June 19, 2013

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Probate Omnibus Bill, Employee Privacy, HOA Bills Signed by Governor Hickenlooper

May 14, 2013 by Leave a Comment

Although the Colorado General Assembly adjourned sine die on May 8, 2013, bills continue to be signed into law by Governor Hickenlooper. To date, the governor has signed 231 bills. Some of the most recently signed bills are summarized below.

On Thursday, May 7, Governor Hickenlooper signed one bill — HB 13-1117 - Concerning Alignment of Child Development Programs, and, in Connection Therewith, Making and Reducing an Appropriation, by Rep. Millie Hamner and Sens. Mary Hodge and Andy Kerr. The bill consolidates several child development programs in the Department of Human Services and extends  the Early Childhood Leadership Council, which was set to sunset on July 1, 2013.

Governor Hickenlooper signed 18 bills into law on Friday, May 10, 2013. Six of them are summarized here.

On Saturday, May 11, 2013, the governor signed 19 bills into law. Five of them are summarized here.

Finally, on Monday, May 13, 2013, Governor Hickenlooper signed 11 bills into law. Four of them are summarized here.

For a complete list of Governor Hickenlooper’s 2013 legislative decisions, click here.

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Bills Regarding Job Protection, Authorization for Foreign Investments, Electric Vehicle Charging Stations, and More Signed by Governor Hickenlooper

May 7, 2013 by Leave a Comment

As the 2013 legislative session winds down, bills continue to reach Governor Hickenlooper’s desk for review and signature. Since January 31, 2013, the governor has signed 169 bills.

Governor Hickenlooper signed the “Job Protection and Civil Rights Enforcement Act,” HB 13-1136, on Monday, May 6, 2013. HB 13-1136 - Concerning the Creation of Remedies in Employment Discrimination Cases Brought Under State Law, by Reps. Claire Levy and Joe Salazar and Sens. Morgan Carroll and Lucia Guzman, establishes provisions for complaining parties who have exhausted administrative remedies to bring actions in state court. It also allows claims to be brought by employees of companies with fewer than 15 employees, which are exempt under Federal anti-discrimination provisions.

On May 5, the governor signed one bill, SB 13-176 - Concerning Authorization for the State Treasurer to Invest State Moneys in Debt Obligations Backed By the Full Faith and Credit of the State of Israel. This bill was sponsored by Sens. Mark Scheffel and Morgan Carroll and Reps. Justin Everett and Angela Williams, and it authorizes the state treasurer to invest state moneys in Israeli bonds.

The governor signed 10 bills on Friday, May 3, 2013. Three of the ten bills signed are summarized here.

  • SB 13-126 - Concerning the Removal of Unreasonable Restrictions on the Ability of the Owner of an Electric Vehicle to Access Charging Facilities, by Sen. Lucia Guzman and Rep. Crisanta Duran. The bill requires landlords and common interest communities to allow unit owners to install electric vehicle charging stations on their own property.
  • HB 13-1167 - Concerning the Collection of Business Information by the Secretary of State, by Reps. Brittany Pettersen and Crisanta Duran and Sen. Larry Crowder. The bill requires the Secretary of State to request certain demographic information from business owners, which will be available to the public on the Secretary of State website. The demographic information includes gender, race, veteran status, disability status, and NAICS code, and submission of the information is voluntary.
  • HB 13-1222 - Concerning the Expansion of the Group of Family Members for whom Colorado Employees are Entitled to Take Leave from Work under the “Family and Medical Leave Act of 1993″, by Rep. Cherylin Peniston and Sen. Jessie Ulibarri. The bill allows employees to take leave under FMLA to care for their partners in civil unions.

On April 29, 2013, the governor signed six bills. These included the long appropriations bill, three Joint Budget Committee bills regarding the General Fund, and a bill to allow students who complete high school in Colorado to qualify for in-state tuition classification (SB 13-033 – Concerning In-State Classification at Institutions of Higher Education for Students who Complete High School in Colorado, by Sens. Angela Giron and Mike Johnston and Reps. Crisanta Duran and Angela Williams.) Governor Hickenlooper also signed the budget bill, SB 13-230, on April 29.

