Amending Your Rules and Bylaws Change is Good

Amending Your Rules and Bylaws

What would it be like if today's society was governed by laws set forth centuries ago and never updated? While some fundamental rules about not stealing things or hurting people might not change much, others would be in dire need of a facelift—giving women the right to vote and outlawing slavery come to mind, among many others. In deference to the need for a set of rules that change with the times, even the U.S. Constitution has been amended. The fact is that most rules need to be revisited and reexamined periodically to make sure they serve the needs and expectations of the population they're intended to govern.

This is no different in a co-op or condo association. The certificate of incorporation, the proprietary lease, bylaws, and, for condos, the declaration of covenants, conditions and restrictions (CC&R) are the main underlying documents that govern HOAs. They're like a contract among shareholders and unit owners, certifying that the residents will behave in a certain manner and adhere to certain regulatory expectations. Just as cities and states periodically revisit laws and regulations and alter them as needed, associations should re-examine their bylaws and rules to make sure they're fair, enforceable, and relevant to today's building community.

An Ongoing Process

"I think that one function of a good governing board is to constantly examine and reassess the scope and content of the community's governing documents," says Thomas V. Giaimo, Esq., an attorney based in Rumson. "It's a continuing and implied duty upon the governing board. The same goes for the community's rules and regulations. Those rules should be under constant evaluation for clarity, fairness and improvement."

Giaimo also says that periodic reexamination of rules and regulations by the board shouldn't be limited to decades-old HOAs. It's just as important for newer associations who've been given their set of governing documents by the community's sponsor or developer.

"These documents are typically boilerplate and do not necessarily reflect the community's true nature, character and temperament," Giaimo says. "New communities and their governing boards typically want to revise the developer's set of governing documents in order to more accurately reflect the community's needs and character. Certain communities will decide that they want to be more vigilant, and insist on strict compliance with the provisions contained in their governing documents."

"Other communities evolve over time with a temperament to be more tolerant of minor deviations from the community's governing documents, including rules and regulations," Giaimo continues. "In fact, over the last decade, we've seen a line of decisions from the courts indicating that communities and their governing boards must tolerate minor noncompliance with the governing documents, as long as it doesn't have a substantive and detrimental impact on the community."

Changing the Rules

In addition to reflecting the current needs of an association, Giaimo says that other legitimate reasons for changing rules and regulations might be to help the board manage the association more efficiently and cost-effectively, or to correct an inherent conflict with other provisions within the documents. Compliance with recently enacted legislation is still another reason for boards to make changes.

Some examples of these types changes include things like increasing or decreasing the monetary penalty the board can impose for rule infractions, or altering the parameters of the association's regulations governing pet ownership. While most proprietary leases require board approval for such transactions, a building's demographics may have changed over the years and shareholders might be less inclined to favor such a restriction. Changes in voting procedures and policies are also an important consideration when reviewing governing documents.

According to Dennis Estis, an attorney with Greenbaum Rowe Smith & Davis LLP in Woodbridge, "One example of why a board might wish to amend its bylaws is if the originals said something like, 'Any expenditure by the board over $5,000 must be approved by three-quarters of the unit owners.' This amount is a woefully low threshold, and it is almost impossible to get three-quarters of all unit owners to approve anything. If a provision like that were to remain in the bylaws, it might prevent the board from taking any action, and the condominium could deteriorate as a result."

Last year, in Denver, Colorado, theJefferson County District Court ruled thata condominium association can prohibit smoking in their four-unit building.The Heritage Hills #1 condominium owners association amended its bylaws to ban smoking after an owner complained about smoke seeping into her unit. The district court upheld the bylaw change, stating that secondhand smoke "constitutes a nuisance [similar to] extremely loud noise."

So, therefore, "one might also wish to amend the rules and regulations to deal with new issues that may arise," adds Estis. "There may not be a provision in the rules and regulations that prohibits someone from utilizing the clubhouse after a certain time. In order to protect that part of the common elements, the board may choose to bar its use after 10 p.m., for example."

