Q-Can association rules and regulations be amended by announcing such changes at a meeting of unit owners and then publishing the new rules in the association newsletter? Or should the board rescind certain rules and then distribute the new rules to the owners?
Can the board enforce a particular rule that states that new owners must reside in their units, but allows a percentage of units to be rented each year?
A-To adopt or amend rules and regulations, the Illinois Condominium Property Act requires that the board first hold a meeting of the unit owners to discuss the proposed rules. The text of the new rules should be included in the notice of the meeting.
Following the owners` meeting, the board should formally adopt the rules and then distribute copies of the new rules to the owners. Thus, the rules must be discussed with the owners before the board votes to adopt a new rule or change existing rules.
The board cannot enforce a rule, not contained in the declaration and bylaws, that requires owners to reside in their units. The board also cannot set a maximum annual percentage of leased units in the association. Rules must be consistent with the recorded declaration and bylaws. If the declaration permits owners to lease their units, this right only can be rescinded by an amendment to the same document.
Setting a maximum percentage of leased units would create two classes of unit owners who can rent their units each year.
In a 1983 Florida case an appellate court struck down a house rule that provided that owners who purchased their units before a certain date could lease their units once per year, while owners who took title after that date were limited to one rental every two years.
The court stated that all rules and regulations must be applied equally to all members in a uniform manner, and this rule created two different categories of unit owners with respect to leasing of units.
Since the Illinois Condominium Property Act also prohibits dual classifications of unit owners and requires that association rules be consistent with the recorded declaration and bylaws, setting a percentage limitation on the units leased per year would probably violate our state law. Q-In addition to 48 assigned indoor parking spaces, there are 36 outside parking spaces. Twelve of these outside spaces are designated for visitors and nine are reserved for certain unit owners who purchased the spaces from the developer.
The condominium declaration and attached survey do not mention or reflect reserved parking spaces. In some, but not all cases, the spaces were included in the deed to the condominium unit.
Did the developer have the legal right to sell the outdoor parking spaces that are part of the common elements? Should these owners have a higher percentage of ownership or a higher assessed valuation for real estate taxes because of the additional parking spaces?
A-Based upon the Illinois cases of St. Francis Courts v. Investors Real Estate and Schaumburg State Bank v. Bank of Wheaton, neither a developer nor an association can convey or permanently assign portions of the common elements without an amendment to the condominium declaration.
In your case, it appears that the developer assigned part of the common elements, consisting of the outdoor spaces, without amending the declaration to create permanent rights to these spaces.
Before taking action to contest the assignment of the outdoor spaces, review the declaration to determine the status of this parking area and the developer`s rights to convey or assign parking spaces. If the outdoor spaces are merely part of the common elements under control of the board of directors, the developer cannot assign the spaces without amending the declaration.
Regarding the percentage of ownership or real estate tax valuation for these owners, the percentage remains fixed from the original declaration unless amended by the consent of all unit owners. The assessed valuation of the property is determined by the county assessor and only that office can determine whether the additional outside parking spaces will affect a unit`s value.
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Mark Pearlstein, a Chicago attorney who specializes in condominium law, writes about condos for the Tribune. Questions to him can be addressed to Condo Log, Real Estate Section, Chicago Tribune, 435 N. Michigan Ave., Chicago, Ill. 60611. Sorry, he can`t make personal replies.