On April 26, 2013, Governor Hickenlooper signed 16 bills. Five of these are summarized here.

  • HB 13-1025 - Concerning an Increase in the Amount of the Authorized Deductible for Workers’ Compensation Insurance Policies, by Rep. Spencer Swalm and Sen. Cheri Jahn. The bill increases the allowable deductible for employers’ workers’ compensation insurance policies.
  • HB 13-1123 - Concerning the Right of a Person to Waive Confidentiality Requirements Protecting Personal Work Information Obtained by the Department of Labor and Employment for Unemployment Benefit Claims to Permit the Department to Forward Certain Information to Potential Employers, by Rep. Tony Exum and Sen. Jim Kerr. The bill allows the Department of Labor and Employment to offer job seekers the opportunity to waive confidentiality so that their personal information may be made available to bona fide employers seeking employees.
  • HB 13-1258 - Concerning Local Government Involvement with Federal Immigration Issues, by Rep. Joe Salazar and Sens. Irene Aguilar and Morgan Carroll. The bill repeals C.R.S. Title 29, Article 29, which required local law enforcement officers to report any suspected illegal immigrants to federal immigration officials.
  • SB 13-048 - Concerning the Use of Highway User Tax Fund Moneys Allocated to Local Governments for Multimodal Transportation Infrastructure, by Sen. Nancy Todd and Reps. Max Tyler and Jeanne Labuda. The bill allows counties and municipalities to spend moneys received from the Highway User Tax Fund on transit-related projects.
  • SB 13-070 - Concerning the Purchase of Vehicles that Operate on Alternative Fuels for the State Motor Vehicle Fleet System, by Sen. Gail Schwartz and Reps. Ray Scott and Max Tyler. The bill requires the Department of Personnel and Administration to report on the number of alternative fuel vehicles purchased, the use of alternative fuel, and a plan to develop the infrastructure necessary to utilize more alternative fuel vehicles.

For a complete list of legislation signed into law by the governor in 2013, click here.

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HB 13-1134: Empowering HOA Information and Resource Center to Perform Certain Regulatory and Investigatory Actions

March 7, 2013 by Leave a Comment

On January 18, 2013, Rep. Su Ryden and Sen. Morgan Carroll introduced HB 13-1134 - Concerning Unit Owners’ Associations Under the “Colorado Common Interest Ownership Act.” This summary is published here courtesy of the Colorado Bar Association’s e-Legislative Report.

The HOA information and resource center (center) was created in 2010 to track inquiries and complaints related to unit owners’ associations (a/k/a homeowners’ associations or HOAs) and report them to the director of the division of real estate (director). The center also serves as a clearinghouse for information concerning the rights and duties of unit owners and associations. The center does not have regulatory or investigative power. The bill empowers the center to perform certain regulatory and investigative actions. The bill directs the director to calculate the annual fee paid by associations to support the center’s operation on a per-unit basis and provides a formula for the director to use to calculate each association’s fee. The bill amends the annual registration provisions. The bill is assigned to the Business, Labor, Economic, & Workforce Development Committee.

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Foreclosures and Liens — Some Basics

October 5, 2012 by Leave a Comment

I recently worked with a client who had purchased a property at the sheriff’s sale on a homeowners association lien. We frequently take properties through this kind of judicial foreclosure, and so from my perspective, everything was pretty cut and dry. The client had a lot of questions, and I found myself discussing some basic rules of real property law. Today, I found this article about a purchaser of a property foreclosed on by an HOA, and decided it might be appropriate to set out some general information about liens and the effect of foreclosure.

