CHAPTER 828

COMMON INTEREST OWNERSHIP ACT

Table of Contents

Sec. 47-250. Meetings. Rules.

Sec. 47-252. Voting. Proxies. Ballots.

Sec. 47-253. Liability.

Sec. 47-258. Lien for assessments and other sums due association. Enforcements.

Sec. 47-260. Association records. Copies. Fees.

Sec. 47-261e. Adoption of budgets. Special assessments. Loan agreements.


PART III

MANAGEMENT OF COMMON INTEREST COMMUNITIES

Sec. 47-250. Meetings. Rules. (a) The following requirements apply to unit owner meetings:

(1) An association shall hold a meeting of unit owners annually at a time, date and place stated in or fixed in accordance with the bylaws;

(2) An association shall hold a special meeting of unit owners if its president, a majority of the executive board, or unit owners having at least twenty per cent, or any lower percentage specified in the bylaws, of the votes in the association request that the secretary call the meeting. If the association does not notify unit owners of a special meeting within fifteen days after the requisite number or percentage of unit owners request the secretary to do so, the requesting members may directly notify the unit owners of the meeting. Only matters described in the meeting notice required by subdivision (3) of this subsection may be considered at a special meeting;

(3) An association shall notify unit owners of the time, date and place of each annual and special meeting of unit owners not less than ten days or more than sixty days before the meeting date. Notice may be by any means described in section 47-261c. The notice of any meeting shall state the time, date and place of the meeting and the items on the agenda, including (A) a statement of the general nature of any proposed amendment to the declaration or bylaws, (B) any budget changes, and (C) any proposal to remove an officer or member of the executive board;

(4) Unit owners shall be given a reasonable opportunity at any meeting to comment regarding any matter affecting the common interest community or the association; and

(5) The declaration or bylaws may allow for meetings of unit owners to be conducted by telephonic, video or other conferencing process if the alternative process is consistent with subdivision (7) of subsection (b) of this section.

(b) The following requirements apply to meetings of the executive board and committees of the association authorized to act for the association:

(1) Meetings shall be open to the unit owners and to a representative designated by any unit owner except during executive sessions. The executive board and those committees may hold an executive session only during a regular or special meeting of the board or a committee. No final vote or action may be taken during an executive session. An executive session may be held only to: (A) Consult with the association’s attorney concerning legal matters; (B) discuss existing or potential litigation or mediation, arbitration or administrative proceedings; (C) discuss labor or personnel matters; (D) discuss contracts, leases and other commercial transactions to purchase or provide goods or services currently being negotiated, including the review of bids or proposals, if premature general knowledge of those matters would place the association at a disadvantage; or (E) prevent public knowledge of the matter to be discussed if the executive board or committee determines that public knowledge would violate the privacy of any person.

(2) For purposes of this section, a gathering of board members at which the board members do not conduct association business is not a meeting of the executive board. The executive board and its members may not use incidental or social gatherings of board members or any other method to evade the open meeting requirements of this section.

(3) Notwithstanding any actions taken by unanimous consent pursuant to subdivision (8) of subsection (b) of this section, during and after the period of declarant control, the executive board shall meet at least two times a year at the common interest community or at a place convenient to the community. Those meetings, and after termination of the period of declarant control, all executive board meetings, shall be at the common interest community or at a place convenient to the community unless the bylaws are amended to vary the location of those meetings.

(4) At each executive board meeting, the executive board shall provide a reasonable opportunity for unit owners to comment regarding any matter affecting the common interest community and the association.

(5) Unless the meeting is included in a schedule given to the unit owners or the meeting is called to deal with an emergency, the secretary or other officer specified in the bylaws shall give notice of each executive board meeting to each board member and to the unit owners. The notice shall be given at least five days before the meeting and shall state the time, date, place and agenda of the meeting, except that notice of a meeting called to adopt, amend or repeal a rule shall be given in accordance with subsection (a) of section 47-261b. If notice of the meeting is included in a schedule given to the unit owners, the secretary or other officer specified in the bylaws shall make available an agenda for such meeting to each board member and to the unit owners not later than forty-eight hours prior to the meeting.

(6) If any materials are distributed to the executive board before the meeting, the executive board at the same time shall make copies of those materials reasonably available to unit owners, except that the board need not make available copies of unapproved minutes or materials that are to be considered in executive session.

(7) Unless prohibited by the declaration or bylaws, the executive board may meet by telephonic, video or other conferencing process if (A) the meeting notice states the conferencing process to be used and provides information explaining how unit owners may participate in the conference directly or by meeting at a central location or conference connection; and (B) the process provides all unit owners the opportunity to hear or perceive the discussion and offer comments as provided in subdivision (4) of this subsection.

