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Subject: Limited vs Common Element Roof
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WilliamA5
(Virginia)

Posts:8


04/02/2019 9:32 AM  
Good Morning, I am an unit owner in a condominium in VA. It is a commercial condominium but for our purposes lets assume its an residential HOA.
We have a situation where we have 2 buildings. The roof of Building 1 is designated as part of the units in Building 1. The roof of building 2 is not designated as part of the units in building 2. So the roof in building 2 is just part of the Common Elements. Would all unit owners in both buildings be responsible for the expenses for the maintenance and care of the roof of Building 2 since its a common element or would just the unit owners in Building 2 be responsible?

VA Unit Owner.
AugustinD


Posts:1627


04/02/2019 9:53 AM  
To say anything intelligent, I would want to see your Condominium's Declaration. I have seen Declarations that do permit assignment of maintenance and repair costs for certain common elements to the unit owners who are principally served by the common element. E.g. roofs.
WilliamA5
(Virginia)

Posts:8


04/02/2019 10:02 AM  
Thanks for the response. I am very familiar with our Declaration as well as the bylaws. There is not anything that directly addresses things either way. There is a chart of responsibilities that does say that Common Elements roofs are the responsibility of the Association. So there is no question as to whom needs to deal with the roof of building 2. The question is who is responsible for the expenses. I see it as possibly the roof of building 2 being a limited common element to building 2 unit owners and therefore the building 2 unit would be responsible for the expenses. However, is the roof to building 2 considered a "limited Common Element" even though it is not specially deeded as a limited common element?
AugustinD


Posts:1627


04/02/2019 10:30 AM  
Posted By WilliamA5 on 04/02/2019 10:02 AM
Thanks for the response. I am very familiar with our Declaration as well as the bylaws. There is not anything that directly addresses things either way. There is a chart of responsibilities that does say that Common Elements roofs are the responsibility of the Association. So there is no question as to whom needs to deal with the roof of building 2. The question is who is responsible for the expenses. I see it as possibly the roof of building 2 being a limited common element to building 2 unit owners and therefore the building 2 unit would be responsible for the expenses. However, is the roof to building 2 considered a "limited Common Element" even though it is not specially deeded as a limited common element?




In my experience, what is a common element and limited common element is explicit in the Declaration . (Though sometimes the Declaration indicates the plat is a part of the Declaration, and a trip to the County Clerk's to review the plat is needed.) If the roof is said to be a "common element," (and not "limited common element") then this usually, but not always, means that all members (in your case, for both buildings) share in the cost of replacement. On the other hand, and as I wrote above, sometimes a Declaration permits assignation of the expense of repair of a common element to only the members who are principally served by this common element. In particular, I have seen the latter caveat where multiple buildings are involved, just like your situation.

I would rather read your Declaration. In my experience, for many HOA matters it takes someone well versed in the lingo to interpret something like this. Maybe you are well versed; I do not know. We are strangers.
WilliamA5
(Virginia)

Posts:8


04/02/2019 10:59 AM  
Thank you again for your reply. I think where I am coming from is more the ideal of what a condominium is and what is its purpose. The definition of common is basically equal. To share equal in responsibility for equal benefit. To treat the units as property but to share in the rest. I would think with out being defined by any wording, the general idea is to be equal as much as possible. to pay for what you use and nothing more. I have read many VA Supreme court rulings on different HOA subjects and what I have learned is that absent of any wording that says common element are not required to be divided equally, all common elements are required to be fair and divided equally. The vary nature of common is equal, so there doesn't have to be any wording saying things have to fair, the word "common" implies it already. I would think in the same regards, absent any specific wording requiring Building 1 owners to pay for Building 2 roof expense, the courts would rule it is unfair to assess Building 1 owners this assessment because it goes against what a Common Element and therefore a Condominium is. Other words there is nothing "Common" about the two roofs so they can not be treated as Common. Would be the same for a single building Utility meter and the other building having individual utility meters per unit. The single building utility meter expense would not be charged to the entire Condo. Would it?

Just my 2 cents.
AugustinD


Posts:1627


04/02/2019 11:25 AM  
Posted By WilliamA5 on 04/02/2019 10:59 AM
Thank you again for your reply. I think where I am coming from is more the ideal of what a condominium is and what is its purpose. The definition of common is basically equal. To share equal in responsibility for equal benefit. To treat the units as property but to share in the rest. I would think with out being defined by any wording, the general idea is to be equal as much as possible. to pay for what you use and nothing more. I have read many VA Supreme court rulings on different HOA subjects and what I have learned is that absent of any wording that says common element are not required to be divided equally, all common elements are required to be fair and divided equally. The vary nature of common is equal, so there doesn't have to be any wording saying things have to fair, the word "common" implies it already. I would think in the same regards, absent any specific wording requiring Building 1 owners to pay for Building 2 roof expense, the courts would rule it is unfair to assess Building 1 owners this assessment because it goes against what a Common Element and therefore a Condominium is. Other words there is nothing "Common" about the two roofs so they can not be treated as Common. Would be the same for a single building Utility meter and the other building having individual utility meters per unit. The single building utility meter expense would not be charged to the entire Condo. Would it?