  • In an HOA foreclosure, what happens to the first mortgage?
    If the HOA lien foreclosed was the six month “superlien,” the first mortgage itself may be wiped out. This is not common. Most of the time, the HOA lien being foreclosed is for amounts owed beyond six months worth of assessments. The superlien is senior to the first mortgage. The amounts owed beyond the superlien are junior to the first mortgage. Foreclosure of a senior lien wipes out junior liens. In all likelihood, if you have purchased a property at the foreclosure of an HOA lien, you are going to have to pay the first mortgage. The holder of the first mortgage may be in the process of foreclosing its lien, as well, so do your research.
  • What happens to the second mortgage, or other liens such as judgments?
    The second mortgage and other liens are wiped out by the foreclosure of the senior lien. An exception to this is when the second mortgage or other liens are not given proper notice of the foreclosure. Make sure to obtain title information to verify that all parties received proper notice.
  • Why is the HOA lien senior to the second mortgage? It was recorded after the date of the second mortgage.
    Colorado requires that any party claiming an interest in real property record evidence of that interest in the real property records of the county in which the property is located. When the Declaration creating the homeowners association is recorded, it automatically creates a lien for assessments. The association doesn’t even have to record a lien later, when an owner fails to pay assessments, but it’s a good idea to do so to protect the association’s rights.
    Because the Declaration was recorded long before any owner took out a first or second mortgage, it is technically “senior” to those interests. The Declaration, however, as well as Colorado law, subordinates the association’s lien (beyond the superlien) to the first mortgage. This is to ensure banks are willing to finance properties within associations. Second mortgages are not treated with the same deference and are junior to the association’s lien.
  • I won my auction! I’m going to sell the property immediately!
    Not so fast, my friend. While you may win an auction, the second mortgage holder and other junior lien holders have at least eight business days after the sale to file a notice of intent to redeem. If they do this, you will receive payment for your bid, but they will end up with the property.
  • How do I get rid of the tenants?
    If the parties residing in the property were the owners who were subject to foreclosure, they can be removed with a simple eviction. Keep in mind that evictions are often not simple. If the parties in the property were bona fide tenants, paying fair market value rent, and not related to the prior owners, you may have to allow the tenant to reside in the property for the longer period of 90 days, or the end of the lease. Contact an attorney to learn the proper procedures in these cases.

Each individual foreclosure has its own idiosyncrasies, and this information is extremely general. If you’re looking into investing in a foreclosure, make sure you do your due diligence and don’t get surprised with an unexpected mortgage payment, or worse, an unexpected foreclosure!

Lindsay S. Smith is an attorney at Winzenburg, Leff, Purvis and Payne, LLP where she practices in general community association and real estate law. She provides legal representation in covenant enforcement, eviction, bankruptcy, and general association litigation; contract and document drafting and review; and general business and governance advice for association clients. She regularly contributes to the firm’s blog on topics such as governance and litigation. This article originally appeared on the firm’s blog on September 21, 2012.
A Colorado native, she received her undergraduate degree from the University of Oklahoma in 2001, magna cum laude. She was a member of Phi Beta Kappa, Phi Sigma Pi, and Alpha Gamma Delta. She received her Juris Doctorate from the University of Oklahoma in 2004, with distinction. She was Articles Development Editor of the American Indian Law Review, which also published her article on American Indian water rights issues. She is a member of the Colorado and American Bar Associations and is admitted to practice in Colorado state and federal courts. To contact Lindsay directly, you may e-mail her at lsmith@wlpplaw.com.
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Trisha Harris: Preparing for Owner Inspection of HOA Emails

August 1, 2012 by 1 Comment

In today’s electronic age, many boards have flurries of e-mails flying back and forth about a wide range of association-related topics. As we have discussed in previous blogs and articles, when HB 12-1237 goes in to effect on January 1, 2013, owners will be entitled to inspect board e-mails that relate directly to decisions made by the board outside of a meeting, whether by e-mail, written resolution, phone, etc. This raises the practical questions of how boards should determine which e-mails to save, how to retain such e-mails, and other related issues. The following are some practical pointers to help your board to comply:

