Jeanne Lauer to speak at CAI Leadership Workshop

 

Jeanne Lauer will speak at the CAI Essentials of Community Association Volunteer Leadership Workshop on October 25, 2014 from 9:00 a.m. until 4:00 p.m. at the SEVA-CAI meeting hall located at 1300 Diamond Springs Road, Suite 400, Virginia Beach, Virginia 23455. The workshop is intended primarily for community leaders and homeowners and will cover the following topics and does qualify for certain continuing education credits:

                                        Legal

                                        Board Governance

                                        Maintenance

                                        Rules Enforcement

                                        Insurance

                                        Accounting/Finance

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Announcement of CIC Recertification Training

     

Training Date: October 29, 2014

 1300 Diamond Springs Road, Suite 400

Virginia Beach, VA 23455

This is to announce the first offering of CIC Recertification Training in Hampton Roads. The Community Associations Law Team is approved by the Common Interest Community Board to provide Fair Housing training and Law and Regulation training as required for recertification. We also welcome any person desiring to learn about the subject matter being offered however priority will be given to licensees if space becomes an issue. We are pleased to offer this training at no cost to the attendees.

The training schedule is as follows:

Check-in:                                        9:00 - 9:30 a.m.

Course 1 - Fair Housing:               9:30  -  11:30 a.m.

Lunch:                                            11:30 - 12:15 p.m.

Course 2 - Laws and Regulations 12:15 -   2:15 p.m.

 The location of the training is the training room of the Southeastern Virginia Chapter of the Community Associations Institute located at 1300 Diamond Springs Road #400, Virginia Beach, VA 23455. A light lunch and beverages will be provided.

If you are interested in registering for one or both of these sessions, please contact Terri Richardson via email at terrir@inmanstrickler.com. Should you wish to speak with Terri you may call her at 757-486-7055. See attached registration form.

The Community Associations Law Team

                       

                                              

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How long does it take for a condominium to get FHA project approval?

We have found that managers and board members who have not had any experience with the process of obtaining FHA project approval have unrealistic expectations about the processing time.In this edition we let you know the “ins and outs” of the application for such approval. We handle both initial applications and recertifications and there is a significant difference.

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If you can't get a critical amendment passed there is relief in court

Due to some shepherding of this bill by CAI’s Virginia Legislative Action Committee, as of July 1 you can get help from the Circuit Court if you have made a good faith attempt (3 times) to get a critical amendment passed without success. The statute details exactly what must be done to achieve the amendment.  We hate to say it but you really need to read this statute as it lays out exactly how and when it works.  Here it is:

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What does the term "member in good standing" mean in association documents?

We are often asked if an owner can be prevented from voting when the association declaration or bylaws state that an owner who is not in good standing may not vote or that their vote will not be counted.  Most board members and managers think this means that an owner who is delinquent in his payment of assessments cannot vote. Without further definition in the documents this is a correct interpretation.  Some people think that it also means that if an owner has been found in violation of the covenants or rules and has not cured the violation or paid a charge made after a due process hearing that the owner cannot vote.  Unless the documents specifically provide for such we believe that “not in good standing” is limited to delinquency in the payment of assessments. 

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News from the Virginia General Assembly and CAI's Virginia Legislative Action Committee

 

Below are a host of new laws that will become effective on July 1, 2014.  There are some significant new items and we urge you to read closely.  Mike Inman serves on the Virginia Legislative Action Committee and can answer any questions you might have about the bills. 

Late Fees- HB 566

 

HB 566 amends the Virginia Condominium Act (§55-79.83) and the Property Owners’ Association Act (§55-513.3) (the “POAA”) by clarifying that associations can charge a late fee as provided in the governing documents, and if not provided for in the governing documents, the association can charge a late fee not to exceed 5%.

