D.C. Condominium Act Amendments Are On the Move

Date: July 11, 2011

The D.C. Legislative Action Committee is attempting to introduce a bill to amend the D.C. Condominium Act to make certain changes that Boards should be aware of. Although these amendments have not been passed yet, Boards should understand the amendments and prepare for them accordingly. Below is a brief summary of some of the key amendments that have been proposed.

Open Meetings
Section 42-1903.03 has a proposed section that will require all meetings of the executive board to be open for observation to all unit owners in good standing. Notice of these meetings must be provided to unit owners who request the information and the notice must be published in a location reasonably calculated to be seen by unit owners. Minutes of these executive board meetings must be recorded and available for examination and copying by unit owners who are in good standing.

The executive board may still convene an executive session to consider personnel matters, to consult with legal counsel and deal with other personal issues in a closed session but this must be done upon a motion and an affirmative vote in an open meeting before moving into the executive session.

Members of the Board should note that these changes are very similar to and based on the current law in the State of Maryland and the Commonwealth of Virginia.

Insurance Obtained by the Association
A proposed revision to Section 42-1903.10 of the D.C. Condominium Act affects insurance. Unit owners must now purchase liability and property insurance coverage in the amount of $250,000 or any other amount that is determined by the Board. If a unit owner suffers a loss that is also covered under the association's policy, then the primary coverage is the unit owner's policy.

If the association's policy is invoked because a unit owner has suffered a loss and the association's policy pays for any of those losses, then the unit owner will be liable for such losses and must pay the association's deductible. This is not to exceed $5,000, which may be adjusted annually.

Association's Lien for Assessments
Revisions to Section 42-1903.13 would allow interest, late fees, expenses, legal fees actually incurred, collection costs and any other amounts payable by a unit owner under the condominium instruments to be included as part of the statutory lien on the unit in favor of the association. This section has also been amended to include a sentence that a unit owner irrevocably appoints the board president of the association as a trustee for the purpose of conducting a foreclosure upon their acceptance of a deed to the condominium unit.

Books, minutes and records; inspection
Section 42-1903.14 which was previously titled "Financial records" has been amended to be titled, "Books, minutes and records; inspection." This section now outlines the association's duty to keep detailed records of the receipt and expenditures of the condominium. It is also expanded to include a provision that allows the association to withhold certain information from examination or copying by unit owners to the extent such information is in drafts that are not yet incorporated into the association's books and records, or if the books and records concern things such as personal matters, pending or probable litigation, contracts, leases and other commercial transactions currently under negotiation, matters discussed in a closed executive session, and individual unit owner files. The section also allows the association to impose and collect a fee for providing copies of any books and records to unit owners.