(8) Instead of meeting, the executive board may act by unanimous consent as documented in a record authenticated by all its members. The secretary promptly shall give notice to all unit owners of any action taken by unanimous consent.

(9) Even if an action by the executive board is not in compliance with this section, it is valid unless set aside by a court. A challenge to the validity of an action of the executive board for failure to comply with this section may not be brought more than sixty days after the minutes of the executive board of the meeting at which the action was taken are approved or the record of that action is distributed to unit owners, whichever is later.

(c) Meetings of the association shall be conducted in accordance with the most recent edition of Roberts’ Rules of Order Newly Revised unless (1) the declaration, bylaws or other law otherwise provides, or (2) two-thirds of the votes allocated to owners present at the meeting are cast to suspend those rules.

(P.A. 83-474, S. 51, 96; P.A. 09-225, S. 25; P.A. 10-186, S. 10, 25; P.A. 13-289, S. 2.)

History: P.A. 09-225 designated existing provisions as Subsec. (a) and amended same by adding requirements for unit owner meetings, added Subsec. (b) re executive board and committee meetings and added Subsec. (c) re conduct of meetings, effective July 1, 2010; P.A. 10-186 made technical changes in Subsec. (a)(2) and (3) and amended Subsec. (b)(5) to require notice at least 5 days, rather than 10 days, before meeting and add exception that notice to adopt, amend or repeal a rule shall be given in accordance with Sec. 47-261b(a), effective July 1, 2010; P.A. 13-289 amended Subsec. (b)(5) by adding provision re secretary or other officer to make meeting agenda available not later than 48 hours prior to the meeting if meeting notice is included in schedule given to unit owners.

Sec. 47-252. Voting. Proxies. Ballots. (a) Unless prohibited or limited by the declaration or bylaws, unit owners may vote at a meeting in person, by a proxy pursuant to subsection (c) of this section or, when a vote is conducted without a meeting, by electronic or paper ballot pursuant to subsection (d) of this section.

(b) At a meeting of unit owners the following requirements apply:

(1) If only one of several owners of a unit is present at a meeting of the association, that owner is entitled to cast all the votes allocated to that unit. If more than one of the owners are present, the votes allocated to that unit may be cast only in accordance with the agreement of a majority in interest of the owners, unless the declaration expressly provides otherwise. There is majority agreement if any one of the owners casts the votes allocated to the unit without protest being made promptly to the person presiding over the meeting by any of the other owners of the unit.

(2) Unless a greater number or fraction of the votes in the association is required by this chapter or other law or the declaration, a majority of the votes cast is the decision of the unit owners.

(c) Except as otherwise provided in the declaration or bylaws, the following requirements apply with respect to proxy voting:

(1) Votes allocated to a unit may be cast pursuant to a directed or undirected proxy duly executed by a unit owner;

(2) The association may provide a proxy form to any unit owner who seeks to vote pursuant to a directed or undirected proxy. If the association provides a proxy form, the proxy form, (A) shall include a blank space reserved for the insertion of the name of the proxy holder, and (B) may include the name of a person designated by the association to be the default proxy holder, who shall be authorized to exercise the proxy in the event the unit owner fails to otherwise specify the name of the proxy holder subject to the limitations set forth in this subsection;

(3) If a unit is owned by more than one person, each owner of the unit may vote or register protest to the casting of votes by the other owners of the unit through a duly executed proxy;

(4) A unit owner may revoke a proxy given pursuant to this section only by actual notice of revocation to the person presiding over a meeting of the association;

(5) A proxy is void if it is not dated or purports to be revocable without notice;

(6) A proxy terminates one year after its date, unless it specifies a shorter term; and

(7) A person may not cast votes representing more than fifteen per cent of the votes in the association pursuant to undirected proxies.

(d) Unless prohibited or limited by the declaration or bylaws, an association may conduct a vote without a meeting. In that event, the following requirements apply:

(1) The association shall notify the unit owners that the vote will be taken by ballot;

(2) The association shall deliver a paper or electronic ballot to every unit owner entitled to vote on the matter;

(3) The ballot must set forth each proposed action or office to be filled and provide an opportunity to vote for or against the action or the candidate for office;

(4) When the association delivers the ballots, it shall also: (A) Indicate the number of responses needed to meet the quorum requirements; (B) state the percentage of votes necessary to approve each matter other than election of directors; (C) specify the time and date by which a ballot must be delivered to the association to be counted, which time and date may not be fewer than three days after the date the association delivers the ballot; and (D) describe the time, date and manner by which unit owners wishing to deliver information to all unit owners regarding the subject of the vote may do so;

(5) Except as otherwise provided in the declaration or bylaws, a ballot is not revoked after delivery to the association by death or disability or attempted revocation by the person that cast that vote; and

(6) Approval by ballot pursuant to this subsection is valid only if the number of votes cast by ballot equals or exceeds the quorum required to be present at a meeting authorizing the action.

