Getting a Developer to Pay for Repairs

We too have an issue with our developer. Our development is a PUD made up of 2 phases. The first phase is 25 homes and they are all sold. We have had our turnover meeting and we have a BOD of which I am president. We were all told, when we purchased, that there were two wells, a main well and a backup well. We did not find out until a few months ago, that the backup well is not hooked up. It will cost approx. $100k to hook it up since it is quite a distance from the current well and distribution system. We feel the developer should pay for this. We are located in Oregon. Does anyone have any ideas that could help us or any information in dealing with something like this.
He is getting ready to sell lots in Phase II (16 total) and some of the board feels that the people in Phase II should be assessed a water hookup fee that would cover the entire cost. Others feel this is not fair, that it should be a shared cost, others feel the developer should pay in full for the hookup. Do we have legal rights to make him pay ?
Thank you,
Marsha

Yes, the developer deeded both wells to us and I have the paperwork to prove it. The main well is on our common area and the backup well is located about 1 mile up the road on another piece of property that is deeded to us and the use of that well except for 5 gal per minute in case a home should ever be built on the property. I am also the certified water system operator and have control over the water system. Water is a very big issue in the area where we are located and the developer has also paid to acquire a water right in the name of the HOA for both wells at a cost of about $11,000.00. Which he paid for and is not asking for reimbursement from the HOA.

I have approached him with the idea of having Phase II pay for all the costs and he stated in his mind this is not fair because ALL will benefit from hooking up the backup well. So he feels all 41 lots should pay equally. I can see his point, but I must also honor the other lot owners who currently have homes built and are living there. Their feeling is that we paid for our lots "assuming" (our mistake) that both wells were already hooked up. When we purchased our lot, I "understood" this to mean that we had two working wells and both were feeding the system.

In our CC&R's, it is loosely worded that the developer will be developing Phase II and that Phase II will be hooked up to the current water system. Does he have any legal rights to the water ? I must be careful that we don't get into a lawsuit over this. I am hoping there is already some legal stance we can take.

Jim, back to your question. Conversions are a little bit different than new-construction condos. The association's control of the common areas and responsibility often are complete with the first closing, even though the developer may still run the association as the first board of directors. When you convened may not be the date when the association and not the development company became responsible for the maintenance, etc. It may have been earlier.

But as the board, you should document the developer's responsiblity as the cause of the problem and send him the bill, then probably small claims court to collect, or, when you select an attorney, let them chase him down. If you can establish cause, or fault, then when the association came into being is not relevant. The developer could be treated as any other contractor that did a job improperly.

Joe