A988

An Act concerning condominium and homeowners’ associations and amending P.L.1969, c.257 and P.L.1991, c.483.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 14 of P.L.1969, c.257 (C.46:8B-14) is amended to read as follows:

14. The association, acting through its officers or governing board, shall be responsible for the performance of the following duties, the costs of which shall be common expenses:

(a) The maintenance, repair, replacement, cleaning and sanitation of the common elements.

(b) The assessment and collection of funds for common expenses and the payment thereof.

(c) The adoption, distribution, amendment and enforcement of rules governing the use and operation of the condominium and the condominium property and the use of the common elements, including but not limited to the imposition of reasonable fines, assessments and late fees upon unit owners, if authorized by the master deed or bylaws, subject to the right of a majority of unit owners to change any such rules.

(d) The maintenance of insurance against loss by fire or other casualties normally covered under broad-form fire and extended coverage insurance policies as written in this State, covering all common elements and all structural portions of the condominium property and the application of the proceeds of any such insurance to restoration of such common elements and structural portions if such restoration shall otherwise be required under the provisions of this act or the master deed or bylaws.

(e) The maintenance of insurance against liability for personal injury and death for accidents occurring within the common elements whether limited or general and the defense of any actions brought by reason of injury or death to person, or damage to property occurring within such common elements and not arising by reason of any act or negligence of any individual unit owner.

(f) The master deed or bylaws may require the association to protect blanket mortgages, or unit owners and their mortgagees, as their respective interest may appear, under the policies of insurance provided under clauses (d) and (e) of this section, or against such risks with respect to any or all units, and may permit the assessment and collection from a unit owner of specific charges for insurance coverage applicable to his unit.

(g) The maintenance of accounting records, in accordance with generally accepted accounting principles, open to inspection at reasonable times by unit owners. Such records shall include:

(i) A record of all receipts and expenditures.

(ii) An account for each unit setting forth any shares of common expenses or other charges due, the due dates thereof, the present balance due, and any interest in common surplus.

(h) Nothing herein shall preclude any unit owner or other person having an insurable interest from obtaining insurance at his own expense and for his own benefit against any risk whether or not covered by insurance maintained by the association.

(i) Such other duties as may be set forth in the master deed or bylaws.

(j) An association shall exercise its powers and discharge its functions in a manner that protects and furthers or is not inconsistent with the health, safety and general welfare of the residents of the community.

(k) An association shall provide a fair and efficient procedure for the resolution of housing-related disputes between individual unit owners and the association, and between unit owners, which shall be readily available as an alternative to litigation. A person other than an officer of the association, a member of the governing board or a unit owner involved in the dispute shall be made available to resolve the dispute. A unit owner may notify the Commissioner of Community Affairs if an association does not comply with this subsection. The commissioner shall have the power to order the association to provide a fair and efficient procedure for the resolution of disputes.

(l) (1) An association shall cooperate to the fullest possible extent with federal home loan insurance providers, by responding fully and expediently to any questionnaires or other requests for information required by the providers before insuring a loan, and providing such materials at no cost to potential buyers, no later than 10 business days after receiving the request.

(2) The Commissioner of Community Affairs may enforce the requirements of this subsection through the imposition of a personal civil penalty, not to exceed $500 per person per violation, on the officers of the association, which may be recovered in summary proceedings pursuant to the provisions of the "Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.).

(cf: P.L.1996, c.79, s.2)

2. Section 10 of P.L.1991, c.483 (C.46:8C-19) is amended to read as follows:

10. a. An association may contract, sue, or be sued, with respect to the exercise or non-exercise of its powers. For these purposes, the powers of the association include, but are not limited to, the maintenance, management, and operation of the property. The association may institute, maintain, settle or appeal actions or hearings in its name on behalf of all homeowners concerning matters of common interest, including, but not limited to: the common property; structural components of a building or other improvements; mechanical, electrical and plumbing elements serving the property; and protests of ad valorem taxes on commonly used facilities. If the association has the authority to maintain a class action, the association may be joined in an action as representative of that class with reference to litigation and disputes involving the matters for which the association could bring a class action. Nothing herein limits any statutory or common-law right of any individual homeowner or class of homeowners to bring any action which may otherwise be available.

b. The powers and duties of an association include those set forth in this section, in sections 6 and 9 of this act, and in the articles of incorporation and bylaws and any recorded declarations or restrictions encumbering the property, if not inconsistent with the provisions of this act.

c. An association has the power to make and collect assessments and to lease, maintain, repair and replace the common areas upon purchase of the private residential leasehold community property.

d. An association shall maintain financial records in accordance with generally accepted accounting standards and principles. The records shall be open to inspection by association members or their authorized representatives at reasonable times, and written summaries of such records shall be supplied at least annually to the members or their authorized representatives. The failure of the association to permit inspection of its accounting records by members or their authorized representatives entitles any persons prevailing in an enforcement action to recover reasonable attorney's fees from the person in control of the books and records who, directly or indirectly, knowingly denied access to the books and records for inspection. The records shall include, but not be limited to:

(1) A record of all receipts and expenditures.

(2) An account for each member, designating the name and current mailing address of the member, the amount of each assessment, the dates on which and amounts in which the assessments come due, the amount paid on the account, and the balance due.

e. An association has the power to purchase, acquire, hold, lease, mortgage and convey any proprietary interest in or affecting the land of the private residential leasehold community.

f. An association shall use its best efforts to obtain and maintain adequate insurance to protect the association and the property upon purchase of the private residential leasehold community. A copy of each policy of insurance in effect shall be made available for inspection by members at reasonable times.

g. An association has the authority, without the joinder of any homeowner, to modify, move, or create any easement for ingress and egress, or for the purpose of utilities, if the easement constitutes part of or crosses the property upon purchase of the property. This subsection does not authorize the association to modify or move any easement created in whole or part for the use or benefit of anyone other than the members, or crossing the property of anyone other than the members, without the consent or approval of such person as required by law or the instrument creating the easement. Nothing in this subsection affects the rights of ingress or egress of any member of the association.

h. (1) An association shall cooperate to the fullest possible extent with federal home loan insurance providers, by responding fully and expediently to any questionnaires or other requests for information required by the providers before insuring a loan, and providing such materials at no cost to potential buyers, no later than 10 business days after receiving the request.

(cf: P.L.1995, c.365, s.10)

3. This act shall take effect immediately.

STATEMENT

This bill would require condominium associations and homeowners’ associations to cooperate to the fullest possible extent with federal home loan insurance providers, by responding fully and expediently to any questionnaires or other requests for information required by the providers before insuring a loan, and providing such materials at no cost to potential buyers, no later than 10 business days after receiving the request.

The Commissioner of Community Affairs may enforce the requirements of this bill through the imposition of a personal civil penalty, not to exceed $500 per person per violation, on the officers of the association, which may be recovered in summary proceedings pursuant to the provisions of the "Penalty Enforcement Law of 1999," P.L.1999, c.274 (C.2A:58-10 et seq.).