure an exemption from leasing restrictions. This makes sense insofar as a lender wants to protect its assets while the home is in foreclosure, and renting a vacant or abandoned home is one way it can generate income to suspend the continued impairment of its asset.

The National Housing Act of 1934, Pub.L. 84–345, 48 Stat. 847 (1934), among other things, created the FHA, which is administered by the U.S. Department of Housing and Urban Development (HUD). The FHA provides mortgage insurance to approved lenders throughout the United States and its territories. No FHA means more risk for lenders.

HUD is now apparently taking the position that common condominium leasing exemptions violate the National Housing Act of 1934, which prohibits federal insurance in cases that would result in transient or hotel usage.  In that case, any condominium project submitted for review and approval will be rejected if it contains this provision.

See Prohibition against transient housing, 12 U.S.C.A. § 1731b.

How will this affect condominiums during FHA’s re-certification and quality control reviews? I may imagine but I cannot.

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Equity and Basic Rules of Fairness (Buck Mountain Owners’ Association v. Prestwich, No. 167714-4-1, (Wash. Ct. App., filed March 4, 2013))

Posted on April 19, 2013 by Brian P. McLean

Equity and Basic Rules of Fairness require owners to share common expenses, even in the absence of an agreement to do so. Buck Mountain Owners’ Association v. Prestwich, No. 167714-4-1, (Wash. Ct. App., filed March 4, 2013) (unpublished). That’s neither a radical nor a novel concept.

The facts are as follows. Owners shared a roadway. Some owners were subject to a Continue reading →

Posted in General, Restrictions and Rules | 2 Comments

They Fought the Lawn and the Lawn Won

Posted on October 7, 2012 by Brian P. McLean

They Fought the Lawn and the Lawn Won
by Brian P. McLean, Leahy McLean Fjelstad

In an epic battle between a homeowners association, owners, and a lawn, the lawn appears to be the only winner. Eleven years ago, Ed and Billye Simmon and their Florida homeowners association began a court battle over a $2,200 bill related to a bad lawn. Probably the association’s cost of re-sodding. According to the ABAJournal, the lawn was re-sod in about 2001 and the Simmons prevailed in 2012.

Justice finally took root. The court awarded the Simmons $85,000 in damages and is now considering Continue reading →

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Put this in your Pipe and Smoke it

Posted on March 3, 2012 by Brian P. McLean

Recently I was asked by a national publication to respond to a question about restricting cigarette smoking in condominiums. I drafted the following response. The editor unfortunately removed my humor and any ambiguity. (For example, in the edited version the editor wrote that smoking restrictions were enforceable so long as they were fair and reasonably adopted. Is that what I said?) Although I’m still attributed to the response in the written publication, the editor graciously removed any attribution to me on their website. The original unedited version is worth publishing, I think, only because it still makes me squirm:

Q.           The rules for my condominium say that an owner must control smoke Continue reading →

Posted in Legislation, Restrictions and Rules | 1 Comment

Glacial Musings

Posted on March 3, 2012 by Brian P. McLean

Sorry for the glacial state of new submissions since June 2011. Having taken on the responsibility of managing shareholder at our firm, developing and implementing complex but much needed programs to help shepherd aging associations through low maintenance reserves and the need for significant work on capital infrastructure, traveling to China and exploring their housing successes and challenges, and, well, life, the luxury of maintaining a useful blog has taken a back seat. Let us declare 2012 as the Year of the Blog! More to come.

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Resale Certificates and Significant Assets

Posted on June 15, 2011 by Brian P. McLean

Significant Assets and Resale Certificates, by Brian McLean

Perfect legislation is aspirational but impossible. The meaning of words change over time. Social customs and values change. These are not novel concepts.

In the newly revised Washington State reserve study legislation 2011 Wash. Laws 189, the duty to obtain a reserve study is triggered by “significant assets”. The 2011 law affects condominiums and, for the first time, non-condominium associations. It is not perfect legislation, but it aspires to do good things for owners and associations.

Continue reading →

Posted in Finance, Legislation | 2 Comments

Resale Certificates and the Price of Disclosure

Posted on May 12, 2011 by Brian P. McLean

Resale Certificates and the Price of Disclosure

The State Legislature has updated RCW 64.34.425(2). As of July 22, 2011, a reasonable charge for the preparation of a resale certificate may not exceed $275. The former cap, established in 1990, was $150.

2011 Wash. Laws 48

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Reserve Accounts and Studies — New Law, Old Problem

Posted on May 12, 2011 by Brian P. McLean

Reserve Accounts and Studies — New Law, Old Problem

You can pay now or someone else will pay later. That used to be the law in Washington State. No longer.

Washington State Governor Christine Gregoire signed into law new legislation concerning owner associations and reserve studies. The law becomes effective January 1, 2012. A copy of the bill can be found here: 2011 Wash. Laws 189.

Continue reading →

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FHA Condominium Project Approval – Status

Posted on December 9, 2010 by Brian P. McLean

Thank you Andrew Fortin, CAI (quoted in full):

Today, FHA announced a revised schedule for condominium project approval expirations and urged all condominium communities wishing to retain FHA approval to complete the recertification process. CAI strongly encourages all condominium communities with FHA approval to be mindful of the new expiration deadlines and to begin the recertification process in a timely fashion to avoid disruption in the sale of units.

The new schedule for project approval expirations is below:

Initial Project Approval Dates Current Expiration Date New Expiration Date
1972 – 1980 December 7, 2010 December 31, 2010
1981 – 1985 December 7, 2010 December 31, 2010
1986 – 1990 December 7, 2010 May 31, 2011
1991 – 1995 December 7, 2010 July 31, 2011
1996 – 2000 December 7, 2010 August 31, 2011
2001 – 2005 December 7, 2010 September 30, 2011
2006 – 2008 (Sept) December 7, 2010 March 31, 2011

According to FHA’s announcement, “The extensions were granted to reduce the impact of processing and reviewing the number of project approvals expiring at the same time while recognizing current housing market conditions…interested parties are encouraged to begin the re-approval or recertification process as early as possible as it is not anticipated that any further extensions of project approvals will be issued.”

In August, FHA announced a streamlined process for condominiums currently on the FHA-approved list to recertify to program requirements. To view CAI’s summary of the streamlined recertification procedures, click here. Under FHA’s condominium project approval guidelines, FHA-approval for all condominiums certified prior to October 1, 2008, was set to expire on December 7, 2010.

On Thursday, December 9, 2010, FHA will host a conference call for all interested parties to explain the new recertification deadlines and answer questions from industry partners. To participate in the conference call, use the information below:

Date:   Thursday, December 9, 2010 from

Time:   3:15 pm – 4:30 pm (EST).

Participants Teleconference Dial-In Number: (800) 683-4564

Participants Access Code: 623108

Confirmation Number: 184260

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