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CCOC Decision Summary

Lopez v. Spring Lake Condominium Association #30-13 (May 29, 2015) (Panel: Stevens, Brandes, Fonoroff)

The homeowner challenged an order of the board to all members to convert their fuse boxes to circuit breaker panels.  She also challenged a decision of the board to loan the affected members the funds necessary to make the conversion.  She argued that there was no evidence of safety hazards from the fuse boxes, nor was such a change required by law, and the governing documents did not grant the board the right to make loans.

The evidence at the hearing showed that the decision to order conversion of the fuse boxes was the result of a survey of the condominium performed by its master insurance company.  The company said it would not renew its coverage unless a number of modifications were made, including the replacement of the fuse boxes.

The hearing panel held that the Condominium Act required the association to have a master insurance policy, and that it was within the discretion of the board of directors to require that the unit owners change their fuse boxes in order to maintain the insurance coverage.  Other evidence showed that even if the board had tried to obtain coverage from another company in order to avoid the need for the conversion, the new carrier was likely to impose the same requirement.  The panel held that the prior CCOC decision in Lieberman v. The Whitehall Condominium,  CCOC #25-06 (2007) did not apply because in the Lieberman case the association not only failed to show any evidence of safety defects but it could not show that its insurance required the change.

The panel also found that the association was not making loans.  On the contrary, the association hired a single contractor to go to each affected unit and make the repairs, and the condo then billed each unit for the cost of those repairs.  The Bylaws specifically allowed the condo to create in “in-unit” service program and to bill the unit owners individually for the costs of servicing that owner’s unit.

The panel refused the association’s request to order the homeowner to reimburse it for its legal fees, claiming the complaints were frivolous.  The panel concluded that the homeowner prosecuted her complaint in good faith even if she was mistaken about the law and did not understand fully the Lieberman decision.  The panel also concluded that the association never took the time to explain itself to the homeowner and might have avoided the need for a hearing if it had done so.

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