CAI of Georgia

Transcription

CAI of Georgia

C
Third Quarter 2009
g e o r g i a
ommons
A Publication of Community Associations Institute of Georgia, Inc.
Inside:
SHATTERED
DREAMS
Attorney’s Fees in
Collection Cases
Plan the Project:
DON’T JUST
BID IT OUT
...and more!
Quarterly Quote
Georgia Commons • Third Quarter 2009
“One of the best ways to measure
people is to watch the way they behave
when something free is offered.”
– Ann Landers
2 0 0 9
Magazine
Lee Mason, Esq. PCAM, Chair
Community Association Management, LLC
John Lueder , Esq., Board Liaison
The Lueder Law Firm, LLC
Christy Borden, CMCA, AMS
Fairfield Plantation
Elina Brim, Esq.,
Gary Caruso, PE, RS
Criterium-Caruso Engineers
Alex Coffman
Community Management Associates
Elizabeth Frey, Esq.
Weinstock & Scavo, P.C.
Doug Goldin, Esq.
Rome & Goldin, P.C.
Mark Greer
Tower Roofing
Travis Jinright
Russell Landscape Group
Joe Larkin
Michael Leavey, Esq.
Dorough & Dorough, LLC
Jason LoMonaco, Esq.
Weissman, Nowack, Curry & Wilco, P.C.
Mike Mewbourne
Pritchard & Jerden
Ashley Miller Lanier, Esq.
John Mitchell, CPA
Owens & Mitchell, P.C.
Marilyn Ratzel, Esq.
Lazega & Johanson, LLC
Marisol Reyes, CMCA, AMS
Brookwood Place Unit Owners Assoc.
RC Shanks, CMCA, AMS, PCAM
GW & Associates
Education
Leslie Fellows, CMCA, Chair
Today Management Inc.
Sandy Depa, CMCA, AMS, PCAM,
Board Liaison
Homeowner Management Services
Jane Beasley, CMCA, AMS, PCAM
Sentry Management
Ashlie Bisig
SERVPRO of North Fulton
Lanier Coulter, Esq.
Lisa Fuerst, Esq.
Brendan Hunter, Esq.
Jami Kohn, Esq.
Noelle Larson
Lazega & Johanson LLC
Kevon Oliver
Heritage Property Management Services, Inc.
Jody Peskin, Esq.
Lipshutz, Greenblatt & King
Olen Robinson, CMCA
Tamera Rodeman
Colby Shear, CMCA, AMS, PCAM
Shaben & Associates
Robin Steinkritz, CMCA, AMS, PCAM
2
Ian Stone
Maggie Vath
Fundraising
Jeff Creecy, Committee Chair
Greenwood Group
Jenni Clemons, CMCA, AMS, Board Liaison
Ethan Atherton
Horizonz Property Management
Ken Baggs, CMCA, AMS
Alicia Fortner
Rome & Goldin, P. C.
Debbie Giggi, CMCA, AMS
Jessica Hartmann
Valley Crest
Sara Hicks
Parker Young Construction
Ginny Krueger, PCAM
Scott Kuperberg, Esq.
Traci Lettsome, Esq.
Lipshutz, Greenblatt & King, P.C.
Kelley Moon
EPIC Response
Mary Ellen Sullivan
Sentry Management
Chris Taylor
Sutter, McLellan & Gilbreath, Inc.
Jamal Williams, Esq.
Golf
Jay Fraiser, Esq., Chair
Teddy Russell, Board Liaison
Neal Bach, CPA
Bach, James, Mansour & Co.
Ashlie Bisig
Kevin Carnes
Arborguard Tree Services
Nancy Cooper
Ray Engineering
Kim Gaddis, Esq.
Gary Kart
Kart’s Landscape
Ginny Krueger, PCAM
Mary Masi
Mark Moore, Esq.
Dale Pendergraft
P3 Painting & Renovations
Sean Ruthven, CMCA
Access Management
Donnie Taylor
A Tow Atlanta
Stephen A. Winter, Esq.
Steven M. Winter, Esq.
Marc Wise
Sweetwater Pool Service
CO M M ITTEES
Membership
Robin Steinkritz, CMCA, AMS, PCAM, Chair
Chuck Negas, Board Liaison
Northwest Exterminating
Daidra Annis,
Houston & Co.
Rhonda Beasley,
Skip Breeden, Esq.
The Lueder Law Firm
Cheryl Bryant
Community Club Cleaning
Lawson Burnat
Pritchard & Jerden
Kevin Carnes,
Arborguard Tree Service
Blair Dean
ASAP Mold
Tanya Fairclough-James, Esq.
Mickel Graham, PCAM
Union Bank
Perry Greene
Taylor Commercial
David Hill, CMCA, AMS
Access Management
Laura Lazar, CMCA, AMS, PCAM
Eagle Management
Mark Peaks,
Sandy Springs Lawn Scapes
Ben Rosenquist,
Talley Custom Painting & Renovations
Jenny Shepherd
Full Circle Restoration
Judy Williams,
Outdoor Lighting
Sabrina Williams
Southern Perfection Painting, Inc.
Programs
Mike Crew, CMCA, AMS, PCAM, Chair
Nancy Allen, CPM
Nature Scapes
Travis Couick
AAPCO
Jeff Creecy
Greenwood Group
Scott Douglas
National Cooperative Bank
Karen Focia, Esq.
Laura Fomby
PDQ Services
Beryl Grall-Petty
Dan Henning, CMCA, AMS, PCAM
Derek Johanson, Esq.
Clarence Lau, Esq.
Ryan Maki
Neighborhood Management Associates
John Melvin
Rock Bridge Commercial Bank
Sheri Stebbins
Crabapple
Rob Stein, Esq.
Bob Russell
Mindy Waitsman, Esq.
Public Relations
Randi Anderson, Chair
Kathy Dorough, Board Liaison
Amy Bray, Esq.
Andersen, Tate & Carr, P.C.
Mary Beth Sierra
Kate Cunningham
Access Management Group
Shandron Forte, CMCA
Professional Office Solutions
Bradley Griffin,
Laura Guilmette
Unique Environmental
Pat Hillen, CMCA, PCAM
Community Association Banc
Brad Jackson
Greenwood Group
Ron Jockers, CMCA, AMS, PCAM
Barbara Miciul, Esq.
Lorraine Serritt, Esq.
Darren Thurmond, CMCA, AMS, PCAM
Atlanta Community Services
Chantell Welch
Bekke White, CMCA
Union Bank
Miye Yi, Esq.
Page Porter
A Tow Atlanta
Sheri Stebbins
Crabapple
Stephen A. Winter, Esq.
Green Committe
Sue Shaw, CMCA, AMS, Chair
Union Bank
Chuck Negas, Board Liaison
Nancy Allen
Nature Scapes
Scott Boring,
AAA Painting
Amy Bray, Esq.
Andersen, Tate & Carr, P.C.
Rachel Carbley
DirecPath
Gail Creef
Emily Croft
Matt Dempsey
Leslie Fellows, CMCA
Today Management Inc
Mark Greer
Tower Roofing.
Jessica Hartmann
ValleyCrest
Kelvin Pipe,
Contracting Concepts, Inc.
Terrence Spires,
Team Pest USA
Brandon Thomas
Brian Watters
Tennis
Judy Dreher, Co-Chair
Bekke White, CMCA
Dreher Insurance
Merrill Walker, CMCA, AMS, PCAM, Co-Chair Union Bank
Robert Zappulla
Homeside Properties
Legislative Action
Sandy Depa, CMCA, AMS, PCAM,
Board Liaison
Mike Zenner, Esq., Chair
Ken Baggs, CMCA, AMS
Kathy Dorough, Esq., Board Liaison
Zach Beck
Caroline Bell, PCAM
Apex Billing
Andrew Bennett
Sally Butler-Lewis
PDQ Services
Insurance Marketing Group, LLC
Ashlie Bisig
Celia Ebert, CPM
Parkside Management
David Boy, Esq.
Dennis Hoffman, CMCA, PCAM
Mike Dangler
Julie McGhee Howard, Esq.
Nature Scapes
Seth Daugherty
Doyle Jones, CMCA, PCAM
Homeside Properties
Capitol Community Management
Blair Dean
Laura Lazar, CMCA, AMS, PCAM
ASAP Mold
Eagle Management
Floyd Dickens, Esq.
