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  • August 16, 2017 11:12 AM | Anonymous

    By: John Cabral, Conflict Specialist
    Oak Park Mediation and Conflict Support
    Oak Park

    Lots of different, very uncomfortable behaviors can start happening in the most peaceful association.  One phenomenon we see now and then is an aggressive email campaign seemingly designed to discredit or intimidate the Board. An owner uses the association listserv to send frequent complaining emails to the whole community.  

    What to do?

    Some boards just vote to change the “rules and regs” so that now, posting to the whole community is a “privilege” that can be rescinded if an owner is sending “abusive” messages.

    But everybody will know who the new rule is directed at.  Depending on the level of antagonism going on, this measure might soon bring attorneys into the picture.  Discriminating against certain owners is illegal. And actually removing the offending owner from the listserv will be messy and awkward.  The owner’s sense of victimhood will intensify.

    This is the “legislative” method.  You can improve the odds it will succeed, without leading to bigger problems, if the Board consults with the community first. The Board can take a survey of the owners to gauge support for restrictive measures: a high favorable response rate will legitimize the new measures considerably. 

    Better yet is if the Board consults directly with the angry owner about the proposed new rule.

    In my experience, underneath this kind of behavior there is something else going on. Usually the person actually has a deep need to contribute their knowledge or expertise to the community but believes from previous experience that “nobody ever listens to me”.  They would love to be seen as a valuable member of the community but have decided beforehand that nobody cares.

    Therefore, it might lead to a real transformation if somebody—a board member, another owner who gets along with the offending emailer, a people-oriented property manager, or a professional conflict specialist-- approaches this owner and asks her or him to please join the Parking Lot committee or the Tax Appeal committee or the Financial Committee.  “We need more people and it’s obvious from your emails that you have some expertise.”

    Whether you follow this course or not, it never hurts to make concrete requests for the behavior that you would like to see the owner adopt.  And be sure to couch the requests in the needs the Board is ultimately trying to fulfill.  For example, “We’re trying to build trust and safety and neighborliness in the association: would you be willing to send only one email message per day to the list”?

    It always pays to assume the best, not the worst.  This owner may actually want recognition and validation, not necessarily the destruction of the whole association. 

  • August 16, 2017 11:08 AM | Anonymous

    By: Scott A. Rosenlund, Attorney
           
    Fullett Rosenlund Anderson PC
           Lake Zurich | Chicago

    Q:        I recently joined the board of my townhome association and discovered that the previous secretary redacted meeting minutes, providing edited versions for real estate transactional purposes. Is this legal? If not, is there any recourse against the secretary/association?

     

    A:         Illinois statutes applicable to community associations and most association governing documents provide that the duties of association secretaries include keeping meeting minutes. If the association is subject to the Illinois Common Interest Community Association Act (“CICAA”), Section 1-25(f)(2) of CICAA requires election of a secretary “who shall keep the minutes of all meetings of the board and of the membership.” With respect to condominiums, similar language appears in Section 18(d) of the Illinois Condominium Property Act (“Condominium Act”). However, notwithstanding the division of labor amongst different association officers, an association secretary should not unilaterally revise or redact board-approved meeting minutes. Board meeting minutes and other association communications generally should be approved by the board as a whole at open board meetings.

                Whether there is legal recourse against the secretary or the association will greatly depend upon any number of factual variables. For example, there could be potential exposure to claims if the minutes were, without disclosure, intentionally falsified to conceal material financial decisions (e.g., a large special assessment or association expenditure), a unit purchaser reasonably relied on the altered minutes when deciding whether to purchase a unit and the purchaser could prove that he or she incurred damages based on this reliance. Alternatively, if the minutes were redacted simply to omit information which might be considered sensitive or embarrassing to an individual (e.g., information regarding the name or address of a unit owner who was fined for a minor rule violation), such action might have been technically improper, but the purchaser would find it very difficult to establish that he or she somehow incurred damages due to the omission.

                A more common concern would be ensuring that the association furnishes accurate and complete copies of approved minutes to unit owners who make proper written requests to review minutes under (depending on the type of association) Section 1-30(i) of CICAA, Section 19 or 18.5(d) of the Condominium Act, Section 107.75 of the Illinois General Not For Profit Corporation Act of 1986, municipal ordinance and/or the governing documents.