Making the Change

When the government wants to pass an amendment to the Constitution, the first method is for a bill to pass both houses of the legislature by a two-thirds majority in each house. Once the bill has passed both houses, it goes on to the states for their approval. This is the route taken by all current amendments. Because of some long outstanding amendments, Congress normally imposes a time limit (typically seven years) for the bill to be approved as an amendment.

It may not require approval from entire states and both houses of Congress, but changing proprietary leases, bylaws and board rules can sometimes feel like an epic legislative undertaking. And like getting a law passed in Congress, changing a rule or regulation can be a long haul—even if the how-to's are spelled out explicitly for the board and residents.

For example, who votes and how many votes are needed depends on what document is being altered—and the protocols are set forth in the governing documents themselves.

"It's unusual for an association board to seek to amend either the master deed or the certificate of incorporation," says Estis. "The bylaws can be amended, but it usually requires a super majority of the unit owners to be approved."

Estis adds that there is no set time for re-visiting the bylaws and rules and regulations. Usually changes are proposed because a particular situation arises which requires action. "I certainly would recommend that boards should review their bylaws and rules at least every five years—but this does not mean that changes must be made," he says.

If it is time for a change, or if a situation has arisen that requires a new rule, the process is more or less the same from association to association.

"To change a bylaw, the board would put an amendment before the community or the building," says David Byrne, an attorney shareholder, who is a partner and chair of Stark & Stark's community association group in Lawrenceville. "The amount of votes you need depends on the master deed or bylaws; you may need two-thirds approval, 100 percent approval, 75 percent, two-thirds of a quorum, and so forth. It just really depends on the documents that you have set up initially."

In addition, adds Giaimo, as a precondition to being valid, binding, and enforceable, most major amendments to an HOA's governing documents must be recorded in the office of the County Clerk where the community is located.

The People's Choice

According to Estis, if your board has doubts as to whether or not a proposed new rule or rule change is a good idea, it might be wise to wait on trying to get it set in stone. "It's worth remembering that unit owners have the added protection of needing a super majority vote to amend the bylaws or master deed," says Estis. "But that's not the case with the rules and regulations—so when in doubt, a board should not attempt to unilaterally amend its bylaws or rules. Unit owners purchased knowing the rules, and now all of a sudden, a change is proposed—and people generally do not like change."

That said, Estis says that most amendments are the result of actions by the board. However, unit owners can request that a meeting of the association be held to consider a specific amendment to the bylaws. A certain percentage of the unit owners may need to be present to hold such a meeting.

So what happens if a proposed amendment or new bylaw is rejected by a majority of residents, or doesn't receive the necessary support to be ratified? It's always a possibility—and if it happens, a board can resubmit the recommended change again at a later date.

"The biggest obstacle to getting something changed is not opposition," says Karim G. Kaspar, a senior counsel with Lowenstein Sandler PC in Roseland. "It's apathy. By not voting, it's a negative vote. People don't care to vote, and the board has a tougher burden just getting people to respond. If they don't pass the percentage, the documents don't get amended."

Alternatively, the board does not need to rely on the community when making changes to their own rules for the association.

"The governing documents are created—and can be changed—by the people," explains Kaspar, "But you can't unilaterally change the rules set by your board. For instance, the governing documents may say that pets are permitted in accordance of approval by the board—but the board may only permit dogs under 40 pounds. They don't need membership approval [for that limitation.]"

Change with the Times

"Typically as a community ages, the membership comes to realize, value and enforce the rules that provide for and insure the quality of life they're seeking," says Giaimo. As long as it's done properly and fairly with an eye for what's reasonable and enforceable, amending your HOAs rules need not be a long, torturous process. It's something that needs to be attended to regularly—just like building repairs and financial reviews. With cooperation and consideration, it can be just as routine.