Randy Lipshutz, Esq.
Lipshutz, Greenblatt & King, LLP
Derry Duncan
George Nowack, Esq.
Unlimited Landscaping
Laura Guilmette
Kerrie Napoli
Taylor Commercial
Jeanette Payne
AtHomeNet
Community Associations Institute—Georgia Chapter • www.cai-georgia.org
A Letter from the Chapter President
By Teddy Russell
Georgia Chapter of CAI
2 0 0 9
precious metals sponsors
PLATINUM
Teddy Russell
“The Georgia CAI
chapter has had a
strong year with
several new events
and many new faces.”
C
an you believe that the summer is already coming to an end?
Hopefully, everyone has had a couple days of vacation and some
time to catch their breath before annual budgets are put together,
community pools are closed and I return to Athens each Saturday to watch
the Dawgs play!
The July Luncheon was a tremendous success. The chapter recognized
the first ever recipient for the Hall Of Fame award, presented to Doyle Jones.
Doyle truly earned this award which entails “continuous Chapter service
over an extended period of years in many capacities.” Congratulations,
Doyle! The Green award was presented to ValleyCrest Landscape for its
achievements in sustainable landscapes and environmentally friendly initiatives. After the awards, Jeff Creecy and the Fundraising committee had huge
success with this year’s Calendar Auction. More than $15,000.00 was raised,
which will allow CAI to continue retaining a lobbyist to monitor the 2010
legislative session. I am still catching heat for bidding the highest amount of
the day! Luckily, the benefits that the committee put together will more than
pay for the expense!
The second half of the year is packed with events and education. On
August 21st, the Membership Committee is hosting a luncheon for all
manager members. There will be a representative from CAI national and
some really exciting announcements regarding the manager membership
structure. If you are a community manager, you will not want to miss this
free lunch at Maggianos! CAI’s annual golf tournament is quickly approaching. Jay Frasier and the Golf Committee have set a record selling out all the
sponsorships before August! The event is on September 17th and we look
forward to seeing everyone at Windermere. Make sure to sign up quickly
to play as registrations will definitely sell out well before the tournament.
Also, in September, the Homeowner education class on the housing market
and economy is back by popular demand. This is going to be held at the
Sheraton Galleria in Cobb County on the 29th. Everyone’s help to get
the word out to the homeowners is very much appreciated. This is a great
time to build your relationship as a manager or vendor by bringing your
homeowner boards. We look forward to more classes from Leslie Fellows
of Today Management, Inc. and the Education Committee with a Mold CE
Class on August 19, 2009 and a Manager Career Enhancement Lunch &
Learn on September 23, 2009.
The Georgia CAI chapter has had a strong year with several new events
and many new faces. I continue to receive comments every week about the
benefit that CAI has brought to its membership. It always amazes me how
hard the volunteers work to achieve the goals of our chapter and I am so glad
that their efforts are paying off.
Teddy Russell
CAI-Georgia Chapter President
Community Association Management
Community Association Underwriters
Community Club Management
Community One Associates
Construction Corporation of America
GW & Associates
Heritage Property Mgt. Services, Inc.
Karts Landscaping
Nature Scapes
Southern Perfection Painting, Inc.
Union Bank
Unlimited Landscape & Turf Mgmt., Inc.
GOLD
Allsouth Renovations, Inc.
Arborguard Tree Specialists, Inc.
Homeowner Management Services, Inc.
Lipshutz, Greenblatt & King
Preventive Maintenance & Contracting Service
Ray Engineering, Inc.
SmartStreet
Talley Custom Painting & Renovations
Taylor Commercial
TMI/Associa
SILVER
AAA Painting & Staining
Access Management Group
Advantage Pool Management
Services, Inc.
Bayview Community Services, Inc.
Capitol Community Management
Colonial Bank
Crabapple, Inc.
EPIC Response
Homeside Properties, Inc.
Lincoln Condominium Group
Owens & Mitchell, PC
P3 Painting & Renovations
Perimeter Landscape
Rock Bridge Commercial Bank
Sandy Springs Lawn Scapes
Shaben & Associates
Sweetwater Pool Service
Tower Roofing
ValleyCrest Landscape Maintenance
BRONZE
Alexander Termite & Pest Control
All Seasons Painting
American Painting & Renovations, Inc.
American Pool Service of Georgia
Andersen, Tate, & Carr, P.C.
Atlanta Community Services, Inc.
Bach, James, Mansour & Co., P.C.
Battle Commercial
Cannon Construction
Community Club Cleaning
Contracting Concepts, Inc.
Elan Management
Exclusive Association Management
Full Circle Restoration
Gold Leaf Landscape Management
GreenCare by Outdoor Expressions
Greenwood Group
HOA Management, LLC
Insurance Marketing Group, LLC
Jowers & Company
Northwest Exterminating Co. Inc.
Rome & Goldin, P.C.
Sentry Management Inc.
Submeter One, LLC
Superior Community Services, LLC
3
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National Corporate Member of Community Association Institute.
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ATTORNEY’S FEES IN COLLECTION CASES
By Elina V. Brim, Esq.
www.luederlaw.com
“...an owner’s obligation
I
G e o r g i a C h a p t e r o f C AI
2009 Board of Directors
n these current economic times, many boards are reaching out to
delinquent owners to help come up with payment plans and other creative ways for delinquent owners to become current on their past due
assessments. In many situations, however, reaching out is simply not
enough. There are some owners who will not work with the boards. When
that occurs, a board is faced with a choice of either risking not meeting the
association’s financial obligations and allowing delinquency rates to continue
or pursuing collections against the delinquent owners. For communities with
high delinquency rates, the issue of attorney’s fees is especially important in
collection cases.
Two important changes on the issue of attorney’s fees took effect within
the last year. The first change is a statute that became effective in July 2008,
and the second is a Georgia Court of Appeals case that was decided in April
2009.
The Georgia Property Owners’ Association Act (the “POA”) and the
Georgia Condominium Act (the “Condo Act”) state that as long as the governing documents so provide, an owner’s obligation to pay assessments also
includes the costs of collections, including court costs and reasonable attorney’s fees actually incurred. Effective July 1, 2008, common law homeowners associations are able to avail themselves of a similar statute: O.C.G.A.
§44-5-60(e). This new statute applies to homeowners associations not subject
to the POA or Condo Act and likewise provides that reasonable attorney’s
fees actually incurred are the obligation of the owner.
The issue of attorney’s fees in a collection case was recently before the
Georgia Court of Appeals in the case of The Springs Condominium Association,
Inc. v. Harris. In that case, a condominium association sued an owner, Cedric
Harris, for unpaid assessments and other charges totaling over $15,000.00.
Mr. Harris filed an answer with the court in which he admitted owing the
past due amounts. In addition, Mr. Harris paid the assessments and charges
that were owed at the time the suit was filed. He did not, however, pay any
President................................................... Teddy Russell
President-Elect.............................Kathy Dorough, Esq.
Past President............................................ Chuck Negas
Vice President ................................................Dan Ross
Sutton Pines Condominium Association
Secretary............. Sandy Depa, CMCA, AMS, PCAM
Treasurer .......................................... John Lueder, Esq.
Board Director............. Jenni Clemons, CMCA, AMS
Executive Director.................................... Julie Jackson
to pay assessments also
includes the costs of
collections, including
court costs and reasonable
attorney’s fees...”
attorney’s fees that were incurred in the preparation and filing of the lawsuit.
The trial court thereafter refused to grant attorney’s fees incurred by the
association in filing the suit against Mr. Harris even though it was the filing
of the lawsuit that compelled the payment from Mr. Harris. On appeal, the
Georgia Court of Appeals sided with the association, holding that where a
statute’s language as to an award of attorney fees is mandatory, the trial court
is required to award reasonable attorney’s fees.
Based on the above case and statutes, a community association’s ability
to recover attorney’s fees in collection cases was strengthened in the past
year. While it is important for community association boards to work with
delinquent homeowners, there are times that putting owners into collections
and filing collection lawsuits become necessary steps to recover unpaid
assessments. n
PO Box 2943
Peachtree City, GA 30269
Tel (770) 736-7233
Fax (770) 736-7232
E-mail: juliejackson@earthlink.net
Our Mission:
The Georgia Chapter of CAI is the voice of the community association industry in the state. Our purpose is to facilitate the professional
creation and operation of community associations through the delivery of high quality education for our multidisciplinary membership.
