Friday, July 21, 2017

Q&A: Unsightly Neighboring Property

Q. We want to clean up the property next door to our association. The association does not own the property. It's less money to just have it cleaned up compared to getting the current owner to clean it up. We would have permission from the owner. As a board can we approve or do we need to advise all the owners for their input?
A.  There are several variables that need to be resolved to know whether spending the Association’s money is appropriate and lawful in this case.  First, while you state that the adjoining property needs to be “cleaned up,” you do not indicate whether this is a matter of cleaning brush, or whether there might be old cars there, perhaps an old barrel that held an unknown substance, etc.  If there is any chance that there is something like old vehicles, in connection with which you do not know who holds the title, or any materials that might constitute a “hazardous substance” under federal or state law, we would recommend against becoming involved in any way, since the possibility of serious liability is much too great.

Assuming that the issue is limited to cleaning up overgrown vegetation and the association has written permission from the owner to undertake the cleanup that details exactly what the owner is agreeing to allow the association to do, you need to ask two additional questions.  First, do the governing documents permit the Association to expend money for this purpose?  Typically there are two places to look for an answer to this question.  One would be in a provision that refers to the budget and the purpose of the expenses the association can include in the budget.  Secondly, there is usually a section of the bylaws setting forth the duties, powers and authority of the board.  In some instances these are stated permissibly, in other words suggesting that the board has, at a minimum, these powers.  Other times the section of the bylaws is stated in such a manner so as to limit the powers of the board.

Finally, there also needs to be a determination by the board that this is truly an association matter.  Is this to help a small portion of all the unit owners, but does not impact the vast majority of owners?  Is there a board member that is impacted and that is why the board is considering this action?  How much money would actually be spent?  If the amount is relatively nominal given the scope of the association’s budget and it is for the general benefit of the association that suggests one direction, but if it benefits few owners or it were to particularly benefit a member of the board, it suggests a different answer.

There are enough complexities in this issue that we would urge the board to consult with legal counsel before taking action.

Friday, July 14, 2017

Q&A: Handling Requests for Emotional Support Animals


Q:
I live in a 40-unit condo building, which has a NO PET AMENDMENT from 1980. A woman recently purchased a unit and has been seen with a dog that barks all the time. She signed all the disclosure forms that stated “no pets” and had given the Board a note from a nurse practitioner that the dog is an emotional support animal. What can we do?

A:

The Federal Fair Housing Act (42 U.S.C. §§3601-3619) and the regulations promulgated thereunder require “housing providers,” including entities such as condominium associations in New Jersey, to make “reasonable accommodations” to disabled persons in rules, policies, practices or services when such accommodations may be necessary to afford a person with a disability the equal opportunity to use and enjoy a dwelling. New Jersey’s Law Against Discrimination (N.J.S.A. 10:5-1 et seq.) similarly requires accommodation of the disabled.  Decisions of federal and state courts in interpreting the Federal Fair Housing Law and New Jersey’s Law Against Discrimination have held that in certain instances housing providers, such as a condominium, must accommodate those with a legitimate physical or emotional disability requiring the support or assistance of an animal.

Notwithstanding, simply providing a note from a nurse practitioner stating that “the dog is an emotional support animal,” does not provide the governing body of a condominium the reasonable opportunity to establish that the resident suffers from a disability defined by law; and, further, requires the physical assistance or emotional support of a dog to reasonably accommodate their disability. Thus, in this instance, it likely would not be unreasonable for the association to request additional information to allow its governing body to evaluate the reasonableness of the request.

For example, the association may reasonably request that the resident provide a certification of a Physician or other qualified Treating Professional certifying: (a) the disability or handicap suffered (b) said disability or handicap meets the standards set forth by the Federal Fair Housing Act; (c) to the major life activities substantially limited by the disability or handicap; (d) whether treatment is available for the disability or handicap; (e) to the description of the accommodation requested; (f) as to whether the accommodation requested alleviates or mitigates the disability or handicap; and, (g) as to whether any alternative accommodations exist. If, upon receipt of such additional information, the association concludes that the resident is disabled under the law and that the physical assistance or emotional support of the identified animal is reasonably necessary to accommodate the disability, then approval of the accommodation is required by law.

Where an accommodation is required by law, the resident is still required to maintain the animal in accordance with existing rules and regulations; which often include, among other requirements, that residents permit no activity that creates a nuisance or annoyance to other residents. Such rules require the resident to take all actions necessary to prevent the animal from making noise that may unreasonably annoy or disturb the peace of neighboring residents.


