Advising HOA Boards After Surfside: Inspection, Review, Maintenance and Repairs

Description

The aftermath of the Surfside condominium collapse is one of the most unspeakable tragedies in condominium history. As investigators continue to search for the cause or causes of the collapse, it is natural to search for solutions on how future building collapses or other disasters can be prevented. It is unlikely that there will be a "single" identifiable cause of the condominium collapse. Rather, the collapse was likely caused by a multitude of factors.

Counsel for HOAs should consider reviewing policies and actions of the condominium association's board of directors. Most states provide various protections for volunteer directors of a nonprofit corporation and only require that a director must discharge their duties in good faith, with the care of an ordinarily prudent person, and in a manner that they believe is in the best interests of the corporation. Directors should ensure that their articles of incorporation and condominium bylaws are updated so volunteer directors are appropriately protected from liability. Similarly, volunteer board members should consult with insurance agents to ensure that appropriate directors' and officers' insurance is in place.

Boards will want to examine inspection and engineering reports and communicate those findings to co-owners to determine the advisability of proceeding with repairs. Counsel should advise condominium board members to act on the advice that is received. Boards need to budget properly and realize that sometimes difficult choices need to be made, which may involve assessment increases that will not be popular with co-owners.

Some condominium documents require the condominium association to perform an annual inspection of the major common elements. While hiring professionals to perform inspections costs money, amending your condominium bylaws to require mandatory inspections may not be a bad idea. Similarly, while reserve studies are a best practice, there is nothing preventing a condominium association from amending their condominium bylaws to require that reserve studies or structural engineering inspections be performed on a regular basis. While condominium and homeowner association acts may not impose minimum insurance requirements, boards should consider reviewing coverage and increasing limits based on current risks.

Listen as our expert panel discusses best practices when advising boards on repairs, inspections, and engineering recommendations for condominiums in order to avoid future disasters.