(e) If the declaration requires that votes on specified matters affecting the common interest community be cast by lessees rather than unit owners of leased units: (1) This section applies to lessees as if they were unit owners; (2) unit owners that have leased their units to other persons may not cast votes on those specified matters; and (3) lessees are entitled to notice of meetings, access to records and other rights respecting those matters as if they were unit owners.

(f) Unit owners shall also be given notice of all meetings at which lessees are entitled to vote.

(g) Votes allocated to a unit owned by the association shall be cast in any vote of the unit owners in the same proportion as the votes cast on the matter by unit owners other than the association.

(h) For the purposes of this chapter, “fraction or percentage”, with respect to the unit owners or the votes in the association, means the stated fraction or percentage of unit owners of units to which at least the stated percentage or fraction of all the votes in the association are allocated, unless the provisions of this chapter provide that the “fraction or percentage” refers to a different group of unit owners or votes.

(P.A. 83-474, S. 53, 96; P.A. 09-225, S. 27; P.A. 10-186, S. 11; P.A. 13-289, S. 3.)

History: P.A. 09-225 redesignated existing Subsecs. (a) and (b) as Subsecs. (b)(1) and (c)(1) to (5), inserted new Subsec. (a) re voting in person, by proxy or by ballot, inserted new Subsec. (b)(2) providing that majority of votes cast is decision of unit owners unless otherwise required by chapter, other law or declaration, amended redesignated Subsec. (c) to add language re other provisions in declaration or bylaws re proxy voting, insert “directed or undirected” re proxy in Subdiv. (1), and insert new Subdiv. (6) limiting undirected proxies to 15% of votes, inserted new Subsec. (d) re vote without a meeting, redesignated existing Subsec. (c) as Subsecs. (e) and (f), deleted reference to manner provided in Sec. 47-250 re notice in said Subsec. (f), redesignated existing Subsec. (d) as Subsec. (g), inserted provision therein re proportion of votes, added Subsec. (h) to define “fraction or percentage”, and made technical changes, effective July 1, 2010; P.A. 10-186 made a technical change in Subsec. (h), effective July 1, 2010; P.A. 13-289 amended Subsec. (c) to add new Subdiv. (2) re association providing a proxy form to any unit owner seeking to vote pursuant to a directed or undirected proxy and re content of such proxy form, and to redesignate existing Subdivs. (2) to (6) as Subdivs. (3) to (7).

Sec. 47-253. Liability. (a) A unit owner is not liable, solely by reason of being a unit owner, for injury or damage arising out of the condition or use of the common elements. Neither the association nor any unit owner except the declarant is liable for that declarant’s torts in connection with any part of the common interest community which that declarant has the responsibility to maintain.

(b) An action alleging a wrong done by the association, including an action arising out of the condition or use of the common elements, may be maintained against the association and not against any unit owner. If the wrong occurred during any period of declarant control and the association gives the declarant reasonable notice of and an opportunity to defend against the action, the declarant who then controlled the association is liable to the association or to any unit owner for (1) all tort losses not covered by insurance suffered by the association or that unit owner, and (2) all costs that the association would not have incurred but for a breach of contract or other wrongful act or omission.

(c) The declarant is liable to the association for all funds of the association collected during the period of declarant control which were not properly expended.

(d) Whenever the declarant is liable to the association under this section, the declarant is also liable for all expenses of litigation, including reasonable attorney’s fees, incurred by the association. Any statute of limitation affecting the association’s right of action against a declarant under this chapter is tolled until the period of declarant control terminates. A unit owner is not precluded from maintaining an action contemplated by this section because he is a unit owner or a member or officer of the association. Liens resulting from judgments against the association are governed by section 47-259.

(e) No member of the executive board or officer of the association shall be subject to criminal liability for an alleged violation of the Fire Safety Code, the State Building Code or a municipal health, housing or safety code when, pursuant to subsection (b) of section 47-261e, the executive board of an association proposes a special assessment to cover the cost of the repairs necessary to ensure compliance with the terms of such codes and the special assessment is rejected by a vote of the unit owners.

(P.A. 83-474, S. 54, 96; P.A. 84-472, S. 14, 23; P.A. 95-187, S. 20; P.A. 13-289, S. 5.)

