Tag Archives: homeowner associations

2022 Maryland Condominium and HOA Laws Enacted

Posted on by
Reply

The Maryland Legislature considered various bills regarding the management and operation of condominiums, homeowners associations and housing cooperatives in 2022.  Although most were not approved, several significant new laws took effect October 1, 2022.

            Reserve Studies Statewide (HB 107).  Most Maryland condos, HOAs and coops will now be required to obtain a reserve study of the association common property at least every 5 years to determine the remaining useful life of each major component of the common property and the estimated cost for long-term repair and replacement. The reserve study must also state the estimated annual reserve amount necessary to accomplish any identified future repair or replacement. This extends statewide the reserve study requirements previously enacted for communities in Prince George’s and Montgomery County.

            Where a reserve study is required, the recommended annual reserve amount must be included in the annual budget.  However, if the most recent reserve study is an initial reserve study, up to 3 years is allowed to attain the annual reserve funding recommendation level.

             No reserve study is required for homeowner associations where the initial purchase and installation costs of components which require periodic repair and replacement is less than $10,000. The reserve study law amends the Maryland Condominium Act, Maryland Homeowners Association Act, and Maryland Cooperative Housing Corporation Act.

Continue reading →

2020 Vision: Maryland Condominium Legislative Update

Posted on by
Reply

Condominium insurance, replacement reserves and dispute resolution procedures were among the condominium and homeowners association topics which were considered during the 2019 Maryland legislative session.  However, virtually no new laws affecting community governance were enacted this year.

Looking ahead to 2020, legislation concerning insurance, reserves and dispute resolution is likely to introduced again.

Condominium Insurance Deductibles

Where damage to condominium units and common elements is caused by fire, water or other perils covered by the master property damage insurance, the Maryland Condominium Act requires a unit owner to pay up to the first $5,000 of repair expenses when the cause of the damage originates in that owner’s condominium unit.  While some condos choose a higher deductible, others can only obtain insurance with a deductible of $10,000 or more.  This leaves the condominium association responsible for repair expenses between $5,000 and the amount covered by insurance. Continue reading →

Short Term Rentals Now OK in Montgomery County, Maryland

Posted on by
Reply

Short term daily and weekly rentals are now allowed in all residential areas of Montgomery County, Maryland, beginning July 1, 2018.

Previously, no residential rentals were permitted in Montgomery County for less than 30 days.  Faced with widespread illegal daily and weekly rentals, the County Council passed legislation in October, 2017 to allow these rentals where the property is the primary residence of the owner or owner-authorized resident of the rental property. However, condominiums, homeowner associations and housing cooperatives are still allowed to ban or restrict short term rentals.  Continue reading →

2018 Maryland Legislative Update–New Laws Help Condos and HOAs

Posted on by
Reply

The hot topic during the 2018 Maryland legislative session was how Maryland will adapt to recent changes in federal income tax and health insurance laws.

Beyond the headlines, the Maryland General Assembly considered many bills which directly affect Maryland condominiums, homeowner associations, and housing cooperatives. Several new laws which help condos and HOAs were enacted. Continue reading →

Maryland Condo and HOA Restrictions on Commercial Vehicle Parking

Posted on by
Reply

Maryland condominium and homeowners association covenants often prohibit parking “commercial vehicles” without specifying what constitutes a commercial vehicle.

Where a word or phrase used in the declaration of covenants for a condominium or homeowners association is not defined in the covenants or by statute, the board of directors has broad discretion to adopt rules which explain how the provisions of the covenants will be applied.

If there are no community rules which define what constitutes a “commercial vehicle”, it is likely that a court would apply the Maryland statutory definition of “commercial motor vehicle” used in connection with the requirements for obtaining a commercial driver’s license.  Under that definition, a commercial vehicle includes any vehicle with a gross weight rating of at least 26,001 pounds; a vehicle designed to transport 16 or more passengers; or any size vehicle used to transport hazardous materials.  Excluded from the statutory definition are fire and rescue vehicles with audible and visual signals. Continue reading →

Montgomery County Towing Law Yields Class-Action Settlement

Posted on by
Reply

Faced with a class action suit based on a Montgomery County towing law which makes a property owner liable for the actions of a towing company which is hired to tow unauthorized vehicles, dozens of condominiums and homeowner associations have agreed to settle the suit by paying nearly $400 per tow.

The suit was filed as a class action suit by vehicle owners against over 500 property owners in connection with over 20,000 tows.  It claimed that the towing company improperly asserted a possessory lien on the towed vehicles by refusing to release the vehicle until the tow charges were paid.  It also claimed that the towing company violated County and Maryland law by not providing required notices to the vehicle owners when they came to retrieve their vehicles and by imposing charges for credit card payment.

Although the condos, homeowner associations, and other property owners were not directly involved in the violation of towing law procedures, Montgomery law imposes joint and several liability on property owners for a towing company’s actions and imposes liability for three times the expenses incurred by the vehicle owner.

The cost of each tow was between $168 and $178 which could have resulted in damages of $504 and $534 per tow.  Therefore, the trial court judge who approved the settlement in January 2018 found the settlement of $390 per tow to be “fair, reasonable and adequate”.  Each property owner also was required to pay about $28 per tow as a portion of the legal fees incurred to defend and settle the suit based on a pro rata share of the number of tows which were part of the settlement.

Some condominiums, HOAs and other property owners opted not to settle the suit and the litigation of legal defenses and factual issues may continue to trial.

Although many contracts between the property owners and towing company require the towing company to indemnify the property owners for any improper or unlawful action by the towing company, an agreed $22 million judgment against towing the company with a payment of over $300,000 forced the company out of business and left the property owners without recourse against the towing company.  The claims against some condos and HOAs were covered by the association’s insurance.

Because condos, homeowner associations, and housing co-ops in Montgomery County, Maryland can be liable for up to three times the cost of an improper tow, each association which tows vehicles from the common property should ensure that its towing contract requires the towing company to provide and follow towing procedures which comply with state and local law.

Posted by Thomas Schild Law Group, LLC, attorneys for condominiums, homeowner associations and housing cooperatives in Maryland -– including Montgomery County, Prince George’s County, Howard County, Frederick County, and Baltimore County; and in Baltimore City and Washington, D.C.