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The Maryland State Senate has approved, with amendment, a bill previously passed by the House of Delegates.  House Bill 34, would give homeowner associations the right to collect a fee relating to inspections during the resale process.  The version passed by the House would entitle an HOA to charge “a reasonable fee not to exceed $100 for an inspection of the low owner’s lot if required.”  The Senate Judicial Proceedings Committee changed the maximum amount of the fee to $50, and added “if the inspection is required by the governing documents of the homeowners association.”  As reported in a prior post, the House of Delegates passed its version by a 85 – 44 vote.

By a vote of 135-1, the Maryland House of Delegates has passed House Bill 651, which would require condominiums and homeowner associations to conduct reserve studies of the common elements and common areas.  As discussed in an earlier post, the new law would provide that, within 90-days of the meeting at which the unit owners assume control of the council, a reserve study must be conducted of the common elements, and the condominium must conduct a reserve study every five years thereafter.  Condominiums established before October 1, 2017 that had a reserve study conducted on or after October 1, 2013 are required to undertake an additional reserve study five years after the previous one, and every five years thereafter.  Condominiums established before October 1, 2017 that have not had a reserve study undertaken on or after October 1, 2013 must conduct a reserve study on or before October 1, 2018, and every five years thereafter.

Also under the bill, similar reserve study requirements would be established for the common areas in homeowner associations.

By a vote of 135-0, the Maryland House of Delegates has passed legislation that would reduce the percentage of affirmative votes required to amend condominium bylaws.  Under Section 11-104(e) of the Maryland Condominium Act, condominium bylaws may only be amended upon a vote of two-thirds (66 2/3 percent) of the unit owners.  House Bill 789 would reduce this to 55 percent.  Significantly, it would also permit the bylaws themselves to establish a percentage as low as 51%.  Additionally, the bill would limit the voting to members in “good standing, ” which is defined as not being more than 90 days in arrears with regard to assessment payments.  The original version of the bill would have also allowed voting to be denied to any member in violation of a provision of the declaration, bylaws or rules and regulations, but this provision was removed in the final version that was approved.

The proposed legislation contains similar provisions to reduce the percentage vote required for bylaw amendments under Section 11B-116 of the Maryland Homeowners Association Act.

Pitchers and catchers report to Ed Smith Stadium in Sarasota, Florida today as the Baltimore Orioles begin spring training for the 2017 season; so it is time for me to step back from condo law for a moment and provide my annual commentary on the state of the team.  This year, I would like to focus on completing the position-player roster.  Here are the current options as I see them: (more…)

Effective January 1, Ober|Kaler joined the national firm, Baker Donelson. The combined firm maintains the name Baker Donelson and has more than 800 attorneys across 25 offices in ten states and Washington, D.C.  I am excited and privileged to begin 2017 as a Baker Donelson shareholder in their Baltimore office, and look forward to continuing communications and sharing of information with the many readers and followers of this blog.

My firm, Ober Kaler, will be combining with the well-respected national law firm Baker Donelson.  The Baker Donelson firm presently has more than 700 attorneys and public policy advisors representing more than 30 practice areas across 21 offices in Alabama, Florida, Georgia, Louisiana, Mississippi, South Carolina, Tennessee, Texas and Washington, D.C.  This combination will bring together two strong firms with national reputations for exceptional client service.  It is anticipated that this combination will be effective January 1, 2017.  The combined firm, which will maintain the name of Baker Donelson, will rank among the 50 largest law firms in the country, with more than 800 attorneys and advisors across 25 offices in nine states as well as Washington, D.C.   I am looking forward to continuing my construction, litigation and real estate practice as part of this dynamic merger.

Legislation introduced in the Maryland General Assembly that would have prevented developers from including provisions in condominium governing documents that limit the developer’s liability for construction defects failed to reach a floor vote during the 2016 session. Senate Bill 250 and House Bill 1170 proposed to prohibit provisions in the declaration, bylaws or rules and regulations that limit the ability of a council of unit owners to file suit on behalf of itself or the unit owners or enforce warranty claims. The proposed new law would also have precluded limits on the rights of condominium councils or individual unit owners to bring claims relating to an alleged failure of the developer to comply with building codes, county approved plans and specifications, product manufacturer’s installation instructions, and other construction industry standards. Proposed new Section 11-134.1 of the Maryland Condominium Act would have prohibited provisions designed to prevent the filing of a claim within the applicable period of limitations or prevent claims from accruing pursuant to the “discovery rule.” The new law would also have precluded provisions requiring a vote of the unit owners approving the initiation of a claim, unless such a requirement is adopted after the unit owners assume control of the community from the developer.

The Maryland General Assembly is again considering legislation that would prevent residential condominium developers from including certain provisions in the project’s governing documents or sales contracts that limit the developer’s liability for construction defects. Senate Bill 570 and House Bill 829 would prohibit provisions in the declaration, bylaws or rules and regulations that limit the ability of a council of unit owners to file suit on behalf of itself or the unit owners or enforce warranty claims. The proposed new law would also preclude limits on the rights of condominium councils or individual unit owners to bring claims relating to an alleged failure of the developer to comply with building codes, county approved plans and specifications, product manufacturer’s installation instructions, and other construction industry standards. Proposed new Section 11-134.1 of the Maryland Condominium Act would prohibit provisions designed to prevent the filing of a claim within the applicable period of limitations or prevent claims from accruing pursuant to the “discovery rule.” The new law would also preclude provisions requiring a vote of the unit owners approving the initiation of a claim, unless such a requirement is adopted after the unit owners assume control of the community from the developer. (more…)

I am pleased to report that our Construction Practice Group at Ober Kaler has received a prestigious ranking as a leading law firm in Construction for 2014 by The Legal 500, including special recognition of my condominium practice.  The following is The Legal 500’s description:

“Ober Kaler’s practice is co-chaired by John Morkan and the ‘honest and intelligent’ Joseph Kovars, with a further 16 lawyers spread across its Baltimore and Washington DC offices giving the firm a national scope. Most of its recent work has been government related, such as advising public authorities on heavy highway construction, or assisting private sector clients on government bid protests and PPP projects. Universities and colleges have been a stable client base, though the firm serves all industry sectors, with a strong emphasis on contentious matters. The ‘excellent construction litigation department’ represents private owners in building and construction defect claims, and acts for developers, public authorities, and construction companies. Raymond Burke is ‘an expert among experts in his field’, and has special knowledge of condominium association litigation. The firm is acting as counsel to the US Department of Justice, Antitrust Division andothers regarding the review and analysis of the design and construction of an $850m expansion of a Mexican brewery. It also defended Diamond State Port Corporation in a dispute brought by the contractor arising from alleged breach of contract in connection with the rehabilitation of berth four at the Port of Wilmington. Firm chair John Wolf and Barbara Werther are additional key contacts.”