History: P.A. 84-472 inserted Subsec. indicators and added Subsec. (b) making the declarant liable for funds of the association collected during the period of declarant control which were not properly expended; P.A. 95-187 amended Subsec. (a) to add provision that a unit owner is not liable, solely by reason of being a unit owner, for injury or damage arising out of the condition or use of the common elements, designated existing provisions of Subsec. (a) re liability of the association and declarant as Subsec. (b), relettering the remaining Subsecs. accordingly, amended new Subsec. (b) to replace “must be brought” with “may be maintained” in provision re action against the association and to provide that an action alleging a wrong done by the association includes “an action arising out of the condition or use of the common elements” and amended Subsec. (d), formerly Subsec. (c), to replace “the association’s right of action under this section” with “the association’s right of action against a declarant under this chapter”; P.A. 13-289 added Subsec. (e) re member of executive board or officer of the association not being subject to criminal liability for alleged code violations when unit owners rejected a special assessment proposed for repair costs to ensure code compliance.

Sec. 47-258. Lien for assessments and other sums due association. Enforcements. (a) The association has a statutory lien on a unit for any assessment attributable to that unit or fines imposed against its unit owner. Unless the declaration otherwise provides, reasonable attorneys’ fees and costs, other fees, charges, late charges, fines and interest charged pursuant to subdivisions (10), (11) and (12) of subsection (a) of section 47-244 and any other sums due to the association under the declaration, this chapter, or as a result of an administrative, arbitration, mediation or judicial decision, are enforceable in the same manner as unpaid assessments under this section. If an assessment is payable in installments, the full amount of the assessment is a lien from the time the first installment thereof becomes due.

(b) Notwithstanding any provision in the declaration or bylaws to the contrary, a lien under this section is prior to all other liens and encumbrances on a unit except (1) liens and encumbrances recorded before the recordation of the declaration and, in a cooperative, liens and encumbrances which the association creates, assumes or takes subject to, (2) a first or second security interest on the unit recorded before the date on which the assessment sought to be enforced became delinquent, or, in a cooperative, a first or second security interest encumbering only the unit owner’s interest and perfected before the date on which the assessment sought to be enforced became delinquent, and (3) liens for real property taxes and other governmental assessments or charges against the unit or cooperative. In all actions brought to foreclose a lien under this section or a security interest described in subdivision (2) of this subsection, the lien is also prior to all security interests described in subdivision (2) of this subsection to the extent of (A) an amount equal to the common expense assessments based on the periodic budget adopted by the association pursuant to subsection (a) of section 47-257 which would have become due in the absence of acceleration during the nine months immediately preceding institution of an action to enforce either the association’s lien or a security interest described in subdivision (2) of this subsection, excluding any late fees, interest or fines which may be assessed by the association during the nine-month period, and (B) the association’s costs and reasonable attorney’s fees in enforcing its lien. A lien for any assessment or fine specified in subsection (a) of this section shall have the priority provided for in this subsection in an amount not to exceed the amount specified in subparagraph (A) of this subsection. This subsection does not affect the priority of mechanics’ or materialmen’s liens or the priority of liens for other assessments made by the association.

(c) Unless the declaration otherwise provides, if two or more associations have liens for assessments created at any time on the same property, those liens have equal priority.

(d) Recording of the declaration constitutes record notice and perfection of the lien. No further recordation of any claim of lien for assessment under this section is required.

(e) A lien for unpaid assessments is extinguished unless proceedings to enforce the lien are instituted within three years after the full amount of the assessments becomes due; provided, that if an owner of a unit subject to a lien under this section files a petition for relief under the United States Bankruptcy Code, the period of time for instituting proceedings to enforce the association’s lien shall be tolled until thirty days after the automatic stay of proceedings under Section 362 of the Bankruptcy Code is lifted.

(f) This section does not prohibit actions against unit owners to recover sums for which subsection (a) of this section creates a lien or prohibit an association from taking a deed in lieu of foreclosure.

(g) A judgment or decree in any action brought under this section shall include costs and reasonable attorney’s fees for the prevailing party.

(h) The association on request made in a record shall furnish to a unit owner a statement in recordable form setting forth the amount of unpaid assessments against the unit. The statement shall be furnished within ten business days after receipt of the request and is binding on the association, the executive board and every unit owner.

(i) In a cooperative, on nonpayment of an assessment on a unit, the unit owner may be evicted in the same manner as provided by law in the case of an unlawful holdover by a tenant, and the lien may be foreclosed as provided by this section.

(j) The association’s lien may be foreclosed in like manner as a mortgage on real property.

