Other
Jul 18, 2023

Understanding the Hierarchy of Governing Documents in a Community Association

Sponsored Content provided by Dave Orr - CEO, Community Association Management Services

Living in a community association entails adhering to a set of governing documents that guide residents, maintain order, and protect property values. These documents exist within a hierarchical structure, each serving a specific purpose and establishing a distinct level of authority. This blog post will explore the hierarchy of governing documents in a community association, starting with federal laws and progressing through local authority and the rules and regulations in your neighborhood.

1. Federal Laws:
At the top of the hierarchy are federal laws governing all citizens and business entities. These laws include regulations concerning property rights, fair housing, taxation, and more. Associations must comply with these laws, as they dictate how the Board must govern on issues that are constitutional or regulated by federal or state agencies.

2. State Laws:
State laws generally establish the foundation for the legal framework within which associations operate. Examples are the Non-profit Corporations Act, stormwater management laws, or state-specific regulations related specifically to homeowner associations.

3. County/City Ordinances
At the local level, counties and municipalities establish ordinances that dictate many aspects of homeowner’s association operations.  Examples include building setback requirements, noise ordinances, and many other regulations the board must know.

4. Plat Map:
A plat map, also known as a subdivision map, is a legal document that illustrates the boundaries, lots, and common areas within a community association. It provides a graphical representation of the physical layout of the neighborhood and serves as a reference for property boundaries and other relevant details. Plat maps are essential for understanding the physical structure of the community and can help resolve boundary disputes or determine common area ownership.

5. Articles of Incorporation:
The articles of incorporation establish the legal existence of the community association as a corporation. This document outlines the association's purpose, structure, powers, and limitations. It typically includes details such as the association's name, registered agent, and the duration of its existence. Articles of incorporation are filed with the state and serve as a legal foundation for the community association's operations.  Not all associations are incorporated, as laws vary from state to state. However, it is generally accepted that incorporation adds protection for volunteers who serve the community as board members and protects homeowners who are members of the association.  

6. Covenants, Conditions, and Restrictions (CC&R):
CC&Rs are legally binding agreements that outline the rights and responsibilities of homeowners within a community association. They establish standards for property use, architectural guidelines, maintenance obligations, and restrictions on certain activities. CC&Rs are crucial in maintaining a cohesive and harmonious living environment while protecting property values. Covenants, Conditions, & Restrictions are binding and run with the land.  This means that anyone who buys the land agrees to abide by the covenants and accepts the restrictions that exist when they take title to the property. For example, CC&Rs may prohibit boats from being parked on a property. CC&Rs can be changed by amendment; however, the bar is set high for passing such amendments since the CC&Rs define the identity of the development and are an important consideration in buying a home.

7.  Bylaws:
Bylaws provide a detailed framework for how the community association operates and are often considered its "constitution." They outline the procedures for electing board members, holding meetings, adopting rules, collecting assessments, and handling disputes. Bylaws address governance matters and provide a roadmap for decision-making and administrative processes within the association.

The developer usually files Articles of Incorporation, CC&Rs, and Bylaws when the homeowner’s association is created.

8.  Rules and Regulations:
Rules and regulations, sometimes referred to as community guidelines, are established by the community association's board of directors. These documents further elaborate on the CC&Rs and bylaws, usually clarifying guidance related to specific issues, such as parking restrictions, pet policies, noise regulations, and the use of common areas. Rules and regulations are typically more flexible and subject to change than CC&Rs since they do not usually require approval beyond the board of directors. Board policies and community rules are derived from the authority granted in the CC&Rs, Articles, or Bylaws. Rules may not create new use restrictions for owners, and they can never contradict rights or restrictions in any of the documents mentioned above.

Hierarchy and Importance:
Understanding the hierarchy of these governing documents is crucial, as each builds upon the previous one to create a comprehensive framework for community association living. While federal, state, and local laws set the baseline legal requirements, CC&Rs provide specific property use and maintenance guidelines. Plat maps define the physical boundaries of the community, and articles of incorporation establish the association's status as a legal entity. Bylaws outline the internal governance procedures, and rules and regulations offer further guidance for specific matters.

It's important to note that conflicts or inconsistencies between these documents are resolved by giving precedence to the higher-ranking document. For example, if a rule contradicts a provision in the CC&Rs, the CC&Rs will take precedence. Consulting legal counsel or seeking guidance from the community management company can help clarify any uncertainties.

Conclusion:
The hierarchy of governing documents in a community association provides a framework for creating a harmonious living environment while upholding property values and community standards. Federal and state laws form the foundation, followed by local ordinances, CC&Rs, plat maps, articles of incorporation, bylaws, and rules and regulations. Each document serves a unique purpose, contributing to the overall governance of the association. Understanding these documents and their hierarchical structure is vital for homeowners and association boards to maintain a well-functioning and prosperous community.

Other Posts from Dave Orr

Ico insights

INSIGHTS

SPONSORS' CONTENT
Burrus rob headshot 300x300

Spreading Wings for Flight: 2nd Annual Trade Show Highlights the Ingenuity of UNCW Business Students

Robert Burrus - Cameron School of Business - UNC-Wilmington
Mcwhorter 0005

The Coastal Corridor is Helping Wilmington Startups With Connected Devices for Life Sciences Industry

Heather McWhorter - UNCW Center for Innovation and Entrepreneurship
Untitleddesign5

Unlocking Potential: The Power of Business Peer Groups

John Monahan - Vistage

Trending News

Wilmington Startup Gains Endorsement Through Spokesperson, Potential Investors

Audrey Elsberry - Feb 26, 2024

Rezoning Proposed For Carolina Beach Land, Including Seawitch Site

Emma Dill - Feb 26, 2024

Sullivan Promoted To Marketing Director At Thomas Construction

Staff Reports - Feb 27, 2024

Sikes Honored As Top Franchisee

Staff Reports - Feb 27, 2024

Wilmington's Venture Capital Spending Declines Sharply In 2023

Audrey Elsberry - Feb 27, 2024

In The Current Issue

Pickler Provides Place To Play

Today, the House of Pickleball has around 2,000 members....


INFO JUNKIE: Brooke Rudd-Gaglie

Brooke Rudd-Gaglie, vice president, director and practicing broker at Margaret Rudd & Associates Realtors, shares her tech and info picks....


MADE: IKA Works Inc. Equips Labs

IKA Works Inc. manufactures products used by universities, biotech companies and more....

Book On Business

The 2024 WilmingtonBiz: Book on Business is an annual publication showcasing the Wilmington region as a center of business.

Order Your Copy Today!


Galleries

Videos

2023 Power Breakfast: Major Developments