  • If your association has a manager, one option is to copy your manager on all such e-mails and have your manager save them electronically or print them out and keep them in a physical file. This may not be something that is currently addressed in your management company contract. In such case, the board and the management company may need to re-negotiate the contract to include this service. If your manager does undertake this role, your records retention policy will need to be revised to reflect that responsibility for the manager. If your association does not have a manager, this retention role can be filled by your secretary.
  • Set up a Google or Yahoo group for the board to use to communicate. This will keep e-mails centralized in one place, allow for storage of the e-mails, and allow for group members to change as board members change.
  • Have board members set up a separate e-mail account for board business, which is separate from their regular personal or business e-mail address. The e-mail addresses could be tied to certain positions, such as president@abchoa.com, which could then be transferred to new board members as board members change. By doing so, owners will always have a consistent and stable list of e-mail addresses, which will reduce confusion and lost communication when there are changes on the board. Having designated board member e-mail addresses separate from individual board member’s personal or business e-mail addresses will also help to protect attorney-client privileged communications to the board.  Often, a board member will share a personal e-mail address with his or her spouse. E-mails that go to that address may be viewed by non-board members, so having a designated board-business e-mail address can help to keep such communications confidential with just board members. Also, if a board member is served with a subpoena for his or her e-mails, not only will the e-mails related to board business be subject to it, but all other e-mails sent and received from that account could also be discoverable.
  • Keep decisions outside of a meeting to a minimum. As much business as possible should be done in open meetings. Limit decisions outside of a meeting to urgent situations where the board cannot call a special meeting nor wait until the next board meeting to discuss the issue.
Trisha K. Harris is a partner at HindmanSanchez and is inspired by the impact that community association law has on so many people. Her philosophy in representing associations is to help them by giving them tools to make good decisions and promoting the positive aspects of association living by blending the social and business aspects together to produce strong communities. She contributes to her firm’s blog, where this post originally appeared on July 26, 2012.
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Colorado Court of Appeals: Interlocutory Appeal — Claims Barred by Statute of Repose; Dispute Regarding “Substantial Completion” to Be Resolved as Question of Law

February 8, 2012 by Leave a Comment

The Colorado Court of Appeals issued its opinion in Shaw Construction, LLC v. United Builder Services, Inc. on February 2, 2012.

Interlocutory Appeal—Construction Defect Action Reform Act—Tolling—Substantial Completion—Summary Judgment—Statute of Repose

In this interlocutory appeal, the Court of Appeals affirmed the trial court’s summary judgments for third-party defendants United Builder Services, Inc. and MB Roofing, Inc. (collectively, subcontractors), and against third-party plaintiff Shaw Construction, LLC (Shaw). The Court held that Shaw’s claims were barred by the statute of repose.

Plaintiff Roslyn Court at Stapleton Homeowners Association (HOA), not a party to this appeal, alleged construction defects in the Roslyn Court condominium complex, for which Shaw had been the general contractor. The project was built in three phases and included eighty residential units in thirty-three buildings, fifteen garage structures, and additional elements such as sidewalks, alleys, benches, courtyards, and landscaping.

Shaw hired subcontractors to hang drywall and install roofs, gutters, and downspouts. The City and County of Denver issued certificates of occupancy (COs) for each residential building (between September 24, 2003 and October 28, 2003 for Phase I; October 31, 2003 and January 29, 2004 for Phase II; and January 22, 2004 and March 10, 2004 for Phase III). The project’s architect did not certify completion of all known architectural items until June 8, 2004.

On May 15, 2007, Shaw received a notice of claim letter from the HOA under the Construction Defect Action Reform Act (CDARA). On January 21, 2009, the HOA filed this action against the developers of the property but did not add Shaw as a defendant until January 28, 2010. On March 29, 2010, Shaw filed its answer and third-party complaint, naming subcontractors, among others, as third-party defendants. Shaw sent its only notice of claim to subcontractors the following day.

Subcontractors moved for summary judgment on the basis that the six-year statute of repose had run. They argued that substantial completion had occurred not later than the date the final CO was issued, March 10, 2004. Shaw argued that substantial completion was June 8, 2004, when the architect certified completion. Shaw did not include any evidence that subcontractors’ work continued after the date of the CO on the last building. Alternatively, Shaw argued that under § 805, the HOA’s notice of claim had tolled all claims associated with the project, including those against subcontractors, even though they had not received actual notice of the claim.

