February 2013
Volume 101 No. 102                                                    Like us on Facebook  Follow us on Twitter  Find us on Yelp 
CAI, 40 Years Young - No Place Like Home!
 
The Community Association Institute is celebrating 40 years of shaping the world of common-interest communities. It was conceived in the early 1970s by a consortium of leaders from three major organizations in government and the real estate industry. The Federal Housing Administration (FHA), National Association of Home Builders (NAHB) and the Urban Land Institute shared concepts regarding the operation of common-interest communities. A new industry and profession developed through the founding of CAI.  You can learn more about the evolution of CAI at www.caionline.org/cai40. It is now one of the primary resources for education and support for community volunteers and the professional property managers that support them in building, managing and developing their communities. There is no place like home!  
A Look at the Upcoming Year 

By Rosario M. Spaccaferro
Article Courtesy of Keough & Moody, P.C. - Attorneys at Law

Let's take a look at what 2013 may hold for common interest communities. This article is focused on the Illinois Condominium Property Act (hereinafter "the condo act") and the Common Interest Community Association Act (hereinafter "CICAA"), as well as other miscellaneous provisions.

Following a growing trend across the nation, the Condo act is likely to see an amendment to section 18(k) that would allow condominium associations to restrict smoking within units. As you may already know, section 18(k) of the Condo act provides that a condominium may enact restrictions on the use and maintenance of units to prevent unreasonable interference with the use of other units. Following studies on the effects of secondhand smoke, the issue of smoking within a unit is beginning to be considered a community issue. This legislation was introduced in the 2012 session as House Bill 4314 and was sent back to the rules committee for further review; however it is likely to come back for a vote as the issue is sweeping the nation.

As of January 1, Section 145.3 took effect allowing an easement for high-speed internet, adding to the existing provision for cable television. Condo associations may now install high-speed internet access following similar procedures used for installation of cable television.

In 2012, CICAA saw a number of small amendments take effect. One proposed amendment from 2012 may be addressed in the upcoming year. According to the Child Care Act of 1969, operation of a licensed daycare in a residential home is incidental to the primary residential use of the dwelling. HB 5513 is a measure amending CICAA to allow the operation of a licensed daycare in a home within a community even if the operation of a business is strictly prohibited by the community's governing documents. The measure would allow communities to specifically prohibit the operation of a daycare; however such prohibition would require the community to amend the existing governing documents. Without taking the additional step of prohibition, communities may be faced with additional insurance requirements above their current coverage.

On the federal level, in 2012 the FHA proposed rule changes to seller contribution limits for real estate transactions. These changes would limit the total dollar amount of seller contributions to 3% of the loan amount where FHA funds are used for purchase. The rules would also prohibit sellers from contributing any money toward assessment payments on behalf of the buyer. The rule changes have not yet been adopted, but they may be later this year.

Finally, in 2012 the FCC conducted a study on covenants, conditions, and restrictions that impede installation of amateur HAM radio towers and antenna that may be used in disaster scenarios. The recommendations developed from the study identify "unreasonable or unnecessary" private land-use restrictions on HAM radio use, like those restrictions enacted by community associations. The FCC may use the study to promote legislation aimed at prohibiting community associations from restricting HAM radio installation. The recommendations were forwarded to the U.S. House Committee on Energy and Commerce, though it is unclear if any action will be taken by the 2013 Congress.
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Supreme Court Upholds an Association's Right to Enforce Rules through Security Guards

By Robert M. Prince
Article Courtesy of Keough & Moody, P.C. - Attorneys at Law

Last year, an association case made headlines when the Illinois Court of Appeals slapped a common interest community association for enforcing its speed limit regulations through its security officers. The opinion cast doubt on association enforcement activities especially if security guards were used. The Illinois Supreme Court issued an opinion that reaffirmed an association's ability to enforce its own covenants and rules and regulations through a security force without the fear of being sued by the owner merely because a stop was made. The case is Poris vs. Lake Holiday Property Owners Association, 2013 IL 113907. The case is sure to make headlines once again as the language used in the opinion should help Associations in their enforcement efforts throughout the state.

Lake Holiday is a homeowners association that has private roads. The board of the association enacted speed limits for those roads. The board also created a private security force to enforce the provisions of the association's governing documents, including its speed limit, by the issuance of citations. The security officers could pull individuals over for violations of the rules. However, they could only issue a citation to an owner for his or his guest's conduct; they could not issue citations to members of the public.

The Court reiterated that the membership in a homeowners association is voluntary in the sense that member could choose whether or not to purchase a home within the association. Since an association is a voluntary association, a court will not interfere with the internal affairs of the association without allegations of mistake, fraud, collusion or arbitrariness. While the owner argued that the association was asserting police powers, the Court found that the association's practice of detaining drivers who violated the association's speed limit was lawful.

The owner also argued that the association committed the tort of false imprisonment when its security officer pulled him over. To win on a claim of false imprisonment, the owner needed to be able to prove that:
  • He was restrained or arrested by the officer and...
  • The officer acted without reasonable grounds to believe that an offense was committed by the owner.
The court found that the association was not effectuating a citizen's arrest, which it could only do if the owner was committing a felony or misdemeanor. Instead, since the association was enforcing its own rules and regulations and since the security officer measured the owner's speed as being higher than the speed limit, the security officer, and therefore, the association had probable cause to detain him for the violation of the Association's rules.

There are many favorable implications of this case for associations. Chief among them is the Court's broad language in support of associations' rights to enforce. The Court stated that it could "discern no logic in allowing a private homeowners association to construct and maintain private roadways, but not allowing the association to implement and enforce traffic laws on those roadways." Beyond its application to traffic issues, this same logic should translate well into other issues involving the common elements.
The Next Cagan Leadership Seminar

The next Cagan Leadership Seminar will be May 9th of 2013. If you have a suggestion/need for a specific topic to be addressed, contact Janet Nelson,
jnelson@cagan.com 

 
In This Issue
CAI, 40 Years Young - No Place Like Home!
A Look at the Upcoming Year
Comcast
Supreme Court Upholds an Association's Right
The Next Cagan Leadership Seminar
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