                The board also should make sure that board meeting minutes follow a proper format. The purpose of board meeting minutes is to create an official record of formal corporate actions (i.e., board decisions), rather than to serve as a transcript of a board meeting or to convey information more suitable for newsletters, websites or other types of communications. If the board meeting minutes have been approved by the board, are accurate and complete, use a proper format and tone and do not contain extraneous information, well-intentioned, responsible board members should have no motivation to edit or redact the minutes prior to dissemination. 

  • June 02, 2017 1:17 PM | Anonymous
    1.     How did you get to become involved with ACTHA?

    I always like to do the best job at whatever I do. When I joined my association in the 1970s, I began to seek knowledge by attending workshops, seminars and conferences in the field. I attended most of the educational offerings at CAI and later attended educational programs through ACTHA. I found that ACTHA provided quality education sessions locally. Members at both organizations continually asked me to participate in its leadership. I have served on ACTHA’s Education, Membership, Bylaws and Executive Committees.  I was elected to the ACTHA Board of Directors in 2013, served as V.P. and was just elected President.

    2.     Tell us about your association. What issues is your association currently addressing?

    My association, Westgate Terrace C.A., is a 48-unit community located in a park like setting with over 160 trees located in the University Village neighborhood on the Near West Side of Chicago. We have engaged owners and have never had a problem getting owners to serve on our nine-member board!

    The main issue facing my association is the lack of operational knowledge amongst the board members. Board members need a foundation of knowledge to make good decisions, and many lack knowledge in construction technology, accounting, budgeting, planning, landscaping, aesthetics, meeting rules, laws and much more in order to make wise decisions. Other factors such as personality/ego issues, personal agendas, lack of understanding of fiduciary responsibility and, most importantly, the unwillingness to seek knowledge through consultants or education, can result in contentious board meetings and impede progress. Boards need training, and ACTHA offers such training! The problem is getting board members to recognize the need for training in order to serve well in their respective roles.

    Additionally, my association is working through a transition of a newly-hired manager.  Outlining expectations and responsibilities for management can help provide for a successful transition.  Like many other newly-formed boards, we acted without utilizing the wealth of available operational information.

    3.     What’s in store for ACTHA in the coming year?  

    ACTHA faces many challenges for the immediate future. Our major initiative is getting the message out to all the owners who live in association environments that we exist and serve as a valuable resource. Like most non-profits, we have a tight budget as well as membership growth challenges. We are experimenting with different venues and offering new and different, meaningful experiences at our conferences to help owners, leaders and board members make better decisions. We also need to continually add to our assortment of vendors to best serve community associations and to help support ACTHA. We need a proper mix of vendors that will attract homeowners as well as board members. We are located in the Chicago metropolitan area and have access to a wealth of quality vendors and opportunities. We must think positively and big!

    4.     What trends to you see in our industry?

    Due to economic feasibility, I see continued growth for people living in community association environments.  I see many boards abdicate their board responsibility role to lawyers or community managers.  Sometimes there is mismanagement and money wasted, and the board isn’t always aware of it.  All owners need to realize that they live in an environment where they have a mini-government and that their active participation is needed to help maintain their properties properly and keep property values up.  Owners need to be the drivers of boards.

    Owners must expect boards to learn to lead instead of letting others (e.g. attorneys or managers) do their jobs for them.  We certainly need legal and management guidance; however, Board members should make policy decisions for the owners, managers should execute the Board’s decisions and lawyers guide the Board in meeting their objectives.  In order to be effective, owners and board members need to be educated.  ACTHA offers such education. In some states, newly elected board members must attend a training session to learn of their responsibilities in an association environment.  Remember, association boards run a business, many with multi-million dollar budgets!  I look forward to ACTHA serving as the source for such education and becoming more recognized and even accredited.

    5. What’s the best piece of advice you’ve received through ACTHA that helped your association?

    ACTHA opens you up to a vast world of leadership knowledge in a community association environment. I learn something worthwhile at every event offered by ACTHA.  Learning and growth never ends!


  • June 02, 2017 1:14 PM | Anonymous

    ACTHA recently conducted a seminar on “How to Be a Great Board Member in 90 Minutes or Less” in Olympia Fields. Below is a recap of a few lessons learned from our presenters, attorney Bob Prince of Cervantes Chatt & Prince P.C. and manager Chris Berg of Independent Association Managers, Inc.:

     1. As a board, surround yourself with a solid team of advisors. An attorney, financial professional, manager, etc; can provide vital information to help a board make educated decisions. This may also limit liability in any litigation against the association.

    2. Get it in writing. Professional opinions, advice and analysis should always be provided in writing. Don’t rely on hearsay or assertions.