(k) In any action by the association to collect assessments or to foreclose a lien for unpaid assessments, the court may appoint a receiver of the unit owner pursuant to section 52-504 to collect all sums alleged to be due from that unit owner prior to or during the pendency of the action. The court may order the receiver to pay any sums held by the receiver to the association during the pendency of the action to the extent of the association’s common expense assessments based on a periodic budget adopted by the association pursuant to subsection (a) of section 47-257.

(l) If a holder of a first or second security interest on a unit forecloses that security interest, the purchaser at the foreclosure sale is not liable for any unpaid assessments against that unit which became due before the sale, other than the assessments which are prior to that security interest under subsection (b) of this section. Any unpaid assessments not satisfied from the proceeds of sale become common expenses collectible from all unit owners, including the purchaser.

(m) (1) An association may not commence an action to foreclose a lien on a unit under this section unless: (A) The unit owner, at the time the action is commenced, owes a sum equal to at least two months of common expense assessments based on the periodic budget last adopted by the association pursuant to subsection (a) of section 47-257; (B) the association has made a demand for payment in a record and has simultaneously provided a copy of such record to the holder of a security interest described in subdivision (2) of subsection (b) of this section; and (C) the executive board has either voted to commence a foreclosure action specifically against that unit or has adopted a standard policy that provides for foreclosure against that unit.

(2) Not less than sixty days prior to commencing an action to foreclose a lien on a unit under this section, the association shall provide a written notice by first class mail to the holders of all security interests described in subdivision (2) of subsection (b) of this section, which shall set forth the following: (A) The amount of unpaid common expense assessments owed to the association as of the date of the notice; (B) the amount of any attorney’s fees and costs incurred by the association in the enforcement of its lien as of the date of the notice; (C) a statement of the association’s intention to foreclose its lien if the amounts set forth in subparagraphs (A) and (B) of this subdivision are not paid to the association not later than sixty days after the date on which the notice is provided; (D) the association’s contact information, including, but not limited to, (i) the name of the individual acting on behalf of the association with respect to the matter, and (ii) the association’s mailing address, telephone number and electronic mail address, if any; and (E) instructions concerning the acceptable means of making payment on the amounts owing to the association as set forth in subparagraphs (A) and (B) of this subdivision. Any notice required to be given by the association under this subsection shall be effective when sent.

(3) When providing the written notice required by subdivision (2) of this subsection, the association may rely on the last-recorded security interest of record in identifying the name and mailing address of the holder of that interest, unless the holder of the security interest is the plaintiff in an action pending in the Superior Court to enforce that security interest, in which case the association shall provide the written notice to the attorney appearing on behalf of the holder of the security interest in such action.

(4) The failure of the association to provide the written notice required by subdivisions (2) and (3) of this subsection prior to commencing an action to foreclose its lien shall not affect the priority of its lien for an amount equal to nine months common expense assessments, but the priority amount in such action shall not include any costs or attorney’s fees.

(n) Every aspect of a foreclosure, sale or other disposition under this section, including the method, advertising, time, date, place and terms, shall be commercially reasonable.

(P.A. 83-474, S. 59, 96; P.A. 84-472, S. 16, 23; P.A. 89-254, S. 14; P.A. 91-341, S. 15, 19; 91-359, S. 1, 2; P.A. 95-187, S. 22; P.A. 09-225, S. 32; P.A. 10-186, S. 13; P.A. 13-156, S. 1, 2.)