The trial court granted subcontractors’ motions, finding that the last CO indicated substantial completion. The trial court also held that the plain language of the statute required actual notice to a party to toll a claim as to that party. The Court accepted an interlocutory appeal due to the unresolved questions regarding tolling and substantial completion under Colorado law.

The Court first addressed whether the determination of when substantial completion under CDARA occurs is a question of fact or a question of law. The Court agreed with the trial court that it is a question of law. CDARA does not contain a definition of “substantial completion.” The interpretation of when a claim accrues under a statute of limitations is an issue of law.

The Court then considered and rejected Shaw’s contention that its claims against subcontractors were tolled by the HOA’s notice of claim to Shaw under § 805. The statute does not say whether claims against participants in a project without notice of a claim are tolled, so the Court looked to the legislative intent behind CDARA and concluded that such an interpretation would not further that intent.

The Court also rejected Shaw’s argument that its claims were timely, because substantial completion did not occur until the architect’s certificate was issued. Shaw argued, without authority, that in a multi-stage project, improvement means the entire project. Subcontractors responded that the statute of repose is triggered “when the subcontractor completed its own work and not when the entire project was completed.” The Court concluded that an improvement may be a discrete component of an entire project, such as the last of multiple residential buildings. Accordingly, the summary judgments were affirmed.

This summary is published here courtesy of The Colorado Lawyer. Other summaries for the Colorado Court of Appeals on February 2, 2012, can be found here.

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Colorado Court of Appeals: Party Seeking to Reopen Evidence after Resting and after Motion for Directed Verdict Made Must Make Offer of Proof as to What Specific Evidence they Would Present and How it Would Cure Deficiencies

June 27, 2011 by Leave a Comment

The Colorado Court of Appeals issued its opinion in Justi v. RHO Condominium Ass’n on June 23, 2011.

Directed Verdict—C.R.C.P. 60 Motion.

Plaintiff Dennis Justi appealed the judgment entered after defendant RHO Condominium Association (RHO) moved for a directed verdict under C.R.C.P. 50 and the trial court denied his motion to reopen his case. Justi also appealed the court’s order denying his C.R.C.P. 60 motion for relief from the judgment against him. The judgment and order were affirmed.

In July 2005, Justi, his brother, and a friend rented a room at the Hi Country Haus Condominiums. During their stay, Justi fell down a flight of stairs and ruptured his left quadriceps muscle. Justi sued RHO, whose primary place of business was located at Hi Country Haus. Justi asserted that RHO was liable for his injury under the Premises Liability Act (Act).

At trial, after Justi’s last witness was questioned, Justi’s counsel and the court had an exchange wherein counsel stated he wouldn’t rest but had no further witnesses. After prodding from the court, counsel rested. RHO then moved for a directed verdict under C.R.C.P. 50, arguing that Justi had presented no evidence to establish a connection between his injury and RHO, including how RHO was connected to the property at issue.

Justi responded by indicating that such evidence would come from RHO witnesses. After another colloquy with the court, Justi moved to reopen his case to present evidence from RHO witnesses to show RHO owned Hi Country Haus. Justi’s counsel stated that he had relied on defense counsel’s representations that he would call an RHO representative, and that he intended to introduce the management agreement and prove ownership at that time. RHO’s counsel denied having promised to call any witnesses. The court denied Justi’s motion to reopen the evidence and granted RHO’s motion for a directed verdict.

On appeal, Justi argued it was error to deny his motion to reopen his case. The Court of Appeals held that even if it was error, any such error was harmless. In what appeared to be a matter of first impression in Colorado, the Court held that a party seeking to reopen the evidence after he or she has rested and after a motion for a directed verdict has been made must make an offer of proof as to what specific evidence the party would present and demonstrate that this evidence would cure any deficiencies in that party’s case.

In this instance, Justi sought to reopen the evidence to prove that RHO owned the condominium in question. The Court held that such evidence would have been insufficient to save Justi’s claim under the Act, because it would not have shown that RHO did not exercise reasonable care to protect against dangers about which it knew or should have known. Thus, even if the court had allowed Justi to reopen his case to present evidence of ownership, a directed verdict still would have been proper.

