Condominium Homeownership in the United States: A Selected Annotated Bibliography of Legal Sources

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LAW LIBRARY JOURNAL Vol. 103:2 [2011-16]

Condominium Homeownership in the United States: A Selected Annotated Bibliography of Legal Sources*

Donna S. Bennett**

Following a brief historical sketch of the condominium concept from its earliest mention in historical documents, this bibliography traces the legal development and growth of condominium homeownership in the United States to the present day. Although condominium ownership has developed in some countries, such as England, under common law concepts, special statutory provisions have directed this form of ownership in the United States. Covenants, conditions, and restrictions, as well as the condominium association, have developed to collectively finance and manage the common areas and facilities of the condominium regime.

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 249HistoricalBackground. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 250DevelopmentofCondominiumLawintheUnitedStates. . . . . . . . . . . . . . . . . . 253StatutoryFoundation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 262CreationoftheCondominium. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 266GovernanceandtheCondominiumAssociation. . . . . . . . . . . . . . . . . . . . . . . . . . 272Bibliographies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 278

Introduction

¶1ThisannotatedbibliographytracesthelegaldevelopmentofcondominiumhomeownershipintheUnitedStatesfromitsbeginningsintheearly1960stothepresent.ThespectaculargrowthofcondominiumhomeownershipintheUnitedStatesinthepastfiftyyears,aswellasthedevelopmentofthisnewareaofpropertylaw,hascreatedaneedforanexaminationoftherelevantsourcesthatdescribeandexaminethisdevelopment.

¶2Thisbibliographygatherstogetherwhattheauthorconsidersthemostrel-evantbooks,chapters,andjournalarticlesonthecondominiumconceptofprop-ertyownership.Itincludessourcesthatprovidethehistoryofthedevelopmentofthis area of law, comparisons of cooperative and condominium ownership,

* © Donna S. Bennett, 2011. The author expresses sincere appreciation to Professor CarylYzenbaardforherassistanceinreviewingthisarticle,herconstructivecomments,andherencourage-ment;toProfessorClaudiaZaherforherextensiveinterlibraryloanefforts;andtoProfessorMichaelWhitemanforhissupport. ** ProfessorofLibraryServices andAssistantDirector forUserServices,NorthernKentuckyUniversity,SalmonP.ChaseCollegeofLaw,HighlandHeights,Kentucky.

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descriptionsofenablinglegislation,discussionsofthelegaldocumentsrequiredtocreate and regulate a condominium, and descriptions of the organizations thathaveevolvedtogoverncondominiumdevelopments.Thebibliographycoversfourgeneralareas:(1)developmentofcondominiumlawintheUnitedStates,(2)statu-tory foundation, (3) creation of the condominium, and (4) governance and thecondominiumassociation.

¶3 State-specific materials are not included. Following the passage of theNationalHousingActin1961,whichrecognizedthecondominiumformofprop-ertyownership,condominiumlegislationwasadoptedineachstateoverthenexteight years, withVermont being the last state to adopt such legislation in 1969.Most state bar journals or law reviews included articles on the development ofcondominiumlegislationforthatparticularstate.Citationstothesearticlescanbelocatedthroughthestandardindexes.Inaddition,noattempthasbeenmadetoincludesourcesforcommercialorresortcondominiums.

Historical Background

¶4 According to many scholars, the concept of condominium is quite old:“Thereisatleastonerecordofthesaleofpartofabuilding,inancientBabylon[modernIraq],duringtheFirstDynasty,nearlytwocenturiesbeforethebirthofChrist,”andthereisevidenceoftheuseofthesystemamongtheGreeks,Egyptians,andothers.1ItwasduringtheMiddleAges,whenwallswereconstructedtoenclosecities in order to provide security, that building space became scarce in manyEuropeancities.Thislackofspaceledtoindividualownershipofpartsofabuild-ing,sometimesevenindividualownershipofsinglerooms,incitiessuchasOrleansandParis.2This“ownershipof floorsofhouses,andevenrooms, inthehandofdifferent persons was common in various parts of Europe.”3 The condominiumconceptofhomeownershipbecameespeciallywidespread in theFrenchcitiesofNantes,SaintMalo,Caen,Rouen,Rennes,andGrenoble.“InRennesacatastrophicfire in 1720, which destroyed most of the city, forced inhabitants to build anewunderasystemofwiderstreetsandtaller,multifamilybuildings.Theexperimentwassosuccessfulthatthesystemwasfirmlyadopted.”4

¶5Regulationofcondominiumownershipduringtheseearlyyearswasmorebyusageandtraditionthanbyformallegalrules.5Thelackofclearrulesinmanycitiesregardingtherepairandmaintenanceofcommonareas,however,ledtodis-putesamongowners.Questionssuchaswhowasresponsiblefortherepairoftherooforthestairwelloreventhebuilding’sfoundationwereoftenhotlydisputed.Frequency of disputes helped to make the condominium concept unpopular in

1. 1aLbERto fERRER & kaRL stEchER, LaW of condominium §31,at15(1967). 2. Id.§32,at18. 3. J.Leyser,The Ownership of Flats—A Comparative Study,7int’L & comp. L.q.31,33(1958). 4. 1fERRER & stEchER,supranote1,§32,at18. 5. Id.§35,at23–24.

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certainareas.6Thisbegantochangewiththefirststatutoryrecognitionofthecon-dominiumconceptintheCodeNapoleon.7

¶6TheCodeNapoleonof1804madeprovisionsinArticle664fortheseparateownershipoffloorsandtheregulationofmaintenanceandrepairsofthecommonpartsofthebuilding:

When the different stories of a house belong to different proprietors, if the titles to thepropertydonotregulatethemodeofreparationsandreconstructions,theymustbemadeinmannerfollowing:Themainwallsandtheroofareatthechargeofalltheproprietors,eachinproportiontothevalueofthestorybelongingtohim.Theproprietorofeachstorymakesthefloorbelongingthereto.Theproprietorofthefirststoryerectsthestaircasewhichconductstoit;theproprietorofthesecondstorycarriesthestairsfromwheretheformerendstohisapartments;andsooftherest.8

¶7JohnHenryWigmoresaidoftheCodeNapoleon:“Thatcodestandsoutasoneofthosefewbookswhichhaveinfluencedthewholeworld.TheCodeNapoleonwassoontranslatedintoalmosteverylanguage.”9Frenchlaws,introducedintoallthoseterritoriesannexedbyNapoleon,wereoftenretainedorincorporatedintothelocalcodebytheindividualcountriesafterNapoleon’sdefeat.Asaresult,thecon-dominium concept spread to other European countries and, eventually, to otherpartsoftheworldasEuropeansimmigratedtoothercontinents.

¶8AlthoughtheinformalownershipoffloorsorpartsofbuildingsexistedincountriessuchasAustria,Switzerland,andGermanyasearlyasthetwelfthcentury,especially among the poorer citizens, by 1900 the German civil code included aprovision“expresslyforbiddingthepracticeofownershipofapartofabuilding.”10This was a result of much official opposition in Germany to the condominiumconceptbyjurists,thepolice,andthetaxingagencies.Manyarguedthat,“apartofa building could only belong to the owner of the land on which the buildingrested.”11 Switzerland andAustria soon followed the example of Germany whentheyadoptedrestrictiveprovisionsin1912.12

¶9ThedestructionofhousinginEuropeduringtwoworldwars,however,aswellas thehighcostofconstruction, lackofavailable land indenselypopulatedareas,andthedesireforhomeownershipratherthantenancy, fosteredarenewedinterestintheconceptofcondominiuminthecontinentalcountries.“Asthenum-berofcondominiumsincreasedandthedemandforstandardagreementstocoveranumberofpracticalproblemsbecamestronger,specialstatuteswereadopted.”13Beginninginthe1920s,anumberofEuropeancountriesbegantopasslegislation

6. Leyser,supra note3,at33. 7. 1fERRER & stEchER,supranote1,§35,at24. 8. Id. 9. 3John hEnRy WigmoRE, a panoRama of thE WoRLd’s LEgaL systEms1031(1928)(footnoteomitted). 10. 1fERRER & stEchER,supranote1,§33,at20. 11. Id. 12. Id.§34,at22–23(Switzerland)(noting that this formofownershipcontinued toexist insomecantonsafter1912);id.§40(Austria)(notingthatthe1912legislationfollowedsimilarlegisla-tionin1879). 13. JanvanWeesep,The Creation of a New Housing Sector: Condominiums in the United States,2housing stud.122,123(1987).


thatwasdesignedtoclarifytherightsandobligationsoftheownersofflats,espe-ciallyregardingresponsibilityforthecommonpartsofthebuilding.14Thecom-monalityofthislegislationconsistedin“twoseparate,butcloselyconnectedrights.Ofthesetworights,oneisashareintheundividedco-ownership,whiletheotherisaseparaterightovertheflatorotherpartofthebuilding.”15Countrieshavedif-feredintheirviewsofwhichrightisthepredominantorprincipaloneandwhichtheaccessory.TheFrenchhavemadetheownershipoftheflattheprincipalright.

German law has adopted a different attitude: here the share in the co-ownership of thecommonpartsmustberegardedastheprincipalrightoftheflatowner,andhisrightofseparateownershipoftheflatasmerelyaccessory.

ItisinherentinthelegalconstructionofflatownershipunderContinentallegislationthatthetworights—theco-ownershipshare,andtherightintheparticularflat—cannotbeseveredatwill.16

Further Reading

Ferrer,Alberto,andKarlStecher.Law of Condominium: With Forms, Statutes, and Regulations. 2vols.Oxford,N.H.:EquityPublishingCorporation,1967.

Thistwo-volumeworkisacomprehensiveandscholarlytreatmentoftheoriginsand development of the concept of condominium, with a focus on the statu-torydevelopmentofthefieldwithintheUnitedStates.Theauthorsattempttointerpret theworldwide scopeof condominium to the legalprofession, and toemphasize that condominium is one of the most effective means of providingmasshousing.Theyprovideanextensivechapteronthehistoryofcondominiumthroughouttheworld,aswellasachapterthatprovidesacomparativeanalysisofforeignstatutes.Theworkincludesadescriptionofthevariouselementsandrequirements of the system, such as the legal documents fundamental to thecreation of the condominium regime, financing, and the rights and duties ofowners.AlbertoFerrer taughtat the Inter-AmericanUniversityofPuertoRicoSchoolofLawandwasamemberofthecommitteethatactedfortheNationalConferenceofCommissionersonUniformStateLawsinpreparingtheUniformCondominiumAct.KarlStecherwasaprofessoroflawatEmoryUniversityandtheUniversityofLouisvillebeforebecomingatrialattorney.

Leyser, J. “The Ownership of Flats—A Comparative Study.” International & Comparative Law Quarterly7(1958):31–53.

Writing in1958,prior to thedevelopmentof condominium law in theUnitedStates,Leyserfocusesontheownershipofflatsincontinentallegalsystems.Heprovideshistorical informationonthedevelopmentof thecondominiumcon-cept in thecontinentalcountriesanddiscusses in somedepth themorerecentlegislationofthattime.Healsopointsoutthelackofuniformityinthelegisla-tionofthevariouscountries,eventhoughmostcontinentalcountrieshadpassedlegislationprovidingownershiprightsinindividualflats.Manyofthecontinentalcountriespermittherightsanddutiesoftheflatownerstoberegulatedby“spe-cialagreement”(p.40).“Generally,theContinentallegislatorshavelefttheparties

14. Leyser,supranote3,at34–37. 15. Id.at37. 16. Id.at38–39.


fullfreedomwithregardtothewayinwhichtheywishtoregulatetheirrelation-ships in connection with the ownership of flats in a building” (p.40). Leyserdiscussestheassemblyoftheco-ownersandthevariouscountries’requirementsforaquorumfordecision-making,rangingfromamajorityofthosepresentatameeting inFrench law, to two-thirdsof thevalueofabuilding inItalian law,with thequoruminsubsequentmeetingsdealingwith thesameagendagreatlyeased.Leyserendswithacomparativediscussionofthecommonlawapproachtocondominium,focusingonEngland.