 

Compliance with Declaration- HB 530

 

HB 530 amends the Virginia Condominium Act (§55-79.53A) by adding the following language:  This section shall not preclude an action against the unit owners’ association and authorizes the recovery, by the prevailing party in any such action, of reasonable attorney fees, costs expended in the matter, and interest on the judgment as provided in § 8.01-382 in such actions.


Merger; Judicial Reformation of Declaration- HB 690

 

HB 690 amends the Virginia Condominium Act (§55-79.71:2) by providing condominiums with the ability to merge two or more condominiums. It also amends both the Condominium Act (§55-79.73:2) and the POAA (§55-515.2:1) by permitting associations to petition the circuit court to make changes to a declaration. 

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Inman appointed by City Council to Virginia Beach Planning Commission

Michael A. Inman has been appointed by City Council to the Virginia Beach Planning Commission for a four year term beginning in January 2014. The Planning Commission meets monthly to review and vote upon applications from property owners for rezoning and conditional use permits. Mr. Inman has practiced in Hampton Roads since 1973 and has been active in numerous community organizations. His practice has a historical heavy emphasis on a broad range of real estate matters including acting as counsel to developers of condominiums and homeowner associations and the formation of a practice group that represents over 200 community associations in the region and beyond.

The law firm’s attorneys provide a broad array of legal services from domestic relations to workers compensation to business matters and can be viewed on the firm’s website: www.inmanandstrickler.com.

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Virginia has a Santa "clause" ....and he brings dollars

Did you know that Virginia has a law which requires all licensed contractors to contribute towards a fund that helps victims of fraud and dishonest conduct? While many states have similar consumer laws, Virginia also includes Property Owners Associations as potential victims. (We don’t know why condominium associations are not included but it is on our “to do” list.) The Contractor Recovery Fund (aka Santa) reimburses qualified applicants up to $20,000.00 in cases where the contractor has engaged in “wrongful taking or conversion of money, property or other things of value which involves fraud, material misrepresentation or conduct constituting gross negligence, continued incompetence, or intentional violation of the Uniform Statewide Building Code…” Virginia Code § 54.1-1118. So if a contractor collected a deposit and never came back to do the work and you can’t find him, there might be a chance to get that money back. The process is a bit technical but worth the effort if you have a substantial amount involved.

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Breaking News: Recertification training available from our CA Team

On December 3, 2013 the Virginia Common Interest Community Board approved the Community Associations Law Team of Inman & Strickler to provide both the Fair Housing training and the Laws and Regulations training required by the CIC Regulations for manager recertification.   Both sessions are required to be two hours in length. We are the sole provider of this training located in Hampton Roads.  The first offering of the course will be early in 2014.  You can obtain more information about the courses by emailing or calling Terri Richardson at terrir@inmanstrickler.com.

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Nonstock Corporation Act

We are all familiar with the Condominium Act and the Property Owners Association Act but how often do we think about the Nonstock Corporation Act? Most of our Associations were formed as nonstock corporations so when we are looking at whether there is compliance with the law, we need to be aware of this Chapter of the Virginia Code.

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PRESS RELEASE

Jeanne S. Lauer, a principal of the law firm of INMAN & STRICKLER, PLC, has been named the 2012 Distinguished Service Award recipient by the Southeastern Virginia Chapter of the Community Associations Institute. (SEVA CAI) The Award is given to a member for a long term achievement of outstanding service to the Chapter.  SEVA CAI is a non-profit organization committed to inspiring professionalism, effective leadership and responsible citizenship in community associations through education.   Ms. Lauer served on the Board of Directors for SEVA CAI from 2006-2012.

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Mandate from the Legislature-Complaint Procedure

QUESTION: 

I understand that at this time all associations are required to have a complaint procedure in place in order for their members to be able to let the CIC Board know of issues they have with their association. I also know that the Annual Report form requires an Association to state whether or not it has a complaint procedure. What is the consequence if an association fails to comply after getting the DPOR’s letter about non-compliance when they have checked “no” on the Annual Report?