Justi also argued that it was an abuse of discretion for the trial court to deny what he characterized as a motion under C.R.C.P. 60(b). The Court disagreed, noting there was no evidence that a reasonably prudent person similarly situated would have neglected to put on a prima facie case before resting. The trial court rejected the argument that defense counsel misled Justi or otherwise caused his mistake. In addition, no evidence was presented showing this was an abuse of discretion. Finally, the Court found no abuse of discretion to deny the request under C.R.C.P. 60(b)(5).

This summary is published here courtesy of The Colorado Lawyer. Other summaries for the Colorado Court of Appeals on June 23, 2011, can be found here.

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Colorado Court of Appeals: Injunctive Relief Appropriate as HOA Covenant Language Prohibited a Broad Range of Commercial Pet-Related Activities, Including those Conducted by Plaintiff

June 13, 2011 by Leave a Comment

The Colorado Court of Appeals issued its opinion in K9Shrink, LLC v. Ridgewood Meadows Water and Homeowners Ass’n on June 9, 2011.

Summary Judgment—Declaratory and Injunctive Relief—Issue Preclusion.

Plaintiffs K9Shrink, LLC and Gail Clark appealed the trial court’s summary judgment in favor of defendant Ridgewood Meadows Water and Homeowners Association (HOA), as well as the court’s order denying declaratory and injunctive relief to plaintiffs and granting an injunction and attorney fees to the HOA. The judgment and order were affirmed.

Clark, a canine behavioral psychologist, operates K9 Shrink on her property. Clients bring their dogs to Clark’s home, where she counsels the owners on communicating with and training their dogs. Clark’s home is subject to the HOA’s Covenants (Covenants).

Clark and K9Shrink filed this action after the HOA required them to cease K9Shrink’s activities after determining they constituted commercial pet-related activity that was prohibited by the Covenants, as amended in 2007 (Amendments). Plaintiffs sought a declaratory judgment that the Amendments were unenforceable and an injunction prohibiting enforcement against plaintiffs. The HOA counterclaimed for an injunction to prevent plaintiffs from conducting their activities.

The trial court granted partial summary judgment to the HOA with respect to plaintiffs’ claim for declaratory judgment regarding the enforceability of the Covenants. Following trial, the court issued an order on January 11, 2010 (January order) determining that K9Shrink’s activities violated the Covenants and denying relief to plaintiffs. Plaintiffs appealed.

The Amendments became effective in 2007 after the district court entered an order amending the 1973 and 1977 declarations under CRS §38-33.3-217(7). Plaintiffs argued it was error for the trial court to rule that their challenge to the Amendments was barred by issue preclusion.

Issue preclusion bars the re-litigation of an issue when (1) the same issue was litigated in a previous proceeding; (2) the party against whom preclusion is asserted was a party to, or in privity with a party to, the previous proceeding; (3) that proceeding resulted in a final judgment on the merits; and (4) the party against whom preclusion is asserted previously had a full and fair opportunity to litigate the issue. [Lazy Dog Ranch v. Telluray Ranch Corp., 965 P.2d 1229 (Colo. 1998).] Plaintiffs challenged only the trial court’s application of the second and fourth Lazy Dog factors, and only as applied to Clark.

The Court of Appeals found that Clark had notice, standing, and an opportunity to be heard in the 2007 court proceeding and therefore was a party to the proceeding in which the court approved the Amendments. The Court reviewed the factors set forth in Bebo Construction Co. v. Mattox & O’Brien, P.C., 990 P.2d 78 (Colo. 1999) to determine whether Clark was given a full and fair opportunity to litigate. The Court found that, as to her declaratory judgment claim, Clark could have brought the same alleged defects in the Amendments in the 2007 case that she raised in the instant action and therefore was given a full and fair opportunity to litigate.