Natelson, Robert G. “Comments on the Historiography of Condominium: TheMyth of Roman Origin.” Oklahoma City University Law Review 12 (1987):17–58.

ThepurposeofthisarticleistodisprovethenotionthatthemodernconceptofcondominiumexistedinRomancivillaw.Intheprocessofdoingthis,theauthorprovidesasketchofthehistoryofcondominiumandathoroughdiscussionoftheclassicaltextsuponwhichthistheoryofRomanoriginshasbeenbased.

Development of Condominium Law in the United States

¶10Priortothepassageofenablinglegislationforcondominiumsinthiscoun-try, many property experts debated the issue of ownership of space below andabovethesurfaceoftheland.“Indirectsupportforthelegalityofstrataownershipofbuildingsmaybederivedfromminingandaviationlaw.Theseareasofthelawhavehadagreatinfluenceindispellingthenotionthatrealpropertymaynotbedividedhorizontally.”17In1929,attorneyStuartBallspeculatedaboutthepossibil-ityofowning“castlesintheairmanystoriesabovethestreets,”18andwhetheritwaspossibletoownspaceasopposedtoowningland.“Fromanotherperspective,evi-dence of the legislative acceptance of airspace as real property comes from theuniversal acceptance in the United States of the condominium, with its three-dimensionalconceptofproperty.”19Today’scondominiumownersarefamiliarwiththeconceptofowningtheairspacewithintheboundarywallsoftheirunit.

¶11 The model for American statutes on condominium law came not fromEurope,butfromPuertoRico.Amajorhousingshortage,alongwiththehighcostofrealestateandashortageoflandinPuertoRico,ledtotheapprovalofthecon-dominiumformofhomeownershipin1951.20Amoredetailedversionoftheact,approvedin1958,wastheHorizontalPropertyAct.ThePuertoRicolaw“iscalledaHorizontalPropertyActbecauseitprovidesastatutorymethodofsubdividingthespaceoccupiedbyabuildingintohorizontalstrataorlayers.Eachlayerrepresentsa

17. CharlesW.Pittman,Note,Land Without Earth—The Condominium,15u. fLa. L. REv.203,207(1963). 18. StuartS.Ball,Division into Horizontal Strata of the Landspace Above the Surface,39yaLE L.J.616,637(1930). 19. 2RichaRd R. poWELL, poWELL on REaL pRopERty§18A.05[6](2009). 20. JohnE.Cribbet,Condominium—Home Ownership for Megalopolis?, 61mich. L. REv.1207,1212–13(1963).


floorinthebuildingthatisthensubdividedverticallyintooneormoreapartmentspacesorunits.”21Eachunitisownedindividuallyandhasitsowndeed.

¶12TheHorizontalPropertyActofPuertoRicogave impetus to thecondo-miniummovementinAmericaandbecamethemodelformuchofthelegislationapprovedinthevariousstates.22“In1961,aPuertoRicandelegationlobbiedtheU.S. Congress to enact Section 234 of the National Housing Act to extend theFederalHousingAdministration’smortgagebenefitstocondominiums.”23AlthoughcondominiumhomeownershipwaspopularinPuertoRico,additionalsourcesoffinancingwereneededbecausethebankingcommunitydidnotofferveryattrac-tivetermsforcondominiummortgages.Thepurchaseofacondominiumwasoutof reach for the average person.24 When the Federal Housing AdministrationreceivedauthorizationfromCongresstoinsuremortgagesfromlendersforcondo-miniumdwellings,PuertoRicanswereabletomakefulluseofthecondominiumconcept.25

¶13IntheUnitedStates,theseverehousingshortageandtheurbansprawlthatoccurredfollowingtheendofWorldWarIIcreateda“needfor‘moreefficientuseoflandthroughhighrisemulti-familydwellingslocatedinthoseareaswherefacili-tiesforemployment,education,recreation,andpublicservicesalreadyexist.’”26Inaddition, therewasnational interest inprovidingmoreaffordablehousing foralargernumberofpeople.Americans, incommonwithmostpeople,preferredtoowntheirownhomes,ratherthanrent,andtoownahomeinanareathatmightbefinanciallyoutoftheirreachiftheyattemptedtopurchaseasingle-familydwell-ing.“This...spurredinterestintraditionalcooperativehousingdevelopmentsandresultedintheintroductionintotheUnitedStatesofanewconceptofapartmentownershipbyindividuals.”27

¶14Scarcityoflandwithincommutingdistanceoflargeurbancenters,thehighcostofrealestate,andagrowingelderlypopulationfurtherincreasedthepopular-ityofthistypeofhomeownership.“Thedesireforthepersonalcomfortsofhomeanditsrelatedfinancialbenefits,theprospectofreducedtraveltime,andthegreatadvantageofbeingclosetoculturalandbusinesscentershavecreatedanewinter-estinreducingtheburdenofinflatedlandcoststhroughcooperativeownership.”28Ina1965presentationatanAmericanBarAssociation(ABA)meeting,WilliamKerrsaid:“Itisfinanciallyimpossibleforamanofevenmoderatemeanstoowna

21. CharlesE.Ramsey,Condominium,pRac. LaW.,Mar.1963,at21,23. 22. Cribbet,supranote20,at1213. 23. 1kaREn chRistEnsEn & david LEvinson, EncycLopEdia of community317(2003). 24. CurtisJ.Berger,Condominium: Shelter on a Statutory Foundation,63coLum. L. REv.987,987n.4(1963). 25. 1fERRER & stEchER,supranote1,§51,at56. 26. WilliamSchwartz,Condominium: A Hybrid Castle in the Sky,44 b.u. L. REv.137,138(1964)(quotingHerbertJ.Friedman&JamesK.Herbert,Comment,Community Apartments: Condominium or Stock Cooperative,50caL. L. REv.299,299(1962)). 27. LouisPohoryles,The FHA Condominium: A Basic Comparison with the FHA Cooperative,31gEo. Wash. L. REv.1014,1014(1963). 28. Id.


privatehousenearthecenterofalargecity.Condominiumshouldmakesuchown-ershippossiblewiththeresultantsavingintimeandmoneyovercommuting.”29

¶15Cooperativesbecamepopularinresponsetohousingshortages,beginningprimarilyaftertheFirstWorldWar.Manyoftheseearlyventuresexperiencedfinan-cialfailureduringtheGreatDepression.30Thistypeofcollectivelyownedcommu-nitywasmostpopularinmajormetropolitanareas.31Italsounderwenttremendousgrowthinthe1950sand1960sinpartsofFlorida.32By1966,however,condomin-iumgrowthoutpacedthegrowthofcooperativeseverywherebutinNewYork.33

¶16Oneofthereasonsforthegrowthofthecondominiumisthatmostpeopleviewitashomeownership.Inacooperative,theindividualownsindirectlythroughownershipinthecooperativestockandalong-termproprietaryleaseontheapart-ment.Thecorporationownsthebuildingandcommonelements,andthemembersarestockholderswholeasetheirunitsfromthecorporation.Inacondominium,theindividualownsoutrightthroughafeetitletotheunitandanundividedinterestinthe common elements. The condominium owner is an owner of real property,while the cooperative owner is viewed as a stockholder and lessee.34 For manypeople,“[d]eedsholdtremendoussymbolicvalue,”andthisisamajoradvantageofthecondominiumoverthecooperative.35

¶17Inacondominium,theunitowner“isnotasdependentuponthefinancialconditionofotherownersas is thetenant-stockholder inacooperative.”36Whileforeclosuresof individualunitsmaycreatefinancialstrainsontheupkeepofthecommonelements,theforeclosureexperiencedbyanindividualorindividualswillnotcausethecommunitytofail.“Theco-oprequiredhomeownerstofinancepur-chasescollectivelyandofferedasimplewaytoexcludeundesirable families fromthecommunity.Thecondominium,bycontrast,permittedindividualfinancingbutofferedfewerpowersofexclusion.”37AbrahamKazan,founderofthelimited-equityco-opinNewYork,statedin1962:“[I]fweencounterabadegg,wegivehimbackhismoneyandtellhimwedon’twanthimhere.”38Theindividualdeedsinacon-dominiummadethis typeofactiondifficult.“Ineffect, thecondominiumtrans-ferredcertainrightsfromthecollectivetotheindividual;...homeownersgreatlypreferredthecondominiumformat.”39

29. WilliamK.Kerr,Condominium,1965A.b.a. sEc. REaL pRop. pRob. & tR. L. pRoc.PartII,at23–24. 30. chaRLEs E. RamsEy, condominium: thE nEW Look in co-ops 3(1961). 31. MatthewGordonLasner,NoLawntoMow:Co-ops,Condominiums,andtheRevolutioninCollectiveHomeownership inMetropolitanAmerica, 1881–1973, at91 (2007) (unpublishedPh.D.dissertation,HarvardUniversity),available athttp://gradworks.umi.com/3265184.pdf. 32. Id.at465. 33. Id.at489. 34. patRick E. kEhoE, coopERativEs and condominiums4–5(1974). 35. Lasner, supranote31,at479. 36. WaRREn fREEdman & Jonathan b. aLtER, thE LaW of condominia and pRopERty oWnERs’ associations23(1992). 37. Lasner,supranote31,at483. 38. Id.at475. 39. Id.at483.


¶18“The condominium concept established the creation of a set of verticalboundaries separated into horizontal apartments, units, floors or stories.”40 Thetraditional form of homeownership involves a fee simple title to the land uponwhichthehousestands.Whatdoesthecondominiumowneractuallyown?“Eachcondominiumpurchaseracquiresafeesimpleownershipintheunit,togetherwithanundividedtenancyincommoninterestwithotherunitownersinthecommonareas.”41Thecondominiumowner,therefore,hasexclusiveownershipoftheinte-rioroftheapartmentorunit,ortheapartment space.“Theterm‘apartmentspace’meansjustthat.Itisthespaceenclosedorboundedbycertain,determined,verticaland horizontal boundaries. These boundaries are the interior surfaces of theperimeterwalls,floor,andceilingoftheapartmentthattheapartmentownerownsindividually.”42Ownershipalsoincludesafractionalownershipinthecommonorgeneral facilities,usuallyreferredtoas thecommonelements.Thecommonele-ments are, basically, all areas of the property outside the individual apartmentspaces.Becauseindividualownerssharetheexpensesforthesecommonareasandfacilities, such as the maintenance of grounds and buildings, swimming pools,clubhouses,andotheramenities,43thecondominiumlifestylehasslowlygainedinpopularity.Inaddition,manyretireesandsecond-homeownerswantedthe“emo-tionalandphysicalsecurityofneighborsaboveandbelowandthefreedomtoleavehomeformonthswithoutworryofburglary....”44

¶19FollowingthepassageofthePuertoRicoHorizontalPropertyActin1958andtherecognitionofthecondominiumformofpropertyownershipinthe1961National HousingAct,“Arkansas and Hawaii were the first states to take up thePuertoRicanchallenge,andArizona,Kentucky,SouthCarolina,andVirginia. . .joinedtheparade.”45AccordingtoCurtisBerger,legislationmustdothreethings.First,itmust“provideaprocedurefortheestablishmentanddissolutionofacon-dominium....”46Thesecondrequirementis“toaccommodateexistinglegislationdealingwithtaxation,recordingprocedures, liens, land-usecontrol,andsecurityregulatorytechniquestothespecialneedsofthecondominium;and[thethirdis]toanticipatepossiblejudicialantagonisminvolvingsuchmattersasbarsonparti-tionandcovenantsreal.”47Headds,“itseemslikelythattheFHAModelStatute,withlocalrefinements,willemergeastheprevailingforminthiscountry.”48

¶20 “The concept has electrified the housing profession,”49 said WilliamSchwartzofBostonUniversityLawSchool.“Atthebeginningof1963,onlysevenstatesandtheCommonwealthofPuertoRicohadenactedlegislation.Duringthenextsixmonthsanothertwenty-fourstatesadoptedsomeformofcondominium

40. 4david a. thomas, thompson on REaL pRopERty§36.03(2dThomased.2004). 41. gRant s. nELson & daLE a. Whitman, Land tRansactions and financE 548(4thed.2004). 42. Ramsey,supranote21,at22. 43. Id. 44. Lasner,supranote31,at490. 45. Cribbet,supranote20,at1218(footnotesomitted). 46. Berger,supranote24,at1003. 47. Id. 48. Id.at1004(footnoteomitted). 49. Schwartz,supranote26,at138.


andlegislationispresentlypendingintenotherstates.”50Indeed,forty-threestatesandtheDistrictofColumbiapassedcondominium-enablingstatutesby1965.51In1969,Vermontbecamethelaststatetoenactacondominiumstatute.52

¶21Althoughintheearly1960smanypeopledidnotevenknowhowtopro-nounce the word “condominium,”53 by 1970 a poll showed that one in fourAmericanswasfamiliarwiththeterm,andby1972,threeofeveryfourAmericansknewtheterm.54Asof2005,therewere6.6millioncondominiumsnationwide.55

Further Reading

Ball,StuartS.“DivisionintoHorizontalStrataoftheLandspaceAbovetheSurface.”Yale Law Journal 39(1930):616–58.