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FHA CONDOMINIUM FINANCING UPDATE

As you may be aware we have obtained FHA Project Approval for a number of condominium communities. Some have not been able to submit applications because they were unable to meet all the criteria imposed by FHA.

We are pleased to report that recently we got word that finally FHA has relented on several of the troublesome application issues that CAI and others have been working on. FHA modified the Certification so that the signer no longer certifies that they will advise FHA of any changes in circumstances that would disqualify the project after approval. FHA substituted “to the best of my knowledge” at the appropriate spot where it used to be unqualified.  The penalty for false statements remains. It has been and remains my opinion that proof of intent or gross negligence would be required. Enforcement would be rare, as you can well imagine, given the shortage of resources available to pursue such in the great scheme of things….probably way behind Medicare fraud.  This was a great breakthrough achieved primarily by the relentless pursuit of it by the Government Affairs Office of the Community Associations Institute.

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State Regulations for Internal Complaint Procedure - Regulations Now in Place

A couple years ago a new state law was passed requiring that associations have an internal complaint procedure once the regulations for such are issued by the Community Association Ombudsman under the Department of Professional & Occupational Regulation.  The official responsible for prescribing an internal complaint procedure for all associations proposed the regulations for it and they have been approved by the Governor. All Associations should have a procedure in place NOW to be in compliance with the law and regulations.

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Collection of Delinquent Assessments

  

In this time of economic struggle, associations can be victims of cash flow shortages due to delinquencies in the payment of assessments, both regular and special.  Realizing that many of our associations would have need of this service at a higher level than before, a few months ago Inman & Strickler became fully engaged in the collection of delinquent assessments, on a contingency fee basis. We have always been  involved in  general litigation and some collection work for associations, particularly special assessment issues, as we have always had trial lawyers involved with our association practice. We have obtained an excellent collections software program and Steve Lauer is heading up this area. 

 

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Condominium Unit Financing

 

We all know that these are troubling times for sales of condominium units. The slow sales market for condominiums is further compounded by the fact that available financing options for condominiums have virtually disappeared over the last several years. When owners are unable to sell their units the result is often foreclosure and/or bankruptcy; which, in turn, results in lost assessments that most likely will never be recovered by the association. Lost assessments can often result in special assessments for the remaining unit owners or routine maintenance and capital improvements being delayed. You have no doubt spent countless hours and association resources trying to collect these assessments.

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2010 Changes to Virginia Laws Affecting Community Associations

 

BOARD MEMBER AND MANAGERS CHECKLIST

 

2010 CHANGES TO VIRGINIA LAWS

AFFECTING COMMUNITY ASSOCIATIONS

 

Earlier this year there were new laws passed by the Virginia General Assembly to amend the laws that govern community associations. The Community Association Law Team at Inman & Strickler, PLC provides the following checklist of actions your community association should consider in order to utilize or comply with changes to Virginia laws that became effective July 1, 2010.

 

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FEDERAL "TENANT RELIEF" LAW

We have recently learned of a relatively new Federal law which gives some protection to tenants who reside in homes owned by folks who don't pay the mortgage resulting in foreclosure UNTIL December 31, 2012. Below is a summary published on the Federal Deposit Insurance Corporation (FDIC) website:

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LICENSE AND REGISTRATION, PLEASE...

For the average person, these words are usually harbingers of doom. But for common interest communities and the professionals associated with them, they are simply an annual chore. For a number of years the law has required residential condominiums and homeowners associations to file annually with the Virginia Department of Professional and Occupational Regulation. Recent changes to the law have added professional management companies as entities required to file as well. The online link to verify compliance can be visited here. The same link allows you to check the status of many professionals, including contractors doing work at your home, and is a terrific source of information.

