Wednesday, April 18, 2018

UPDATE: Recent Clarifications from the New Jersey Department of Health on the Amendments to the Public Recreational Bathing Code



BY: MARTIN C. CABALAR


In our most recent blog post, we responded to a reader considering eliminating the lifeguard at their pool. This is something that many communities have considered doing this pool season as a result of the amendments to the Public Recreational Bathing Code, N.J.A.C. 8:26-1 (the “Code”), particularly the requirement that facilities with pools larger than 2,000 square feet of surface area have at least two lifeguards on duty. Recently, the New Jersey Department of Health issued a Frequently Asked Questions (“FAQ”) clarifying that a “private nonprofit common interest community” is a “specially exempt facility” and thus exempt from the lifeguard requirements of the Code. Accordingly, so long as your community is a specially exempt facility and complies with all other requirements of the Code, there is no requirement that you have at least two lifeguards on duty if your pool has a surface area greater than 2,000 square feet. One lifeguard will continue to suffice, provided you have appropriate signage. 

If you nonetheless decide to eliminate the lifeguard at your pool, the Public Recreational Bathing Code requires that you post a sign at least three feet by four feet in size, prominently displayed at every entrance to each swimming area, stating: (a) “No lifeguard on duty,” (b) “Persons under the age of 16 must be accompanied by an adult,” and (c) “No swimming alone.” This sign must include the hours the pool is open and all information on the sign must be easily readable with contrasting colors. At mobile home parks or retirement communities, the sign must also state: “This pool is closed when the owner or operator is not on the premises.” There are also additional signage requirements for a “Health Club” registered with the Director of the Division of Consumer Affairs pursuant to N.J.S.A. 56:8-39.

Given the insurance and other legal implications, we highly recommend that you consult with your attorney and insurance agent prior to opening your pool this season, especially if you are considering making any decision to eliminate your lifeguard. 

Monday, March 26, 2018

Q&A: Amendments to the New Jersey Public Recreational Bathing Code and the Effects on Your Community Association


BY: MARTIN C. CABALAR



Q: Our association is considering eliminating the lifeguard at our pool. Do we need to do anything other than post “swim at your own risk” signs?

 
A: Many communities throughout the State of New Jersey are giving serious consideration to eliminating the lifeguard at their pool in light of the amendments to the Public Recreational Bathing Code, N.J.A.C. 8:26-1 (the “Code”), particularly those portions addressing the duties of lifeguards as they may result in increased costs. However, provided your association has been approved as a “specially exempt” facility, the association would be exempt from the lifeguard requirements of the Code.

As you may be aware, the amended regulations require communities with pools larger than 2,000 square feet of surface area to have at least two lifeguards on duty. In addition to other changes, which are discussed in more detail below, lifeguards are not permitted to perform any activities that would distract them or intrude upon their attention from proper observation of, or prevent immediate assistance to, persons in the water. This means that lifeguards should not be texting or looking at their cellphones, checking pool passes or performing any services with respect to testing or cleaning of the pool while on duty. While this has always been the case, the language of the amendment suggest that local municipalities may enforce these requirements more strictly.

Despite any increased cost that may result to your community, we do not recommend that you completely eliminate the lifeguard at your pool. The safety benefits of having a lifeguard are obvious, but there are other financial and liability considerations as well. The elimination of your lifeguard will certainly increase your insurance premium and may expose your community to greater risk. For example, if you currently have a vendor providing lifeguard services, you will lose the benefit of insurance coverage and other protections afforded by this vendor. In the event that a lawsuit was filed in connection with an incident at or near the pool, your vendor and its insurance carrier would likely be required to defend and indemnify your community. Whereas, if you eliminate the lifeguard provided by the vendor, the association or its insurance carrier must absorb these costs.

If you are a qualified common interest community and decide to eliminate the lifeguard at your pool, the Public Recreational Bathing Code requires that you post a sign at least three feet by four feet in size, prominently displayed at every entrance to each swimming area, stating: (a) “No lifeguard on duty,” (b) “Persons under the age of 16 must be accompanied by an adult,” and (c) “No swimming alone.” This sign must include the hours the pool is open and all information on the sign must be easily readable with contrasting colors. At mobile home parks or retirement communities, the sign must also state: “This pool is closed when the owner or operator is not on the premises.” There are also additional signage requirements for a “Health Club” registered with the Director of the Division of Consumer Affairs pursuant to N.J.S.A. 56:8-39.

Given the insurance and legal implications, we highly recommend that you consult with your attorney and insurance agent prior to making any decision to eliminate your lifeguard.

