SBA Extends Deadline for Quake Victims

QUESTION: Our condominium association is still struggling with earthquake recovery. There are three different groups who cannot agree on the course of action and our board of directors has become totally ineffective. I am feeling frustrated, angry and powerless.

I have learned that the person who volunteered to file the loan application with the Small Business Administration (SBA) did not complete the paper work and now refuses to do it because we missed the filing deadline.

We are not convinced that the SBA could help us even if we had completed our application. We know of other associations in our area that still have not received approval for their loans.

Our association did not have earthquake insurance. If we can’t get funding from SBA, I don’t know how our association is going to function. Can we appeal to the SBA to accept a late application if our association can get its act together?

ANSWER: I have good news for you and other people who have been dragging their feet. The SBA has once again extended the loan application deadline to Oct. 17. Rebecca Cooksey heads the SBA Outreach Department and she would be glad to assist your association. Her phone number is (818) 556-1554.

“We know that there are still a lot of community associations that have been unable to deal with the decisions they need to make,” Cooksey said.

“The SBA is doing everything that we can to reach those associations and assist them by coming out to the associations and meeting with the board members and homeowners. Right now, we are meeting with about three associations every day.”

The SBA is already helping some 1,800 community associations at the present time. For those other associations that want to check on the status of their loan applications, the SBA number to call is (800) 488-5323.

If your association was dysfunctional before the quake, the crisis has magnified the problem. You are not the only association member who is frustrated and angry. Try to maintain hope and work to heal the divisive attitudes within your association so that you can start progressing toward the goal of making your association whole again. Please write to me again in a few weeks to let me know how your association is doing.

Must Owner Pay for Quest’s Damages

Q: I live in a planned unit development (PUD), which consists of 74 separate individual homes and a gated private road with retaining walls and tennis courts in the common area.

A visitor to my home accidentally backed into the retaining wall causing a small amount of damage. I informed my friend and the homeowner association so that they could resolve the problem. In the meantime, the association sent me a bill for the wall repair.

The association says that when I granted my friend’s entrance to the complex, I became responsible for all of that person’s actions. I refused to pay the bill because I refuse to acknowledge complete liability for my guest’s behavior.

Do I have any legal basis for my position?

A: I’m sorry to disappoint you, but if you read your association’s governing documents you will probably find that a member of the association is responsible for the actions of himself or herself, as well as family members, guests, repair workers or any other person that you invite or allow into the complex.

The association has the right and the authority to hold you responsible for the payment of damages. You are obligated to pay the bill, whether your friend reimburses you or not. I advise you to pay up or you will soon have late charges and attorney’s fees added to your unpaid balance.

You may want to investigate obtaining liability insurance now that you are aware of your responsibility for your guests.

Are Special Rules Only for Children Legal?

Q: Our community association has some rules that apply to children under the age of 15. For instance, there are specific hours set aside when children can use the pool. We have occasionally been challenged as to the legality of these restrictions.

What is your opinion of age restrictions?

A: Your association should eliminate age restrictions other than those found in the local health and safety codes. Most attorneys who counsel community associations are making sure that their association clients are aware of the federal Fair Housing Amendments Act, which prohibits age discrimination in housing. Many parents feel that their children have the right to full enjoyment of the use of the association amenities, regardless of their age.

I recommend that associations restrict unwanted behavior rather than restricting children. For example, if you don’t want noise or toys in and around the pool area, then restrict the noise and toys but don’t make rules that are age-specific. A rule that states, “Running in the pool area is prohibited” is better than “Children are not allowed to run in the pool area.” Obviously, to prevent injury, no one should run in the pool area regardless of their age, so eliminate the reference to children.

Research the local health and safety codes and consult with your association’s attorney if you have specific questions about the legality of your rules.

Management Firm Hides Their Address

Q: Our homeowner association is managed by a management company that closed their office and obtained a post office box so that most of their business is conducted by mail. Even the board members do not know the location of the manager’s office or the whereabouts of our association records. Our phone calls are taken by a recorder and many calls are not answered.

It seems peculiar that the company does not want their business address known. The board of directors is sympathetic to our complaints but they haven’t changed management companies.

Isn’t the company obligated to provide the services that we need? What can we do?

A: Reputable management companies have a business address and they answer phone calls promptly. If the contract does not specify that they must have a business office that is accessible to the members, then they may not be required to provide one. However, the association’s board of directors should know the location of their records and they should be cautious about a company that is, in effect, going into hiding.

Managers have disappeared without notice and taken association funds with them. The board should be diligent about obtaining a business address. If the company is failing to operate in a professional manner, the board should probably seek a new company.

As owners, you can attend a board meeting or write to the board to let them know that you are concerned about the current management company’s performance. If the board fails to respond, you can petition the board to hold a special meeting of the owners to discuss the matter. Consult your association’s bylaws about the method of calling for a special meeting.