The Courtyards of Huntersville Condominium Community was developed by EPCON with a total of 53 individual, free-standing, ranch-style units. David Bayne Alexander and twelve (12) other unit owners (Petitioners) filed suit when Association issued opinion that the Association would maintain portions of the individual residential buildings housing the units including maintaining the roof, siding and gutters as common elements. Petitioners sought a declaration that these were not common elements, were not to be maintained by the Association as common or limited common elements, that each owner of an individual unit should be charged with the costs of maintenanceof their building including roof and exterior walls, and that each owner would be charged with the insurance costs on “their" building, including the roof and exterior walls.
A lawsuit between unit owners, the developer, and the association resulted and the trial court entered summary judgment consistent with the Association's position that the exterior of the building are common elements and that the Association is to insure the buildings and units. This decision was appealed and the Court of Appeals found that the Association is obligated to insure the roof, gutters, other limited common elements serving their unit, and remanded the proceeding to review the issue of insurance.
The Association then adopted an amendment reallocating maintenance responsibility for the exterior portions of buildings containing units. The judge on remand struck this amendment finding that the Association is obligated to insure the common elements and limited common elements, including exterior of buildings. The Association has now filed a Notice of Appeal to the North Carolina Court of Appeals.
The appellate issue here is very simple: whether an association, relying on language within a state condominium act that mirrors the Model Act, may reallocate maintenance responsibilities from an owner to an association for limited common elements. The trial judge relied on language in the North Carolina Condominium Act, virtually identical to the Model Act that states that ownership of limited common elements cannot be reallocated absent 100% approval of all unit owners. The
Association here did not do that and contends that the amendment was properly approved with approval of 67% of the voting interest of the Association. The adverse parties, for their part, contend that reallocation of ownership and reallocation of maintenance responsibilities are one and the same, and that the amendment failed based on the failure of the Association to secure 100% approval of the membership.
Fundamentally, the real problem in this case is that EPCON, the original developer, constructed condominiums that look like single family homes. They are free-standing and not attached. The vast majority of the members in this 55 and older community wanted maintenance free living and purchased with the understanding that the Association would maintain their gutters, roofs and siding. A very few owners object and have fought this reality every step of the way.
The issue being raised in this case is of enormous importance. There are dozens, if not more, of free-standing condominiums in this State that allocate maintenance responsibilities to their association. And, condominiums routinely decide, for various reasons, that certain limited common elements should be maintained by the association and adopt amendments to effectuate that. This firm has likely drafted hundreds of amendments over the years that do this with the requisite authority under the Condominium Act or governing documents, but without 100% approval of the membership. A decision from the Court of Appeal here that such unanimous approval was needed would have serious negative impacts on all of the communities. And, given that North Carolina's Condominium Act and its amendment language is virtually identical to the Model Act, a decision here, flying in the face of all precedence, that somehow 100% approval was needed for such amendments could have disastrous effects on communities across the country.
Amicus Brief
North Carolina Court of Appeals Opinion December 2023
Court: North Carolina Court of Appeals
Topic: Limited Common Elements
Brief Author: Alex C. Dale, Esq., Ward and Smith, P.A., Wilmington, North Carolina.
Filed: May 1, 2023
CAI Amicus Review Panel: Mr. Robert Diamond, Esq., CCAL, (VA) Co-Chair of Amicus Committee
Mr. Stephen Marcus, Esq., CCAL, (MA) Co-Chair of Amicus Committee
Mr. Ed Allcock, Esq., CCAL (MA)
Mr. Steven Sugarman, Esq., CCAL (PA)
Ms. Anthony Rafel, Esq., CCAL (WA)
Ms. Russell Robbins, Esq. (FL)