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Insurance and Collections

We bring you news on two popular topics; Insurance and collections.  Two of our team members, Jeanne Lauer and Mike Inman, recently participated as presenters in an enjoyable association Leadership Retreat sponsored by two Virginia CAI chapters at the Boars Head Inn in Charlottesville and hope to repeat the experience next year – as do most who attended. It was a first time event which was well organized and executed. Much credit goes to our local Chapter Executive Director, Rebecca Woodring.

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Collection of Assessments 101

Collection of Assessments 101 - Owner Bankruptcy Did You Know?

 

 

Section 523 (a) (16) of the Federal Bankruptcy Act excepts from the debtor's discharge all assessments which become due and payable after the debtor's bankruptcy papers are filed. In other words the law allows you to pursue collection of an owner's delinquent assessments if they became due after his bankruptcy filing. The Board should pursue such assessments by exercising acceleration options and record liens every 90 days as provided by the Condo Act and the POA Act. This will give you a secured debt and the ability to foreclose when and if the time is right. In these financially stressful times these rights should be pursued to insure the financial health of the association if there is a reasonable chance of recovery and realization of a reasonable net amount after all costs to collect.

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Mike Inman has been selected for membership in the exclusive College of Community Association Lawyers (CCAL)

Mike Inman has been selected to join an exclusive group of attorneys evaluated by other attorneys who are long time practitioners of community association law and members of the Community Association Institute (CAI). Attorneys selected for the College are those who have spent considerable time writing articles and giving presentations on community association law topics over a period of years.  Mike has been presenting in seminars on Community Association topics for over 20 years and has been a presenter for the Virginia State Bar on the topic of Creating Condominiums in Virginia. He has also written a chapter on community association law for a Virginia State Bar Continuing Legal Education publication: Real Estate Transactions in Virginia. He serves on the Virginia Legislative Action Committee for the Community Associations Institute.

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New Laws Affect Resale Packets and Homeowner Complaints

We got big changes in Washington recently but we got big changes from Richmond in July! We are all grappling with the implementation of the new laws affecting associations contained in HB 516 which became effective on July 1. This law impacts numerous aspects of the operation of community associations.  In this blog we will deal with two aspects of the law – Resale Packets and Complaint Procedures.  Mike Inman is serving on two state committees which are working on the implementation of the law - a committee of the Common Interest Community Board known as the Regulatory Review Committee and a committee of the Virginia Housing Commission known as the HB 516 Work Group.  As a result he is keeping on top of developments relative to the new laws and the publishing of regulations which are intended to implement them.

Resale Packets

One of the biggest changes affecting you is the creation and administration of Resale Packets. 

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Neighborly Advice - Richmond Magazine - September 2008

Do you have issues with your neighbors?  In the September 2008 Edition of Richmond Magazine, Mike Inman gives his expert opinion and weighs in on a common neighborhood issue - noise. 

You can read the article by clicking on the below link to a pdf file. 

Article from Richmond Magazine, September 2008 Issue.

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Dear Managers and Board Members...

Once again we bring you a smorgasbord of information for you to digest!  In this edition we will talk about leasing restrictions, tree encroachments, and a new lawyer in our group.

NEW ADDITION TO COMMUNITY ASSOCIATION LAW TEAM

First, let us tell you how pleased we are to have Steve Lauer join our Community Association Law Team. Steve is husband to our long time member and CAI Board Member, Jeanne Lauer.  Steve has been in both private practice and the corporate world since obtaining his law degree in 1990 from William & Mary Law School.   Most recently he worked for an international legal research organization analyzing court decisions.  He has attended several seminars in preparation for joining our team and has proven to be a quick study as he has gotten involved in some of the work for our association clients.  Steve is also big on soccer as a coach and local organizer of youth soccer for many years.

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Reserves - Condominium Act

§ 55-79.83:1. Reserves for capital components.