We are committed to building cohesion, integrity and respect.
■■■
The materials contained in this publication are designed to provide accurate, timely and authoritative information with regard to
the subject matter covered. The opinions reflected herein are the
opinion of the author and not necessarily that of CAI. Acceptance of
an advertisement in Georgia Commons does not constitute approval or
endorsement of the product or service by CAI. CAI-Georgia reserves
the right to reject or edit any advertisements, articles, or items appearing in this publication.
■■■
To submit an article for publication in Georgia Commons, contact
Julie Jackson at (770) 736-7233.
5
Shattered Dreams
By R. Shanks, PCAM
GW & Associates, Inc.
Over the past several years, many dreams
have been shattered. Developers, home
builders, banks and homeowners have all
suffered devastating financial losses.
D
evelopers envisioned that the lots and communities they were
developing would sell quickly. Instead, they have seen the value
of these residential lots plummet well below the amount owed on
them. Developers have lost lots or entire developments to the bank
that financed them. Many developers have gone bankrupt or have just gone
out of business. Communities under development that were once a flurry of
activity are now silent with out of control weeds and grass on vacant lots since
no one has the funds available to mow them. In these subdivisions, the all too
familiar white utility pipes, barely visible above the weeds and grass, give the
impression of tombstones.
Home builders have seen a drastic drop in their potential customers. They
have seen the value of their completed homes decrease by thousands of dollars
and their profits evaporate. Many have filed bankruptcy. Some of the large
national and regional builders have left the state. Those still trying to hang on
have been forced to cut their staffs. Most have been spending more time negotiating with the banks to keep their projects going than they have been completing
and selling homes. One home builder recently told me he feels as if he is working
for the bank. These same home builders are blamed by their former customers
for the community not being as they envisioned it or as their sales agent indicated it would be. Any profits and cash reserves the home builder may have
seemingly vanished. He has often not been able to arrange additional financing,
and his remaining staff now must do several jobs. Therefore, in community after
community, we are seeing many things going undone. In many communities,
common areas are not being well maintained and fresh pine straw and vibrant
colorful summer flowers are not affordable. Sadly, many community swimming
pools have not opened even though the Atlanta area temperatures continue to
rise well into the nineties. These shuttered pools consequently have become a
favorite target for vandals.
All Homeowners have seen the value of their homes plunge. Often, their
homes are now valued at less than what they owe on them. Many have lost
their jobs or have had their hours cut, thereby making it hard for them to
cover all of their expenses. Some have had to file for bankruptcy, while many
have lost their homes to foreclosure or have just abandoned them. These
problems are also taking their toll on many communities. Most of the vacant,
foreclosed or abandoned homes require repair because of damage by vandals
or are in need of grass being cut.
The Banks and Mortgage Companies have been forced by their regulators to call in many loans or to foreclose on numerous homes and projects
they have financed. The strain of underperforming loans and the specter of
government scrutiny are making it difficult for them to operate in the usual
manner. This in turn has caused many banks to fail and many mortgage
companies to go out of business.
The Community Association that was established and charged with
maintaining the common areas of the community and enforcing the covenants
is often unable to do so simply because it has run out of operating funds. The
association depends on homeowners in the community to pay their assessments.
These assessments or fees provide the money needed to operate the association
(a corporation). Without these funds, the association cannot provide the services
it promised. In developing communities, the Declarant (developer or builder)
generally pays the shortfall (the difference between assessment income and actual
cost of operation). Presently, most developers either do not have the money to
pay the shortfall or they have simply gone out of business.
It is indeed a complex and frustrating situation. No one entity or person is
to blame. No one could predict the recession in which we now find ourselves.
Everyone has suffered to some degree. Some have lost all while some have
found a way to hang on.
Rebuilding Those Dreams
Years ago in almost every town across the country everyone knew not only
their neighbors but almost everyone in the town. People worked together and
helped each other. Our population has grown and diversified and our cities
and communities are teeming with people that are so immersed with their
own lives that they don’t know the family next door or across the street. A
community is not truly a community until the homeowners in the community
come together and meet one another.
Often it takes a problem or a tragedy
to bring people together.
Pulling Together – Working Together – All-For-One & One-For-All - It
can be said many ways but much more can be accomplished when everyone
works together. Several communities are well on their way to insuring that
their communities do not fall victim to neglect, an outcome which would
lower their home values even more.
*Leisure Crossing near Braselton was beginning to look like a ghost
town. Neither the builder nor the developers were in a financial position to
fund the association. Working together, the twenty homeowners at Leisure
Crossing have reduced their expenses and raised money to assure that their
grounds, pool, and clubhouse are well maintained. It all started when they
became aware that there was insufficient assessment income to keep things
going. Most were upset that their dreams were about to be shattered. They
were frustrated and angry; they blamed the developer, the builder and the
management company. Several meetings were held, and bit-by-bit the anger
and frustration gave way to cooperation and team work. Almost everyone
pitched in. Furniture was donated for the clubhouse; one owner took the
pool operator’s certification class so he could maintain the pool while others
cut the grass and cleaned restrooms. They identified street lights which they
felt were unnecessary and had them cut off. Neighbor to neighbor conversations resulted in everyone paying their assessments. Still there were not
enough funds to operate everything for the remainder of the year. Additional
meetings were held, some in person and some by e-mail. Two things were
decided: 1) everyone would need to pay an additional $200.00 immediately,
C ontinues on page 8 .
6
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7
SHATTERED DREAMS...from page 6.
and 2) they would attempt to sell pool memberships to the community next
door. Selling pool memberships to the adjacent community has raised much
needed funds and has fostered many new friendships. Things have turned
around so much that the builder is again trying to sell homes in the community. Their community is a survivor and the dream will be realized.
*Brooksville homeowners in Cumming are well on their way. They have
formed an Advisory Board. They are taking on some of the responsibilities
in their community such as monitoring the pool, cleaning and stocking the
restrooms, making repairs to the playground equipment, etc. They are also
forming a compliance committee to monitor covenant violations. Their community is far from built out. They want to help see that the community looks
its best so the builder can continue to sell homes.
*Cason Woods, a community near Jonesboro, has one owner who finally
understood the severity and reality of the situation. He has taken it upon
himself on several occasions to go door to door in the community to encourage those who have not paid their assessments to do so. He has also enlisted
several other owners to form an Advisory Board. They are discussing renting
equipment so they can cut the tall grass and weeds on the vacant lots. They
want to assure that their dreams are realized.
*Camellia Springs near Powder Springs was well on its way to becoming
a dream community. It had a great location, attractive lots, beautiful homes,
and a nice pool, clubhouse and tennis courts. Then everything stopped dead.
It has been slashed by a double edged sword. First, the developer and builder
had their loans called by the bank; then within days the FDIC took over
the bank. Second, after several weeks, the bank/FDIC directed the builder
to sell five completed homes at less than the builder owed on them (a short
sale). The few original owners in the community understandably are angry,
frustrated and hurt. Not only have their home values plummeted, but their
community association is in dire financial straits. Meetings, thus far, have
served primarily as a forum to vent the anger and frustrations. Hopefully, at
the next meeting an Advisory Board will be established and a firm foundation
of cooperation and teamwork will be formed. Several owners are spearheading this effort. One stepped forward and personally paid the past due electric
bill of more than $1,200. This will insure that the lights stay on and the pool
pumps operate at least for the next few months.
*Astor Lake, a developing community near Fairburn, was dealt a severe
blow. Just before pulling out and leaving the community association in debt,
the builder and Declarant resigned from the Board. A meeting was then called
to elect a homeowner Board of Directors. At the beginning, the meeting was
quite volatile as the pool was closed, landscaping services had been terminated
and utilities had been cut off. One vendor had even filed a lien on every home
in an attempt to collect for his services. The owners were extremely upset. (It is
important for people to be allowed to vent their anger and voice their fears and
frustrations; they must have some release for their pent up feelings before they
are able to listen and understand the reality and severity of the situation.) After
much discussion, a five member Board was elected and many more volunteered
to serve on committees. The Board and committees have worked closely and
have held weekly meetings. Assessments are being paid, contracts reviewed,
expenses have been reduced, and the pool is being readied to open. The majority
of the past due invoices have been paid. These owners have spent a lot of time
and effort to save both their community and their dream.
