by Raymond Daniel Burke | May 29, 2018
Maryland Governor Larry Hogan has approved a new law intended to prevent condominium developers from including provisions in the project’s governing documents and sales contracts that limit the ability of the unit owners to bring claims for construction defects. The provisions of Senate Bill 258 and House Bill 77 will now become law as of October 1, 2018. New Section 11-134.1 of the Maryland Condominium Act protects claims relating to the developer’s failure to comply with applicable building codes; approved plans and specifications; product manufacturer’s installation instructions; or the implied warranties provided under Maryland law. The new law prohibits a developer from including language in the condominium’s governing documents or in the purchase agreements that (1) shortens the applicable statute of limitations; (2) waives the application of the discovery rule or other means of determining the claim’s accrual date; (3) requires that the claim be submitted to arbitration within a period shorter than the applicable statute of limitations; or (4) operates to prevent the assertion of a claim within the applicable statute of limitations. The new law expressly only applies prospectively, and does not affect any governing documents recorded or contracts executed prior to October 1, 2018.
by Raymond Daniel Burke | Apr 3, 2018
Both houses of the Maryland General Assembly have passed legislation that would prevent condominium developers from including provisions in the project’s governing documents that limit the ability of unit owners to bring claims for construction defects. Senate Bill 258 and House Bill 77 would protect claims relating to the developer’s failure to comply with applicable building codes; approved plans and specifications; product manufacturer’s installation instructions; or the implied warranties provided under Maryland law. The legislation would prevent a developer from including language in the condominium’s governing documents or in the purchase agreements that (1) shortens the applicable statute of limitations; (2) waives the application of the discovery rule or other means of determining the claim’s accrual date; (3) requires that the claim be submitted to arbitration within a period shorter than the applicable statute of limitations; or (4) operates to prevent the assertion of a claim within the applicable statute of limitations.
There has been a trend among condominium developers to include language in the governing documents and sales contracts that changes the laws that are normally applicable as to when a claim accrues and when it must be brought. The identical bills passed by the General Assembly would counter this trend by adding new Section 11-134.1 to the Maryland Condominium Act. The House vote was 137-0, and the Senate vote was 43-2.
by Raymond Daniel Burke | Mar 28, 2018
House Bill 997 in the Maryland General Assembly would require a developer, upon transfer of control of the project, to provide the council of unit owners with a reserve study prepared by a “certified” engineer. The bill would amend Section11-132 of the Maryland Condominium Act to also require that the developer provide “a reserve account containing funds equal to at least five times the annual funding amount recommended in the current reserve study report.”
by Raymond Daniel Burke | Mar 28, 2018
The House of Delegates of the Maryland General Assembly has passed legislation that authorizes a condominium declaration to provide for the suspension of the use of parking or recreational facility common elements by a unit owner that is more than 60 days in arrears in the payment of assessments. House Bill 575 would amend Section 11-103 of the Maryland Condominium Act by adding new subsection (d). The measure would require the condominium to provide the delinquent unit owner with 10 days notice, within which the unit owner may pay the delinquent assessment or request a hearing to contest the suspension. The proposed law also allows an amendment to a declaration to add such a suspension provision with the approval of only 60% of the unit owners, regardless of what super majority is otherwise called for in the governing documents. The bill is now under consideration in the Senate.
by Raymond Daniel Burke | Mar 28, 2018
House Bill 564 in the Maryland General Assembly would require a developer, upon the conveyance of 25% of the units or lots, to appoint at least one board member to the association’s governing body who is a unit owner or lot owner, and not affiliated with the developer. The bill would also require the association’s governing body to meet at least two times each year, and would require the developer to provide the members of the board with certain information relating to any bond provided to a governmental authority in connection with the project. The legislation would also require that the books and records of the association be kept separate and apart from those of the developer.
by Raymond Daniel Burke | Feb 28, 2018
House Bill 179 filed in the Maryland General Assembly would reduce the percentage of votes required to amend a condominium declaration. Under current law, as provided in Section 11-103(c) of the Maryland Condominium Act, “80 percent of the unit owners listed on the current roster” must consent to an amendment of the declaration. The proposed bill would reduce the required percentage to 60 percent. Moreover, it would potentially have the effect of further reducing the number of affirmative votes needed by changing the voting pool from including “the unit owners listed on the current roster” to including only “unit owners in good standing.” “Good standing” is defined in the bill as “not being more than 90 days in arrears in the payment of any assessment or charge due to the condominium.” Accordingly, unit owners who do not qualify as being in “good standing” would be excluded from the pool of voters, of which 60 percent would be need to approve an amendment.