Plaintiffs then argued that the trial court erred in its interpretation of Part II, paragraph 5(c) of the Covenants. The Court disagreed. The Covenant at issue stated: “Commercial livestock husbandry or animal processing operations are prohibited upon any lot, as are any commercial pet-related activities, such as dog boarding kennels, catteries or commercial breeding operations.” The Court agreed with the trial court that the language prohibits a broad range of commercial pet-related activities, which would include the activities of K9Shrink.

The Court also rejected plaintiffs’ argument that it was error to grant injunctive relief to prevent them from conducting commercial pet-related activities on Clark’s property. The Court found that the trial court addressed each of the necessary findings in a well-reasoned manner. The HOA established that: (1) it has achieved actual success on the merits; (2) irreparable harm will result unless the injunction is issued; (3) the threatened injury outweighs the harm that the injunction may cause the opposing party; and (4) the injunction, if issued, will not adversely affect the public interest. The judgment and order were affirmed.

This summary is published here courtesy of The Colorado Lawyer. Other summaries by the Colorado Court of Appeals on June 9, 2011, can be found here.

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SB 11-253: Clarifying Requirements for the Registration of HOAs under the Colorado Common Interest Ownership Act

April 27, 2011 by Leave a Comment

On April 21, 2011, Sen. Morgan Carroll, D-Aurora, and Rep. Angela Williams, D-Denver, introduced SB 11-253 – Concerning clarification of the requirements for registration of a unit owners’ association under the “Colorado Common Interest Ownership Act.” This summary is published here courtesy of the Colorado Bar Association’s e-Legislative Report.

Legislation adopted in 2010 requires unit owners’ associations (homeowners’ associations or HOAs) to register annually with the director of the division of real estate and pay a fee to support the creation and operation of an HOA information and resource center.

The bill amends the registration provisions by:

  • Removing a citation to a specific statute under which most, but not all, HOAs are organized, effectively closing a potential loophole;
  • Limiting the information that an HOA must provide to a specific list of items, including the official name of the HOA and the name and contact information for the HOA’s managing agent;
  • Clarifying that an HOA that fails to register will have its right to pursue legal remedies suspended, without prejudice, and that upon valid registration it will not have permanently lost its rights or otherwise been penalized for the gap in registration;
  • Clarifying the means by which an HOA can prove that it is registered;
  • Specifying that a registration may not be invalidated solely as a result of a technical or typographical error; and
  • Codifying the effective date of the registration requirement.

Assigned to the Judiciary Committee; the bill is not listed on the printed calendar.

Summaries of other featured bills can be found here.

Filed Under: Legislation Tagged With: , , ,

HB 11-1124: Conflicts of Interest of Members of the Executive Board of a Unit Owners’ Association

March 2, 2011 by Leave a Comment

On January 21, 2011, Rep. Angela Williams, D-Denver, and Sen. Morgan Carroll, D-Aurora, introduced HB 11-1124 - Concerning conflicts of interest of members of the executive board of a unit owners’ association. This summary is published here courtesy of the Colorado Bar Association’s e-Legislative Report.

The bill pertains to conflicts of interest of members of the executive board of a unit owners’ association. In 2006, the law pertaining to conflicts of interest of executive board members was amended to import and apply conflict of interest provisions contained in the “Colorado Revised Nonprofit Corporation Act.” The bill restores the original executive board conflict of interest provisions, which require an executive board member to disclose a conflict of interest and abstain from voting on an issue from which the member or a member of the member’s family would financially benefit. Any action taken by the executive board in violation of these requirements is void.

The bill also prohibits a person from serving concurrently on the board of directors for a metropolitan district and the executive board of an association located within that district. The following are exempt from this provision:

  • Small cooperatives and small limited expense planned communities; and
  • Executive board members appointed or elected during a period of declarant control over the association; except that, the number of members so exempted are not permitted to exceed the number of declarant-appointed members allowed to serve during a period of declarant control under current law. This exemption ends upon termination of the period of declarant control.

Amended bill passed 3rd Reading on February 25.

One Colorado HOA law firm has also covered HB 1124 here. Summaries of other featured bills can be found here.

