Ask the Attorney By Nigel Mendez, Esq., Carlson & Associates, Ltd.
This column is comprised of questions that have been posed to me by homeowners, property managers and related professionals regarding legal issues that they have encountered with respect to their associations. Discussion of these questions, as well as prior questions, can be found on the CAI-MN LinkedIn page: tinyurl.com/CAIMN-LinkedIn.
No questions were submitted this month, so I’ve compiled a sort of “best of ” column reflecting commonly asked questions or issues that frequently arise.
Q:
Is our association governed by the Minnesota Common Interest Ownership Act (MCIOA)?
A:
Although there are exceptions, the easiest way to break down the governed/not governed by MCIOA question is with these simple rules:
1. If the association was created on or after June 1, 1994, it is, by default, governed under MCIOA; 2. If the association is a condominium, and not a townhome or a single family association, it is, by default, governed by most provisions of MCIOA regardless of when it was created;1 3. If the association is a single family or a townhome association and it was created before June 1, 1994, it is NOT governed by MCIOA unless the association votes to amend its declaration and “opt-in” to MCIOA. Again, as with all rules, there are some specific exceptions. However, these three rules cover most associations in Minnesota. Here are some examples: • A condominium association that was created in 1978 is governed by the Act. (See Rule #2) 1 Only associations created under Minn. Stat. § 515 are not fully governed by MCIOA, but are subject to most of the substantive provisions 30
Minnesota Communit y Living
• A townhome association created in 2001 is governed by the Act. (See Rule #1) • A townhome association created in 1991 is not governed by the Act unless it has taken specific actions to amend its declaration for the purpose of opting-in to the Act. (See Rule #3)
Q:
If our association is not governed by MCIOA, are there provisions of it that we still must follow?
A:
Even if your association is not governed by MCIOA, there are indeed some provisions of the Act that would still apply. Minn. Stat. §515B.3-1102(3) states that even if an association is not governed by MCIOA, three sections must be adhered to.2 The three sections are: 1) §515B.1-116, subsections (a),(c),(d), and (e). This section, and the stated subsections, provide the process to record a declaration or bylaws, and any subsequent amendments, with the county. 2) §515B.4-107. This section pertains to the resale of a unit in an association, by a party other than a declarant. The seller must provide any potential buyer with a copy of the declaration, articles of incorporation, bylaws, rules and regulations (if any) as well as any amendments or supplemental declarations. If the association is part of a master association, the master association documents must also be provided. Finally, a Resale Disclosure Certificate must also be provided. The information that must be contained in and the layout of the Certificate is set forth in §515B.4-107(b). The Certificate provides details on the assessments, maintenance obligations, reserve balances, insurance coverage, etc. Although the Certificate is provided to the potential purchaser by the seller, it is the association that is required to complete and sign the Certificate. Within ten days of a request, the association must provide an owner with the completed Certificate. The association 2 As a general rule, this is true, but as with most rules there are exceptions. Minn. Stat. §515B.1-102(e) provides an exception for associations comprised of single family homes where there is no maintenance performed by the association on the dwellings. There are additional exceptions, but they deal with 2-unit associations, certain cooperatives, non-residential associations and access easement/drainage associations.