Keep in mind that where an accommodation is required to be made by law, the animal is not considered a “pet.” Rather, it is an animal that the resident has claimed is required under the law for the physical assistance or emotional support for the disability that the resident is afflicted with. Therefore, the governing board of a community association should seek the advice of legal counsel before denying the request of a resident for a physical assistance or emotional support animal. The association’s legal counsel is best suited to advise and assist the governing board with implementation of appropriate procedures should the board receive such a request.  

Monday, June 5, 2017

Becker & Poliakoff Wins Multi-Million Dollar Jury Verdict In Landmark Construction Case



FOR IMMEDIATE RELEASE
Media Contacts:
Kris Conesa or Andi Phillips
Roar Media
kconesa@roarmedia.com or aphillips@roarmedia.com
(305) 975-5934 or (305) 401-5098

Jury Finds Subsidiary of National Developer Hovnanian Enterprises Inc. Liable for Breach of Contract and Violation of the New Jersey Consumer Fraud Act 

MORRISTOWN, NJ & FORT LAUDERDALE, Fla. – June 5, 2017 – Becker & Poliakoff secured a landmark $9 million-plus jury verdict Thursday against a subsidiary of Hovnanian Enterprises, Inc. (NYSE: HOV). The award includes punitive (treble) damages for violation of the New Jersey Consumer Fraud Act and also entitles the plaintiff to recover attorneys’ fees, costs and prejudgment interest. The jury found that Hovnanian Enterprises used the subsidiary as an instrument to commit a fraud or injustice on purchasers of condominium units. The ultimate recovery against all parties, including the project architect and geotechnical engineer, could exceed $20 million.

After a six-week trial in New Jersey Superior Court (Docket No. HUD-L-2560-13), the jury agreed that Hovnanian, after learning that the condominium building was being improperly constructed with plywood flooring in violation of the building code, chose to nevertheless continue construction. Hovnanian then sought to reclassify the building type. The jury agreed with the plaintiff’s position that the reclassification was never approved by governmental authorities. The units were then sold without disclosing the code violations or the lack of approval to the buyers. The claim arose out of construction problems with the six-story, 132-unit residential and commercial building in Port Imperial, West New York, NJ.

Matthew Meyers, a Shareholder in Becker & Poliakoff’s Morristown office, represented the homeowners and initiated the suit against Hovnanian. “Hovnanian knew that the use of combustible materials in the flooring was in violation of the building code, and instead of fixing the mistake, attempted to change the building’s classification. They then sold units knowing that the change in classification had never been approved. They continued to arrogantly defend their conduct at trial but the jury would have none of it. Hopefully, after this verdict, Hovnanian will get the message.”

“A key point making this landmark case particularly unique is that the parent company, Hovnanian Enterprises, was found to have used its shell subsidiary to perpetrate an injustice on the condominium unit buyers,” said Becker & Poliakoff shareholder John Cottle, who was first chair/lead trial counsel in the case representing the homeowners. “This is a rare instance in which the ‘corporate veil’ was pierced, and we expect the result of this will be that Hovnanian Enterprises will ultimately be held responsible for the judgment.”

In addition to Cottle, the Becker & Poliakoff trial team from Florida included: Perry M. Adair, Miami managing shareholder and a board-certified construction law attorney; and Sanjay Kurian, a shareholder and board-certified construction law attorney. The New Jersey team included Vincenzo Mogavero, a shareholder and litigation Chair and Martin Cabalar, in addition to Mr. Meyers. 

About Becker & Poliakoff
Becker & Poliakoff, with headquarters in Fort Lauderdale, Fla., is a multi-practice commercial law firm with attorneys, lobbyists and other professionals at offices across the United States. More information is available at www.bplegal.com.

Friday, May 12, 2017

David Ramsey Receives CAI Distinguished Service Award

Hearty congratulations go out to J. David Ramsey, shareholder in Becker & Poliakoff’s community association practice group. David was recently honored with the Distinguished Service Award at the Community Associations Institute’s (CAI) Annual Conference Awards dinner in Las Vegas.

The Distinguished Service Award is CAI’s most prestigious award and is periodically presented in recognition of longstanding, extraordinary contributions to the Institute. A member of CAI for over 30 years, David served as president in 2003-04 and remains actively involved in CAI’s Government and Public Affairs Committee, chairs the New Jersey Chapter’s Strategic Planning Committee and is a member of the New Jersey Legislative Action Committee. David has spent the majority of his legal career advocating on behalf of community associations, particularly in New Jersey and New York.


Tuesday, February 7, 2017

NO BANK ACCOUNT, NO EMPLOYMENT, NO PROBLEM

 
Once a judgment for condominium arrears is entered and various post judgment enforcement remedies have proved unavailing to locate assets, i.e. there are no bank accounts in the debtor’s name and no employment information can be located, there is one more tool in the toolbox!

