1-888-800-1042
Kaman Cusimano Logo

Condo | HOA Lawyers

What Happens When All Committee Members Resign, Refuse to Act or Move?

This issue arises more than one might suspect. Because of association apathy, many committees go unfilled and often even boards don’t have members.  The results of this apathy could be much different than you would expect.

Facts.  In a 2017 case, the relevant property “was subject to a 1996 restrictive covenant that required the approval by an architectural control committee [‘ACC’] before any building … could be erected.”  The ACC consisted of two named persons within the documents, one of which was dead and the other refused to act.  The owner of the property filed a declaratory judgment action seeking to have the court declare the covenant unenforceable based on impossibility of performance.  Other property owners objected, claiming the covenant could be made enforceable by modification.  The documents did not provide a means by which new members could be added to the ACC.

Court Rulings. The court held that restrictive covenants are contracts and as such applied the “cardinal principle” to its construction that “the intent of the parties must control, and except in cases of ambiguity, this is determined by what the contract itself says.” Applying this principle, the court went on to hold that:

“The language of the restrictive covenant is limited and unambiguous. The written language of the restrictive covenant appoints two specifically named individuals, with no succession mechanism, thus limiting its duration. There is no mechanism to transfer authority to another member or to appoint new members to the committee. The language of the restrictive covenant further limits the approval process to buildings and structures to be erected on lots in the development. The restrictive covenant does not address the approval process for other types of building on the lots, such as modifications, additions, or reconstruction.”

Because the specific language of the covenant could not be complied with, the court held that performance with the covenant was impossible and that the doctrine of discharge by supervening impracticability from the Restatement (Second) of Contracts also applied. The court also found that the proposed modification by the defendant owners was not practical and therefore affirmed the trial court decision terminating the restrictive covenant.

Lesson.  If you have committees required by your documents make sure that your documents also provide for a means to add and remove members from the committee and that the committee has members on it.  Otherwise, you may find an owner seeking to terminate the committee, even when your association desires the committee to remain (e.g. Insurance Committee, Grievance Committee, ACC).

Categories

Three bars icon gold

Recent blog Posts

Three bars icon gold

Partner Nicholas Meinert Presents at Northern Ohio CAI Chapter on the Corporate Transparency Act

On June 14, 2024, Partner Nicholas Meinert presented to the Northern Ohio Chapter of the ...
Read More →

Partners Dan Miske and Lydia Chartre presented at Wisconsin’s Chapter of CAI on reserves and lending

On May 23, 2024, Partners Dan Miske and Lydia Chartre presented a webinar for the ...
Read More →

Strengthening Community Associations: The Vital Role of a Comprehensive Assessment Recovery Policy and Procedure

Community associations are founded on principles of shared responsibility and collective maintenance. From maintaining common ...
Read More →

Partner Nick Meinert presented at OLCA’s Spring Conference

Partner Nicholas Meinert gave a presentation at the 2024 Ohio Lake Communities Association’s Spring Conference. ...
Read More →