Just my 2 cents.


What I am aware of is that the courts start with the 'plain meaning' of what is in the Declaration. Condos all the time assess to all members the cost of repairing a common element, like a water supply pipe, serving only one building out of many within the condo. Granted this seems inconsistent with declaring that Building 1's roof is the responsibility of only Building 1's members while Building 2's roof is the responsibility of both Building 1's members and Building 2's members.

Yet I know of a condo Declaration that has a section titled "Specific Assessments." This section gives the condo some leeway to assess, under certain conditions, the members in a certain building for the costs of repairs to what are common elements, with the particular common elements serving only the one building. Is there a section titled "Specific Assessments" in your Declaration?

I am not sure what a court would say about your situation. In context, maybe the court would conclude that the matter either was ambiguous, or there was some kind of inequitable logical inconsistency, and so xyz rule of law should apply. I know that, if I owned shares in Building 2, and had bought on the premise that the Declaration means what it says, then I would not be happy that I was now being told that the Building 1 owners did not have to pay for Building 2's roof.

I appreciate your opinion. I am just sharing mine. I think I'd be poring over the Declaration looking for wording to reconcile the situation. If all the HOA attorneys in the world were not available, then I think as a director I would do what the Declaration says: Assess the cost of an explicit common element to all owners, since this is the 'contract' on which all agreed when they bought.
WilliamA5
(Virginia)

Posts:8


04/02/2019 12:51 PM  
AugustinD, Thank you very much for your replies, they have helped me greatly. Based on your thoughts that the courts would look on the written word first, I can see them ruling the all building owners would be responsible in that regard. Maybe it is what it is. However, your thoughts have helped me in many ways with other issues with the docs that I am having. Just hard to understand when there are very clear in what the words are saying but the conflict with what other words in other areas of documents are saying.

For Instance, wonder if they said all owners are responsible for all common element expenses based on the common element interests. Then in another area of the docs it says unit owners should only be assessed common element expenses for common element items for which they receive benefit for.

either way, you mentioning that the "wording" comes first before the "intent" helped greatly.
AugustinD


Posts:1627


04/02/2019 1:52 PM  
William, to be clear, the "wording" (or "plain meaning") is used as long as the wording is clear and not illogical. Of course, what is "clear" and what is "logical" is often subjective. The courts (and anyone in a position of authority to rule, including hoa and condo boards) do the best they can. If a court finds the wording to be ambiguous or failing the common sense test, then the court will look at intent, context and so on at greater length.

Here's some discussion of statutory interpretation that I have seen applied to confusing covenant situations as well: https://en.wikipedia.org/wiki/Statutory_interpretation . Granted there are some caveats from HOA case law with regard to interpreting covenants. E.g. if a covenant is ambiguous, then the courts will err on the side of 'free enjoyment of property.' But I do not think this caveat applies in your situation.

For your situation, I am not so sure the wording is clear and logical. Maybe the authors of the covenants did make an unintentional mistake? I am curious why this distinction between the two buildings' roofs was made. Do all owners pay the same rate for the assessment (based, say, on square footage owned)? Or per chance are the assessment rates different for building 1 owners vs. building 2 owners? Is building 1 a one story building whereas building 2 is a multi-level building? Is there any reason of which you know for this distinction between the two roofs?

One thing we have not talked about is liability issues. Is there insurance on the common elements for the two buildings? And the insurance will cover, say, a failed roof on building 2 (and all the damage the failure causes) but not on building 1 (and all the damage the failure causes)? If so, this is getting weird. You all might want to see about amending your Declaration.
AugustinD


Posts:1627


04/02/2019 2:09 PM  
Posted By WilliamA5 on 04/02/2019 12:51 PM
For Instance, wonder if they said all owners are responsible for all common element expenses based on the common element interests. Then in another area of the docs it says unit owners should only be assessed common element expenses for common element items for which they receive benefit for.


William, does your Declaration actually say, in one section, "all owners are responsible for all common element expenses based on the common element interests"? Then in another section, does the Declaration say unit owners should be assessed common element expenses only for the common elements from which they receive benefit?

If so, then I think it's fair to conclude that only building 1's members pay for building 1's roof, and only building 2's members pay for building 2's roof.
KerryL1
(California)

Posts:6350


04/02/2019 2:12 PM  
I wrote the below a while ago, but forgot to post it:

I agree with Augustine given what's been written here so far."...as a director I would do what the Declaration says: Assess the cost of an explicit common element to all owners, since this is the 'contract' on which all agreed when they bought."

In our twin tower high rises, 80% of our residential owners are assessed more that the street level townhomes. The main reason is that the Towers have common area corridor & wall coverings & carpeting that the other Owners don't have. "The Towers" are, in our CC&Rs, a "Special Benefit Area."

Based on some advice from Augustine previously, I was able to "see" our covenants differently especially noting intention and context. Now, his "free enjoyment of property" does matter a lot in our case.