New Jersey Court Rule 4:59 - 1 (d) (1) permits a judgment creditor to file a motion for an order to sell real property where the judgment debtor's assets are insufficient or cannot be located. The Appellate Division recently reversed an order denying such relief where the lower court held that notice to the mortgagee was a prerequisite. The relevant consideration under the rule is whether the judgment creditor made reasonable efforts to locate personal property. If you have an unsatisfied judgment, this remedy may be available as an alternative to a lien foreclosure. This strategy has been effective to bring delinquent condominium owners to the table when no bank accounts or employment can be located.

Submitted by :  Angela M. Morisco, Esq.

Thursday, January 12, 2017

Q&A: Disclosure of Tenant Information


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Q:        Does a condominium association board have an obligation to disclose information to an owner about an individual who is leasing a unit? If the lessee has a permanent guest with a criminal background does the board have an obligation to disclose this to the owner? 

A:        Typically, a condominium association in New Jersey would not have an obligation to disclose information to an owner about another resident who is renting a unit or is a guest in a unit. The New Jersey Condominium Act sets forth the duties of a governing board of a condominium association. With respect to disclosures, the Condominium Act specifically requires the association to maintain accounting records, in accordance with generally accepted accounting principles, open to inspection at reasonable times by unit owners. See N.J.S.A. 46:8B-14(g). Such records include (i) a record of all receipts and expenditures and (ii) an account for each unit setting forth any shares of common expenses or other charges due. The Condominium Act further states that the board shall have such other duties as set forth in the master deed or bylaws. N.J.S.A. 46:8B-14(i). Therefore, unless the master deed or bylaws set forth disclosure obligations in addition to those above, there is generally no duty to disclose information with respect to tenants.

Nevertheless, the Condominium Act still requires the board to exercise its power and discharge its functions in a manner that protects and furthers or is not inconsistent with the health, safety and general welfare of the residents of the community. Thus, where there is a risk of foreseeable criminal harm, an association has an obligation to take reasonable action.  What that reasonable action may be depends on the particular facts. Therefore, the board must balance the possibility that any specific notice to other residents of the community may result in the resident that lawfully resides in the community being harassed by other residents, thereby creating a potential liability for the association. This is a very complex balancing act for the board and it should not be undertaken without the advice of the association’s attorney. 


It would be a rare case in which notice of past criminal history of a resident should be reported to the other owners in the community. That determination should be made in consult with the association’s attorney and consider the type of crime committed (such as whether the crime was violent in nature), the age of the person at the time the crime was committed, the length of time since the crime was committed, and the amount of time during which the person has not been subject to incarceration and has not committed another crime. Even where the decision to disclose such matters is made, the board should ensure that the notice is limited to purely factual matters. 

Monday, August 8, 2016

Landmark Decision by New Jersey Supreme Court Finds Developer's Insurance Covers Consequential Damages Caused by Faulty Workmanship of Subcontractors

The New Jersey Supreme Court has finally joined the majority of other states by holding that the standard developer/general contractor commercial general liability insurance policy (“CGL policy”) covers consequential damages caused by the faulty workmanship of their subcontractors.  The ruling is significant for condominium and homeowner associations that suffer from construction deficiencies because it provides an avenue to satisfy a judgment or otherwise recover funds necessary to repair construction deficiencies left behind by a defunct or assetless developer or general contractor. 

All too often developers and general contractors form assetless “shell” entities that have no means to satisfy a judgment for construction deficiencies.  In these circumstances, the only hope for recovery for community associations is through the developer or general contractor CGL policy.  However, prior to the ruling in Cypress Point Condominium Association, Inc. v. Adria Towers, LLC, et al., insurance carriers routinely refused coverage by relying on the “damage to your work” or “your work” exclusion in CGL policies which excluded coverage for property damage to the work of the developer or general contractor.  Insurance carriers argued that the “your work” exclusion was inclusive of the entire building or property because that is what the developer or general contractor was responsible to construct.  Thus, carriers steadfastly refused to settle or pay for damages caused by construction deficiencies -- such as those resulting from water infiltration or leaks.

Attorneys for community associations throughout New Jersey have long argued that the “subcontractor exception” found in standard CGL policies provided a clear exception to the “your work” exclusion. Nevertheless, carriers still refused to provide coverage to developers or general contractors.  At last, the New Jersey Supreme Court finally weighed in and agreed that the “your work” exclusion was unequivocally narrowed by the “subcontractor exception” because it expressly declared that the exclusion did not apply if the damage or work out of which the damage arose was performed by a subcontractor.  Thus, so long as the damage alleged arose out of faulty workmanship performed by the subcontractor of a developer or general contractor, it is a covered loss.