Inthisextensivestudyoftherightsofownershipoflandspace,theauthormain-tainsthatthecourtswillsomedaybereceptivetothestratificationofcubicspaceallowing for division by horizontal planes capable of ownership by differentindividuals; in other words, the idea of real property without land. The articlediscussestheseparateownershipofroomsandapartmentsincommonlawandcivil law jurisdictionsandprovidesnumerous footnotedreferences.“Justas thewillingnessofthecourtstoadmitthatachambercouldbeseparatelyconveyedresulted from the accustoming of the judges to the notion by the practicalexamplessurroundingthemintheInnsofCourt,sowillourcourtsoftomorrowceasetoregardasstrangetheownershipofcastlesintheairmanystoriesabovethestreets”(p.637).

Barnhill, K. E., Jr. “The Creation of Estates in Airspace.” Rocky Mountain Law Review25(1953):354–63.

Thiscomment,writteninthe1950s,referredtothelackofspaceandtheincreasedpopulationinColoradothatwasspurringtheconstructionofmultistorybuild-ings.Thearticlecentersaround legislationpassed inColorado thatallowed forownershipofspacesabovethesurfaceofthegroundbyindividualsorcorpora-tionsotherthantheowneroftheland.Thenewstatuteestablishedthe“legalityofcommonlawmethodsofconveyinganinterestinseparateairspace”and“thepower to create estates above the surface of the land” (p.354). The author dis-cussesanumberofproblemsconnectedwiththecreationofestates inairspaceandprovidessomepossiblesolutions.

Bell,Laird.“AirRights.”Illinois Law Review 23(1928):250–64.ThekeyquestionaskedinthisarticlebyLairdBell,aChicagoattorney,is:“Canan abstract thing like space be bought and sold as land?” (p.252). The authorreviewsanumberofcasesthatattemptedtoresolvethisissue.HepointsoutthattheseparateownershipofroomsandstorieshasbeenmorecommoninEnglandthan in America. Bell concludes his article by saying,“A conveyance of the air

50. W.RobertFokes,Legal and Practical Aspects of Condominium,19bus. LaW.233,233(1963)(footnotesomitted). 51. PatrickJ.Rohan,Condominium Housing: A Purchaser’s Perspective,17stan. L. REv.842,844(1965). 52. vanWeesep,supranote13,at126. 53. Lasner,supranote31,at481. 54. Id.at522. 55. Id. at529.


lotwitharighttosupportisobviouslybetteradaptabletothemysteriesofthefuture”(p.263).

Borgwardt,JohnP.“TheCondominium.”Journal of the State Bar of California 36(1961):603–12.

PublishingafewmonthsafterthepassageoftheNationalHousingActof1961,theauthorassertedthatpriortothepassageofenablinglegislationinCalifornia,therewas“nobasicprobleminvolvedinconveyingtitletoaportionofabuilding,ortoacubeofairspaceenclosedbyabuilding”(p.604).Thedevelopercanavoidproblems by drafting the deed to convey airspace and retaining the structuralportionsof thebuildingas commonarea.“If theunit is air space,destructionofthebuildingwillnotdestroythesubjectmatterofthefee,andownershipwillcontinue”(p.604).Borgwardtprovidesexamplesofprovisionsthatareessentialtotheregulationanddevelopmentofthecondominium.Theseincludeeachunitowner’s paying a proportionate share of common expenses, the ability of themanagertoimposealienontheunittosecurepaymentofthisshare,arestric-tionagainstanyact thatwill impairthestructural integrityof thebuilding,anobligationtomaintaininsurance,theprovisionforeasements,thespecificationsofthepowersofthemanager,anddetailedinformationonhowthedeclarationcanbeamended.

Clurman, David, F. Scott Jackson, and Edna L. Hebard. Condominiums and Cooperatives. 2ded.NewYork:Wiley,1984.

This is a comprehensive survey of condominium and cooperative ownership.Writtenforthelegalpractitioner,banker,andrealestatedeveloper,aswellasforstudents,thebookprovidesanoverviewofthehistoryandpolicyofcondomini-ums and cooperatives. The authors include information on financing, incometax factors, legal structure, and salesof condominiumsandcooperatives.Theyalso provide an excellent chapter on the development and purpose of hom-eownerassociations.Thechapter“OperationandManagementofCondominiumRegime” provides information on some of the problems associated with con-dominium living (referred to as the three P’s—pets, parking, and people), asection on typical developer mistakes, and essential information on insurance.AppendixesincludeHUDlegalpolicies,modelcondominiumbylaws,andalist-ingofselectedAmericancases.DavidClurmanservedasanAssistantAttorneyGeneraloftheStateofNewYorkfortwenty-threeyears.Heconcludedhistermof office in the position of Director of the Bureau of Securities and PublicFinancing,apositioninwhichhewasresponsiblefordirectingandimplement-ingnewcooperativeandcondominiumconstruction.

“Condominium:AnIntroductiontotheHorizontalPropertySystem.”DePaul Law Review 11(1962):319–28.

Written at the time when only two states, Arkansas and Hawaii, had enactedcondominiumlegislation,thisstudentcommentstatedthat“[t]heneedfortheCondominium is becoming quite evident; it grows out of a pressing necessitytoprovideadequatehousing in large urban areas where the high costof land,coupled with construction and financing expenses, practicably precludes theerectionof single familyhomesandwhere rentalsonavailable apartments areprohibitivelyhighforthemasses”(p.321).ThearticleprovidesananalysisofthePuertoRicoHorizontalPropertyActandanoverviewofthe1961amendmenttotheNationalHousingActthatauthorizedtheinsuranceofmortgagesoncondo-


miniumunits.Thearticlestatesthatthecondominiumconceptofhomeowner-shiphasbeensuccessfulincountriesthroughouttheworld,andthereisnoreasonwhyitshouldnotflourishintheUnitedStates.

Cribbet, JohnE.“Condominium—HomeOwnership forMegalopolis?”Michigan Law Review 61(1963):1207–44.

Professor Cribbet provides a brief history of condominium and describes thethreebasicfactorsthathaveledtothedevelopmentofthisformofhomeowner-shipintheUnitedStatesandPuertoRico.Theseare(1)thelackofgoodbuild-ing sites close to urban areas and the resulting housing shortage, (2) the greatdesireforhomeownership,and(3)thefactthatthisformofhomeownershipismoreaffordable fora largernumberofpeople.Cribbet alsodiscusses indepththeadvantagesof the regulationof condominiumby legislation,asopposed toregulationbycommonlaw.Heprovidesadraftofacondominiumact,withcom-ments upon the provisions within each section. The last portion of the articledescribes theadvantagesof thecondominiumformofhomeownership,aswellasitsdisadvantages.

Crowley,BenH.“Property:Condominium:WhatPlace—Space?”Tulsa Law Journal1(1964):73–79.

Thisisaninterestingstudentcommentfocusingontheexaminationandevalu-ationofthecondominiumconceptofconveyingspaceasrealproperty.“Thefeesimple possessory right to the condominium unit is to ‘airspace’ and nothingmore” (p.74). The state statutes also authorize the conveyance of the commonelements,whichcannotbepartitionedordividedfromthespaceestate.

Fokes,W.Robert.“LegalandPracticalAspectsofCondominium.”Business Lawyer19(1963):233–42.

This is an excellent introductory article on condominium development in theUnitedStates,inwhichtheauthorpointsoutthe“spectacularlegislativegrowth”(p.233)oftheconceptofcondominium.Heexaminestheadvantagesofthecon-dominiumformofhomeownership,concernsregardingtherecordingofthelegaldocuments,andfinancingissues,andmakesfrequentreferencetothelawrecentlyadoptedinhishomestateofFlorida.

Genshlea,JosephS.,andWilliamA.Hirst.“HomeOwnershipinSpace––PieintheSky?”Hastings Law Journal 14(1963):263–69.

Theauthorsdiscussthenatureofhomeownershipinacondominiumandstatethattheconceptdependsonthepossibilityofowningairspace.TheycitemanyearlyEnglishandAmericancasesbothinfavorofowningairspaceandopposedtotheidea.Theyaskthefollowing:“Towhatdoesonehavetitle?Howenduringisthatpropertyinterest?Whenthebuildingisdestroyed,orisnolongerhabitable,whatremainstothe‘homeowner’?”(p.264).Theauthorsrefertoproposedcon-dominiumlegislationinCaliforniaandnotesomeoftheproblemstheownershipofspacemaypresent.

Kehoe, Patrick E. Cooperatives and Condominiums. Dobbs Ferry, N.Y.: OceanaPublications,1974.

ThisworkispartoftheLegalAlmanacseriesthatattemptstoexplainthelawonasubjectinnontechnicallanguage.Kehoeprovidesanexcellentcomparisonofthetwotypesofhomeownershipanddiscussestheprosandconsforpurchasingoneortheotherandthetaxconsequencesofeach,andtheinsuranceneedsofeach.Thebookincludesasampledeclaration,bylaws,andmanagementagreement.


Kerr,WilliamK.“Condominium.”InA.B.A. Section of Real Property, Probate, and Trust Law Proceedings, Miami Beach, Florida, August9–11,1965,Pt.II,19–26.SouthHackensack,N.J.:FredB.Rothman&Co.,1972.

Inthispresentationtoa1965ABAmeeting,theauthorindicatesthathisviewofcondominiumas“theownershipofpartsofabuilding”mayrepresentaminorityview.Heexplainsthatmostpropertyexpertsofthedayviewedcondominiumastheownershipofaunitandtheunitasacubeofspaceabovethesurfaceoftheland.“[O]wnershipofthecubecarrieswithittherighttooccupytheportionofthebuildingwhich itcircumscribes”(p.19).Kerrdiscusses thevalueof legisla-tioninregulatingcondominiumhomeownership,asopposedtocontrollingthistype of ownership using common law. He provides a description of the basicdocumentsofcondominiumandinformationonthefinancingofcondominiumprojects.

Lasner, Matthew Gordon.“No Lawn to Mow: Co-ops, Condominiums, and theRevolution in Collective Homeownership in Metropolitan America, 1881–1973.”Ph.D.diss.,HarvardUniversity,2007.

