REVIEWING YOUR POLICIES ANNUALLY

By Riddle and Williams, PC





Dean A. Riddle
received his B.A. and J.D. degrees from the University of North Carolina at Chapel Hill in 1981 and 1985. He is licensed to practice law in and is a member of the state bars of Texas (1990), Georgia (1985) and North Carolina (1988) and has represented clients in at least ten states. He is admitted to practice before the U. S. District Court for the Eastern and Western Districts of North Carolina, the U. S. District Court for Northern District of Georgia and the U. S. District Court for Northern and Eastern Districts of Texas. Mr. Riddle previously worked for a large, nationally recognized, full-service law firm which trained him in litigation techniques and real estate law. He is a member of the American Bar Association, the Dallas Bar Association, the Tarrant County Bar Association and the American Association for Justice. He is also a member of the Real Estate, Probate and Trust Law Section and Litigation Section of the State Bar of Texas. In 1994, as a member of the Dallas Association of Young Lawyers, he was chairman of the Homeowners’ Rights Committee. Mr. Riddle served two separate terms on the Board of Directors of the Dallas-Fort Worth Chapter of the Community Associations Institute (CAI) and served as its President in 1994. He has written and lectured extensively on numerous topics impacting community associations at the state and national level. As an active member of CAI, Mr. Riddle has served as a delegate to the Texas Legislative Action Committee from 1993 to the present, has actively participated in drafting proposed legislation affecting planned communities, and has received numerous awards including speaker of the year, outstanding service and Hall of Fame. Mr. Riddle is also a member of the Million Dollar Advocates Forum. The  Million Dollar Advocates Forum is recognized as the most prestigious group of trial lawyers in the United States with membership limited to attorneys who have won million and multi-million dollar verdicts, awards and settlements. Less than 1% of U.S. lawyers are members. Mr. Riddle is AV-rated by Martindale-Hubbell, the highest rating an attorney can receive.

Lance E. Williams was admitted to the bar in Texas in 1986 and was also admitted to practice before U.S. District Courts in the Northern and Eastern Districts of Texas. He received his B.S. (magna cum laude) degree in 1983 from Oral Roberts University and a J.D. in 1986 from Southern Methodist University. While in law school, he was awarded the American Jurisprudence Award in Torts, Business Associations and Evidence. Mr. Williams is a member of the State Bar of Texas, the American Bar Association, the Dallas Bar Association, and the Dallas-Fort Worth Chapter of the Community Associations Institute, where he has served as a board and a committee member. He has also conducted industry seminars and workshops and been actively involved in drafting proposed legislation affecting planned communities. Mr. Williams is AV-rated by Martindale-Hubbell, the highest rating an attorney can receive.


 

For property owners’ associations, each association was statutorily required to adopt three specific policies on or before  January 1, 2012: a document retention policy, a records production and copying policy, and an alternative payment plan schedule. All property owners’ associations should ensure that they have adopted and recorded these policies.

Once in place, the board should annually revisit the policies. For example, the board may want to revise the standard payment plan offered to delinquent owners provided by the alternative payment plan schedule. Property owners’ associations may also want to consider or revisit adopting policies that address the registration of email addresses for electronic notification of board meetings and/or voting by absentee and electronic ballots.

As part of the same sweeping legislative changes which mandated the policies above, the legislature also limited the ability of property owners’ associations’ to regulate certain items: religious symbols, flags, rain barrels, energy--‐efficient roofing materials, solar collection devices and xeriscaping. Associations may want to consider adopting guidelines or policies which meet the parameters of the restrictions on these items permitted by the legislature. If the association already has rules, restrictive covenants or design guidelines which address some or all of these items, the board may want to ensure that the association’s regulations do not exceed what is permitted by statute.

Property owners’ associations should also annually take inventory of frequent issues in the community to determine if those can be addressed through new rules or policies. This could include maintenance rules, use restrictions or common architectural control application denials. If parking is an issue within the community, the board should consider whether it has the right to adopt rules regulating parking. Or, if the association’s architectural committee has received several applications to install a particular style of mailbox that is permitted by the restrictive covenants but the committee has deemed aesthetically undesirable, the association and the committee may want to investigate whether either entity has the power to adopt some type of guidelines or policies which regulate mailbox types.

For condominiums that have obtained FHA certification or are currently seeking such certification, the board should review its use and occupancy policies to ensure compliance with the FHA approval guidelines and bulletins, as the FHA frequently updates these requirements. For example, the FHA has recently changed the permissible types of background checks  allowed, and will only allow for a background check regarding sex offender status. In addition, all condominiums, especially those seeking FHA certification, may want to consider adopting an aggressive collection policy to reduce the percentage of delinquent owners, as FHA also will not certify a condominium that exceeds a certain percentage of delinquencies. Such a policy may include enforcement of the condominium association’s lien on rents which is provided for by statute. The board of directors for most condominium associations can adopt rules and policies involving all of these items, as this right is expressly granted by the Texas Uniform Condominium Act so long as it does not conflict with the declaration.

Effective September 1, 2013, the Texas Uniform Condominium Act was amended to provide for certain insurance practices. Part of that amendment addresses payment of the association’s insurance deductible where a loss exceeds the cost of repair. If the association’s dedicatory instruments do not address payment of the association’s deductible, the amendment permits the board to adopt a resolution to allocate payment of the deductible. Condominium associations should review whether they have allocated responsibility for the deductible through either the restrictive covenants or a resolution—otherwise, the act provides that the deductible must be treated as a common expense.

Both condominium associations and property owners’ associations should annually consider whether use restrictions are needed to address recurring problems in the community. This could include nuisance provisions, leasing guidelines or pet policies. Associations may also want to consider whether it is appropriate to adopt a code of conduct for officers and directors which clarifies the standard to which each officer or director will be held in their official position.

Lastly, if the association has made a recent change in management, or the association’s contact information has changed, some or all of these policies may need updating as well to ensure that all communications and submissions to the association are sent to the proper contact.

                       


 
 

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