History: P.A. 84-472 amended Subsec. (a) by replacing “due” with “delinquent”, amended Subsec. (b) by adding “or a security interest described in subdivision (2) of this subsection”, deleted former Subsec. (k) prohibiting a unit owner exempting himself from liability for payment of common expenses and reenacted such provision as part of Sec. 47-257, and added new Subsec. (k) re the appointment of a receiver, new Subsec. (l) re the treatment of a statutory lien for assessments in determining if a security interest held by a savings bank is a first lien, and new Subsec. (m) re the liability for unpaid assessments against a unit sold at a foreclosure sale; P.A. 89-254 amended Subsec. (i) by deleting “commercial” before “tenant”; P.A. 91-341 amended Subsec. (b) to provide that the lien has priority to the extent of (A) an amount equal to 12 months’, rather than 6 months’, common expense assessments and (B) the association’s court costs and attorney’s fees, and to provide that the lien for any assessment or fine specified in Subsec. (a) shall have priority in an amount not to exceed the amount specified in Subpara. (A) of this Subsec.; P.A. 91-359 amended Subsec. (b) by replacing “twelve months” with “six months” in Subpara. (A) and “association’s court costs” with “association’s costs” in Subpara. (B); P.A. 95-187 amended Subsec. (a) to delete provision specifying that the lien in favor of the association runs “from the time the assessment or fine becomes delinquent” and deleted former Subsec. (l) which had required that statutory lien for assessments be treated as a tax lien for purposes of determining whether a security interest held by a savings bank is a first lien under section 36-99(1)(d)(1), relettering former Subsec. (m) as Subsec. (l); P.A. 09-225 amended Subsec. (a) to substitute “attributable to” for “levied against” re any assessment, add reasonable attorneys’ fees and costs and any other sums due the association under the declaration, this chapter or as result of administrative, arbitration, mediation or judicial decision, and substitute “enforceable in the same manner as unpaid assessments” for “enforceable as assessments”, substituted “three years” for “two years” in Subsec. (e), added “against unit owners” re actions in Subsec. (f), substituted “request made in a record” for “written request” in Subsec. (h), and added Subsec. (m) re association’s power to commence action to foreclose a lien on a unit and Subsec. (n) re commercially reasonable standard, effective July 1, 2010; P.A. 10-186 made a technical change in Subsec. (l), effective July 1, 2010; P.A. 13-156 amended Subsec. (b) by adding “Notwithstanding any provision in the declaration or bylaws to the contrary,”, by adding “In all actions brought to foreclose a lien under this section or a security interest described in subdivision (2) of this subsection,”, by substituting “nine months” for “six months” re common expense assessment period covered by the lien, by adding provision re exclusion of late fees, interest or fines assessed by association during the 9-month period, and by adding provision re lien priority to include reasonable attorney’s fees, effective June 24, 2013, and applicable to all actions pending on and actions filed on or after that date, and amended Subsec. (m) by designating existing provision as new Subdiv. (1), by redesignating existing Subdivs. (1) to (3) as Subparas. (A) to (C), by adding requirement in redesignated Subdiv. (1)(B) that association provide a copy of record to the holder of a security interest and by adding new Subdivs. (2), (3) and (4) re notice requirements for association prior to foreclosing a lien on a unit, effective October 1, 2013, and applicable to all actions filed on or after that date.

Sec. 47-260. Association records. Copies. Fees. (a) An association shall retain the following:

(1) Detailed records of receipts and expenditures affecting the operation and administration of the association and other appropriate accounting records, including, but not limited to, records relating to reserve accounts, if any;

(2) Minutes of all meetings of its unit owners and executive board other than executive sessions, a record of all actions taken by the unit owners or executive board without a meeting, and a record of all actions taken by a committee in place of the executive board on behalf of the association;

(3) The names of unit owners in a form that permits preparation of a list of the names of all unit owners and the addresses at which the association communicates with the unit owners, in alphabetical order showing the number of votes each unit owner is entitled to cast;

(4) The association’s original or restated organizational documents, if required by law other than this chapter, bylaws and all amendments to the bylaws, and all rules currently in effect;

(5) All financial statements and tax returns of the association for the past three years;

(6) A list of the names and addresses of the association’s current executive board members and officers;

(7) The association’s most recent annual report delivered to the Secretary of the State, if any;

(8) Financial and other records sufficiently detailed to enable the association to comply with section 47-270;

(9) Copies of current contracts to which the association is a party;

(10) Records of executive board or committee actions to approve or deny any requests for design or architectural approval from unit owners; and

(11) Ballots, proxies and other records related to voting by unit owners for one year after the election, action or vote to which they relate.

(b) Subject to subsections (c) and (d) of this section, all records retained by an association shall be available for examination and copying by a unit owner or the owner’s authorized agent:

(1) During reasonable business hours or at a mutually convenient time and location; and

(2) Upon five days’ notice in a record reasonably identifying the specific records of the association requested.

(c) Records retained by an association shall be withheld from inspection and copying to the extent that they concern:

(1) Personnel, salary and medical records relating to specific individuals, unless waived by the persons to whom such records relate; or

(2) Information the disclosure of which would violate any law other than this chapter.

(d) Records retained by an association may be withheld from inspection and copying to the extent that they concern:

(1) Contracts, leases and other commercial transactions to purchase or provide goods or services, currently being negotiated;

(2) Existing or potential litigation or mediation, arbitration or administrative proceedings;

(3) Existing or potential matters involving federal, state or local administrative or other formal proceedings before a governmental tribunal for enforcement of the declaration, bylaws or rules;

(4) Communications with the association’s attorney which are otherwise protected by the attorney-client privilege or the attorney work-product doctrine;

(5) Records of an executive session of the executive board; or

(6) Individual unit files other than those of the requesting owner.