ThisPh.D.dissertationisanexcellenthistoryofcollectivelyownedmultifamilyhousing in theUnitedStates.Theauthordescribes thevarious typesofcollec-tivehomeownership,suchascooperatives,gardenapartments,attachedhouses,“own-your-own”apartments,andcondominiums.Pages465through557focusexclusively on condominiums. Lasner provides a thorough comparison of thecooperative and the condominium and describes how manyAmericans in theearly1960scametofeelthatthecooperativeboard’sabilitytoapproveorrejectsalesofapartmentswasinconvenientanddistasteful.“Afterdecadesofpromot-ingtheco-opasnothinglessthanabsoluteandindependenthomeownership,therealestateindustry,virtuallyovernight,changedcourseandbegandescribingthecondominiumasatruesystemofhomeownershipandtheco-opassomethingpartial and inferior” (p.480). Many people decided that they preferred to owntheir units outright rather than own an interest in a cooperative. In addition,condominiumhomeownersappreciated the fact that theywereable to financetheirunitsindividually,whereasthecooperativerequiredhomeownerstofinancetheir purchases collectively. Lasner describes in some detail one of the earliestand largestof thecondominiumdevelopments inthiscountry.Aventurawasahigh-risecondominiumdevelopmentofover17,000apartmentssetonapproxi-mately800acresinnorthernDadeCountyinFlorida.Thedevelopmentincludeda270-acregolfcourse.Theauthorprovidesasketchofthemasterplan,anaerialphotographofthedevelopment,floorplansoftheapartments,andcopiesofthemarketingbrochures.Healsoprovidesanextensivebibliographyofsourcesonmultifamilyhousing.

Lippman, William J. “Legal Problems of Condominiums.” Appraisal Journal 39(1962):453–57.

The author, a member of a NewYork City law firm specializing in real estateissues,focusesonnumerouslegalproblemsthathesaysmustberesolvedbeforethecondominiumformofhomeownershipcanbecomewidespread.Twoofthemajor problems center around the ownership of airspace and the rule againstperpetuities.HeincludesadiscussionofthecondominiumdocumentsandtheproposedNewYorkStatelegislation,theUnitOwnershipAct.


O’Keefe,RaymondT.“FinancialAspectsofCondominiums.”Appraisal Journal30(1962):465–69.

O’Keefe discusses whether the condominium will be successful in the UnitedStatesandifitwillbeabletocompeteinthehousingmarketwithrentalapart-ments,cooperatives,andsingle-familydwellings.Hethinksthattheanswerwillbedeterminedbywhetherthecondominiumwillenablefamiliestoobtainhous-ingatareasonableprice.TheauthoralsodiscussestheFHAregulationsandthefinancingofcondominiummortgageloans.

Pohoryles, Louis.“The FHA Condominium:A Basic Comparison with the FHACooperative.”George Washington Law Review 31 (1963):1014–37.

Thisarticle,writtenintheearlydaysofcondominiumdevelopment,isprimarilyadescriptionofthecondominiumconcept.Asthetitlestates,thearticlecomparesthecondominiumstyleofhomeownershipwiththecooperative.ItdoesthisfromthepointofviewoftheFederalHousingAdministration’sregulations.Thecoop-erative differs from the condominium in that the ownership or the title to thewholepropertyremainswiththecorporation.Thememberofthecorporationisashareholderorapersonwhoisentitledtooccupyaunitforanindefiniteperiodoftimeinaspecificapartment.Inthecondominium,theindividualownsthespacewithinthatunitandapercentageofthewhole.Pohorylesemphasizestheneedforenablinglegislationatthestatelevelifthecondominiumformofhomeownershipistoflourish.Healsoemphasizesthevalueofpublicrecordationofanenablingdeed.Includedisareviewoftheroleoftheinvestorordeveloper,themanagementoftheproperty,assessmentofcommonexpenses,andthefinancial issuestobeconsideredwhenchoosingbetweenpurchasingacondominiumoraninterestinacooperative.Heconcludes:“Thecondominiummaybeheretostay.Ithasbeenacclaimedwidelyasasaviorofurbanhousing....”(p.1037).Thisisanexcellentreviewoftheprosandconsofcondominiumhomeownership.

Rohan,PatrickJ.“DraftingCondominiumInstruments:ProvisionsforDestruction,ObsolescenceandEminentDomain.”Columbia Law Review65(1965):593–624.

ProfessorRohanaddressesthepossiblenegativeaspectsofcondominiumowner-ship, such as partial or total destruction of the building, excessive repair costs,obsolescence,terminationofthecondominium,andeminentdomain.Inanefforttoencouragethoseworkingonenablinglegislationtoincludeprovisionsfortheseareas, he provides specific drafting recommendations for each area. Althoughtheseconcernscanbeproblemsforanypropertyowner,inacondominium“theirpotentialdisruptiveeffectthreatensnotonlytheinterestsoftheindividualunitowner,butextendstothelegalframeworkoftheentireproject”(p.594).Decision-makinginacondominiumiscomplicatedbytheabsenceofindividualdecision-makingpower.Understandingbeforepurchasethevotingrequirementsstipulatedbythecondominiuminstrumentsisawiseprecaution.

Schlitt,CarlD.“HistoryofCondominiums.”Appraisal Journal30(1962):453–57.This article discusses the history of condominiums in the United States as of1962.Theauthordefinescondominiumsaspropertyinwhicheachpersonownsanindividualportionofthebuilding.Writtenatthebeginningoftheperiodofcreationofstatutesgoverningcondominiumdevelopment,theauthordescribesa specific condominium development that he helped to create in 1947. HeworkedwithagroupofGIswhowantedtoliveinanapartmentbuildinginNewYorkCity.Oneofthemenboughtabuildingthatcouldbeconvertedintotwelve


individualapartments,anditwashisintentiontoselleachapartmenttooneofhisfriends.SchlittandhiscolleaguesdecidedthatunderNewYorkStatelawapersonhadtheright toownairspace,andtheydecided“itwouldbeperfectlyfeasibletoinsuretitletoanairspaceinsidethebuilding,providedtheyhadsomedominionoverthosephysicalelementswhichwouldpermitthemtogettoandtakepossessionoftheairspace.Sowedevisedourcastlesintheair”(p.454).Bythetimehewrotethisarticleintheearly1960s,thatventureintocondominiumlivinghadsucceeded.Theauthorpointsoutthathehasbeendiscussingcondo-miniumsastheyrelatetoapartmenthouses,butsays,“Iwantyoutorecognizethefactthatthepossibilitiesareunlimited.Forinstancethecondominiumformofownershipmightbeapplicabletoatwo-familyhouse....”(p.457).Heevenmentionsthefactthatthecondominiumconceptcouldapplytoindustrialandcommercialbuildings.

Transcript of the Text Prepared for Delivery at the Symposium on The Practical Problems of Condominium.NewYork:TheAssociationoftheBaroftheCityofNewYork,1964.

Asthetitleindicates,thisworkcontainsthetextofthetalksgivenbythevariouspanelmembersattheAssociationoftheBaroftheCityofNewYork’sCommitteeonRealPropertyLawmeetingofMay11,1964.ProfessorCurtisJ.Berger’stalkprovidesanupdateoncondominiumdevelopment,adescriptionoftheprosandconsofthisrelativelynewformofhomeownershipinNewYork,andareviewofthekeyelementsintherecentlyapprovedNewYorkstatute.MendesHershmanexploresvarioususerestrictionsandrelevantcourtdecisions.Othertalksfocusonmortgagelendingconcerns,problemsofthetitleinsurer,andissuestheattor-neymusthandleinrepresentingthedeveloperofaproposedcondominium.

Statutory Foundation

¶22ThelawofcondominiumdevelopedrapidlyintheUnitedStatesfollowingthe passage of two important pieces of legislation. On June 30, 1961, PresidentKennedysignedtheNationalHousingActof1961.56Thislegislationcontainedsec-tion234(c),whichlegallyrecognizedthecondominiumconceptofrealpropertyownershipforthefirsttime.57Inaddition,theactauthorizedtheFederalHousingAdministration to insure mortgages from lenders for condominium dwellings,58andtherebymadeobtainingamortgageforthepurchaseofacondominiummucheasierbyeliminatingtheneedforalargedownpayment,whichisrequiredtooffsetuninsuredmortgages.59ThiswasamendedbytheHousingActof196460toincludea subsectionauthorizing“the insurance of amortgage whichwould finance theconstruction or rehabilitation of a condominium, in addition to the sale of thedwellingunits.”61Thislegislationpermitting“theFederalHousingAdministration

56. Pub.L.No.87-70,75Stat.149;ass’n of thE baR of thE city of n.y., tRanscRipt of thE tExt pREpaREd foR dELivERy at thE symposium on thE pRacticaL pRobLEms of condominium2(1964). 57. Pub.L.No.87-70,sec.104,§234,75Stat.149,160(codifiedasamendedat12U.S.C.§1707). 58. Berger,supranote24,at988. 59. 1gaRy a. poLiakoff, thE LaW of condominium opERations §1.07(1988–). 60. Pub.L.No.88-560,sec.119,78Stat.769,780. 61. 1fERRER & stEchER,supranote1,§9,at5–6.


to insure mortgages on individual units in multi-unit structures, i.e., oncondominiums”62allowedthosewhocouldnotaffordasingle-familydwellingtorealizetheAmericandreamofhomeownership.AccordingtoonesourcethatsellsFHA-insured loans:“Insurance for condominiums, such as is provided throughSection234(c),canbeimportantforlowandmoderateincomerenterswhowishto avoid being displaced by the conversion of their apartment building into acondominium.”63

Condominium’s appearance is timely, for it coincides with a growing awareness that formanyurbanresidentshome-ownershipinitshistoricguise,theone-familyhouse,isbecom-ingimpracticable.Still,thedesireforone’sownhomeislikelytopersist,sofirmlyembeddedhasitbecomewithinourculture.Condominiummayhelptoredirectthisdesiretowardthekindofstructurethatwilllargelycompriseourcitiesoftomorrow.64

¶23Itwasduringthe1960sthatstatesadoptedenablinglegislationpermittingthecreationofcondominium.“UnlikemostAnglo-Americanconceptsofpropertylaw,condominiumownershipisbasedonstatutoryauthority,notoncommonlawconcepts.”65CurtisBergerstated:

Inconsideringwhethercondominiumisafeasibleformofownershipunderthecommonlaworwhetheritrequiresspecialstatutoryprovision,asithasinLatinAmericaandEurope,onemightnotethatEnglandandScotlandhaveassimilatedflat-ownershipwithoutbenefitofstatute,andintheUnitedStates,thereareinstancesofcondominiumthatpredatelegisla-tiverecognition.66

OnesuchexperimentwasdescribedbyCarlSchlittinhisHistory of Condominiums.67¶24 Berger, however, concluded that although condominium can exist under

common law, it was unlikely to flourish in this country without statutoryprovision:

Whatkindoflegislationdoescondominiuminitsembryonicstaterequire?Thereisimme-diateneedforanofficial imprimatur—anenablingstatutethatblessesthecondominiumconceptanderases anydoubts thatour legal systemcan tolerateownershipof estates inairspacelots.Thisaloneshouldstimulatetheinterestandelicittheconfidenceoflenders,consumers,andsuppliers.Thestatutewouldensure thatunitownership is recognizedasaninterestinrealproperty—astatusdeniedbysomecourtstothestock-leasearrangementforacooperative—andthatunitmortgages,whether insuredorconventional,qualify forinstitutionalinvestment.68

¶25JohnCribbet,authorofthePrinciples of the Law of Property,providedtwomajor reasons for preferring the regulation of condominium by statute. First, acarefully written statute would clarify many uncertainties that would otherwisehavetoawaitanswersfromthecourts,andsecond,statuteswouldhelptoprovide“uniformityinthecreationofprojects.”69

62. vanWeesep,supranote13,at 122. 63. FHA Programs: FHA Mortgages for Condominium Units,fha Loan,http://www.fhaloan.com/fha_condominium.cfm(lastvisitedFeb.21,2011). 64. Berger,supranote24,at1024. 65. thomas,supranote40,§36.06(a),at237. 66. Berger,supranote24,at1001–02(footnoteomitted). 67. CarlD.Schlitt,History of Condominiums,30appRaisaL J.453(1962). 68. Berger,supranote24,at1003. 69. Cribbet,supranote20,at1218.


