Q. I received a notice from my condominium association that new windows must go in as soon as possible, and owners must cough up $7,000 for the work.
Each owner’s assessment is based upon an estimate. We do not have a schedule for when the work will begin.
Are owners supposed to provide financing for the work without knowing when the work is starting?
The board stated that the cost for the windows was passed on to the owners in the annual budget and, thus, is not a special assessment or subject to owner approval.
Since I am not a lawyer, I am not sure this is legal.
If the bids come in for less than the assessment, does the association keep the overage?
If we don’t pay this assessment by July, interest will be assessed.
A. The board has the right to assess owners for window replacement. If the board has communicated with the ownership regarding the condition of the windows, this assessment should not be a surprise.
If the charge was not levied as a special assessment, the owners still had the right to challenge the expense if it was more than 5 percent of the annual budget.
The board can levy an assessment on the basis of estimates. If the actual costs after competitive bidding are less than the amount collected by the association, the board may apply the excess to reserve funds or credit the owners for their assessments in the following year.
While it may appear you are under a tight timeline, the board has given the owners seven months to pay. Owners may arrange their own financing, as a home-equity loan, and deduct the interest.
Q. The president of our association informally collects proxies from new tenants in their initial acceptance interviews. These proxies, along with others, voluntarily and involuntarily given, have constituted approximately 70 percent of the vote in board elections the last 10 years. Opponents of the president who collect proxies must turn them in, and these proxies are often judged to be invalid, because the president has collected more recent ones. This board has a reputation for being extremely litigious, but losing in court has not discouraged them.
Are there any realistic legal options for having an election not always decided before the vote?
A. The president has no authority to collect “general” proxies for a board election. Directors and owners may solicit proxies for the election after the owners receive notice of the annual meeting and board vote. Perhaps your owners consider themselves tenants, because the president is acting improperly. Owners foolishly have allowed the president to control the building. The only realistic option is to elect a board that will select another president and not let the building be run by dictatorship.
Q. Our condominium board recently approved a 2007 budget that included a 10 percent increase for the cost of an independent contractor to maintain our property. The budget also includes a significant increase for worker’s compensation insurance. Why should the condo association be paying worker’s compensation insurance for independent contractors?
Is it necessary for an association to pay for this coverage when the independent contractor should have its own insurance?
A. I agree that an independent contractor should have liability insurance. However, an injured contractor can make a worker’s compensation claim. The government agency that reviews these claims does not rely solely upon the formal contract arrangement between the property owner and the contractor.
Worker’s compensation insurance is part of better association insurance packages, and the cost is worth the extra protection.
Q. I own a condominium in a high-rise. Very few owners attend the meetings, and the board rarely conducts opinion surveys. I believe that it would be cost effective and beneficial for the board and the owners to have statistical data on owners’ opinions. One board member told me that I would not receive any assistance from the board on this matter. How do I go about initiating an opinion survey that would be conducted by the board? Is it possible to conduct a binding referendum that would force board members to vote in a specific way?
A. No, you cannot force the board to conduct a survey; nor is an owners’ referendum binding on the board unless the matter is one that requires owner approval.
The nature of condominium living is that the board makes major business decisions. Owners may challenge expenses or assessment increases if they exceed a certain level. The board does have an obligation to advise the owners of the annual budget, special assessments and major projects.
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Mark Pearlstein is a Chicago lawyer who specializes in condominium law. Write to him c/o Condominiums, Real Estate, 4th Floor, Chicago Tribune, 435 N. Michigan Ave., Chicago, IL 60611. You may e-mail questions to realestate@tribune.com. Sorry, he can’t make personal replies. Answers will be supplied only through the newspaper.
