“Can My Association Board Pass a Rule Regarding That?” FCAP Managers Report

“Can My Association Board Pass a Rule Regarding That?” FCAP Managers Report

You attend your association’s monthly board of directors meeting because you notice an item on the agenda that piques your interest. The board of directors is scheduled to consider and pass a rule regarding _________ (you fill in the blank). You ask yourself “Can they do that?” The answer, as it is many times, is “it depends”.

The first place to look is the association’s governing documents. The governing documents (declaration, articles of incorporation or bylaws) must give the board of directors the authority to promulgate rules and regulations. If this authority is not contained anywhere in the association’s governing documents, then the board does not have the authority to promulgate or amend rules and regulations.

If the authority does exist in the governing documents, then the board has the authority to promulgate reasonable rules and regulations. Again, you must look to the governing documents to see if such rules must also be approved by the membership. While not common, some association documents do require membership approval, so be sure to check your documents for such a requirement.

Assuming that the board can pass reasonable rules without membership approval, how does that work? There are essentially two categories of cases in which an association attempts to enforce rules of restrictive uses. The first category is dealing with the validity of restrictions found in the declaration. The second category involves the validity of rules promulgated by the board of directors.

Restrictions found in a declaration are clothed with a very strong presumption of validity which arises from the fact that each individual unit owner purchases his unit knowing of and accepting the restrictions to be imposed. White Egret Condominium, Inc. v. Franklin, 379 So.2d 346 (Fla. 1979). As such, a use restriction in a declaration may have a certain degree of unreasonableness to it, and yet withstand attack in the courts.

However, where a rule is created by the board of directors, such rule is subject to a test of reasonableness. If a rule is reasonable, the association can adopt it, if not, it cannot. Hidden Harbor Estates, Inc. v. Norman, 309 So.2d 179 (Fla. 4th DCA 1975). What this means is that if a rule is challenged, the association must be able to show the rule is reasonable. The challenging owner is not required to show the rule is unreasonable; the burden is on the association to show that the rule is reasonable.

In addition to being reasonable, there are other limitations on board enacted rules. A board enacted rule cannot be in contradiction with any other provision of an association’s declaration, articles of incorporation or bylaws. Any conflict between a provision in an association’s rules and regulations and an association’s declaration, articles of incorporation or bylaws will be resolved against the rule and in favor of the provision in the declaration, articles of incorporation or bylaws.

Furthermore, a rule cannot amend a provision of the declaration. Unfortunately, many associations attempt to do just that by passing rules that, if challenged, would not be upheld by the courts as a valid rule. For example, if your governing documents provide that owners who want to sell or lease their unit must provide a copy of the sales contract or lease to the association, and nothing more, a rule that provides sales and leases must be approved by the association would not be upheld by a court if challenged.

Similarly, if your governing documents do not include restrictions limiting leases to no less than 3 months, or that leases must be at least one year in length, the board cannot pass a rule to that effect. Such restrictions must be in the declaration, unless, arguably, the declaration specifically grants the board the authority to pass additional rules and regulations regarding leasing.

Also, you should be aware that there is now a difference regarding rules and regulations in what the defined term “governing documents” means in regard to a homeowners association as opposed to a condominium association. Chapter 720, Florida Statutes (the “Homeowners Association Act”) was amended to include an association’s rules and regulations in the definition of an association’s “governing documents”. See Section 720.301(8), Florida Statutes. Chapter 718, Florida Statutes, (the “Condominium Act”) does not contain a similar provision or definition. So while the defined term “governing documents” includes rules and regulations in a homeowners association, the same defined term does not include rules and regulations in a condominium association.

Finally, whenever an association is considering amending or addition rules and regulations, it should always do so in consultation with its attorney. The attorney should review the rule to make sure it is not in conflict with any provisions of the declaration, articles of incorporation or bylaws; make sure there are no potential housing law issues or other legal issues in regard to the proposed rule and that the proper meeting notice requirement for the board to consider and pass the rule are followed. In condominium, homeowner and cooperative associations, written notice of any meeting at which amendments to rules regarding unit (or parcel) use will be considered must be mailed, delivered, or electronically transmitted (to those who have consented in writing to receive official association notices electronically) to owners and posted conspicuously on the property not less than 14 days before the board meeting.