¶26WilliamSchwartzofBostonUniversitywrote:

The statutory foundation would appear desirable, if not strictly necessary, in order toclarifytherightsoftheparties inter-se andwithrespecttothirdparties,suchasthetax-ingauthorities.Thus,intheabsenceofastatute,itisdoubtfulwhetheraunitownerwhorepairsthecommonareascanobtaincontributionfromhisneighborsorthataunitownercan demand that his neighbors make repairs. Likewise, in the absence of a statute, it isdoubtfulwhetheraunitwouldberecognizedasaseparateentityfortaxpurposes.70

¶27Section234of theNationalHousingAct includedaconditionrequiring“thattheconceptofcondominiumhomeownershipmustbeestablishedunderthelawsofthestatewherethepropertyislocated.”71Thisisnotnecessarilyarequire-ment that each state approveenabling legislation,but rather that condominiumownershipbepermittedinthestate.72However,“[i]twouldbehighlydesirable...ifproperstatelegislationwereenactedtosimplifyandstandardizethemethodofsettingupsuchtitles.Theywouldthenbemorereadilyinsurable.”73

¶28By1969,everystatehadadoptedacondominiumstatute.Theseearlystat-utes,oftenreferredtoasfirstgenerationstatutes,continueto“providethestatutoryfoundationforcondominiumdevelopmentinapproximatelyhalfofthestates.”74They“provideforrecognitionofdividedownershipandtheutilizationofconvey-ancing instruments that adequately and clearly demonstrate ownership and itstransferability.”75Theyalso

attempttoregulateprocedures,delineatethedutiesoftheindividualunitowners,aswellasofthecondominiumassociation,providefordistributionofresponsibilitiesintheeventofdamage,destructionorcondemnation,anddeterminethelegalrightsofcondominiumunitownersandassociationsintheeventofdefaultingindividualunitowners.76

Inotherwords,thefirstgenerationofcondominiumstatutesrecognizedthecon-dominiumconceptofhomeownership,butdidnotattempttoregulatepotentialabuses.77

¶29Inordertoaddressproblemsnotcoveredbytheseearlystatutes,suchasabusesinoperationsanddevelopment,andtorequiredisclosurestatementscon-cerning all condominium declarations, bylaws, and restrictions, many statesenactedsecondgenerationcondominiumstatutes.Themodel formanyof thesesecondgenerationstatuteswastheUniformCondominiumAct(UCA),approvedbytheNationalConferenceofCommissionersonUniformStateLawsin1977.78“Asecond wave of state condominium legislation—in some states, even a third

70. Schwartz,supra note26,at143(footnoteomitted). 71. Ramsey,supranote21,at22. 72. Id. 73. Id.at22–23. 74. WaynE s. hyatt, condominium and homEoWnER association pRacticE: community association LaW12(3ded.2000). 75. david cLuRman Et aL., condominiums and coopERativEs13(2ded.1984). 76. thomas,supranote40,§36.06(a),at237–38. 77. vanWeesep,supranote13,at127. 78. hyatt, supra note 74, at 12. Condolawyers.com (condolawyers.com/nationalaw.htm) pro-videslinkstostatecondominiumlaws.Megalaw.com(www.megalaw.com/top/condo.php)provideslinkstostatecondominiumlawwebsitesaswellascondominiumlawsitesandcitationsforpublica-tionsaboutcondominiumlaw.


wave—isprovidingimprovedguidelinesfordevelopingandgoverningcondomini-ums, and consumer standards are being set to eliminate sales abuses, leading togreatersatisfactionwithcondominiumliving.”79

Further Reading

Berger, Curtis J. “Condominium: Shelter on a Statutory Foundation.” Columbia Law Review63(1963):987–1026.

Berger believes that one of the major goals of condominium is to allow indi-vidualstoobtainhomeownershipwithinamultifamilyproject.Eventhoughthedesireforhomeownershipissofirmlyingrainedinourculture,manypeopledonotwanttheupkeepandmaintenancethatasingle-familydwellingrequires.Thecondominiumformofhomeownershipoffersmajoradvantagestonotonlytheconsumer,butalsothespacesupplierandthemoneylender.Bergerexaminestheneedforandthespecificsofenablinglegislationneededbythestatesandempha-sizesthatalthoughthecondominiumcanexistundercommonlawit isdoubt-fulwhether itwouldever flourishwithout statutoryprovisions.He thoroughlydescribes two importantdocuments thatprovide informationon thenatureofthe enterprise and its internal organization—the declaration and the bylaws.Bergerprovidesaverythoroughreviewofthedevelopmentofthecondominiumconceptthatisvaluablenotonlyfromahistoricalperspective,butforhisinsightintothe futureofcondominiums.Hepointsout that,“Asexperiencewithcon-dominiumgrows,thelegislativeprocessshouldenterasecondphase.Ontheonehand,weaknessesintheprototypallawsarelikelytoappearandrequireremedy.And,ontheother,condominiumsmayprovesufficientlydesirablethatnewlegis-lationwillbesoughttostimulatestillfurthertheirestablishment”(p.1024).

Ferrer,Alberto. “SomePracticalAspectsofCondominiumLaw.”InA.B.A. Section of Real Property, Probate, and Trust Law Proceedings, Miami Beach, Florida,August9–11,1965,Pt.II,27–34.SouthHackensack,N.J.:FredB.Rothman&Co.,1972.

At the timeof thispresentation,Ferrerwasdirectorof theOfficeofLegislativeServices in Puerto Rico. A few years later, he published, with Karl Stecher, thewell-known two-volume treatise Law of Condominium. This presentation pro-vides a brief overview of the state of condominium and indicates that, as of1965,sixteenstatesreferintheirstatutesnottocondominium,butto“horizontalproperty,”fivestatesto“apartmentownershipact,”ninestatesto“unitownershiporunitproperty,”and seventeen states to“condominium.”Ferrer indicates thatonlyelevenofthestatesactuallydefinetheboundariesofacondominiumunit.These states agree“theboundariesof anapartmentare the interior surfacesoftheperimeterwalls, floors, ceilings,windowsanddoors thereof, and theapart-ment includesboth theportionsof thebuildingsodescribedandtheair spacesoencompassed”(p.29).Heanswerssuchquestionsas:Doesthecouncilofco-ownershaveindependentlegalstatus?Istheretortliabilityofanownerforinju-riesdue tonegligenceoccurringonthecommonelements?When is thepublicdeedfornewdevelopmentsfiled?Cancondominiumbeusedforadevelopmentofsinglefamilyhouses?

79. thE oWnER’s and managER’s guidE to condominium managEmEnt,atxiv(rev.ed.1984).


Kerr,WilliamK.“Condominium:StatutoryImplementation.”St. John’s Law Review38(1963):1–49.

The author compares condominium with other forms of property ownershipandexaminesitsprincipalcharacteristicsandafewspecificproblemsthatmayarise, such as determining the ratio of common interest, inseparability of thecommonelementsfromtheunit,dealingwithrecalcitrantowners,andtermina-tionofthecondominium.Hediscussessomesolutionstotheseissuesfoundinexistinglegislationandprovidesachecklistattheendthatspecifiesthepointstheidealstatutemustinclude.

Ramsey,CharlesE.“Condominium.”The Practical Lawyer 9,no.3(March1963):21–32.

This article was originally delivered as a paper before the Section on RealProperty,ProbateandTrustLawoftheABAin1962.RamseyusestheHorizontalPropertyActofPuertoRico“asanexampleofwhatcondominiumisandhowitworks,andtoillustratehowsomeofitsbasicproceduresmay,withsomemodi-fications,beusedintheUnitedStates”(p.23).Thearticleprovidesanexcellentoverviewoftherequirementsofcondominium.

Ramsey, Charles E. Condominium: The New Look in Co-ops, Practical and Legal Problems.Chicago:ChicagoTitleandTrustCo.,1961.

ThisexcellentworkwaspublishedshortlyaftertheenactmentofSection234oftheNationalHousingAct.Ramsey,TitleOfficerfortheChicagoTitleandTrustCompany,becameanexpertinthedevelopmentofcondominiumintheUnitedStates.Heprovidesbackgroundinformationonthedevelopmentofcondomin-iuminPuertoRicoand theUnitedStates,alongwithacomparisonofcondo-miniumandcooperativeownership.HeincludesadescriptionoftheFHA’snewregulationsconcerningmortgagesinsuredunderSection234.Hefullydescribesthedeclarationandbylawsandincludesabriefdiscussiononrestrictionstobeincludedinthedeclaration.

Schwartz,William.“Condominium:AHybridCastleintheSky.”Boston University Law Review44(1964):137–55.

Schwartzdiscussestheadvantagesofthecondominiumconceptofhomeowner-shipandexploreswhethertheconceptcanexistincommonlaw.HereviewstheMassachusettsstatutepassedin1963thatregulatescondominiumandindicatesthatalthoughthestatuteisathoroughtreatmentofthesubject,therearemajorgapsinthelegislation.“Problemsremainwhichcanonlyberesolvedbystatutoryamendmentor judicialdecision” (p.144).Someof theseproblemareas are theun-neighborly neighbor (the author refers to condominium as an experimentingroupliving),thecreationofa lienthathaspriorityoverallother liens,thetreatmentoftortliabilityinthestatute,thelackofeminentdomainprovisions,andthelackofclarityinthecaseofapartialdissolution.Heconcludeswiththisprophecy:“Thus,attheriskofbeingcharacterizedasafalseprophet,theauthordoespredictthatitwillnotbetoolongbefore‘castles’willbebuiltintheskiesofMassachusetts”(p.155).

Creation of the Condominium

Acondominiummaybeahigh-riseapartmentbuilding,agardentypehousingdevelopment,anofficebuilding,ashoppingcenteroranindustrialcomplexwhereeach apartment, attached or semi-detached unit, office space unit, etc., is indi-


viduallyowned,withjointownershipandcontrolofcommonareasandfacilities.Ineachof thesesituations, theunitownerhasa fee interestwhichmaybesold,exchanged,mortgaged,andseparatelyassessedfortaxpurposes.80

¶30Developerswhowish tocreateacondominiummustdeclare their intentwiththerecordingofthedeclaration,sometimesreferredtoasthemasterdeed,aswellasthebylawsandthefloorplans.Withthesedocuments,“thecondominiumprojecthasitslegalinception.”81Thesedocumentsmustbefiledwiththerecordingofficerwithinthejurisdiction.82

¶31 The declaration is a constitution setting out the rights and duties of theowners—the original owners, as well as all future owners—and is an importantdocument in modern land development. It must comply with the state condo-miniumlaworotherapplicablestatutes.83

The declaration contains fundamental ownership covenants that“run with the land” sothat itbindseverypersonwhobecomesapropertyowner in theproject. Inessence, thisdocument provides for dividing ownership—a veritable declaration of independence fortheseparateunitscreatedbythisprocessaswellasaffirmationbyunitownersofthesharedobligationforcommonlyusedareasorcommonelements.84

Thedeclarationincludesalegaldescriptionofthelandandbuildings,aswellasadescription of each unit and of the common areas. According to the UniformCondominiumAct,itshouldincludethenameofthecondominium,thenameofeverylocaljurisdictioninwhichanypartofthecondominiumislocated,adescrip-tionoftheboundariesofeachunit,andadescriptionofthelimitedcommonele-ments.85Thedeclaration includesanyapplicable restrictions, suchasano-rentalpolicy,astatementthattheunitsareforresidentialpurposesonly,andapolicythatany violation of the declaration or bylaws or any rules that the Board ofAdministrationimposescanberemediedbylegalaction.