Here are some other important amendments to the Code that will affect everything from preseason pool opening procedures to pool inspections and maintenance:
  • Lifeguards are not permitted to perform any activities that would distract them or intrude upon their attention from proper observation of, or prevent immediate assistance to, persons in the water. This means that lifeguards should not be texting or looking at their cellphones, checking pool passes or performing any services with respect to testing or cleaning of the pool while on duty. While this has always been the case, the language of the amendment suggest that local municipalities may enforce these requirements more strictly.
  • Twenty-one (21) days before the pool is set to open, the owner/operator must submit the Checklist for Public Recreational Bathing Facilities to the local health authority for approval to open. An initial water sample must be obtained prior to opening the pool and sampling must be done at least once every week thereafter;
  • Bonding and grounding certificates must now be provided annually before the pool opens; 
  • A full spine board must be kept poolside;
  • Pools must have at least one throw line which reaches the other side of the pool;
  • All life-guarded pools must have an automated external defibrillator (AED); 
  • All pools with a depth great than five (5) feet, a diving area, or greater than 2,000 square feet in surface area must have elevated lifeguard platforms located at the water's edge; 
  • Emergency telephone numbers of the nearest rescue squad, police department, and other appropriate entities, along with the address of the pool, shall be posted in a weather-resistant display adjacent to the lifeguard station;
  • While a written standard operating procedure aquatics facility plan is not a new requirement, there is some new information that must be included in the plan, including: the location of the emergency shut off switch for the suction outlets, the hours of operation of the pool, the schedule of operational activities (such as water testing), the zone of protection plan for lifeguards and a safety policy on water toys and floats. 
  • Dressing rooms and bathrooms shall be provided. 
  • For facilities constructed prior to November 4, 1986, dressing rooms shall not be required and bathrooms may be portable. 
  • For facilities constructed prior to September 7, 2010, dressing rooms and bathrooms shall be provided within 50 feet and at least one bathroom shall be provided and it may be portable.
  • For existing condominiums where all residences are within 100 feet of the swimming pool, a separate dressing room and bathroom near the pool are not required. 
  • The circulation system must meet the following requirements:
    • The pumps, piping, return inlets/suction outlets, filters, etc. shall be maintained to ensure the complete circulation of water throughout all parts of the swimming pool.
    • The circulation system shall be operated so as to turn over the entire swimming pool water capacity at least once every six hours; and the wading pool water capacity at least once every hour. Pumps shall be operated 24 hours a day and seven days a week.  
    • The facility owner may install an energy efficient two-speed pump to save energy when the pool is closed at night. If such a pump is installed, the turnover rates do not have to be met during the night when the pool is closed.
    • Swimming pool water clarity shall be maintained so that the deepest portion of the pool is clearly visible from the pool’s edge.
    • The pump and component parts of the circulation system, shall be operated in a safe manner that is not hazardous to the operator and maintenance personnel.
    • Mechanical seals shall be corrosion resistant and shall be maintained in good repair.
    • Direction of water flow and pump rotation shall be clearly indicated on the pumps & all visible piping.
    • Strainers shall be provided on all filter systems, shall be removable, and shall be located upstream of the circulation pump(s) to remove solids, debris, hair, and lint. Water entering the pump shall first pass through the removable strainer.
    • Filters shall be cleaned and maintained pursuant to the manufacturer’s instructions, so that the circulation system can provide the required water clarity.
These are only some of the changes to the Code. Thus, we highly recommend that you first consult with and seek the advice of your counsel and pool management vendor before the upcoming pool season to ensure that your community is in compliance.

Tuesday, March 6, 2018

Becker’s Brand Evolution - A Message to Clients & Friends



 BY: MARTIN C. CABALAR

We’re Becker & Better Than Ever...

...and we have a powerful story to tell. One that captures our pioneering spirit, our passion, and our unwavering commitment to our clients and the industries and communities we serve.

We are your champion - an advocate, cheerleader and partner - breaking new ground and pushing the edge on what’s possible. 

To more fully convey this message, we are thrilled to announce the creation of our new brand. We invite you to visits our new website and share your thoughts.


And most importantly, we thank you for your support over the years.

We remain fearlessly yours,

Your friends and colleagues at Becker

Tuesday, February 20, 2018

Q&A: Handling a Homeowner Request to Review Counsel’s Invoices


BY: MARTIN C. CABALAR


Q:        A resident is demanding copies of attorney invoices, but aren’t these subject to the attorney-client privilege? 

A:        The simple answer is: it depends. While “it depends” is not the most satisfyingly complete answer, owners generally have a right to see our invoices. However, when an invoice pertains to or contains attorney-client privileged information, your counsel should review them and redact any part of the privileged narrative.  Examples of attorney-client privileged information that would have to be redacted include entries related to individual privacy, pending or anticipated litigation, contract negotiations, the employment, promotion, discipline or dismissal of a specific officer or employee of the association, or any other matters falling within the attorney-client privilege, to the extent that confidentiality is require in order for the attorney to exercise his ethical duties as a lawyer.

