Some associations charge fees to review improvement plans

Q: My association just informed us that they will be charging fees to review our landscape plans and any improvements being done to our properties.

This was decided by the board. Previously, there was no fee. Is this allowable? Can they just decide to charge people to look over plans for work that is mandatory?

A: The short answer is yes. There are a number of associations whose covenants or architectural guidelines allow the association to charge fees when reviewing improvement plans.

Some of the associations only charge fees if the association needs the resources of a professional to review the plans.

In the reader's case, the homeowner will need to review the covenants and architectural guidelines to first see if the charging of fees is allowed when the association reviews improvement plans.

If these sections of the governing documents indicate there is no charge for reviewing the improvements, then the reader should review the section in the covenants pertaining to special assessments.

There is a possibility that the association implemented the charges utilizing this section of the covenants.

In addition, the reader needs to review the agenda for the meeting.

Was membership notified of the fees? If not, then technically, the board did not follow NRS 116.3108 subsection 4a-b.

If that is the case, the board should place this matter back onto the next agenda.

The purpose of this statute is to inform homeowners in advance of potential decisions that the board could make and allow homeowners to comment on these matters, either in person or by mail.

Why would an association begin charging for improvements?

In some cases, the association may be paying a third party (possibly, the management company) to actually visit the home as part of the review process.

In some cases, associations need the assistance of legal counsel as to the interpretation of the association's powers in rejecting or accepting a proposal, or in the interpretation of the guidelines.

The reader should discuss the reasons for this change with either the management company or with the board at its next meeting.

Q: I am a homeowner who was part of a class action construction defect lawsuit filed by the association itself and class representation. My name was not on the lawsuit, but I was just being represented as a homeowner. Sometime in June 2006, the case was declassified due to a Supreme Court ruling.

However, I did not receive a notification notice from the attorney's office nor from the board. A separate case was filed again for the association itself after the declassification.

I still did not get a notification notice, not from the association and not from the attorney.

What is the law governing notification notice of homeowners on issues such as lawsuit, settlement, etc. by the board of directors?

A: NRS 116.31088 requires the association to provide written notice to each unit owner of a meeting at which the commencement of a civil action is to be considered at least 21 days before the date of the meeting.

Please note that this provision does not apply to a civil action that is commenced to enforce the payment of an assessment, enforce governing documents, enforce a contract with a vendor or proceed with a counterclaim.

The initial class action construction defect lawsuit would have required such notification and a vote of the membership before the lawsuit could be filed.

This section of the law also requires that if any civil action in which the association is a party is settled, the board shall disclose the terms and conditions of the settlement at the next regularly scheduled meeting of the board after the settlement has been reached.

As to the lack of notice of the declassification, this should have been the responsibility of the association to communicate this information in a meeting and in a newsletter, since so many owners do not attend meetings.

As to the filing of a separate case by the association, the association, again, should have noticed the homeowners.

If the original lawsuit and the subsequent lawsuit are substantially different, then the association would have been required to notice the homeowners that a meeting and vote by the membership was required.

Barbara Holland, certified property manager, broker and supervisory certified association manager, is president and owner of H&L Realty and Management Co. Questions may be sent to Association Q. & A., P.O. Box 7440, Las Vegas, NV 89125. Her fax number is 385-3759. Questions may be shortened and are subject to editing.