¶32Thedeclarationprovidesanoverviewoftheadministrationofthecondo-miniumprojectandinformationonthealterationoftheproject,replacementandmaintenance funds, insurance, and the procedure regarding unpaid commonexpenses.“Theownersarealsograntedeasements tomaintainpipes,wires,con-duitsandpublicutilitylines,etc.,andarightofaccesstounitstomakerepairs.”86Thedeclarationusuallyincludesasectiononeminentdomainandhowthatcouldimpactthecondominiumproject.

¶33“Oneof itsmost important features is thestatement in fractionsofeachowner’s‘commoninterest’—i.e.,hisshareofrightsanddutieswithrespecttothe

80. ERnEst hEnRy bREuER, condominium: a sELEctEd bibLiogRaphy of thE histoRicaL, common LaW, fEdERaL and statE LEgisLation aspEcts of unit oWnERship, hoRizontaL pRopERty and aiR spacE oWnERship in REaL pRopERty101(1962). 81. ass’n of thE baR of thE city of n.y.,supranote56,at6. 82. See1poLiakoff,supranote59,§4.22. 83. WayneS.Hyatt,Community Associations: How to Draft Documents That Work,7REaL Est. L.J.26,30(1978). 84. cLuRman Et aL.,supranote75,at12. 85. Unif.CondominiumAct§2-105(amended1980),7(pt.II)U.L.A.535(2009). 86. bREuER,supranote80,at100.


commonelements.Thisfractionfixestheunitowner’sprorataburdenofthecom-monexpenses . . . .”87Thepercentage isnecessarytocalculateeachunitowner’sliabilityforthemaintenanceofthecommonareasandimprovements.Italsodeter-minestheweightofeachunitowner’svoteforthepurposesofamendingthedec-larationordeterminingtheassociation’sassessments,aswellasothervotingissues,suchasvotingforthedirectorsoftheassociation.

Ithasbeenheldthatthecondominiumdeclarationismorethanamerecontractdelineat-ingthemutualrightsandobligationsoftheparties.Italsoassumessomeoftheattributesofacovenantrunningwiththeland,circumscribingtheextentandlimitsoftheuseandenjoymentofrealproperty.88

¶34Thedeclarationisanimportantlegaldocument,anditisusuallydifficulttoamend.89TheUniformCondominiumActrecommendsthatresidentialcondo-miniums require at least sixty-seven percent of the votes in the association foramendment,butindicatesthatthedeclarationcanrequirealargermajority.90

¶35Thebylaws“aretherulebookbywhichtheassociation,andparticularlytheofficers and directors, function.”91 The bylaws“spell out the policies and proce-duresthatwillbeemployedintheeverydaygovernanceandadministrationofthecomplex.”92Theydescribemembersoftheassociation,thetypesofmeetingsthemembers are required tohaveand their frequency, aswell aswhat constitutes aquorumforthesemeetings.Thebylawsdelineatetheobligationsofthemembers,includingwhat theyare required tomaintainandrepair, andwhathappens if amemberdoesnotpaytheassessmentfees.Theydescribethemakeupandrespon-sibilitiesoftheboardofadministration;thetermsofoffice;thefrequencyofboardmeetings;thetimingofthenoticeregardingmeetings,includingtheannualmeet-ing; theelectionprocess; and theboard’spowersandduties.Thebylawsusuallyincludeprovisionsfortheremovalofboardmembers,thekeepingofminutes,andthecontentandnoticeoftheannualbudget.Inmostcommunities,amendingthebylawsiseasierthanamendingthedeclaration.93

¶36Therulesaretheregulationsofthecondominiumprojectandtheopera-tionalrulesofbehavior.Theyarebindingoneachowner.94Therulesmayincludeprovisionsforpets,parking,trash,noise,fencing,decks,patios,landscaping,exte-riordecoratingandlighting,windows,doors,andskylights.Therulesregulatetheuseof thecommonelements, the limitedcommonelements,and the individualunits.“By and large, condominium documents do not subject the rule-makingauthorityoftheboardtounitowneragreementorvote.Mostoften,however,theboardisrequiredtodistributetoeachunitowneracopyofanyrulesthatithasadopted.”95

87. ass’n of thE baR of thE city of n.y.,supranote56,at6. 88. thomas,supranote40,§36.06(a),at240. 89. nELson & Whitman,supranote41,at549. 90. Unif.CondominiumAct§2-117,7(pt.II)U.L.A.at564. 91. Hyatt,supranote83,at32. 92. kEhoE, supra note34,at 19. 93. SeenELson & Whitman,supranote41,at549. 94. C. JamEs doWdEn, cREating a community association 36(2drev.ed.1986). 95. 1poLiakoff,supranote59,§4.28.


¶37Thesedocuments—thedeclaration,bylaws,andrules—providethestruc-tureofthelegalentitycalledtheassociationandarereferredtoasthecovenants,conditions,andrestrictionsortheCC&Rs.96

Further Reading

Kratovil,Robert.“TheDeclarationofRestrictions,Easements,Liens,andCovenants:An Overview of an Important Document.” John Marshall Law Review 22(1988):69–97.

ProfessorKratovilprovidesageneral introductionto thedeclarationofrestric-tions and illustrates how modern property law evolves. The declaration is“theoperative document creating a condominium that subdivides the declarant’sinterestinthelandhorizontallyandvertically.Toestablishacondominium,thedevelopermustdeclarehisintentiontodosobyrecordingadeclarationcontain-ingtheinformationrequiredbystatute.InsomestatesthedeclarationisreferredtoasaMasterDeed”(p.75).Hecallsthedeclaration“acreationofthiscentury’slawyers’ingenuity”(p.69).Kratovildescribestheearlydevelopmentofthehome-ownerassociation,theUniformCondominiumAct,andtheUniformCommonInterestOwnershipAct.

Lippman, William Jay. Condominium and Co-op Closings: A Practical Guide to Residential and Commercial Properties. 4th ed. New York: Practising LawInstitute,2009.

Thisexcellenthandbookprovidesextensiveinformationforattorneysrepresent-ing the purchasers and sellers of a condominium or co-op dwelling, as well asthose purchasing a commercial condominium. The author, counsel to the lawfirmofThacherProffitt&WoodandanadjunctassociateprofessorattheNewYork University Real Estate Institute, provides a detailed section on preparingthecontractofsale.Heprovidesanextensivesystematicchecklistfortheclosingprocedure,alongwithadetailedexplanationofeachstep.“Theclosingrepresentsa complex coordination of a number of steps that must come to a conclusionsimultaneously”(p.4-3).Thefinalsection,anoteonlegalsources,providesalist-ingofall thestatutesoncondominiumforthefiftystates.Thistitle isavailableonWestlaw.

Norcross, Carl. Townhouses & Condominiums: Residents’ Likes and Dislikes.Washington,D.C.:UrbanLandInstitute,1973.

This is an interesting report of a survey of residents in forty-nine projects inCalifornia and the Washington, D.C., area. The emphasis was on the peoplealreadylivinginatownhouseorcondominium,notonthoseindividualswhoareconsidering buying. The survey attempted to determine what 1800 individualsandfamiliesinforty-nineprojectslikeanddislikeabouttheirtownhouseorcon-dominium.Norcrossprovidesdataonownersatisfaction,irritationswithcondo-miniumliving,parkingproblems, importanceofrecreationalfacilities,aprofileofbuyers,aswellasthedensityandthe“peoplefactor.”Thetopthreecomplaintsin the surveydealtwithcrowdingor living tooclose together,noisyneighbors,andbarkingdogs.Theauthorincludesnumerousblack-and-whitephotographs

96. maRLEnE m. coLEman & WiLLiam huss, WoRking With youR homEoWnERs association60(2003).


ofthevariouscommunities,aswellassketchesoflandplans,includingbuildinglocations,streetandparking layouts,andthespacearoundthem.Anappendixincludes the names, descriptions, price ranges, and developers of the variouscommunitiesthatwereincludedinthesurvey.

The Owner’s and Manager’s Guide to Condominium Management. Rev.ed.Chicago:InstituteofRealEstateManagementoftheNationalAssociationofRealtors,1984.

Thistextbookservesasanexcellentreferenceforallpersonsinvolvedwithcon-dominiums: the developer, unit owner, property manager, and board member.It provides detailed information on the governing documents, the transfer ofcontrol fromthedeveloper to thehomeowners, theboardofdirectors,howtoconduct effective membership and board meetings, the committee structure,propertymanagementandmanagers,maintenanceandsecurity,insurance,andthebudgetaryprocess.Italsoincludesanextremelyhelpfulchecklistofsampleforms,suchasgrievanceorcomplaintforms,asampleproxy,noticeoftheannualmembershipmeeting,andabudgetworksheet.

Poliakoff, Gary A. The Law of Condominium Operations. 2 vols. Eagan, Minn.:Thomson/West,1988–.

This excellent source, updated annually, provides an overview of the condo-miniumconcept,aswellasanextensivesectionofforms.Theroleoftheassocia-tionisdiscussedindepth, includingitsstructure, itsroleinrulesenforcement,its financial obligation for common expenses, and its insurance requirements.Achapterontherightsandliabilitiesofdirectorsprovides informationontheresponsibilitiesofthedirectorsformaintenanceandrepairofassociationprop-erty,fiscalplanning,andenforcingcovenantsandrestrictions.Therearechaptersonconductingassociationmeetings,thecovenantsandrestrictionsofthecondo-minium,assessmentofhomeownersforassociationexpenses,aswellasonhan-dlingnonpaymentofassessmentsandforeclosure.Thechapteronprotectingtheassociationfromrisksincludesinformationontheassociation’sresponsibilitytoprotectthecondominiumfromcriminalactivity,toprotecttheassociationprop-erty, and to protect the residents of the condominium. An interesting chapteronwarrantiescoversthespecializedfieldofconstructiondefectlitigation.Therearechaptersonamendingthecondominiumdocuments,associationattorneys,andtherightsandresponsibilitiesofunitowners.Alsoincludedisachapteronspecialtycondominiums,suchaslandcondominiums,nonresidential,continuedcare,hotel, and resortor time-sharecondominiums.There is a comprehensiveindexandatableofcases.

Ramsey,CharlesE.“Condominium.”Mortgage Banker 23 (December1962):22–25,52.

Thisisanexcellentintroductoryarticleregardingcondominium,whichprovidesextensive information about the content and requirements of the declaration.Ramsey stresses how important it is for the declaration to mandate “that noco-ownermayconveyormortgagehisapartmentwithoutincludingalsohiscor-respondingundividedinterestinthecommonelements,andviceversa.Itismostimportanttothecontinuedexistenceandsuccessofthecooperativeventurethatthiscombinedunitownershipnotbeseparated....”(p.25).


Rohan, Patrick J. “Condominium Housing: A Purchaser’s Perspective.” Stanford Law Review17(1965):842–62.

Theauthorindicatesthatatthetimethearticlewaswritten,in1964,therewerefewsourcesof informationavailable toprovideeither thepurchaserorcounselfor the purchaser with guidelines on factors to be considered and problems tobe anticipated when purchasing a condominium unit. He recommends a closescrutinyofboth theassessmentandvotingrightspolicy in thedeclarationandrules,aswellastheprovisionsforamendingthecondominiuminstruments.Healso stresses the importance of the documents requiring professional manage-ment of the property. “Shortsighted economies and outright mismanagementmay produce a decline in essential services, amenities, and eventually propertyvalues”(p.856).

Rohan,PatrickJ.,andMelvinA.Reskin.Condominium Law and Practice: Forms.7vols.Albany,N.Y.:LexisNexisMatthewBender,1965–.