I don't know about VA, William, but in CA, a lengthy document called a Condominium Plan must be filed with the state by the developer. Ours was done in '01 and I've studied it. Our towers were built in phases, with one being finished a few months before the other. Might be worth a look in your case.
WilliamA5
(Virginia)

Posts:8


04/02/2019 2:38 PM  
The bylaws talk about metered utility services should be assessed against each unit....
garage door painting and cleaning to each unit......and then says any other common expenses paid or incurred for the benefit of less than all of the condominium units shall be specially assessed against the condominium unit or units involved to the extent each is thereby benefitted unless common expenses arises from the responsibility of the Unit Owners Association pursuant to section 5.5 hereof.

5.5 refers to a Responsibility chart which shows that all common element roofs are the responsibility of the Association. No where does it say or not say that the expense of such responsibility be charged to all or less than all.

The Column in which this requirement is listed states:
General Common Elements under Association Responsibility-Responsibility for determining and providing for the maintenance, repair and replacement requirements of the general common elements and determining the costs thereof shall be primarily the responsibility of the Board of Directors and such designs to which it may delegate certain such responsibilities.
WilliamA5
(Virginia)

Posts:8


04/02/2019 2:41 PM  
However it is also stated in the bylaws The total amount of the estimated funds required from assessments for the operation of the property set forth in the budget adopted by the Board of Directors shall be assessed against each unit owner in proportion to such unit owner's respective common element interest. This seems pretty clear.
AugustinD


Posts:1627


04/02/2019 3:06 PM  
William, thank you for the elaboration. If the Declaration is clear that Building 1's roof is not a common element, but Building 2's roof is a common element, then I think Building 2's roof has to be paid for by both Building 1's members and Building 2's members.

Another possible way to throw some light on this curious situation: Has your commercial condo ever had a Reserve Study done? Does it actually estimate the life of Building 2's roof and ignore Building 1's roof? Reserve Study professionals are pretty good at figuring out what is a "common element" for which the entire HOA is responsible.

With regard to the Bylaws statement that, "the total amount of the estimated funds required from assessments for the operation of the property set forth in the budget adopted by the Board of Directors shall be assessed against each unit owner in proportion to such unit owner's respective common element interest": I presume the percentage ownership of each unit is written down in the declaration. If so, then the cost of the roof is assigned to each of the two buildings' units using this percentage ownership. E.g. if Building 2's new roof costs $100,000, and Unit owner Jones in Building 1 has a 2.3% ownership, then Unit owner Jones pays $2300 towards the roof.

If you have a reserve fund, and planning has been based on all unit owners paying for Building 2's new roof, then this percentage ownership is already factored in.

WilliamA5
(Virginia)

Posts:8


04/02/2019 3:15 PM  
Im good with the thoughts. it is what it is. However on a sort of other subject

Based on- "the total amount of the estimated funds required from assessments for the operation of the property set forth in the budget adopted by the Board of Directors shall be assessed against each unit owner in proportion to such unit owner's respective common element interest"

If an 8% portion of the paved common element areas are declared as a Limited Common Element to one unit owner who holds a 10% common element interest, would the statement above still work?

How about if that same owner only had a 6% common element interest?

See any issues?
WilliamA5
(Virginia)

Posts:8


04/02/2019 3:38 PM  
AugustinD, are you an attorney? or something to that effect. Either way I would like to hire you to look at my docs and tell me what you think if that's possible. Please let me know when you have a few minutes. Thanks.
AugustinD


Posts:1627


04/02/2019 5:03 PM  
Posted By WilliamA5 on 04/02/2019 3:15 PM
Im good with the thoughts. it is what it is. However on a sort of other subject

Based on- "the total amount of the estimated funds required from assessments for the operation of the property set forth in the budget adopted by the Board of Directors shall be assessed against each unit owner in proportion to such unit owner's respective common element interest"

If an 8% portion of the paved common element areas are declared as a Limited Common Element to one unit owner who holds a 10% common element interest, would the statement above still work?

How about if that same owner only had a 6% common element interest?

See any issues?



I am kind of hamstrung without seeing the entire Declaration with all its definitions. I suspect it still works. First, what is the basis for the computation of each owner's respective 'common element interest'? I am betting it is square feet of living (or office) space. If so, this means the LCE percentage is not relevant. For example, I have seen condos where units have the exact same square feet of living space. These units pay the exact same assessment. But the square footage of these same units' LCE patios differs by a great deal. Some patios are around 30% larger than other patios. Is there an adjustment based on the different size of the LCE patios? No. The owners pay based on their square footage of living space. The LCE patio size is irrelevant.

Back to your roofs. I am glad Kerry posted the info about her condo above. Her condo's approach, on this matter a bit like your condo's, is rational to me. By contrast, so far I do not see a rational explanation for why your Building 2's roof is a common element but Building 1's roof is assigned to the individual owners. I feel like I must be missing something. Some of the Virginians here may yet weigh in.

I am not an attorney. If you want, feel free to send your docs to [email protected] along with questions you have. I'll share my opinion and then respond to your rebuttals. As a refugee from corporate America who is reasonably well off, I am happily compensated via learning something new.

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