Donna Berger recently wrote a blog entitled “What are the real reasons for certain association rules” . She raises a number of legitimate reasons for board-enacted rules and regulations, such as pet restrictions, paint colors, leasing restrictions and so on.
Equally important as the reasons for rule-making is when and how a board can create such rules. Unlike covenants, board-enacted rules are not legally “clothed with a presumption of validity.” This means board-enacted rules and regulations are easier to challenge. It also means that boards should be clear about their rights, obligations and limitations.
There are many reasons why rules and regulations are not given the same weight as covenants and are easier to challenge:
First, board-enacted rules (or amendments thereto) are often not recorded, so there is no constructive notice of them. I have seen instances where the board claims they were published, but the homeowner never obtained a copy. To make matters worse, sometimes boards refuse access to view the rules and regulations, for any number of concocted reasons. Clearly, this is not all associations – and is not an association operating properly. However, without recording, homeowners may or may not know what the current “rules” are – if the rules are not attached as an exhibit to a Declaration of Covenants or Condominium. Florida Statutes Section 720.301 (8) does not include “rules and regulations” in the definition of “governing documents”, possibly for that reason. Similarly, Section 718.103 (15) defines the Declaration of Condominium but does not reference rules and regulations.
Secondly, a board is not the original developer that once owned all the properties. Unlike amendments to covenants, most board-enacted rules by definition do not require a vote of the owners. A board’s authority to create rules is therefore limited – a legal “rule” of which boards are often unaware:
The authority for the board to enact a given rule or regulation must be either expressly authorized in the governing documents or Declaration of Condominium or be reasonably inferred therefrom.
For example, suppose an HOA’s Declaration of Covenants, Conditions and Restrictions expressly states that board may enact rules governing the common area (such as a pool or clubhouse). However, the Declaration has no other provision regarding rules, and no provision from which it can be reasonably inferred that the board has authority to regulate the aesthetics of individual homes. Suppose further that the homes are currently painted a variety of different colors. In such a case, a board does not have the authority to create a rule requiring certain paint colors. Such a rule is not enforceable, even if the rule is otherwise “reasonable.” Furthermore, a homeowner could sue the association for violating the HOA statute, in this scenario. Although condo statutes are not as specific, case law suggests a similar requirement applies to condo rules and regulations.
Rules and Regulations cannot contradict or be inconsistent with the governing documents.
It should be obvious that a board cannot enact a rule that violates the governing documents or Declaration of Condominium. Regardless, about a decade ago, my own HOA created a rule that directly contradicted the covenants. Our covenants expressly prohbited stand-alone basketball hoops. Nonetheless, board members enacted a rule allowing them because their children wanted to play basketball. A homeowner could have sued the association for this “rule” allowing what was prohibited in the covenants. The proper way to have handled this would have been to propose an amendment to the covenants.
Boards cannot create rules that are retroactive, unreasonable, arbitrary or designed to target certain individuals.
Florida courts have held that board-enacted rules must meet a test of “reasonableness” – they must be reasonably related to the promotion of health, happiness and peace of mind of the unit owners. Boards cannot enact rules that are inherently unreasonable or which have no objective basis or purpose. One judge, in dicta, said that he would even question whether it was reasonable to allow only a single color of roof. (Dicta is a statement in a court opinion that is not the binding holding of the case, but which may well help predict how a court may rule in the future.) Boards also cannot create rules that apply retroactively.
Rules and regulations, as well as covenants, should be sufficiently defined to put the homeowner on notice as to what conduct is prohibited (or required). A restriction or requirement that is too vague or overbroad will only create problems and may not be enforceable. What, for example, is a “neat yard”? Or “immoral conduct”? While some boards may like the apparent enforcement latitude these offer, they can backfire. For example, a homeowner could sue an association for not enforcing a prohibition against “immoral conduct.” What board is going to police personal conduct in that fashion, or know what homeowners may consider immoral? Too much latitude with rules can be a double-edged sword. (This is also true with covenants.)
Rule-making is not an inherent board right. The authority for rule-making stems from the Declaration (of Covenants or Condominium.) Even if a board has the authority to create certain rules, the rule cannot be retroactive, and it must be reasonable with an objective basis and with objective criteria for enforcement