These are just a few of the many encouraging stories of communities that
have decided to set aside their differences and work together to make a reality of the community they envisioned. They are working together to rebuild
the dream.
Unfortunately owners in some other communities contact the news media.
The few seconds of air time on the evening news, or the paragraph in the
newspaper showing an unsightly community, do little or nothing to solve
the problem. These owners sit by waiting for the developer, the builder, the
management company, the bank or the government to solve the problem.
Owners in the community need to pull together to help solve these problems, to revitalize their community and to insure that the dream is realized. If
every community were to do this, the housing market in and around Atlanta,
as well as across the country, would rebound much more quickly, help create
jobs and refuel the economy.
Ralph Waldo Emerson once said: “What lies behind us and what lies
before us are small matters compared to what lies within us.” n
* The names of the communities have been changed to protect their privacy.
8
2009 Cai-georgia
calendar of events
*Tentative Calendar for the Georgia Chapter of the
Community Associations Institute
January
Networking Luncheon
01/23/09
Location: Maggiano’s Buckhead
11:30 AM – 1:30 PM
February
Community Association
Volunteer Leadership Course
02/05/09
Location: Doubletree Hotel,
Roswell
Mini Expo
02/05/09
Location: Doubletree Hotel,
Roswell
M-100 – Essentials of
Community Management
02/26/09-02/28/09
Century Center Marriott
CAI-Georgia Casino Night
02/27/09
3:00 – 7:00 PM
March
Networking Luncheon
03/20/09
Location: Villa Christina
11:30 AM – 1:30 PM
M-205 – Risk Management
03/26/09-03/27/09
Sheraton Galleria
May
Networking Luncheon
05/15/09
Location: 103 West
11:30 AM – 1:30 PM
M-203
05/14/09 – 05/15/09
Location: TBD
July
Auction Luncheon
07/17/09
Location: Century Center
Marriott
11:30 AM – 1:30 PM
August
M-201
08/13/09 – 08/14/09
Location: TBD
M-350
08/27/09 – 08/28/09
Location TBD
September
CAI-Georgia Golf Classic
09/17/09
Windermere Golf Club
Homeowner Education Class
09/29/09
Location: Sheraton Galleria
Mini Expo
09/29/09
Location: Sheraton Galleria
October
Speaker Luncheon
10/9/09
Location: Divine Events
11:30 AM – 1:30 PM
December
Annual Awards Banquet
12/11/09
Georgia Tech Conference Center
11:30 AM – 1:30 PM
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VICTORIA HEIGHTS CONDOMINIUM ASSOCIATION, INC
THE ASHFORD CONDOMINIUM ASSOCIATION, INC
CITY HEIGHTS CONDOMINIUM ASSOCIATION, INC.
in Atlanta, Georgia
1421 PEACHTREE CONDOMINIUM
ASSOCIATION, INC.
June 2009
TOWNSEND PLACE
CONDOMINIUM
ASSOCIATION, INC.
Proudly serving Community Associations since 1982
in Property
Atlanta,
Georgia
Heritage
Management
Services, Inc
Corporate
500 Sugar Mill Road
Suite 200 B
Atlanta, GA 30350
South Metro
September7952009
Lanier Avenue
Midtown
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360 14 Street
Suite 201
Atlanta, GA 30318
Suite C
Fayetteville, GA 30269
Savannah
138 Canal Street
Suite 107
Pooler, GA 31322
Proudly serving Community Associations since 1982
(770) 451-8171
Heritage Property
Management
Services, Inc.
gcobb@heritageproperty.com
www.heritageproperty.com
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“Experience the difference”
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9
IS YOUR ASSOCIATION PROTECTED?
The Pitfalls To Using Volunteers
And Uninsured Contractors
By Marilyn M. Ratzel, Esq.
I
n this economy, everyone is looking to shave a little off the bottom
line. Community associations are no exception. Faced with increasing numbers of delinquencies as members struggle to make ends
meet, many boards are looking for ways to tighten the budget and
save a little money.
It is not uncommon when associations are tightening the purse strings for
boards to start looking at ways to economize on the provision of services to
the community. In fact, it is increasingly common for associations to look
to volunteers within the community or to individual contractors who may
not be insured as opposed to established vendors to provide services to the
community, such as landscaping or general maintenance. While this can be
a great way to save a little money, not to mention serve as an opportunity
to build community spirit, if a board does not fully understand the risks or
take the proper precautions to protect the interests of the association, using
volunteers or uninsured contractors can backfire on an association, costing
the association thousands of dollars as opposed to saving thousands of dollars. Understanding the pros and cons can help a board make an informed
decision and protect the association.
Use of Community Volunteers:
• Pros: Asking volunteers from the community to pitch in with some of the
maintenance and/or beautification projects for the neighborhood can be a
great way to foster community spirit and pride, not to mention the added
bonus of saving money.
• Cons: Homeowner volunteers do not carry insurance to protect the association in the event the volunteer is hurt during the course of his or her
activities on behalf of the association. For example, if a volunteer falls off
a ladder while cleaning the gutters on the association clubhouse, seriously
injuring himself or herself, the association can be responsible for the damages incurred by the volunteer. While hopefully, the association will have
sufficient insurance coverage in place to cover such an incident, a large
claim can result in increased premiums or even cancellation of insurance.
Additionally, notwithstanding insurance, all thoughts of community spirit
go out the window in the event of a serious injury and the Association can
be faced with a potential lawsuit for damages in the event of injury.
Likewise, if the volunteer should inadvertently damage someone’s property or otherwise encroach on an owner’s rights during the course of his
or her activities on behalf of the association, the association can be on the
hook for the cost of the damages. For example, if the volunteer misunderstands the boundaries of association common property and clear cuts a
portion of an owner’s lot, the association can be responsible for the damages to the owner’s lot.
Finally, it should be pointed out that member volunteers may not always
be covered by the association’s directors’ and officers’ liability insurance
(“D&C Insurance”), which can also be a source of liability for an association.
• Steps for Protection: There is nothing that an association can do to prevent a person from bringing an action against the association. However,
there are some steps an association can take to help protect itself when
using volunteers. Although it may seem contrary to the spirit of volunteerism, the best way for an association to protect itself is to have each
volunteer sign a release and indemnification agreement, whereby the
volunteer agrees to release the association from any liability in the event
the volunteer is injured or otherwise incurs damages during the course of
his or her activities (the release) and further agrees to cover any claims for
damages caused by the volunteer during the course of his or her activities
(the indemnification). Any such indemnification is only as good as the
volunteer’s personal assets, but in many cases, it is better than nothing.
Another way an association can protect itself in the use of volunteers is to
limit the activities of volunteers to those that are the least harmful or likely
to cause damage. For example, associations should avoid using volunteers
for activities involving ladders, heavy equipment or chemicals.
Lastly, an association should always make sure that its D&O insurance
covers volunteer or committee activities so that it is properly protected
in the event of a claim against the board or the association arising out of
volunteer activity.
Use of Uninsured Contractors:
• Pros: Individual contractors can be much more inexpensive than established companies or national vendors. Also, an individual contractor can
be or is often perceived to be more attentive to the needs of the association.
• Cons: Similar to the cons presented by using volunteers, individual contractors are often uninsured, leaving the association on the hook in the
event the contractor is hurt on the job or damages the property of others
during the course of his or her activities on behalf of the association.
Another significant drawback to hiring individual contractors and/or
laborers is the application of worker’s compensation laws in Georgia.
It comes as a surprise to many boards of directors that their association
may be subject to damages under the state worker’s compensation laws,
depending on the facts and circumstances surrounding the contractors
being hired by the association. In a nutshell, under Georgia law, any
company hiring three or more persons to perform work on behalf of the
company, whether on a full time or a part time basis, is required to carry
worker’s compensation insurance. Failure to do so can result in a significant expense for an association. For example, in an effort to save money,
one Atlanta community hired four uninsured day laborers to clean out
the community’s detention facilities. The board members provided the
instructions and the equipment to the laborers. One of the contractors fell
while using a chainsaw, nearly severing his leg. An action was brought
against the association for several thousands of dollars in benefits under the
state worker’s compensation laws. Under the facts, the laborer was entitled
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11
IS YOUR ASSOCIATION PROTECTED...from page 10.
to recover from the association pursuant to the law, and the association was
not sufficiently protected to avoid liability.