(e) An association may charge a reasonable fee for providing copies of any records under this section and for supervising the unit owner’s inspection.

(f) A right to copy records under this section includes the right to receive copies by photocopying or other means, including copies through an electronic transmission if available upon request by the unit owner.

(g) An association is not obligated to compile or synthesize information.

(h) Information provided pursuant to this section may not be used for commercial purposes.

(P.A. 83-474, S. 61, 96; P.A. 07-243, S. 7; P.A. 09-225, S. 33; P.A. 10-186, S. 14; P.A. 13-289, S. 4.)

History: P.A. 07-243 designated existing provisions as Subsec. (a) and amended same by adding provisions re accounting records, books and minutes of meetings and voting records of the executive board, re records to be made available by the board or a managing agent, re copying and re request of unit owner or agent and by making technical changes, and added Subsec. (b) re loan disclosure and comments; P.A. 09-225 deleted former Subsecs. (a) and (b) and inserted new Subsecs. (a) to (h) re association records, copies and fees, effective July 1, 2010; P.A. 10-186 made technical changes in Subsec. (a)(3), (4) and (6), effective July 1, 2010; P.A. 13-289 amended Subsec. (a)(1) by adding provision re association responsibility for retaining records re reserve accounts.

Sec. 47-261e. Adoption of budgets. Special assessments. Loan agreements. (a)(1) Except as provided in subdivision (2) of this subsection, the executive board, at least annually, shall adopt a proposed budget for the common interest community for consideration by the unit owners. Not later than thirty days after the adoption of a proposed budget, the executive board shall provide to all unit owners a summary of the proposed budget, including a statement of the amount of any reserves, and a statement of the basis on which such reserves are calculated and funded. Simultaneously, the board shall set a date not less than ten days or more than sixty days after providing the summary for either a meeting of the unit owners or a vote by ballot without a meeting to consider approval or rejection of the proposed budget. If, at that meeting or in the vote by ballot, a majority of all unit owners or any larger number specified in the declaration votes to reject the proposed budget, the proposed budget shall be rejected. If, at that meeting or in the vote by ballot, a majority of all unit owners or any larger number specified in the declaration does not vote to reject the proposed budget, the proposed budget shall be approved. The absence of a quorum at such meeting or participating in the vote by ballot shall not affect rejection or approval of the proposed budget. If a proposed budget is rejected, the budget last approved by the unit owners continues until unit owners approve a subsequent budget. If a proposed budget is not rejected in accordance with the provisions of this subdivision, the proposed budget shall be deemed approved.

(2) The executive board of an association of a common interest community, or of a master association as defined in section 47-239 exercising the powers on behalf of one or more common interest communities or for the benefit of the unit owners of one or more common interest communities, which community or communities were established prior to July 3, 1991, and have more than two thousand four hundred residential units, at least annually, shall adopt a proposed budget for the common interest community for consideration by the unit owners. Not later than thirty days after the adoption of a proposed budget, the executive board shall provide to all unit owners a summary of the proposed budget, including a statement of the amount of any reserves, and a statement of the basis on which such reserves are calculated and funded. Simultaneously, the board shall set a date not less than ten days or more than sixty days after providing the summary for either a meeting of the unit owners or a vote by ballot without a meeting to consider approval or rejection of the proposed budget. If, at that meeting or in the vote by ballot, a majority of unit owners votes to reject the proposed budget, the proposed budget shall be rejected, provided not less than thirty-three and one-third per cent of the unit owners entitled to vote on the proposed budget vote at that meeting or in the vote by ballot to reject the proposed budget. If an association’s declaration or bylaws include quorum requirements for a meeting, the absence of a quorum at such meeting or participating in the vote by ballot shall not affect rejection or approval of the proposed budget. If a proposed budget is rejected, the budget last approved by the unit owners continues until unit owners approve a subsequent budget. If a proposed budget is not rejected in accordance with the provisions of this subdivision, the proposed budget shall be deemed approved.

(b) (1) Except as provided in subdivision (2) of this subsection, the executive board, at any time, may propose a special assessment. Not later than thirty days after adoption of a proposed special assessment, the executive board shall provide to all unit owners a summary of the proposed special assessment. Unless the declaration or bylaws otherwise provide, if the proposed special assessment, together with all other special and emergency assessments proposed by the executive board in the same calendar year, do not exceed fifteen per cent of the association’s last adopted periodic budget for that calendar year, the proposed special assessment is effective without approval of the unit owners. Otherwise, the board shall set a date not less than ten days or more than sixty days after providing the summary for either a meeting of the unit owners or a vote by ballot without a meeting to consider approval or rejection of the proposed special assessment. If, at that meeting or in the vote by ballot, a majority of all unit owners or any larger number specified in the declaration votes to reject the special assessment, the special assessment shall be rejected. If, at such meeting or in the balloting, a majority of all unit owners or any larger number specified in the declaration does not vote to reject the special assessment, the special assessment shall be approved. The absence of a quorum at such meeting or participating in the vote by ballot shall not affect the rejection or approval of the special assessment. If a proposed special assessment is not rejected in accordance with the provisions of this subdivision, the proposed special assessment shall be deemed approved.

