Creating Association Rules

Homeowner association members can reap great benefits from association membership that residents living outside an association cannot. Membership in an association can include recreational amenities and architectural standards designed to protect and enhance property values. To realize the full advantages of being a homeowner in an association, rules and regulations are necessary to assure that everyone maintains a reasonable standard of conformity.

As a starting point to any rule-making process, it's important to begin with a core assumption that members are reasonable adults, who freely chose to move into a community with association rules and regulations. When it comes to effective rule making, common sense tells us that fewer rules and restrictions are generally favored by most residents; however, in an association, rules are necessary for clarification purposes. Yet, in many homeowner associations there exists poorly worded and thoughtless regulation. How does this happen with well-meaning, conscientious Board members? Often, it's a case of Board members who overreact in search for a quick solution to a member's concern.

Any board-adopted rule must be reasonable in order to withstand legal challenge. On this front, applying the "business judgment rule," certainly supports the Board of Directors if a future challenge occurs. Therefore, even though there may be other solutions to a particular problem, a board-adopted rule will usually withstand a reasonableness challenge if it is rationally related to the management and operation of the community.

Another common problem when deliberating upon board-adopted rules is one of vagueness. It has been consistently held by the courts that a rule made with uncertainty or ambiguity, when applied, will not be upheld.

In addition, look to see by what authority the Board has to act upon a board-adopted rule. In some instances the Board may be entering into a situation to which the association has no legal jurisdiction. Board members are human, and their desire to fix a problem can occasionally serve to further complicate matters.

Here's a simple statement from the CC&R's: The Board shall have the right to adopt Association Rules limiting the duration of guest parking. One small sentence can indeed be construed as muddled and confusing. What approach does the Board of Directors take to interpret this small passage of words? Is guest parking restricted to a number of hours, days, or weeks? What if the guest were parked within an enclosed garage, not visible from neighboring property? Can the association completely prohibit or restrict guest parking? Once a rule is established, what is the enforcement mechanism? And don't forget to define what a guest is if not clearly defined in your governing documents. Clearly, it is important for the Board to establish the criteria for limiting the duration as well. What's imperative is that members of the Board explain the rule that is being adopted and communicate details that the members can live within.

Reasonable rules and regulations are essential for an effective homeowners association to maintain property values. Reasonable board members who use that criteria in their rule-making process will ensure a positive future for the association.

Source: Association Times
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