• Steps for Protection. Clearly, the best means for protection for an association is to avoid hiring uninsured contractors and instead require each
contractor to provide the association with a certificate of insurance guaranteeing that the contractor carries current insurance in sufficient amounts
to address any claims that may arise as a result of the contractor’s activities. However, a certificate of insurance is only as good as the underlying
contract so it is essential for the association to have a written contract with
any individual contractor providing services. The contract should specifically provide that the contractor is required to carry insurance and that the
contractor’s insurance is to cover his or her activities on behalf of the association. The association should also be named as an additional insured on
the contractor’s insurance so in the event of damages, the association can
make a claim directly as opposed to having to bring a third party action.
If it is not practical for an association to avoid uninsured contractors or
if the board determines that the savings outweigh the potential risks,
the association should have the uninsured contractor sign a release and
indemnification agreement similar to that discussed above with respect
to community volunteers. Although a release and indemnification agreement would not prevent a lawsuit against the association, it can serve as a
defense in the event of an action.
Finally, any association hiring three or more individuals to perform services on behalf of the association and at the direction of the association
should consider obtaining worker’s compensation insurance to ensure that
the association is properly protected. The added cost of worker’s compensation insurance is minimal compared to the potential liability for the
association in the event of an accident.
The use of volunteers or uninsured contractors can be an effective method
for saving money for an association. However, as with any financial decision,
it is important for a board to weigh the benefits versus the risks when making
decisions to use volunteers or uninsured contractors. If it is determined that
the benefit outweighs the risks, the board should take the proper measures to
protect its interests and those of the membership. By doing so, it will truly
be a cost effective means of saving money versus costing the association a
lot of money. n
Congratulations to our latest CAI-Georgia
Chapter CMCA Recipients!
John Anderson
Brookwood Place Unit Owners Association
Robert Long
RTL Solutions, Inc.
Randi Anderson
John Lumsden
Skylake Community Association
Christine Barber
Today Management
Richard Maritt
Angela Basharat
Today Management
Susan Kay McDonald
Today Management
Dominic Brodbeck
Homeside Properties, Inc.
Janet Phillips
McCreary Realty Management, Inc.
Gail Creef
Today Management
Rosemary Riccio
Brundella Gross
Today Management
Annette Shaffer
Andrea Haywood
Access Management
Bruce Hayworth
Today Management
Anthony Hill
Greenlea Commons Community Association
12
Francine Sturges
Today Management
Kerri Van Pelt
Continental Group, Inc.
Mona Wheeler
Four Star Community Association Management
CAI-Georgia Luncheons
(right) Chapter President
Teddy Russell of the
Russell Landscape
Group presents the July
Green Award to Jessica
Hartmann and other
staff from ValleyCrest
Landscape.
May & July Luncheons
(below) Gavin Cobb of Heritage
Property Management Services, Inc.
& Dean Donald, CMCA, AMS, PCAM
of Bayview Community Services.
(left) Program Committee Chair Mike
Crew, CMCA, PCAM of Homeowner
Management Services.
(above) Jay Lazega of Lazega & Johanson
LLC & Olen Robinson, CMCA of Heritage
Property Management Services
(above) Arlene Sicilano
of Management Resource
Center & Jenny Shepherd
of Full Circle Restoration.
(left) Dennis Hoffman, CMCA, AMS,
PCAM of Community Management
Associates & Mike Beecham of
Piedmont Management.
(below) Buck Cannon of Cannon
Construction Group, Rachel
Carbley of DirecPath, and Rich
Cannon of Cannon Construction
Group.
(above) Jay Plotkin of Heritage Property
Management Services, Inc., Kathy Dorough of
Dorough & Dorough, LLC and Morris Zoblotsky
of Heritage Property Management Services, Inc.
(left) Sue Shaw,
CMCA, AMS of Union
Bank, Doyle Jones,
CMCA, PCAM of
Capitol Community
Management and
Randy Lipshutz of
Lipshutz, Greenblatt
& King.
(below) Riverside Property Management group.
(right) Bob Russell of Russell
Landscape Group leads another
successful CAI-Georgia Calendar
Auction.
Savannah Luncheon
(left) Benjie James of Russell Landscape Group & Emily
Bohannon of GW & Associates at the CAI-Georgia
Savannah Luncheon.
(left) Everyone
enjoys
themselves at
the Savannah
luncheon.
(above) Rob Stein of Weissman,
Nowack, Curry & Wilco, P.C.
speaks.
(right) David Durgin of
Coosawattee River Resort
Association accepts the
May 2009 Green Award
from Chapter President
Teddy Russell of Russell
Landscape Group.
(below) Doyle Jones, CMCA,
PCAM of Capitol Community
Management receives the Hall
of Fame Award from Chapter
President Teddy Russell of the
Russell Landscape Group.
(right) Pat Hillen,
CMCA, PCAM
of Community
Association Banc
and Gary Kornegay
of Mopper-Stapen
Management.
(above) Fundraising
Committee Chair Jeff
Creecy of Greenwood
Group Landscape.
(left) Gary Griffin,
CMCA, AMS, PCAM
of GW & Associates
speaks.
(above) Steven Winter & Mark Bandy of Weinstock
& Scavo, P.C., John Melvin of Rock Bridge
Commercial Bank and Gary Griffin, CMCA, AMS,
PCAM and Emily Bohannon of GW & Associates.
(above) Lanier Coulter and Kathy Dorough
of Dorough & Dorough, LLC and Pat Hillen,
CMCA, PCAM of Community Association
Banc.
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It Can Happen!
Dealing with the real problems community associations
face in a surreal and light hearted way
By Jason LoMonaco, Esq.
L
ast issue “It Can happen” showed how an association overcame the
scarlet letter of “selective enforcement” and enforced its rules and
regulations going forward. This issue “It Can Happen” has decided
to include a practical guide for the homeowner, board member or manager
who finds him or herself in the unenviable position of sitting in Court for an
entire day.
Often owners, board members and managers are stumped by the convoluted and legalistic ramblings of judges. This confusion creates more legal
work for attorneys and higher costs for the association. Below is a translation
dictionary of common judicial phrases to assist the average Joe in understanding the technical terms and phrases judges often use in the Courtroom.
While the experienced lawyer understands judicial terminology and can
divine meaning from even the most obscure utterances by the Court, this is
no easy task for the layman. Pay attention and enjoy.
The Court: “Are you an Atlanta Lawyer.1”
Translation: Your country lawyer opponent starts on third base.
“I am the judge here.”
Stop talking.
Owner: “Your honor my name is” / The Court: “Ma’am I’m letting them in
to inspect!”
Don’t let your bathtub leak on your downstairs neighbors.
“Isn’t that the same as Blockbuster imposing daily late fees?”
The fines will be cut.
“The law doesn’t necessarily apply here in Magistrate Court.”
Don’t sue in Magistrate Court.
“English lessons aside, the correct interpretation of term. . .”
Stop trying to sound smart.
“How about lunch?”
Has this hearing really taken three hours already?
“The Law is clear. . .”
The Association wins.
“In the interests of justice. . .”
The owner wins.
“I haven’t heard anything that would justify. . .”
Start talking.
“We’ll let the jury decide.”
Nobody wins.
“I strongly urge. . .”
Someone is about to be held in contempt of court.
“Correct counselor, but how do you think the jury would view that?”
Settle the case!
“So your saying the ACC approved a garage with the same square footage as
your house?”
The unapproved garage will be torn down.
[sotto voce] “Where’s the money?”
Get the money back in the account by 5:00 P.M. or someone is going to jail.
“That’s all well and good counselor, but why is this matter in Court”
I’m a Republican.
“That’s all well and good counselor, but is this really fair?”
I’m a Democrat.
“That’s all well and good counselor, but why should she pay if she can’t use
the pool?”
I live in a homeowners association.
“But the past is the past.”
You can enforce the rules going forward.
“So it looks like a ‘crack house’. . . ”
Owner led out of the courtroom in handcuffs.
“The little guy is hurting.”
You’re a big guy. I’m cutting your attorney’s fees.
“Is this really the deal you want to enter into?”
Go to trial, homeowner. I’ll cut the attorney’s fees.
Jeff Hope
President/Owner
P.O Box 1656
Dallas, GA 30132
(O) 770-443-2391
(C) 404-583-6734
www.ActionCommunityMgmt.com
jeffhope@ActionCommunityMgmt.com
16
“I have a condominium and I pay my assessments.”