(2) The executive board of an association of a common interest community, or of a master association as defined in section 47-239 exercising the powers on behalf of one or more common interest communities or for the benefit of the unit owners of one or more common interest communities, which community or communities were established prior to July 3, 1991, and have more than two thousand four hundred residential units, at any time, may propose a special assessment. Not later than thirty days after adoption of a proposed special assessment, the executive board shall provide to all unit owners a summary of the proposed special assessment. Unless the declaration or bylaws otherwise provide, if the proposed special assessment, together with all other special and emergency assessments proposed by the executive board in the same calendar year, do not exceed fifteen per cent of the association’s last adopted periodic budget for that calendar year, the proposed special assessment is effective without approval of the unit owners. Otherwise, the board shall set a date not less than ten days or more than sixty days after providing the summary for either a meeting of the unit owners or a vote by ballot without a meeting to consider approval or rejection of the proposed special assessment. If, at that meeting or in the vote by ballot, a majority of unit owners votes to reject the proposed special assessment, the proposed special assessment shall be rejected, provided not less than thirty-three and one-third per cent of the unit owners entitled to vote on the proposed special assessment vote at that meeting or in the vote by ballot to reject the proposed special assessment. If an association’s declaration or bylaws include quorum requirements for a meeting, the absence of a quorum at such meeting or participating in the vote by ballot shall not affect the rejection or approval of the proposed special assessment. If a proposed special assessment is not rejected in accordance with the provisions of this subsection, the proposed special assessment shall be deemed approved.

(c) If the executive board determines by a two-thirds vote that a special assessment is necessary to respond to an emergency: (1) The special assessment becomes effective immediately in accordance with the terms of the vote; (2) notice of the emergency assessment must be provided promptly to all unit owners; and (3) the executive board may spend the funds paid on account of the emergency assessment only for the purposes described in the vote.

(d) Notwithstanding any provision of the declaration or bylaws to the contrary, at least fourteen days prior to entering into any loan agreement on behalf of the association, the executive board shall (1) disclose in a record to all unit owners the amount and terms of the loan and the estimated effect of such loan on any common expense assessment, and (2) afford the unit owners a reasonable opportunity to submit comments in a record to the executive board with respect to such loan.

(e) Unless prohibited or otherwise limited in the declaration, if the executive board proposes to enter into a loan agreement on behalf of the association and to assign its right to future income as security for such loan pursuant to subdivision (14) of subsection (a) of section 47-244, then, in addition to satisfying the requirements of subsection (d) of this section, unit owners of units to which at least a majority of the votes in the association are allocated, or any larger percentage or fraction stated in the declaration, must vote in favor of or agree to such assignment.

(P.A. 09-225, S. 37; P.A. 10-186, S. 18; P.A. 13-182, S. 1.)

History: P.A. 09-225 effective July 1, 2010; P.A. 10-186 amended Subsec. (a) to add “a statement of the amount of” re reserves, amended Subsecs. (a) and (b) to replace “otherwise” with provisions re if, at meeting or in vote by ballot, majority of unit owners or larger specified number does not vote to reject budget or special assessment, amended Subsec. (b) to substitute “special assessment” for “budget”, and made technical and conforming changes in Subsecs. (a) and (b), effective July 1, 2010; P.A. 13-182 amended Subsec. (a) by designating existing provisions as Subdiv. (1) and amending same to add “Except as provided in subdivision (2) of this subsection,”, add “If a proposed budget is not rejected in accordance with the provisions of this subdivision, the proposed budget shall be deemed approved.” and make technical changes, and by adding Subdiv. (2) re adoption of proposed budgets in common interest communities established prior to July 3, 1991, which have more than 2,400 residential units, and amended Subsec. (b) by designating existing provisions as Subdiv. (1) and amending same to add “Except as provided in subdivision (2) of this subsection,”, add “If a proposed special assessment is not rejected in accordance with the provisions of this subdivision, the proposed special assessment shall be deemed approved.” and make technical changes, and by adding Subdiv. (2) re adoption of proposed special assessments in common interest communities established prior to July 3, 1991, which have more than 2,400 residential units.