Generally, we would advise our community associations to inform an owner requesting access to the association’s counsel’s invoices that if they wish to review the content of legal invoices, rather than just the amounts billed, they must first be reviewed by counsel, so that any entries which are protected by the attorney-client privilege can be redacted. While that work is not a significant undertaking, the association should not make the determination as to what is or what is not subject to the attorney client privilege or attempt to undertake the redaction on their own without the advice of counsel. An entry as innocent as “discussed contract negotiations with the Board and landscaping contractor” may be an attorney-client protected communication.

The cost to review and redact the invoices should be charged to the requesting unit owner and not as a common expense to all unit owners. While owners may argue that you are attempting to prevent them from seeing the invoices, this is not the case at all. Owners are permitted to see the amount of each invoice, but they are not permitted to review narrative entries which contain attorney-client privileged communications.

Finally, while an owner may argue that they “pay our bill” or that they are our client and therefore have the right to see the narrative entries on our invoices, the individual unit owners are not our clients. Yes, the unit owners pay the common expenses fees, which fund the association’s legal expense, but our client is the corporate entity which acts through its governing board.  

If your governing board receives a request to review the association’s attorney’s invoices, we recommend that you first consult with and seek the advice of your counsel before providing copies to a unit owner.

Tuesday, January 9, 2018

Q&A: Board Member Confidentiality Agreements



By: Martin C. Cabalar

Q:     Can board members adopt a policy requiring all members of the Board to execute a confidentiality agreement?  

A:       While there is no New Jersey case law directly on point, the likely answer is that with respect to material that is confidential, the governing board of a common interest community may adopt a policy requiring that the right of a director or trustee to access confidential material will be conditioned upon the board member's execution of a confidentiality agreement.

The New Jersey Condominium Act and New Jersey Planned Real Estate Development Full Disclosure Act (PREDFDA), despite having vigorous open meeting requirements, recognize that certain discussions should be held in confidence. Specifically, the governing board, in the exercise of its powers and duties, may exclude or restrict attendance at those meetings, or those portion(s) of meetings, dealing with: (1) any matter, the disclosure of which, would constitute an unwarranted invasion of individual privacy; (2) any pending or anticipated litigation or contract negotiations; (3) any matters falling within the attorney-client privilege, to the extent that confidentiality is required in order for the attorney to exercise his ethical duties as a lawyer; or (4) any matter involving the employment, promotion, discipline or dismissal of a specific officer or employee of the association. See N.J.SA. 46:8B-13 and N.J.S.A 45:22A-46(a). It is very likely that the reason for such provisions in the Condominium Act and PREDFDA are in recognition of the fact that to act within the best interest of the association (i.e. maintain a duty of loyalty) requires members of the governing board to exclude and restrict attendance at certain meetings in order to maintain the required fiduciary level of confidentiality. Thus, a governing board would be justified in denying a board member access to such confidential information or materials where that board member refused to sign a confidentiality agreement with respect thereto.

In fact, the Appellate Division in one New Jersey case did not appear to take issue with the association requiring its members to sign confidentiality agreements in order to obtain a list of all members of the association.  Instead, the court held that a one thousand dollar liquidated damages clause in the confidentiality agreement was unreasonable and invalid, but did not otherwise appear to take issue with the confidentiality agreement or the board’s requirement that members sign same. See Comm. for a Better Twin Rivers v. Twin Rivers Homeowners' Ass'n, 383 N.J. Super. 22, 60 (App. Div. 2006) rev'd on other grounds, 192 N.J. 344 (2007). Likewise, in a corporations cases from Delaware, the court there has held that the access to materials as a director may be conditioned on the execution of a confidentiality agreement. See e.g. Hollinger Int'l, Inc. v. Black, 844 A.2d 1022, 1092 (Del. Ch. 2004); Stroud v. Grace, 606 A.2d 75, 89-90 (Del. 1992).


In light of the aforementioned legal precedent, where a member refuses to sign a reasonable confidentiality agreement but continues to demand access to confidential information, the board of a common interest community would likely be justified in seeking a judgment declaring that the member’s access to materials be conditioned on his or her execution of a confidentiality agreement.  In addition, while the board likely cannot remove the member from the board, as most governing documents require a vote of the unit owners, the board may also be justified in calling upon the unit owners for a vote to remove the obstinate board member.

Tuesday, December 19, 2017

Q&A: Charging for Copies of Financial Documents


BY: MARTIN C. CABALAR


Question:       

Is there a limit how much we can charge to pull, provide and copy requested paperwork? Can we make a profit?