I’m awarding everything to the Association… deadbeat!
“I’ll take this under advisement and issue an order.”
I’m going to take two weeks and find an excuse to cut the attorney’s fees.
“Pretermiting the inapposite juxtaposition proffered beyond cavil by the decedent’s intestate”
Who am I and why am I here?
Can it happen? Yes it can, and it has. Well, not that last one. n
1 Being an obvious New Yorker, I once made the mistake of responding,
“No judge, I’m much worse. . . “
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17
An Alternative Collection Method: Retaining Insurance Proceeds Intended
for the Delinquent Owner’s Unit
By Ashley Miller Lanier
A
lmost all community associations have struggled at some point with
collecting assessments from delinquent owners. For most of these
delinquent owners, the traditional collection process is effective for
bringing in the dollars. This includes collection letters, liens, collection phone calls and, when necessary, filing a lawsuit to obtain a money
judgment against the owner. However, for a few owners, traditional collection efforts are ineffective. Those owners will digs in their heels, ignore the
association and simply refuse to pay. To combat this problem and obtain payment, board members are implementing alternative plans to show delinquent
owners that there are consequences for their failure to pay assessments.
Collection policies and plans are important because an association’s board
of directors has a fiduciary duty to the owners within the condominium or
community development to collect assessments and properly handle the association’s financial affairs. Associations are exploring all avenues and creating
multi-faceted plans for collecting from delinquent owners. One method that
is gaining popularity involves how the association handles monies received
from the insurance carrier for a claim on a delinquent unit.
Imagine how frustrating it would be for a board to have money in their
hands and have to turn it over to a delinquent with no payment on the
outstanding balance to the association. Unfortunately, this is what happens
when insurance proceeds are processed on a delinquent owner’s unit. A
claim is made, monies received, and unless the association has a specific
provision in its governing documents authorizing the board to apply the
funds differently, the board must provide the money to the delinquent owner.
Associations are starting to move forward and change their documents to deal
with this issue.
Some associations are amending their declaration to provide that the
board may utilize insurance proceeds attributable to one unit to reduce
that unit’s delinquency before handing the remaining money over to the
owner. Associations that have implemented this program find it to be a
“Those owners
will digs in their
heels, ignore the
association and
simply refuse to
pay.”
successful way to collect a delinquency in these rare situations. For those
associations that desire to adopt this provision, it is recommended that the
board first discuss this issue with the association’s insurance carrier to ensure
that application of this collection method would not violate the terms of the
policy. Additionally, it is recommended that the amendment provide that
any surplus remaining after application of the proceeds to any delinquency
shall be paid by the association to the affected owner to make the needed
repairs. The owner would then be obligated to use personal funds to make
up any shortfall in the repair costs not covered by the remaining insurance
proceeds.
Associations should be aware that a declaration provision of this nature has
never been considered in a court of law, which means that the industry is not
certain whether a judge would find a provision of this nature to be a reasonable collection method. As with many amendments that similarly have not
been considered in a court of law, the Board should evaluate the benefits
against the risks associated with this amendment. To assist in this evaluation,
each association should discuss its individual needs and the risks with a legal
professional before moving forward with an amendment of this nature. n
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18
GEORGIA LIGHT
COMPANY TROPHY
BEST IN SHOW
ROBINSON WHIMSICAL
TROPHY
CAI National Conference in New Orleans...
(below) Robin Steinkritz, CMCA,
AMS, PCAM of Heritage Property
Management Services and his wife
Andrea Steinkritz.
(above) Teddy Russell of Russell Landscape
Group and CAI-Georgia President and wife
Courtney Russell.
(left) Mike Crew, CMCA, PCAM of
and Randi Anderson of Community
Management Associates.
(above) Bill Seatz & Leisa Ballew of Association
Management Advisory Group.
(above) Gary Griffin, CMCA, AMS, PCAM
of GW & Associates and his wife Debbie
Griffin.
(above) Ken Koushel, CMCA, AMS, PCAM of
Homeside Properties and his wife Margie
Koushel.
(left) Dean Donald, CMCA, AMS, PCAM
of Bayview Community Services.
(right) Pete Paulos
of Vertex Business
Services, Laura Lazar,
CMCA, AMS, PCAM of
Eagle Management and
Darren Thurmond, CMCA,
AMS, PCAM of Atlanta
Community Services.
19
20
Drought Officially Over —
Conservation is still a Must!
By Mike Shaffer
Shaben & Associates
G
eorgia has officially declared the end of the drought and the
reinstitution of “Non-Drought” Outdoor Water guidelines on June
10, 2009. However, it is important for homeowner associations
as well as individual homeowners to verify local and regional
water guidelines that may differ from State guidelines. The Metro Atlanta
Landscape & Turf Association (MALTA) outlines the Non-Drought Rules currently in effect for Georgia on their website www.maltalanscape.com. Check
your local county’s website for local water management guidelines.
Although the drought has officially ended, Georgians continue to have
an obligation to conserve natural resources; the economic impact is substantial. Given the current economy, this eco-friendly alternative is also a cost
effective measure. Below are a few suggestions for conserving this valuable
resource:
• Invest in faucets with aerators.
• Update sprinkler heads and nozzles with more
efficient models and install rain sensors to
automatically shut off the system when there
is sufficient precipitation.
• Reduce unnecessary evaporation by setting sprinkler systems to water in
the early morning hours.
• Use 3” of mulch around plantings to conserve moisture.
• Install electric hand dryers. This not only reduces water usage but waste.
• Lawns require approximately one inch of water per week. It is healthier
for the lawn if it is watered once a week for a longer period of time rather
than more frequently to encourage deeper root growth.
• Using an irrigation system, isolate zones used for seasonal flower beds
from zones for existing mature plantings in order to individualize the water
requirements for each area.
• Consider xeriscaping when replacing or
installing new plants to minimize the need
for supplemental irrigation.
• Consider using native plants where possible which tend to not only require less
irrigation but are also more disease resistant.
The Georgia Native Plant Society (www.gnps.
org) is a good resource for information on
native plants.
As property managers, we have an obligation to conserve our natural
resources and assist and advise communities on methods of accomplishing
this. The above suggestions represent several avenues for reducing water
consumption and saving money. Additional resources to aid in this effort
are as follows:
www.epa.gov/watersense
www.georgiawatercouncil.org
www.conservewatergeorgia.net
www.uga.edu/aboutUGA/water_tips n
21
Eeny, Meeny, Miny, Moe?:
Finding a Better Framework for Decision-Making by a Board of Directors.
By Michael E. Leavey, Esq.
www.dorough.com
H
omeowner and condominium associations in Georgia are
usually established as nonprofit corporations pursuant to the
Georgia Nonprofit Corporation Code (“Nonprofit Code”).
The board of directors is the decision-making body of any
community association and must manage and operate the
association and all of its assets and enforce any applicable covenants. The
governing documents of any community, such as the declaration of covenants and the bylaws of the association, usually allow the board of directors
some amount of discretion in making the various decisions that arise. These
decisions may involve consideration of whether to approve proposed exterior modifications in the community, how association money is spent, how
certain common expenses are allocated among the members, whether and
how to enforce covenants in certain situations, whether to allow exceptions
to a leasing cap contained in a declaration of covenants, and when and how
to perform the association’s maintenance obligations. With each decision of
the board comes the potential for challenge by a homeowner who may be
adversely affected or who otherwise disagrees with the decision. Although a
community’s governing documents may allow discretion in decision-making,
they do not address the standard by which a decision would be judged should
their decisions be challenged. Fortunately, Georgia statutes and case law give
some guidance into this process.
Section 14-3-830 of the Nonprofit Code sets forth the general framework
for a director’s actions: “A director shall discharge his or her duties as a
director, including his or her duties as a member of a committee: (A) In a
manner the director believes in good faith to be in the best interests of the
corporation; and (B) With the care an ordinarily prudent person in a like
position would exercise under similar circumstances.” Board members of
homeowner-controlled community associations are volunteers with other
obligations and generally have a finite amount of time and energy they are
able to dedicate to their duties. The Nonprofit Code authorizes directors
to rely on information, opinions, reports, or statements, including financial
statements, in coming to decisions, if prepared or presented by officers or
employees of the association or by professionals engaged by the association,
such as legal counsel or a certified public accountant. In relying on information and/or documents given by individuals who are not on the board, a
director must believe such individuals to be reliable and competent and must
not have knowledge contradictory to the information presented.