    3. The board speaks with one voice. Each board member has equal decision-making authority. The President has no more authority than the Treasurer or a board member at-large. Once a decision is voted on, all board members should support the decision externally in their community.

    4. Be prepared. Review materials prior to meetings. It’s okay to discuss issues with board members outside of a meeting—just be sure it doesn’t meet a quorum and that no decisions are made.

    5. Communicate. Not only with fellow board members, but with the community. Printed newsletters and/or consistent email updates keep owners engaged and aware of what’s going on in the association.


  • May 31, 2017 12:04 PM | Anonymous

    By: Charles Keough
    Keough & Moody, PC
    Naperville and Chicago

    A community association’s declaration, plat of survey/subdivision, bylaws, rules and regulations, and Articles of Incorporation are important documents that members may be interested in reviewing. In the case of a declaration, bylaws and rules and regulations, members should have a working knowledge of such documents. Failure to comply with these instruments may result in serious consequences. Yet commonly, unit owners do not have copies of these documents or even know where to find them. This article provides simple instructions for members of condominium or common interest community associations interested in locating these important materials.

    Written Request to the Board

    Every member of an association has the right to examine and make copies of the association’s declaration, bylaws, plat, rules and regulations, and Articles of Incorporation. After submitting a written request to the Board or its authorized agent identifying the documents sought for examination, the Board will typically make the requested records available within thirty days. Be prepared to pay a fee however; the Board is permitted to charge for the actual cost of retrieving and copying these records.

    Additional Options

    Alternatively, if an owner would like to locate and review one of these documents without submitting a written request to the Board, the process will depend on the document sought:

    Declaration, Plat, and Bylaws: In order for a property to be legally considered a condominium or common interest community association, the declaration, plats of survey, and bylaws (either embodied in the Declaration or attached as an exhibit) must be recorded in the office of the recorder of the county where the property is located. There, it is easy for a unit owner to find any documents recorded against their property using their name and Property Index Number (PIN). Though a plat may be difficult or impossible to locate online, generally declarations and bylaws are available online (but may be date-restricted).

    Rules and Regulations: Unfortunately, you will not typically find these recorded in the county recorder’s office. These you may obtain on your association’s website or from management and/or the board of directors.

    Articles of Incorporation: To obtain copies of an association’s Articles of Incorporation, the Illinois Secretary of State’s Office requires: 1) a request by mail sent to “Secretary of State Corporations Division, 501 S. Second St., 3rd Fl., Springfield, IL 62756” along with a $25.00 check, or 2) a request by telephone to 217-782-6875 with a $27.50 credit card payment. However, much of the important information contained in the Articles of Incorporation—such as the legal name, status, date of incorporation, or names and addresses of the registered agent, president, and secretary—is available for free on the Secretary of State’s website at https://www.ilsos.gov/corporatellc/CorporateLlcController.


  • May 31, 2017 12:03 PM | Anonymous

    Answers provided by:

    Karyl Dicker Foray, CIRMS, CRIS
    Rosenthal Brothers, Inc
    Deerfield
     Joel Davis, CPCU, CIC, CIRMS
    Community Association
    Underwriters of America, Inc.
    Hoffman Estates

    Foray: There are various ways that an Association can require unit owners to provide proof of insurance.  They can 1) make it a requirement under their Rules and Regulations or 2) through an amendment to their Declarations and Bylaws or 3) through a Board Resolution.  Condo associations can only require proof of liability insurance (since the Association really doesn’t care if they have insurance to replace clothes, furniture, etc).  See Section 12 (3)(h) of the Illinois Condominium Property Act for exact wording.  If it is a townhome association and the association doesn’t insure the units at all then they can require that proof of property and liability be provided.  Associations may fine unit owners who fail to provide proof of insurance, on a monthly basis, until the Certificate of Insurance is provided. 

    Davis: Section 12(h) of the Illinois Property Condominium Act addresses this issue.  Once a rule has been adopted by a condo association requiring owners to provide proof of coverage, the board has the authority to impose fines for owners who don’t comply. Outside of fines, I suggest an informational meeting be held with owners to explain the importance of verifying unit owner coverage. Owners can easily request that his/her insurance agent set up their policy so automatic policy renewal information is sent to the Property Manager or member responsible for verification.


  • April 19, 2017 11:35 AM | Anonymous

    By: David Bendoff, Attorney
    Kovitz Shifrin Nesbit
    Mundelein | Chicago | Naperville

    Question: Our association utilizes mail in ballots for elections to the board.  The association’s accounting firm (which also tallies our election results) opened the ballot box before last year’s election with only their personnel present in order to ensure a quorum before the annual meeting.  Shouldn't that ballot box be sealed until, and only opened at, the election?