Interested in HOA issues? On Thursday, March 3, we’re offering an HOA Law Basics CLE program that will cover everything from CCIOA to collections to covenant enforcement. It will also be available as a homestudy in three formats: online video, MP3 download, and audio CD.

Image Source: Wikimedia Commons

Filed Under: Legislation Tagged With: , , ,

Molly Foley-Healy: HOA Registry – New Information from Division of Real Estate

December 29, 2010 by 2 Comments

The Colorado Division of Real Estate (“Division”) has just provided the following updated information on the HOA Registry:

  1. All HOAs must formally register with the Division of Real Estate prior to March 1, 2011.
  2. The online registration process will be available for use on January 3, 2011.
  3. The registration fee for each HOA will be $8.93. Associations with annual revenues of $5,000 or less OR are not authorized to levy assessments and do not have any revenue – are not required to pay the $8.93 fee.
  4. All registrations must be completed online. The HOA Information and Resource Center will not accept paper applications or cash or checks for payment.

As we noted in our December 17th blog posting, all associations in Colorado have been granted a temporary and automatic registration by the Division that is valid through February 28, 2011. The Division promulgated this emergency rule to ensure that associations were not penalized for failing to register by the initial statutory deadline of January 1, 2011.

We will provide you with a link to the online registration as soon as it becomes available.

Molly Foley-Healy blogs at Winzenburg Leff Purvis & Payne’s Colorado Homeowners Association Law blog and this post originally appeared here on December 29, 2010. Click here to read all posts by this author.

Click here for more HOA Law Updates.
Filed Under: Legislation, Resources, Updates Tagged With: ,

Colorado Court of Appeals: Thompson Creek Townhomes, LLC v. Tabernash Meadows Water and Sanitation District

June 11, 2010 by Leave a Comment

The Colorado Court of Appeals issued its opinion in Thompson Creek Townhomes, LLC v. Tabernash Meadows Water and Sanitation District on June 10, 2010.

Summary Judgment—Specific Performance Regarding Water Taps—Governmental Immunity from Specific Performance.

Thompson Creek Townhomes, LLC (Thompson Creek) filed a suit for breach of contract and promissory estoppel against the Tabernash Meadows Water and Sanitation District (District), seeking specific performance and money damages for the District’s failure to reserve water taps for Thompson Creek’s residential development. The District filed a motion to dismiss, which the court considered a motion for summary judgment because the underlying operative facts were undisputed. The court granted summary judgment dismissing Thompson Creek’s specific performance and promissory estoppel claims and the remaining claims were dismissed by stipulation. The Court of Appeals affirmed the lower court’s decision.

In 2005, First Community Bank (Bank) acquired a parcel of real property known as Lot 16 through foreclosure. The District then had a policy of reserving water and sewer taps for landowners who paid “availability of service charges.” These charges were based on 50 percent of the monthly cost for the sewer and water service, and were to be paid quarterly. When the Bank acquired the Lot, these charges had not been paid for approximately three years. The Bank paid past due amounts to the District when it foreclosed, but it elected to defer any newly accumulating charges until the lot was sold.

In 2006, Lot 16 was sold to Thompson Creek. Before the closing, the District announced that it would no longer reserve taps in exchange for availability of service charges and would reserve them only if they were purchased outright. The District notified the Bank that no taps would be reserved for the Lot until they were purchased.

The closing occurred in early 2007. The Bank tendered payment for the accrued availability of service charges on closing, but the payment was rejected by the District. Thompson Creek filed suit, asserting claims for breach of contract and promissory estoppel, seeking specific performance and money damages. Thompson Creek appealed the judgment dismissing the claim for specific performance.

Thompson Creek argued that a contracting party may seek specific performance against a governmental entity, notwithstanding governmental immunity, if the performance it seeks involves a non-core governmental power. Thompson Creek contended that a contractual obligation to reserve water taps is such a non-core governmental power. The Court disagreed, finding no exception for governmental immunity from specific performance for such so-called non-core powers. The judgment was affirmed.

This summary is published here courtesy of The Colorado Lawyer. Other summaries by the Colorado Court of Appeals on June 10, 2010, can be found here.

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