Thisexcellentmultivolumesetisupdatedquarterly.Theauthorsprovideexten-siveinformationonthecreationofcondominiums,includingexamplesofactualcondominium documents and litigation documents. They include informationonthecondominium’suseofairspace,andcurrentcondominiumissues,includ-ingantidiscriminationlaws,constructiondefects,time-sharing,obsolescence,andretirement communities. They also provide citations to current condominiumlegislationandregulations.Thistitleisarequiredresourceforprofessionalswork-ingwithcondominiums.

Thomas,DavidA.Thompson on Real Property.15vols.2dThomased.Newark,N.J.:LexisNexis,2004–.

Chapter36ofthistreatisediscussestheresidentialpropertyrightsofownersofcondominiumsandcooperatives.Thecondominiumconceptprovidesforsepa-rateownershipofindividualunitsinmulti-unitprojects,andasharedownershipastenantincommonofthecommonareasandfacilitiesofaproject.Itreviewsthepropertyrightsofoccupantsofseparateunitsinmulti-unitbuildingsandthebenefits of individual ownership as well as shared responsibilities. The chapteralsoprovidesabriefhistoryofcondominiums,adescriptionofthelegalstructureof the concept of condominiums, a description of condominium documents,andinformationonliabilityoftheassociation,termination,disclosuresrequiredbeforesale,andtheestablishmentofthemechanismforcareandupkeepofcom-mon areas and facilities. The chapter concludes with a bibliography, completewithalistingofA.L.R.annotations.Thisworkisupdatedannually.

Williams, Stephen L. The Great Condominium Ripoff. Brookline, Mass.: ResearchPublications,1974.

Theauthor,aresearchandmarketinganalystinthecondominiumfield,highlightsmanyoftheproblemsofcondominiumsduringtheirfirstdecadeofdevelopmentintheUnitedStates.Williams’sfocusisonabusiveanddeceptivedevelopersandthequestionablepracticesofsomelendinginstitutions.


Governance and the Condominium Association

TheCondominiumisinrealityanexperimentingroupliving.Itbringstogetheragroupofindividualswithdiversepersonalitiesandattitudesandimposesuponthemthe“task”oflivingharmoniouslyincloseproximityonetoanother.Inaddi-tion,theseindividualsalsoassumetheresponsibilityofcollectivelymanagingthecommonareasandfacilities.97

¶38 In other words, these individuals make up the community association,sometimesreferredtoasthecouncilofhomeownersorthecondominiumassocia-tion.Theassociationisan“automaticandmandatorymembershiporganization.”98“Theassociationiscreatedatthetimethedeclarationisrecorded....”99Atthetimeofpurchase,thetitleownerautomaticallybecomesamemberoftheassociation.“Theymustremaincitizensofthatassociationsubjecttoitsgoverningandtaxingpowerssolongastheyremainowners.”100

¶39Theassociationhasthepowertogovernthecommunityandtoprovideforthecare,upkeep,andphysicalmaintenanceof thecommonelements.101 Itmustenforce the provisions of the founding documents, and establish, publicize, andenforcerulesandpenaltiesapprovedbythemembers.102Itisresponsibleforpro-curingadequate insurancecoverageas requiredby the legaldocuments. Itmustestablishsoundfiscalpolicy,keepproperrecords,establishbudgetsandassessmentrates,andsupportthebusinessneedsofthecommunity.Oneofthewaysinwhichit fulfills its responsibilities is toelectaboardofdirectors fromamong theunitowners.103

¶40“The initialboard is formedat thecreationof thecondominiumand isappointedby thedeveloper.”104Theadministrationof thecondominiumprojectrestswiththedeveloperuntilsuchtimeasthelegaldocumentsstipulatethattheownerswilltakecontroloftheassociation.105Thistimeframecanvary,butitoftenoccursatthetimeacertainpercentageoftheunitshavesold.106Somestateshavetakentheleadandhaveestablishedthetimeframeforthetransferofcontrolfromdevelopertounitowner.“Thiswasdoneinresponsetodeveloperabusessuchasindefinitely retaining control over a certain percentage of units, selling units todeveloper-controlled parties, packing the board of directors with developer-controlledpartiesorunilaterallyreservingtherighttoamendeitherthedeclara-tionorthebylaws.”107

97. Schwartz,supranote26,at144. 98. WaynE s. hyatt, condominiums and homE oWnER associations: a guidE to thE dEvELopmEnt pRocEss§1.04(1985). 99. Id.§1.05. 100. Id.§1.04. 101. Id.§1.01. 102. Id. §1.04. 103. Id.§10.11. 104. thomas,supranote40,§36.10(c),at263. 105. Id. 106. Id.at265. 107. Id.at264.


¶41The start-up board appointed by the developer represents the developer,ratherthanthehomeowners.“Thedeveloperinitiallycontrolstheassociationbothtoprotect the firm’s financial interests and to effectivelypromote the saleof thecondominiums in this project.”108As additional units are sold, the board will becomposed of developer-appointed individuals, as well as one or more memberswhorepresenttheunitowners.Eventuallytheunitownerswillbegintooutnumberthedeveloperrepresentatives.“Theroleofthedeveloperinturningovertheprojecttonewunitownershasbeenlikenedtothatofabusinesspersonturningoveranestablished business to new people with no business experience. The transitionprocess is one of the most problematic areas affecting developer/unit ownerrelationships.”109

Theemphasisisuponcreatinganatmosphereforthecommunityanduponeducatingthemembersastothegeneraloperationsoftheboardandoftheassociation.

....

....Atitsbest,turnover,thatis,transferofcontroloftheassociation,istheculminationofagradualprocessoftraining,involvement,andmutualtrustthatequalstransition.110

Afterthetransitionhasbeencompleted,theboardmovesfromappointedmemberstoelectedmembers.

¶42Thecondominiumdocumentsdescribetheelectionprocessfortheboardofdirectors,andtheyspecifytheboard’sroleandresponsibilitywithintheassocia-tion. The board of directors is the most visible group in the community. Theseindividuals are homeowners who choose to be involved in the decision-makingprocess.111 The board“is responsible for making all the business decisions thataffecttheassociation.Ithasfiduciary responsibility, legal oversight,andoverallman-agement responsibility for all of the association’s business.”112 The board is alsoresponsible for protecting, maintaining, and enhancing the value of theproperty.113

¶43 Most condominium documents include a provision allowing the boardtohireapropertymanagertohandletheday-to-dayadministrationof thecom-munity.114Itistheboard,however,whohastheultimateresponsibilityformonitor-ingandoverseeingthemanagementcompany.115

¶44 “In a move that confirmed the importance of the condominium to theAmericanhousingmarket,theUrbanLandInstitutehelpedestablishanindepen-dentorganizationtoserveasthevoiceforcondominiumhomebuildersandhome-owners called the CommunityAssociations Institute [CAI] in 1973.”116 From itsdevelopment,CAIwasdesignedtorepresentfivegroups:(1)developers,(2)prop-ertymanagers, (3)homeownerassociationdirectors, (4)publicofficials, and (5)

108. thE oWnER’s and managER’s guidE to condominium managEmEnt, supra note 79, at49. 109. thomas,supranote40,§36.10(c),at262. 110. hyatt,supranote98,§10.01,at318. 111. coLEman &huss,supranote96,at23–24. 112. Id.at23. 113. See id. at24. 114. Berger,supranote24,at1005. 115. SeecoLEman &huss,supranote96,at36–37. 116. Lasner,supranote31,at522.


professionalswhodeal inhomeownerassociations, suchas lawyers, landscapers,etc.117CAIisaneducationalorganization,whichalsolobbiesstatelegislaturesonbehalfofhomeownerassociations.Homeownerassociationscangoverncommu-nitiesofdetachedhouses,aswellassemi-detachedhouses,rowhousing,andcon-dominiums. In these communities, the members of the association own incommontherecreationalcentersandthegreenareas.AsofDecember2008,CAIhad 28,929 members. CAI reports that in 2008 there were 300,800 association-governedcommunitieswith24.1millionhousingunitsand59.5millionresidents.Thiscompareswith10,000communitiesin1970with701,000housingunitsand2.1millionresidents.118

¶45Fromitsbeginnings,CAIhas focusedoncommunicationandeducationthroughthepublicationofnewslettersandresearchreports.Theirpublishingdivi-sion,CommunityAssociationsPress,publishesnumerousresources forcommu-nity association volunteers and professionals. Their bimonthly newsletter isCommunity ManagerandtheirmagazineisCommon Ground.Theyofferanumberofsubscription-basede-newsletters.CAIservesasaclearinghouseforinformationimportanttocommunityassociations.

¶46“Living inacondominium,unlike living ina single-familyhome,elimi-natesindividualresponsibilityforyardworkandrepairsbecausethehomeownersassociation assumes those duties.”119 Prospective buyers of any condominiumshouldreadthedeclarationpriortopurchasingaunit,andtheyshouldhaveaclearunderstandingoftherulesofthecommunity.Petownersmustbeawarepriortopurchaseiftheyareconsideringacommunitywherepetsarerestricted.Rulesmayrestrict the number of vehicles allowed per unit, the type of flowers allowed incertainareasinfrontoftheunit,thecolorofwindowblinds,andthetypeofdeco-rativeitemsused,tonamejustafew.Toavoidproblems,thebuyershouldbeawareofthecommunityrulesbeforepurchasingtheunit.

¶47 Members of the condominium association own their own units, but allmembers collectively own the commonly held areas of the community and arerequired to finance, repair, and maintain those areas.120 When homeowners areinterestedintheoperationsoftheircommunityandparticipateintheprocess,theywillfindthattheircommunityexhibitsparticipatorydemocracyatitsbest.Iftheorganizationisplaguedwithapathetichomeownersordictatorialanduntrainedboard members, the community experience will be less than satisfying. SurveysdonebyZogbyInternationalin2009,however,indicatethatseventy-onepercentofpeoplelivinginacommunityassociationratetheirexperienceaspositive,withonlytwelvepercentratingitasnegative.Seventypercentsaidthattherulesoftheircommunityprotectandenhancetheirpropertyvalues.121

117. Evan mckEnziE, pRivatopia: homEoWnER associations and thE RisE of REsidEntiaL pRivatE govERnmEnt111(1994). 118. Industry Data: National Statistics, community ass’ns inst., http://www.caionline.org/info/research/Pages/default.aspx(lastvisitedJan.19,2011). 119. chRistEnsEn & LEvinson,supranote23,at317. 120. kEhoE,supra note34,at34. 121. community ass’ns inst., What do amERicans say about thEiR community associations? (2009), available at http://www.caionline.org/info/research/Documents/national_research_2009_bw.pdf.


Further Reading

Coleman, Marlene M., and William Huss. Working with Your Homeowners Association: A Guide to Effective Community Living. Naperville, Ill.: Sphinx,2003.

This book focuses on building community within a homeowner association,managingthelegalissuesthatariseinthistypeofcommunity,andmanagingtheday-to-dayoperationsofthecommunity.Ithasspecificpointersforboardmem-bers,propertymanagers,andhomeowners.Thesectiononmanaginglegalissuesprovidesanoverviewofthe legal issuesanassociationmayface.Thethirdpartdiscussestherolethatresidents,committeemembers,orboardmembersmaytakeastheyworktoimprovetheoperationsofthehomeownerassociation.Thisguideoffersverydescriptiveinformationontheresponsibilityoftheboardofdirectorsandthetypesofcommitteesthatmayexistwithintheassociation,andinforma-tionaboutpropertymanagersandvariousmanagementcompanies. Itprovidesdescriptionsoftheprimarydocuments,suchasthedeclaration,CC&Rs,bylaws,andarticlesofincorporation,andthehouserules.Italsodiscussesinsomedepththe types of communications that should occur within a community. It is anexcellenthandbookforthenewboardmemberorapersoninterestedinlearningaboutwhatisinvolvedincondominiumandhomeownerassociationliving.Thisbookisusefulforanytypeofcommunityassociation,whetherthecommunityiscondominium,cooperative,communityapartmentproject,orplanneddevelop-ment.

