Posts Tagged ‘Covenants’

Racist Covenant Clauses From 1950s Get Press

January 20, 2015

Capture

Last night in honor of Martin Luther King Day, local Boise Channel 6 news ran a story about overtly racist 1950s CC&R provisions in an old Boise subdivision.  However, the story did not provide details about the covenants, but instead quickly pivoted to coverage about the ongoing “Add the Words” campaign.  This is a lobbying campaign to add equal rights protection for sexual orientation to Idaho state law.  So far, these protections are found in Boise City Code and the codes of a few other cities, but not in Idaho’s human rights law. The courts recently legalized gay marriage in Idaho, but in order to get a law like this passed, you still need a certain amount of public interest.

It seems to me that there must not be any recent or interesting stories of discrimination in Idaho based on sexual orientation, if the “Add the Words” coverage has to dig into old CC&Rs covenants to get a news story to tie to the legislative efforts.  If there were even one recent or ongoing story about discrimination based on sexual orientation, the campaign and supportive media would be using it to drive interest in passing the new law.  Or perhaps Channel 6 was just looking for something relevant to say about MLK Day?  That doesn’t happen, does it?

Meanwhile, the lack of news about recent discrimination in HOAs is a hopeful sign that current HOA boards in Idaho are already using common sense in reading their CC&Rs to avoid discriminating against anyone, whether Idaho law explicitly requires it yet or not.  Hopefully that will continue.

Virginia is for lovers of HOAs

November 6, 2014

5456d6dcd74b5.imageSo two things jumped out at me from this article by Ted Strong in Richmond.  First,  it’s a great article on HOAs.  It isn’t often that someone captures the quasi-governmental role that associations end up playing in modern communities:

associations are nearly ubiquitous for new residential housing in the Richmond area, embraced by developers as a way to handle long-term care of common amenities and by local officials as “mini-governments” that can help maintain order and property value.

Second, the underlying dispute was regarding an in-home day care center.  It looks like the HOA took a position in the county conditional use permit hearings, but did not take any legal action based on its covenants alone.  I don’t know if this is the case in Virginia, but here in Idaho the association could have done both.  So it is possible the HOA decided to back down.

I have had a number of boards ask me about this type of situation.  It can be difficult to definitively define the line between residential and commercial use.  Day cares are one tough call.  Frequent “AirBNB” landlords can be too.  A case of low income housing was just in the news too.  The Board would need to carefully review the specific language in their restrictions and probably look at other uses in the community as well before deciding.

Anyway, this Virginia case isn’t going anywhere, but HOA news lovers should be watching that Volt case in Waterford CA.  I’ll comment when it all plays out a bit more.

Renting In A Recession

October 5, 2012

Landlords and homeowner associations have always been uneasy bedfellows, in my experience.

In the most common situation, the homeowner association is made up of a majority of resident owners, who elect other residents to serve on the board of directors.  The board makes decisions usually influenced mostly by the residents.  Absentee owners are more difficult to communicate with, you can’t talk to them while they are walking their dog, and they have a different set of priorities.

The conflict between homeowner associations and owners who want or need to rent their homes out to make ends meet is a highlighted in an article in USA Today.  The article focuses on traditional planned developments “clamping down” on rentals to stop the quality of the neighborhood from slipping.  This of course puts boards in conflict with owners who may be forced to downsize by a still-slow housing market and depressed property values.  Helpful government programs for refinancing may put the mortgage payment down near rental values, but still not let a homeowner sell at current prices without losing some cash.  At the same time, homeowners who are fighting to stay in a neighborhood can’t afford to see values drop further with a perception that an area has become rental-heavy.

rent sign

 

In traditional suburban association, rental restrictions may not be included in the declaration of covenants, conditions and restrictions.  Being able to rent out your property is a valuable way to use it, so in my opinion, this would have to be included in the original CC&Rs, or added by amendment, before the association can directly address leasing.  Without those provisions, a board could only address the consequential results of absentee owners with strict enforcement of landscaping and other restrictions.

This conflict of course arises also in condominium associations.  Condominium associations are often struggling to comply with updated FHA lending guidelines that will make it impossible for any buyer to get HUD lending if the ratio of rentals to owner-occupied units gets too high.  Fortunately, condominium associations nearly always have a rental provision in their declaration.   A board just needs to establish procedures to enforce that provision.

 

 

 

 

The Unspoken Rule: Discrimination in Unenforced Covenants

August 9, 2012

Can something discriminatory written and recorded in your Idaho CC&Rs decades ago still pose a liability for your association today?  Today, a blog for the Orlando Sentinel discusses the state of the law in Florida, and recommends a professional review of governing documents to find and remove offending restrictions. Not surprisingly, in Florida’s litigious society, there are municipal and county fair housing regulations.  Florida associations have been found liable for discrimination for “publishing” rules and regulations that caused a tenant “emotional distress,” even where those rules are not enforced.  That 1997 decision is online here.

The question remains how to regard that decision and legal advice here in Idaho, where the legal climate is as different from Florida’s as Idaho’s high desert climate is different from Florida’s coastal humidity.  Certainly the federal fair housing laws still apply, even if we do not see much additional municipal and county fair housing regulations.

Idaho’s Supreme Court found in a 2002 case, D & M Country Estates v. Romreill, that Idaho statutes restricting discrimination in zoning laws do not apply to covenants.   The Court found that because the governing documents in question were specific and unambiguous in limiting housing use to two “families,” the Idaho association was acting within its rights to prohibit use of a house by eight unrelated adults in a group home setting.  Unfortunately, in that case, claims based on the Idaho Human Rights Act were not properly before the Court, and so did not factor into the decision.  Indeed, the Human Rights Commission no doubt would urge Idaho courts to follow the Florida ruling that recorded “published” governing documents indeed can have a discriminatory effect.

In my experience, unenforced clauses in Idaho governing documents have not led to court liability.  However, I have seen such unenforced clauses lead to discrimination charges against associations and their boards.  Even unsuccessful fair housing claims require legal representation and defense.  Rather than face that uncertainty and expense, a preemptive review and amendment of governing documents is still as good an idea here in Idaho as in Florida.  But it may not be the only option.

An option that has not been explored here in Idaho is the use of a recorded cover sheet, as is required in California.  This would involve recording a statement that any discriminatory language in the remaining covenants is to be ignored.  The cover sheet would explicitly void any discriminatory covenants.

Either amending covenants to change language or to add a cover sheet would require the same supermajority vote by the owners.  In Idaho, we have no uniform common interest ownership act to make the process any easier than it sounds.  At the moment, either approach would require legal assistance and membership participation.