A. Except to the extent otherwise provided in the condominium instruments and unless the condominium instruments impose more stringent requirements, the executive organ shall:

1. Conduct at least once every five years a study to determine the necessity and amount of reserves required to repair, replace and restore the capital components;

2. Review the results of that study at least annually to determine if reserves are sufficient; and

3. Make any adjustments the executive organ deems necessary to maintain reserves, as appropriate.

B. To the extent that the reserve study conducted in accordance with this section indicates a need to budget for reserves, the unit owners' association budget shall include, without limitations:

1. The current estimated replacement cost, estimated remaining life and estimated useful life of the capital components;

2. As of the beginning of the fiscal year for which the budget is prepared, the current amount of accumulated cash reserves set aside, to repair, replace or restore the capital components and the amount of the expected contribution to the reserve fund for that fiscal year; and

3. A general statement describing the procedures used for the estimation and accumulation of cash reserves pursuant to this section and the extent to which the unit owners' association is funding its reserve obligations consistent with the study currently in effect.

(2002, c. 459.)

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Reserves - Property Owners Association Act

§ 55-514.1. Reserves for capital components.

A. Except to the extent otherwise provided in the declaration and unless the declaration imposes more stringent requirements, the board of directors shall:

1. Conduct at least once every five years a study to determine the necessity and amount of reserves required to repair, replace and restore the capital components;

2. Review the results of that study at least annually to determine if reserves are sufficient; and

3. Make any adjustments the board of directors deems necessary to maintain reserves, as appropriate.

B. To the extent that the reserve study conducted in accordance with this section indicates a need to budget for reserves, the association budget shall include, without limitation:

1. The current estimated replacement cost, estimated remaining life and estimated useful life of the capital components;

2. As of the beginning of the fiscal year for which the budget is prepared, the current amount of accumulated cash reserves set aside, to repair, replace or restore capital components and the amount of the expected contribution to the reserve fund for that year; and

3. A general statement describing the procedures used for the estimation and accumulation of cash reserves pursuant to this section and the extent to which the association is funding its reserve obligations consistent with the study currently in effect.

(2002, c. 459.)

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Safety and Legal Liability Regarding Swimming Pools

Our association has a swimming pool which is fairly popular with our owners, many of whom have small children. We are concerned about safety and legal liability and whether or not we are protected by our rules and our insurance policy. What are the essential practices and rules that will keep us out of legal trouble? How much do we have to worry about our insurance company saying "sorry, you're not covered for that"?

A:You are surely right to be concerned about these risks because every year associations are the target of claims for injuries in and around the swimming pool. Our sources tell us that about 70% of associations have pools and it is well known that the real estate/development community believes they are an essential amenity to insure strong buyer interest. We have seen some associations close and remove pools due to inadequate use so as to eliminate a significant expense and risk, however many pools, like yours, are a desirable and highly utilized feature of the community.

Boards of directors must recognize that pools are dangerous in various ways and seek to establish rules and practices that will minimize the risks. This is essential to be exercising adequate fiduciary responsibility which will avoid legal liability in the event of a bad accident. The various municipalities set their own standards in many ways, including chemical requirements, self inspection, record keeping, equipment, fencing and city inspections. These regulations only establish minimum requirements but go a long way toward eliminating substantial risk. You may have special circumstances which require a greater level of care, such as an inordinately high number of young children. This may dictate having more lifeguards or longer lifeguard hours. You must also insure that depths are indicated along the side of the pool.

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WHY DOES A COMMUNITY ASSOCIATION NEED AN ATTORNEY?

The primary benefit of hiring legal counsel to assist a Condominium or Homeowners Association is that it should save the association money in the long run, analogous to preventative maintenance. Problems will always exist, but timely advice from an experienced law firm can help an association reduce or avoid potential problems and, ultimately, the financial liabilities associated with those problems.

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Requirement for Annual Report to the Virginia Real Estate Board

Please be reminded that all associations must provide an annual report to the Virginia Real Estate Board as required by Section 55-79.93(1) of the Virginia Condominium Act and Section 55-516.1 of the POAA. This creates a state database for all associations and is available to the public.

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