Dowden, C. James. Creating a Community Association: The Developer’s Role in Condominium and Homeowner Associations. 2d rev. ed. Washington, D.C.:ULI–The Urban Land Institute, and Alexandria, Va.: CAI–The CommunityAssociationsInstitute,1986.

Thisisanexcellenthandbookonthecreationandoperationofcommunityasso-ciations.Theauthorprovidesrecommendationsonhowtosuccessfullytransferthecontroloftheassociationtotheunitowners,alongwithaveryusefulchartand description of the transition phase from developer control to unit-ownercontrol. Although written primarily for the developer and builder, it providespracticalinformationtoanypersonconsideringbuyingahomeinacommunityassociation and to the person interested in serving on the board of directors.DowdenservedastheexecutivevicepresidentoftheCAIfrom1974to1990.

Freedman,Warren, and Jonathan B.Alter. The Law of Condominia and Property Owners’ Associations. NewYork:QuorumBooks,1992.

Thisresourceprovidesreaderswithaworkingknowledgeoftheimportantprin-ciplesofcondominiumlaw;adetaileddescriptionofthedocumentsofthecon-dominiumassociation;informationregardingitsoperationandcreationofrulesandregulations;andamodeldeclarationandbylaws.Also includedaresamplerulesandregulations,asamplemanagementagreement,andproceduresforthecollectionofassessmentsaswellasnotesonimportantcasesthathaveestablishedprecedentsinthisfield.

Hyatt, Wayne S. Condominium and Homeowner Association Practice: Community Association Law. 3d ed. Philadelphia: American Law Institute/American BarAssociation,2000.

This work is primarily for the practicing attorney, but it provides informationofvaluetoanyoneinterestedinbuyingahomeinacommunityassociation.The


authordiscussesthecreationofacommoninterestcommunity;definesthecom-munityassociation;anddiscussestheassociationpowersanditsfunctions,howdesignstandardsandcontrolaredeveloped,andenforcementwithin thecom-munityofthesestandards,aswellastheliabilityofassociations,theirboards,andtheassociationmembers.Healsocoversthedevelopment,building,andsellingofacommoninterestcommunity.Includedareverypracticalguidestodraftingthe creation documents. Hyatt includes drafting checklists and points out thatthefailuretodevelopagoodlegaldocumentcanbeamajordevelopermistake.Particularlyvaluableisanappendixthatprovidesadocument-draftingchecklist,atableofcontentsforthedeclarationofthecondominium,andatableofcon-tentsofCC&Rsforahomeownerassociation,aswellasacommunityassociationbylawstableofcontents.Thesecanbeparticularlyvaluabletotheattorneywrit-ingdocumentsforanewcommunity.

Hyatt, Wayne S. Condominiums and Home Owner Associations: A Guide to the Development Process.ColoradoSprings,Colo.:Shepard’s/McGraw-Hill,1985.

Thisworkisanintroductiontocommunityassociationsandanexplanationoftheircreation.“Theauthor’sintentionistocreateauser’smanualwhichunfoldsaswouldthejobitselfifthereaderweresittingdowntodotheworknecessarytocreatethecommunityassociation”(p.2).Hyattfocusesoncommunityassocia-tion law,rather thanrealestate issues.Heprovidesanexcellentchapteronthetransition process from developer to homeowner control and emphasizes thatthe transition should be a process. To indicate that the transition is a time ofturningovercontrolshowsalackofunderstandingregardingthisprocesswhichcanbeharmfultoitsultimatesuccess.Hyattspecializesinrepresentingmaster-plannedcommunitiesandtheirdevelopersandistheauthoroftwelvebooksonlegalissuesrelatingtoplannedcommunities,condominiumassociationlaw,andcommunityassociations.

“JudicialReviewofCondominiumRulemaking.”Harvard Law Review94(1981):647–67.

This student note examines the problems and abuses of unrestrained condo-minium government, and the appropriate role of the judiciary in curtailingthecondominiumassociation’srulemakingpower.Theauthoremphasizes thatenforcing condominium restrictions is desirable. The condominium-enablingstatutesprovideforenforcementofrestrictions,andthisinturnpreservesthesta-bilityofthecondominiumenvironment.“Enforcementthusfosterscondomin-ium development by attracting buyers seeking a stable, planned environment”(p.653).Thecreationandenforcementofarbitrary,capricious,andsometimestotalitarianrulesmustbecontrolledthroughjudicialreview.

McKenzie, Evan. Privatopia: Homeowner Associations and the Rise of Residential Private Government.NewHaven,Conn.:YaleUniversityPress,1994.

Thisisacomprehensivestudyofthepoliticalandsocialissuesposedbytheriseof common interest housing developments (CIDs) governed by homeownerassociations.Theauthorreferstohomeownerassociationsasprivatized,quasi-autonomousgovernments.HetracesthehistoryofCIDhousingfromthenine-teenth century to the present, and focuses on how the rise of such governingorganizationsisreshapingourneighborhoods.HeprovidesanexcellentchapteronthehistoryoftheCAI.


Powell, Richard R. Powell on Real Property. 17 vols. NewYork: Matthew Bender,1949–.

Chapter 54A of this updated multivolume set is titled “The Operation ofCommon Interest Communities: Condominiums, Cooperatives, HomeownerAssociationDevelopmentsandTime-Shares.”Theauthorprovidesalegaldefini-tionandoverviewofthekeytermsusedinthisareaoflaw,explanationsoftheprimary documents, explanations of issues in the day-to-day operations of thecommunity,andanexaminationofthechallengesconfrontingcommoninterestcommunities.He includes informationregarding the transition fromdevelopercontrol; budgeting for common expenses; rules regarding pets, noise, motorvehicles,tenants,architecturalcontrols;andassociationinsurance.

Reichman, Uriel. “Residential Private Governments: An Introductory Survey.”University of Chicago Law Review43(1976):253–306.

Theauthorprovidesananalysisofthegrowthoftheresidentialprivategovern-mentphenomenon, the termusedbymany in the1960sand1970s todescribecondominium and homeowner associations, and concludes by proposing “apolicy rationale forpreferringaprivate, rather thanapublic, lawconstruct forresolving disputes between the residential private government and individualhomeowners”(p.254).Reichmanexplorestheadvantagesoflivinginaresidentialprivategovernmentcommunityandthepriceofthoseadvantages—primarilytheerosionofwhattheauthorseesasthebasicconceptsofpersonallibertyintermsofpropertyrights.Paintcolor,windowcoverings,andtheabilitytomakecertainhomeimprovements,suchasconstructingafence,orevenpetownershiphavethepotentialtobelimitedorforbiddenbytheresidentialprivategovernment.

Restatement of the Law Third, Property (Servitudes).2vols.St.Paul,Minn.:AmericanLawInstitute,2000.

TheAmericanLawInstituteaddedChapter6totheRestatementofPropertyin2000tocovertherapidlygrowingbodyofcommunityassociationlaw.Thefocusof thischapter isonresidential rather thancommercialcommoninterestcom-munities.“Three strandsof lawcome together in the lawgoverning residentialcommon-interestcommunities:thelawofservitudes;thelawgoverningtheformsofownershipusedinthecommunity;andthelawgoverningthevehicleusedinthe community for management of commonly held property or provision ofservices”(vol.II,p.69).Thechaptercoversthepowersofcommoninterestcom-munities,thedutiesandliabilitiesoftheassociationandtheboardofdirectors,the governance of the community, and the relationship between the developerand the common interest community. References to statutes and digests of allrelevantcasesareincluded.

Rohan,PatrickJ.“PreparingCommunityAssociationsfortheTwenty-firstCentury:AnticipatingtheLegalProblemsandPossibleSolutions.”St. John’s Law Review 73(1999):3–42.

ProfessorRohan,authorofnumerousarticlesandtreatisesonrealproperty,con-dominiums,andcommunityassociations,saysthatthisistheageofcommunityassociation living. Fewer people now rent or own one-family homes. Potentialhomeownersprefertobuyindevelopmentsthatprovidesignificantrecreationalamenities.Thismeansthattheyarewillingtoacceptresponsibilityforthecom-monlyheldareasofthecommunityandthecovenantsandrestrictionsthatrunwiththeland.Rohansuggeststhatjudgesshouldupdatetheirviewofcovenants


andrestrictionsandstopviewingthemunfavorablyasattemptstointerferewiththe right of every individual to enjoy his or her property. “[T]hey should belookeduponfavorably(ifnotbenignly)intheabstract,andenforcedwheneverreasonablypossible”(p.14).Additionally,“inshort, the timehascometobringthelawofcovenantsabreastofthebeneficialfunctionthesedevicesactuallyserveandtheirall-but-universalpresenceinmodernhousingarrangements”(id.).Thearticle also provides information regarding strengthening insurance laws forcommunityassociations.

Stabile, Donald R. Community Associations: The Emergence and Acceptance of a Quiet Innovation in Housing.Westport,Conn.:GreenwoodPress,2000.

Stabile explores the roots of the modern community association from feudaltimestoitsdevelopmentinpresent-dayAmerica.Hedescribesthevariousformsof community associations and the development and growth of the CAI. Theauthor describes the book as an intellectual and social history of communityassociations.HeprovidesextensiveinformationonthedevelopmentofCAIandanexcellentselectivebibliographyofcommunityassociations.

“Understanding Condominium Association Powers: To Govern Well, theCondominium Association Must Be Endowed with the Proper Powers.”Practical Real Estate Lawyer 19(July2003):47–64.

To work well, the association must be a smoothly functioning private govern-ment.Itmusthavethepowertomakedecisions,enactandenforcerules,conductassociationaffairs,andthepowertoauthorizetheexpenditureofcommonfunds.Thisarticlefocusesprimarilyontheassociation’sresponsibilityformanagingthecommonelements.

Wolfe, David B. Condominium and Homeowner Associations That Work. Washington,D.C.:ULI–TheUrbanLandInstitute,andAlexandria,Va.:CAI–TheCommunityAssociationsInstitute,1978.

Thisvolumedescribestheprocessofdesigningacommunityassociationthroughthefoundinglegaldocumentsandtheprocessofoperatingtheassociation.Wolfeemphasizesthecloserelationshipofthesetwoelementsandpointsouttheharmthat can occur when the founding documents are written in isolation and theday-to-dayneedsoftheassociationarenotconsidered.“Legaldesignissuccessfulonlywhenitanticipatestheneeds,dilemmas,andoperationofthelivingcom-munitywhichwillfollow;andinturn,thecommunityassociation’sgovernancesystemdependslargely,foritssuccess,onthelegalstructureonwhichithangs”(p.vii).Thisisanexcellentandinformativeresource.

Bibliographies

Breuer, Ernest Henry. Condominium: A Selected Bibliography of the Historical, Common Law, Federal and State Legislation Aspects of Unit Ownership, Horizontal Property and Air Space Ownership in Real Property.Albany, N.Y.:NewYorkStateLibrary,1962.

An excellent annotated bibliography by the librarian of the New York StateLibrary.BreuerprovidesabriefoverviewofthedevelopmentofcondominiuminthiscountryandinformationonFHAmortgageinsurance.Hestateshispurposefor compiling the bibliography as“list[ing] all the references to condominiumwhichIhavebeenabletofindsinceIfirstsawthistermmentioned”(p.102)in1961.


CouncilofPlanningLibrarians.Bibliography of Condominium Literature. Madison,Wis.:ContinentalMortgageInsurance,Inc.,1974.

AveryusefulbibliographyofbooksandarticlespublishedprimarilyduringthefirstdecadeofcondominiumhomeownershipintheUnitedStates.Manyofthelistedarticles reviewstatecondominium legislationpublishedduring this time.Therearealsoafewcitationstojournalsfromothercountries.

Condominium Homeownership in the United States: A Selected Annotated Bibliography of Legal Sources

Documents

Transcript of Condominium Homeownership in the United States: A Selected Annotated Bibliography of Legal Sources