    Answer:  One of the purposes of having an independent third party act as an election inspector is to ensure a fair election; this involves maintaining the security of the ballots and ballot box.  The practice of opening the ballot box, and the actual ballots prior to the annual meeting, can jeopardize that purpose and may give rise to an appearance of impropriety. 

    And even the most unintended of consequences can result when ballots are removed from the ballot box prior to the election.  For example, a ballot can be inadvertently lost or misplaced. 

    The Condominium Property Act (Section 18(e)) does provide that “a candidate for election to the board of managers or such candidate's representative shall have the right to be present at the counting of ballots at such election.”  The Illinois General Not for Profit Corporation Act (Section 107.35) authorizes the appointment of election inspectors, and provides in relevant part:

    “…..the chairman of the meeting may, or upon the request of any members shall, appoint one or more persons as inspectors for such meeting……”  Such inspectors shall ascertain and report the number of votes represented at the meeting, based upon their determination of the validity and effect of proxies; count all votes and report the results; and do such other acts as are proper to conduct the election and voting with impartiality and fairness to all the members.”

    I infer from these statutes that the ballots are to be opened, for all purposes, at the annual meeting, and not before.

    Other states do have regulations in place that expressly provide that no person shall open or otherwise review any ballot prior to the time and place at which the ballots are counted and tabulated. 

    Many associations adopt, or their governing documents expressly require them to follow, Robert’s Rules of Order.  The 11th Edition provides that “(t)he person designated as addressee for the returned ballots should hold them in the outer envelopes for delivery, unopened, at the meeting of the tellers where the votes are to be counted.”

    Moreover, a quorum is determined at the annual meeting, not prior to the annual meeting.  There may be some administrative convenience of having the election inspector review ballots before the annual meeting.  However, I don’t believe it is the best practice, and may open the door to attacks on the election procedure by those that might claim that this practice involves a nefarious purpose.  It just doesn’t seem like a practice whose benefit is outweighed by the risk.  The inspector could certainly keep a count of the ballots received as they are placed in the ballot box, and this would give a general sense of whether there is quorum.  However, I would not suggest opening the ballot box and reviewing any ballots prior to the annual meeting.


  • April 19, 2017 11:18 AM | Anonymous

    By: Scott A. Rosenlund, Attorney
    Fullett Rosenlund Anderson PC
    Lake Zurich and Chicago

    Community associations seeking to make additions to their governing documents often ask whether the changes may be implemented through revised rules and regulations or whether they must be adopted via an amendment to the declaration or bylaws. Depending on the nature of the contemplated revisions, analysis by association legal counsel may be warranted. But an association in any event should ask itself the following questions before adopting a new rule.

    Does the proposed rule directly contradict the declaration and bylaws? 

    If the answer to this question is “yes,” a declaration or bylaw amendment is most likely required. Limited exceptions to this general principle exist when applicable laws clearly override the declaration or bylaw provision at issue and authorize the rule. For example, Subsection 12(h) of the Illinois Condominium Property Act expressly provides that a condominium board, by rule, may require unit owners to obtain individual liability insurance coverage.

    Does the proposed rule indirectly conflict with the declaration and bylaws?

    By way of example, until recently, there were differing viewpoints amongst community association professionals regarding an association’s authority to adopt leasing restrictions by rule. Many professionals took the position that leasing restrictions can be adopted via rule only on the very rare occasions when the declaration and bylaws are completely silent as to leasing or when the declaration and bylaws expressly allow such rules. Others employed a more aggressive approach and supported adoption of rules restricting leasing so long as there was not a direct, obvious conflict between the declaration and bylaws versus the rules. The latter, more aggressive approach was rejected in the 2016 court decision Stobe v. 842-848 West Bradley Place Condominium Association. In the Stobe case, the Illinois Appellate Court (First District) held that a condominium association rule imposing a 30-percent cap on leasing was invalid because the declaration mentioned the leasing of units and did not expressly allow the association to impose further restrictions on leasing by rule.

    Do the declaration and bylaws expressly mention the board’s authority to adopt rules relating to a particular subject? 

    If the answer is “yes,” then a rule probably will be valid. For example, condominium declarations for multi-story buildings often clearly state that boards may by rule implement guidelines requiring sufficiently sound-absorbent floor coverings. If this type of express language appears in the declaration, a properly-adopted, reasonable rule relating to floor coverings would be enforceable.

