Maryland Condominium Is Responsible for Maintaining Common Property in Safe Condition

Condominiums in Maryland have a duty to exercise reasonable and ordinary care to keep the common area safe for residents and their guests. Where there is a dangerous condition on the property which the condominium board or manager knew or should have known about, the condominium may be liable for the injuries caused by the dangerous condition.

Duty Owed Depends on Status of Injured Person. As explained in a decision of the Maryland Court of Special Appeals, the potential “premises liability” depends on the relationship between the injured person and the condominium. For an “invitee” on the property at the invitation of the property owner, there is duty of reasonable and ordinary care which includes a duty to inspect the property to discover and correct dangerous conditions. Invitees must also be warned of known dangers. For a “social guest” or “licensee” who is permitted on the property for the benefit of the person entering the property, there is only a duty to warn of known dangers. For a “trespasser” or “bare licensee” who does not have permission to be on the portion of the property where an injury occurs, there is merely a duty to refrain from willful injury or entrapment but no duty to warn of dangerous conditions.

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Maryland Eases Hurdle to Amending Condo and HOA Covenants

The governing documents of Maryland condominiums and homeowner associations often require that amendments to the governing documents must be approved by up to 100 percent of the lenders who hold the mortgage of homeowner’s property. The Maryland Condominium Act for several years has allowed lender approval of most condominium bylaw amendments to be presumed if a lender does not object to the amendment within 60 days.

A new Maryland law extends the presumed lender consent to amendments to a condominium declaration and to all governing documents of a homeowners association, including the declaration of covenants, bylaws, deed and agreement, and other recorded covenants and restrictions. The hurdle of obtaining lender approval has been eased for nearly all amendments to condominium and HOA covenants. The only exceptions are amendments which alter the priority of the mortgage lien; materially impair or affect an owner’s unit or lot as collateral; or materially impair or affect the right of the lender to exercise rights under the mortgage or law.

The presumed consent procedure requires the association to deliver the proposed amendment to each lender entitled to notice of the amendment. If the lender does not object in writing within 60 days of actual receipt of the proposed amendment, the lender is deemed to have consented to the amendment.

The new amendment procedure is included in the Maryland Condominium Act and Maryland Homeowners Association Act, effective October 1, 2020.

Separately, the Maryland Condominium Act insurance provisions were amended this year to allow a condominium to require a unit owner to pay the master insurance deductible amount up to $10,000 where the cause of damage originates in the owner’s condominium unit. This is increase from $5,000, beginning in October, 2020.

And, the Maryland Condominium Act and Maryland Homeowners Association Act were amended to require all Maryland condos and HOAs to submit the approved annual budget to all owners within 30 days after the meeting at which the budget was adopted. This is in addition to the requirement that the proposed annual budget be provided to owners at least 30 days before it is adopted. The budget information may be provided by email, posting on the association website or inclusion in the association newsletter.

Another new Maryland law requires all condominiums, housing cooperatives, and homeowner associations in Prince George’s County to obtain a replacement reserve study of the condition the common property every 5 years and include in the annual condominium fees a portion of the estimated future cost to repair and replace major components of the condominium.

Replacement Reserve Funding Required for Condos and HOAs in Prince George’s County, Maryland

A reserve study to determine the funding needed for future major repairs and replacement of common property in condominiums, homeowner associations and housing cooperatives in Prince George’s County, Maryland will now be required by a new Maryland law, effective October 1, 2020.

The replacement reserve study must be prepared by a qualified professional and identify each structural, mechanical, electrical and plumbing component of the common property and any other components that are the responsibility of the condo, HOA or coop to repair and replace. It must also state the normal useful life and estimated remaining useful life of each component; state the estimated cost of repair or replacement; and state the estimated annual reserve amount necessary to accomplish any future repair or replacement.

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Maryland Condo Owners May Be Responsible for $10,000 Property Insurance Deductible

The Maryland Condominium Act has been amended to increase from $5,000 to $10,000 the amount which a unit owner may be required to pay where the cause of fire, water or other casualty damage to units or the common elements originates in that owner’s condominium unit, beginning October 1, 2020.

In recent years, it is has become common that the insurance deductible amount for property damage claims is at least $10,000.  Some condo associations are not able to purchase insurance with a lower deductible due to its claims history.  Others choose to have a deductible of $10,000 or more to obtain lower insurance premium costs.

For condos which have a deductible of at least $10,000, an owner will be responsible for the first $10,000 of repair costs to the owner’s units, other units and the common elements if the cause of damage originates in the owner’s water or sewer pipes, kitchen or other parts of the unit.  If the insurance deductible is less than $10,000, a unit owner will be responsible for the lower deductible amount.  The condominium association will be responsible for the repair cost in excess of the deductible amount.

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Coronavirus Update: Practical Tips for Community Associations

By Thomas C. Schild and Scott J. Silverman

When Coronavirus Disease (COVID-19) was declared a pandemic in mid-March, 2020, state and local governments in Maryland and Washington, D.C. ordered that most everyone stay home to limit the spread of the coronavirus.  After several months of staying home and restrictions on gathering in public places, business and social activity in Maryland and the District of Columbia stated Phase 2 re-opening in late June, 2020.

While the duration and impact of COVID-19 locally and throughout the United States is still unknown, it is certain that condominiums, homeowner associations, and housing cooperatives must continue to adapt their practices and procedures to the ongoing health crisis. With most offices in the Washington region likely to remain closed until September, 2020 or longer, many residents are still staying home and working at home.  Schools may not fully open until 2021, which means school-age children and their parents will continue to be home. 

Although we defer to medical and health professionals on how to best protect against the spread of COVID-19, we offer a few practical tips on how community association boards, managers, and residents can adapt the management and operation of their community to limit the risk of illness…and legal liability.  

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U.S. Supreme Court Sidesteps Condo Assessment Dispute

The United States Supreme Court, during its recently-ended 2018 Term, declined  to review the decision of a federal appeals court that a condominium owner is not personally responsible for payment of assessments which become due after the owner files a Chapter 13 bankruptcy petition when the owner makes all payments under a bankruptcy payment plan approved by the Bankruptcy Court. Continue reading