The standard for judicial review for any discretionary action taken by a
board of directors pursuant to a declaration of restrictive covenants; that
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22
Property Managers:
“Does this look familiar?”
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is, whether a court will allow challenges to such an action to be considered
by a jury, was established by the Georgia Supreme Court in the context of
a homeowners association: “Where… the declaration delegates decisionmaking authority to a group and that group acts, the only judicial issues are
whether the exercise of that authority was procedurally fair and reasonable,
and whether the substantive decision was made in good faith, and is reasonable and not arbitrary and
capricious.” Saunders v. Thorn
Woode Partnership, 265 Ga. “With each decision of
703, 704 (1995). This standard
has also been applied by the the board comes the
Georgia Courts in the context
potential for challenge by
of condominium associations.
See Atlanta Georgetown Condo. a homeowner who may be
Assoc., Inc. v. Chaplin, 235 Ga.
App. 460, 461 (1998).
adversely affected or who
Since the standard for
review for discretionary otherwise disagrees with
action taken by a board of
directors was first articulated, the decision.”
Georgia courts have allowed
homeowners to challenge decisions made by a board of directors where the
homeowners offer evidence that the decision is “procedurally unfair and
substantively arbitrary and capricious,” (for example, if an association is
not enforcing its covenants uniformly throughout the community, and the
homeowners association offers no evidence to the contrary.) See Southland
24
Owners Assoc., Inc. V. Myles, 252 Ga. App. 522 (2001). Although there is no
method of predicting whether a court in Georgia would find a particular
decision made by a board of directors to a proper exercise of discretion or
an “unreasonable, arbitrary, and capricious” decision subject to challenge,
a homeowners association will not be able to adequately defend a decision
made by its board of directors unless it offers some kind of evidence supporting the board’s decision. See King v. Chism, 279 Ga. App. 712 (2006)
and Wright v. Piedmont Prop. Owners Assoc. Inc., 288 Ga. App. 261 (2007).
Therefore, it is critical to keep good minutes of meetings at which decisions
are made. The minutes should reflect the various points of view expressed
and show that a vote was taken.
In conclusion, the governing documents of homeowners and condominium associations usually grant the board of directors discretion in
how the association and the community are operated and managed. In
coming to decisions regarding the community, board members may rely
on outside information and documentation. For any decision made by
a board of directors pursuant to discretionary authority granted under
a community’s governing documents, the board should examine why it
is coming to its decision and should record its reasoning in well documented minutes so that, in the event that challenge is made, there is sufficient evidence to defend the board’s actions. Of course, each decision
of the board is distinct and may present unique challenges. A board of
directors may want to consult with the association’s legal counsel for
assistance in establishing a general procedure the board can follow when
coming to decisions regarding the community and reflecting those decisions in the association’s records. n
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Plan the Project: Don’t Just Bid it Out
By Gary J. Caruso, R.S. P.E.
P
lanning is the first step in any construction project. All repair projects
start with a problem that must be resolved properly. The complexities of the problems vary from a simple painting project to a water
intrusion problem, requiring a multi-disciplinary approach. In both
cases, a solution must first be developed through the use of professional
expert consulting. Depending on the project, you should have a professional
engineer (PE), architect or construction expert involved from the beginning.
These professionals can help design, plan and manage the project. Their
advice, along with a competent contractor, will make the project run as
smoothly as possible.
Once the best solution to the problem is identified, a scope of work is
developed and bids are solicited. Without a clear picture of the problem and
a well thought out remedy, the project should not be started. Using contractor proposals in an attempt to identify the solution without a clearly defined
scope of work can be a serious mistake in the process. This path usually leads
to confusion, a less than satisfactory result and possibly legal complications.
The owner of the property or his representative should utilize the best
information possible to develop the scope of work. The information that
is needed may come from various professionals, specialty contractors and
manufacturers or trade organizations, depending upon the work item under
consideration. Once a sound scope of work is developed, it is time to plan the
solicitation of bids. Plan the format of the bid form that you will be sending
out later so it is readable and easy to follow. It will be invaluable in analyzing the bids later.
Preparing a bid requires a clear picture of the desired result as well as the
means that will be needed to get to that result. The bid process generally
seeks to determine who is the best contractor to perform the desired work for
the most competitive dollar amount. The bidder with the least dollar amount
HMS
“Once the best solution to
the problem is identified, a
scope of work is developed
and bids are solicited.”
bid is not necessarily the best one for the project. The bid document should
answer many questions for the contractor and owner. For instance:
• Where does the work begin and end?
• Will specific materials be specified for use or will equal products be
allowed? Who approves the use of any equal products?
• Is there a requirement for a certain performance level on the completed
project? Does the owner want any specific warranties?
• If no products are specified, who selects the materials that will be used?
• Will the work have to be completed on a certain date? Are there times
when the contractor cannot work?
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Michael Crew, PCAM, CMCA
President
mike@hms-inc.net
• Will some or all of the work be performed on a time and material basis?
If so, on what basis will the costs be determined?
Many more details regarding payment schedules, legal stipulations and the
method of resolving disagreements should be covered in the contract once
you have selected a contractor. Careful attention to a clear scope of work
will make the contract preparation phase much easier. The final scope of
work should be incorporated into the contract either directly or by reference.
Consult your legal advisor or use standard contract forms.
Once you receive several bids from experienced contractors, it is time to
analyze the bids. If you have prepared a bid form outlining the general scope
of work items, the analysis will be simplified. Review the best two or three
proposals and ensure that they are bidding on the same scope of work. Be
careful to note any exceptions on the bids as well as any cost saving suggestions by the contractors. These suggestions are frequently very valuable and
can be a source of significant savings. A brief discussion with representatives of the contractors who submitted the best proposals is recommended
to ensure that they understand the project and the scope. As always, check
references and insurance if you have not already done so. On large projects,
you should determine if the contractors are bondable or check them out on a
financial reporting service such as Dun and Bradstreet.
Congratulations. You have made a careful selection of the best contractor
to perform the work on your project. Unfortunately, no amount of planning
can eliminate all of the problems and misunderstanding involved in any
construction project. However, good planning in the beginning will keep
surprises to a minimum. n
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Georgia Commons • Second Quarter 2007
Going Green
By Robert A. Zappulla, AIA, NCARB, LEED AP
On behalf of the Georgia Green Committee
Did you know that the Georgia CAI chapter was the
first to establish a GREEN committee nationally?
D
carbon emissions by the applicants, yet there remains one constant link
id you know that the national CAI Foundation for Community
between them; utilizing multiple “green” procedures or strategies.
Association Research has recently published a Best Practice
By now, you’re probably reviewing in your mind some of the things that
Report on being green, “Report #9, Green Communities”? Did
you or your group does already that are “green” and wondering exactly what
you know that the city of Atlanta has developed a mandatory
has been done by the applicants for a comparison. Below is a short list of
“Atlanta Sustainable Building Code” starting in 2010 that will require all new
some strategies implemented by the 2009 applicants:
mid-rise residential construction to be LEED certified and by 2012 it will
• Replace incandescent lights bulbs with high efficiency compact fluorescent
require renovations and new mid-rise residential construction to be certified
LEED Silver or equivalent? Did you know that according to CNN Money.