    What is the scope of the association’s rulemaking authority in general?

    Subsection 18.4(h) of the Illinois Condominium Property Act provides that the purpose of condominium rules and regulations is to cover the details of the operation and use of the property. Meanwhile, non-condominium common interest community associations and master associations must consider the scope of rulemaking authority conferred by their governing documents. Some governing documents for non-condominium associations expressly empower boards to adopt rules regulating the use and operation of individually-owned lots, while other governing documents only discuss the adoption of rules relating to the common areas. In the 2013 court decision Ripsch v. Goose Lake Association, the Illinois Appellate Court (Third District) held that a common interest community association had the implied, inherent authority to adopt rules regulating the use of common areas, even though the covenants did not expressly grant such rulemaking authority.

    Does the proposed rule restrict basic use and occupancy rights? 

    As a general matter, restrictions upon the use and occupancy of, or behavior within, individually-owned units or lots are best implemented by amending an association’s declaration and bylaws, rather than through the rulemaking process. Under a well-established body of case law in Illinois and other states, such restrictions contained in recorded covenants will be granted greater deference by a court and generally should not to be subject to a judicial inquiry as to their reasonableness, but a restriction established by rule can be invalidated if a court deems the restriction to be unreasonable.


  • February 27, 2017 9:55 AM | Anonymous

    By: Michael DeSantis, Attorney
    Gardi & Haught, Ltd.
    Schaumburg, IL


    Question: "Is a crack in a garage floor the responsibility of the Association or unit owner?  We are assuming, as based on reading our Declarations, that the unit owner is.  Garage floors are not specifically mentioned, just "...foundations, structural parts of the Building....", (unless the floor is considered part of the foundation)."

    Answer: In this response, I am assuming you are referring to a crack in your garage foundation. You are correct to assume that your answer lies in your community’s covenants, conditions and restrictions (“CC&Rs”). CC&Rs detail what responsibilities belong to the Association and what responsibilities belong to you, the individual homeowner. In your case, you must discover whether your CC&R’s define garage foundations as a limited common element or designate it as something else, specifically whether your garage is defined as being part of your individual unit. If your garage is defined as being part of your unit, then it is your responsibility to maintain. If your garage is defined as a limited common element, the Association is likely responsible for its maintenance.

    However, even if your Association is responsible for its maintenance, there is a possibility that your Association will make you pay for the repair depending on what your CC&R’s read. If your unit is governed by the Illinois Condominium Property Act (the “Act”), the Act provides that an Association may assess the cost of maintenance,  repair and replacement of limited common elements back to the homeowners who have use of those amenities, if the CC&R’s provide for such a charge back. Carefully reading your CC&Rs will help you clarify who is responsible for your garage foundation maintenance and whether such costs can ultimately be charged back to you.
  • February 27, 2017 9:48 AM | Anonymous

    Did you know Community Association Managers must be licensed through the State of Illinois? Make sure your manager has the proper license to manage your community association.  Below is an explanation of the difference between Community Association Managers and Property Managers.

    Who:  Community Association
    Manager 
    Property Manager
    Reports to: Association Board Owner or General
    Manager
    License Type: Community Association
    Manager
    Real Estate
    Scope of Work: Manages community
    associations
    Manages Properties

                                                     

    Community Association Managers:  Managers may work for a management company or directly for one or more community associations.  They may work for condominium, townhome, homeowner, recreational, marina, equestrian or other community associations.  They may maintain financial records including receiving funds and making deposits, paying bills, obtaining proposals for projects, issuing work orders for routine items, responding to owner questions and complaints, maintaining records, communicating with board members, assisting with budget preparation, etc.   They may not manage properties unless they have a Real Estate Broker or Managing Broker license.

    Property Managers:  Brokers and/or Managing Brokers list properties for sale or rent in order to procure buyers or tenants for clients.  They also assist buyers and tenants in finding properties.  Types of properties include, but are not limited to, residential, vacant land, multi-unit/apartment residential, industrial, office, retail, institutional, mobile homes, deeded parking, mixed use, businesses with real estate, etc. and they may manage properties, but not community associations unless they also have a CAM - Community Association Manager License.  A Broker will work for a company under the direction of the Managing Broker.

    All Community Association Managers must be licensed under the Community Association Manager Licensing and Disciplinary Act.  It would be wise to ask for a copy of the manager’s license or you may go online to check:  http://www.idfpr.com/profs/cam.asp.
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