A. DON’T DO IT YOURSELF
- Turn the matter over to your experienced community association attorney – otherwise, you will be outgunned and outsmarted, as most developers are sophisticated businesspeople with an army of lawyers.
B. DETERMINE WHAT MAY BE AT ISSUE
- Circulate a questionnaire to all co-owners regarding construction defects and other problems.
- If the defects are significant, have a licensed engineer inspect the premises and provide an estimate of repair costs.
- Have your experienced community association attorney send a written demand to Developer to make repairs or to provide funds to do so.
- Keep informed – your attorney is obligated to inform you of any offers made by the Developer.
- Meet as a Board with your attorney to assess and discuss any offers.
D. IF NEGOTIATIONS DON’T WORK, WHY LITIGATE?
- The Association is responsible for common elements; if you don’t want to pay to litigate, you will pay to do the repairs.
- The Court of Appeals in Oregon recently held that a Board of Directors could be found to have been grossly negligent, and, therefore, personally liable to the Association, where the Board had “in effect, let the [Developer] off the hook for breaching its obligations”.
E. GARNER CO-OWNER SUPPORT
- Inform co-owners of the true extent of the problems and the costs of a fix. Use mass mailings or e-mail, schedule informational meetings, make the rounds.
- Be prepared for the fact that Developers will enlist the aid of co-owners to use propaganda to divide and conquer the Association.
F. OBTAIN CO-OWNER APPROVAL
- Since it is the Developer that drafts the original condo docs, many condo documents require the approval of a super-majority (2/3) of the co-owners to approve litigation against the Developer.
- HB 4919 (2015) proposes to eliminate this required approval so boards can decide to enter into litigation without the extra step of co-owner approval.