• Replace exterior flood lights with solar powered LED lights
com, as part of the recent federal stimulus program, more than $100 billion
• Replace old hot water heaters with high efficiency tank-less water heaters
dollars is allocated to “green” technologies and services? In fact, if you watch
• Replace standard thermostats with programmable thermostats
any major network channel, it is nearly impossible to avoid ads for “green”
products or services. It is clear that the time has come, and “going green” is
• Replace LP fuel pool water heating system with solar and air to water
no longer a fad. Instead, it is pervasive and affects all of our daily lives.
heating system
OK, before we lose some readers, please be aware that “going green”
• Implement paper, plastic, aluminum and cardboard recycling programs
doesn’t mean trading in a car for a horse and buggy or planning weekend
• Recycle old computer parts, cell phones, ink cartridges and batteries
tree hugging sessions. There is no single definition to explain exactly what
it is, but generally speaking, “going green” comes in many “shades” and
• Implement digitizing of incoming mail, electronic invoicing and utilizing
means many different things to different people. It covers a very wide scope
email when possible
of “green” ideas, materials and magnitude of implementation that helps pro• Group site visits and appointments by location to reduce travel
mote the following:
• Harvest rainwater and retain storm water onsite
• Reduction of waste through recycling and reuse of materials
• Install a rooftop garden
• Reduction of harmful materials, ozone depleting gases and chemicals
• Replace low gas mileage fuel vehicles with high fuel efficient and hybrid
• Protection of the earth’s natural resources from waste or contamination
vehicles
through environmentally friendly techniques and materials
•
Utilize “green” materials and chemicals with low VOC’s
With this in mind, over a year ago, the GREEN committee began promot• Reduce the use of plastic dishes and supplies by utilizing recyclable paper
ing a “Going Green Award.” The competition is open to any and all Georgia
products
CAI members who are willing to document their “green” initiatives. The award
recognizes a group or individual commitment to “going green” and is presented
• Recycle spent supply containers and re-use for future needs
to six winners throughout the year at each of the chapter luncheons. The award
• Train staff for LEED Accreditation
is not intended to create a bias towards a singular service or product. In fact,
• Purchase “Carbon Offsets” through TerraPass for a “carbon balanced”
it is preferable that submissions do not tout the “greenness” of a specific brand,
business
but rather explain generically how or what a group is doing to accomplish the
common goal of “going green.” GREEN committee members, who vote on the
• Purchase recycled office products and materials
merits of the applications, range from community managers to roofers to bank• Upgrade attic insulation
ers to landscapers and many other industry professionals. All have specialized
• Purchase high efficiency HVAC equipment
expertise in diverse fields, yet share a common inspiration, the desire to promote
• Purchase high efficiency windows and doors
the integration of environmentally friendly practices and materials within their
business areas and to inform other CAI members of the plethora of “green”
There are likely many “green” strategies on the above list that you or your
alternatives that are available.
group are currently doing, and probably others that you do that are not on
To date, many diverse applications have been submitted by our memberthe list at all. It would be greatly appreciated if you shared with us and the
ship, all of which have documented their groups’ environmentally friendly
membership the things that your group does to “go green.” If you would like
practices, methods or use of “green” materials. Applications have come
more information on applying for the “Going Green Award,” please email
from small to large homeowner associations, management companies, and
executivedirector@cai-georgia.org to request an application.
industry professionals. Submissions have varied widely with regard to scope,
The GREEN committee would like to thank those who have submitted their
magnitude and implementation. The submissions also vary greatly in initial
applications to date. We appreciate your support and look forward to learning
cost from the less expensive implementation of a paper-recycling program to
more of the great things the rest of our membership is doing to “go green.” n
the expense of purchasing new Hybrid or fuel-efficient vehicles. Some applications have even documented incredible cost savings, upwards
of hundreds of thousands of dollars for their efforts. However,
regardless of cost, industry or locale, it is clear that many in our
CAI-Georgia Green Award Winners
chapter recognize the benefits which “going green” can have on
protecting the environment without decreasing the bottom line
May 9, 2008.................. Arborguard Tree Specialists & DGF Management
of their financials.
July 18, 2008.................. Walden on Lenox Condominium Association, Inc.
The key recurring strategy amongst applicants is the synergy
September 26, 2008 .... Nature Scapes
of “green” practices being implemented. We have seen many
December 5, 2008........ Eagle Management Services & East Coast Property Management
instances of singular innovative approaches to address wasted
energy or utilizing “green” technologies and practices to reduce
March 20, 2009............. Taylor Commercial, Inc.
May 15, 2009................. Coosawattee River Resort Association, Inc.
July 17, 2009.................. ValleyCrest Landscape
28
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29
TANGLED BRANCHES:
THE LAW OF BOUNDARY LINE TREES
By R. Douglas Goldin
Rome & Goldin, P.C.
www.hoa-attorneys.com
E
ven in the urban areas, Georgia is known for its abundance of trees.
With such a lush environment, inevitable legal questions arise regarding trees near the property lines. In the context of community associations, the typical issues revolve around homeowners’ Lots adjoining the
common areas.
What if a homeowner’s tree falls onto the association clubhouse during
tornado level winds? What if the homeowner says they are not paying for
damages? Can the association trim the branches of a homeowner’s tree that
overhangs into the common areas? Does an adjoining homeowner have to
send a certified letter to the association demanding the removal of a dangerous tree? Could the association still be held liable for damages if the letter
is not sent?
Trimming Limbs and Roots. The law allows you to maintain anything on
your side of the property line. Therefore, you can trim limbs that overhang
on your Lot, but only up to the Lot’s boundary. In addition, you are also
allowed to cut back any root intrusions. The exception is if the cutting of the
limbs or roots could kill the tree. When there is a question as to whether this
may be the case, an arborist should be contacted for an opinion. If the tree is
located directly on the property line, the neighbors have joint ownership of
the tree and are each responsible for maintenance of the portion of the tree
that is located on their part of the boundary.
Who is Responsible for Damage Caused by a Fallen Tree? If it is an ‘Act of
God,’ the owner of the tree is not responsible for any damage to the adjoining
property. On the other hand, if your neighbor knew (or should have known)
the tree was dangerous, they will be liable for negligence for not resolving
the situation. For this reason, the vast majority of cases in Georgia revolve
around whether or not the tree’s owner should have known that it was diseased, dying or dead.
This is where the erroneous idea comes from that you must send your
neighbor a certified letter, informing them that the tree is dangerous. The
legal myth is that if you do not send the letter, the adjoining owner will not
be responsible for any damage if the tree falls.
Although such a letter can be helpful evidence, each property owner has
an independent duty to maintain their trees. In Georgia, urban residents are
held responsible for conditions that a ‘reasonable person’ would have been
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aware or should have been aware of if properly inspected.
The Question of Insurance Coverage. An insurance policy is a private
contract between the insured and the insurance company. Coverage will be
determined by the terms of the policy. In spite of the fact that you and your
neighbor are not legally responsible for an Act of God, a policy might cover
the damage, along with the cost for removing the tree. Even if you are alleging your neighbor was negligent in maintaining the tree, your neighbor and
their insurance carrier may disagree. In this situation, you may want to consider making a claim under your own policy. This way, you will get paid for
your damages (assuming it is covered) and your insurance carrier can decide
later if they want to pursue your neighbor and their insurance company for
reimbursement.
Additional Requirements of Covenants. So far we have addressed the
common law regarding boundary line trees, but covenants may contain
additional requirements beyond the common law. The covenants could
require the homeowner to obtain the association’s approval prior to cutting
down trees on their Lot. Conversely, they may obligate the homeowner to
remove any dead or diseased trees or even require owners to keep the trees
properly trimmed.
Being a good neighbor requires a joint understanding of each party’s rights
and obligations regarding boundary line trees. Hopefully, this will create a
cooperative approach to solving any problems. If a problem should arise, the
association should seek advice from its attorney for specific legal advice to its
specific fact situation. n
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CAI-Georgia Tennis Tournament...
(below) Meg Baer of Access
Management.
(left) Kim Gaddis, Floyd
Dickens, & Julie Howard of
Weissman, Nowack, Curry
& Wilco, P.C.
(left) Laura Guilmette of Unique
Environmental.
(below) Page Porter & Donnie Taylor
of A Tow Atlanta.
(above) Robin Steinkritz of Heritage
Property Management Services, Inc. & Jami
Kohn of Weinstock & Scavo, P.C.
(below) Tennis Committee Co-Chair
Merrill Walker, CMCA, AMS, PCAM of
Homeside Properties.
(right) Bob Powser,
CMCA, AMS, PCAM of
Access Management
& Todd Guilmette of
Unique Environmental.
(above) Kerrie Napoli and Ross Haynes
of Taylor Commercial.
(left) Mike Comer of
Homeside Properties
& Derry & Chiaki
Duncan of Unlimited
Landscaping.
(below) Mary Masi of Community
Management Associates.
(above) Tennis Committee
Co-Chair Judy Dreher of Dreher
Insurance & Sandy Depa, CMCA,
AMS, PCAM of Homeowner
Management Services.
(right) CAI-Georgia Tennis
Tournament attendees.
35
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PO Box 2943
Peachtree City, GA 30269
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CAI of Georgia

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