Lisa Iannucci is a freelance writer living in Poughkeepsie, New York and a frequent contributor to The New Jersey Cooperator.

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  • What if a bylaw hasn't been changed in over 30 years and it states that it only gives each unit 2 parking spots but when a family of 2 cars grows into a family of 3 or more cars then what can you do?
  • This is an ongoing problem at all condo's across the world. Best to buy your own home, as there is not a solution to this when all the guests spots are taken too.
  • A real estate lawyer advised our board that it could raise late regime fee payments without amending the bylaws and master deed. For 30 years, the board had wrestled with the assumption that 51 percent of owners must agree.
  • My question - when a board wants to change the covenants, is there a specified time in which votes must be cast and counted?
  • This HOA tricked people into signing undted signature cards and recorded amendments falsely. There were never any fees in our Original Declaration of Covenants and they misrepresented the facts and immediately began charging fees.
  • What if you were allowed 2 pets and now the association wants to change the rules to allow only 1 pet. Is the 2nd pet necessarily "grandfathered" in or is the owner expected to dispose of a pet to continue to live in the condo? (the 2nd pet is an indoor cat)
  • Would like to add Mitsubishi air conditioning as bedroom has no unit. Told cannot add unit to patio as it is "common ground". Is it possible to have rules changed.
  • Is there a Florida requirement that a super majority vote is required to change an HOA Bylaws? If so, where can I find the regulation or statute?
  • Our by-laws are 25+ years old. Our board only has 2 members -supposed to be 5. The Pres. Makes her own rules. Are votes from the owners required in order for her to do this? Thank you
  • My HOA has Covenants and Bylaws. A few members wish to eliminate the Bylaws and incorporate them into the Covenants. It is much easier to amend the Bylaws than the Covenants and for that reason I object.
  • My boyfriend passed away. He left the home to me in a will. Will the co-op board have to approve me or will I automatically inherit the home. I live in New Jersey
  • By NJ law, statute, etc., must By Law amendments be filed with the county clerk or any other jurisdiction having authority before they become effective?
  • - Can the board raise the HOA fees without receiving unit members approval? - We're in a new community. The budget was never shared and discussed for a fiscal year. And now the board members and management company is saying that we are required to increase the HOA fess because we are in debt now. Two meetings were held to discuss the issue and management passed the motion to raise the HOA fess. Majority of residents believe that money is not being utilized properly and someone screwed up and now home owners have to face the consequences. Balance sheets and financial documents were not shared until they were asked by us. Any many more things have gone wrong. Any help out there to explain us the rules and regulations and help us dig out of this situation?
  • Our bylaws prohibit any commercial vehicles, automobiles, and boats. Then the bylaws go on to provide the filling ( no boat or watercraft shall be stored overnight in the property, unless totally enclosed in a garage and not be visible from the outside.) section 10.03. It also indicates ( the association may, but should not be obligated to,desgnate certain portions of the common properties, which may be relocated from time to time, for the parking of trucks, commercial vehicles, buses, recreational vehicles, mobile homes, trailers, boats,and campers). As far as I can see there has never been any storage provided for this use. They made me get rid of a larger boat because it was visible from the street and they advise me that I can have a boat on my property as long as it wasn't an eye sore and you couldn't see it from the street. I recently purchased a smaller boat that you can't see from the street. It has been parked in my yard towards the end of my fence for past 2 months before I recieved a letter stating that I had an illegal stored boat in my yard. My question is what can I do in order to keep my boat without paying any extra fees at a storage unit that won't guarantee the security of my boat. Living in florid we enjoy the beach and now the boat. HELP me please what are my options.
  • Is there a special meeting held for the purpose of amending the bylaws? This includes the voting process. Should the tally be taken within a couple of days after the meeting, or is it be possible to have an ongoing count for eleven months??? Our board seems to feel they have the right to continue counting (eleven months). At which point, supposedly, they achieved their goal.