Answer:

Yes, there is a limit to the amount a condominium association can charge its residents to provide copies of records the association is required to keep open to inspection by its owners. In New Jersey, the charge cannot exceed an amount reasonably related to the association’s copying cost, which may include any additional administrative expense incurred. Therefore, unless your governing documents provide otherwise, the association may charge the cost for copying.

It is important to keep in mind that the New Jersey Condominium Act provides that associations shall be responsible for “the maintenance of accounting records in accordance with generally accepted accounting principles open to inspection by unit owners at reasonable times.” N.J.S.A. 46:8B-14(g) (emphasis added). The accounting records required to be open to inspection by unit owners include (1) a record of all receipts and expenditures and (2) an account for each unit setting forth any shares of common expenses or other charges due, the due dates thereof, the present balance due and any interest in common surplus. Thus, while the association may charge a fee reasonably related to the association’s copying cost to provide copies, the association must grant access to inspect the financial records required to be kept open to inspection without charge to the unit owners. Even if another party, such as the Association’s managing agent or accountant, charges the association a production fee, the association cannot charge the owner a fee to merely inspect these records.

Finally, while the Condominium Act is silent as to whether owners have a right to make copies, and New Jersey case law has not resolved this precise issue, the New Jersey Department of Community Affairs takes the position that the right of inspection includes the right to copies of those documents. Thus, we recommend that you allow members to make copies of financial records that are required to be open to inspection.

Tuesday, December 12, 2017

Hudson County Court Distinguishes Controversial Palisades Decision


On December 7, 2017, a Hudson County Superior Court Judge, in the matter of Grandview II at Riverwalk Port Imperial Condominium Association, Inc. v. K. Hovnanian at Port Imperial Urban Renewal III, LLC, et al, Docket No. HUD-L-2839-14 ("Grandview II"), denied summary judgment to an architect retained by the developer who argued that the statute of limitations barred the association's claims pursuant to the Supreme Court's controversial decision in the matter of The Palisades at Fort Lee Condominium Association, Inc., v. 100 Old Palisade, LLC (“Palisades”)[1] because the developer knew of the defects more than six-years prior to the lawsuit being filed. In denying summary judgment, the Court specifically held that Palisades (1) was factually distinguishable from a project such as Grandview II that was originally developed as a condominium with the intent to transition the operational control to an association in the future and (2) did not modify the long-standing rule that claims by a condominium association against the developer, its design professionals and subcontractors do not accrue until transition. Citing Terrace Condominium Association, Inc. v. Midlantic National Bank, 268 N.J. Super. 488, 503 (Law Div. 1993). 

Becker & Poliakoff represents the plaintiff condominium association in Grandview II and argued in opposition to the motion for summary judgment, among other things, that Palisades was not only factually distinguishable, but that it did not change long-standing New Jersey case law holding that such claims do not accrue, at the earliest, until transition of control by the developer. Fortunately for common interest communities throughout New Jersey the Court agreed that "no claim could be brought by the association until the transition occurred. That is until at least seventy-five percent of the units were sold to require the transition from owner to association control." 

As recognized by the Court, the statute of limitations is a rule of equity and as such equitable considerations must control the Court. There is an inherent conflict of interest in the argument put forth by the architect in Grandview II that a cause of action for construction defects by a condominium association accrues when anyone in the chain of ownership, including the developer, first knows or reasonably should know of a defect, even if transition to unit owner control had not yet occurred. While such may be equitable in the unique circumstances presented by Palisades, where the building was constructed as an apartment complex and subsequently transitioned to a condominium, it is not realistic to suggest that a developer would initiate an action against itself, or its contractors and design professionals, prior to transitioning control to the unit owners in the normal condominium context. 

While we believe the decision by the Hudson County Superior Court is correct and well-reasoned, it certainly will not bring an end to design professionals and subcontractors attempting to dismiss a condominium association's construction defect claims as being barred by the applicable statute of limitations based on the decision in Palisades and the developer alleged knowledge of defects. The Palisades decision, while innately fact driven, is nonetheless a decision by the Supreme Court. Thus, defendants may still attempt to argue that Palisades is not distinguishable and as a decision of the Supreme Court is the applicable controlling law. While we believe that argument to be incorrect for the very reasons argued to and set forth by the Court in Grandview II, if your association is currently experiencing problems due to potential construction or design defects it is suggested that you seek the advice of counsel immediately to best protect your interests.



[1] The full opinion in Palisades can be downloaded at: http://njlaw.rutgers.edu/collections/courts/supreme/a-101-15.opn.html

UPDATE: Recent Clarifications from the New Jersey Department of Health on the Amendments to the Public Recreational Bathing Code

BY: MARTIN C. CABALAR In our most recent blog post, we responded to a reader considering eliminating the lifeguard at their pool. T...