Whether you’re new to being a board member or a seasoned vet, you’ve probably figured out that you’ve volunteered for a rather complicated job. Not only do you have to consider your association’s governing documents, but there are several state (and a few federal) laws that speak to what community associations and non-profit organizations can and cannot do. But don’t worry, at CAMS, we’ve got you covered as far as educational resources go, so let’s dive into amending governing documents and handling violations in North and South Carolina.
Sometimes the provisions within your governing documents need a bit of a makeover if, for example, your association is older and the language within has become irrelevant. Of course, there are other reasons you may want to consider amending the documents, and, no matter what those reasons are, there are processes to follow. Easy enough, right? That depends on whether you live north or south of the border (we mean South of the Border as in the tourist attraction when I-95 crosses from NC into SC, of course). Amending governing documents is no small undertaking and is generally only done when essential changes are needed that are broadly supported by all residents.
Declaration of Covenants, Conditions, & Restrictions
North Carolina has rules for pretty much everything. Lots of them. Thankfully they’re conveniently located in just a few sections of the NC General Statutes – NCGS 47F and NCGS 47C, the Planned Community Act, and Condominium Act, respectively. But, to make things even more complicated, whether these acts apply to your association also depends on its age.
For condominiums built after October 1st, 1986, an affirmative vote of at least 67% of members is required to amend the declaration or a larger number if specified in the declaration. What if your condominium association was formed before that date? In that case, these are usually subject to NCGS 47A, the Unit Ownership Act, and whatever language you have in the declaration speaking to amendments is what you must go by. Remember – the condominium act cannot be applied retroactively. So, for those of you living in a pre-October 1st, 1986, community, you don’t have to begin abiding by newer laws in this instance.
For planned communities (for example, your single-family home associations), the same general requirement of affirmative votes of 67% or more of the membership is required to amend the declaration.
Remember: For declaration amendments to be valid and enforceable, they MUST be recorded in the county where the development is located.
South Carolina tends to make amending the declaration/master deed less complicated for their associations. This is because there aren’t any state statutes governing how you amend or the percentage of affirmative votes needed to approve amendments. Instead, you will find that information in each association’s governing documents. However, the South Carolina HOA Act, created in 2018, requires that amendments to ANY and ALL governing documents must be recorded in the county records to be enforceable. Also, keep in mind when you’re amending documents, you’re making changes, not adding new stuff. Therefore, it is difficult to add further restrictions that will limit an owner’s rights to use their property.
As you might have guessed by now, NC has state statutes (NCGS 55A-10-21) that speak to amending a community association’s bylaws. Unless the bylaws themselves require a greater percentage of affirmative votes, 2/3 of votes cast, or a majority of the votes entitled to be cast, must agree with the amendment for it to pass. However, unlike the declaration, there is no obligation to record this with the county in NC.
In SC, the South Carolina Code of Laws (SC Code 27-30-1021) speaks to amending bylaws and is much more detailed than the requirements in NC. Board members can amend bylaws unless the articles of incorporation reserve this power for the members or expressly states that board members may not amend the bylaws. As with other governing documents, amendments to bylaws must be recorded to be effective and enforceable.
One of the most important things to remember about rules is that they are NOT the same as restrictions. Restrictions always take precedence over rules because the board can usually change rules, whereas restrictions require a membership vote.
In NC, boards can adopt rules under the Planned Community and Condominium Acts. These are rules about the common elements and what owners can and can’t do on their lots if allowed in the declaration. The authority for the rule must have a basis in the governing documents, and the rule cannot ever be more restrictive than the covenants.
In South Carolina, the process by which you amend rules will be stated within the declaration or inferred by the language within. So don’t forget to record any changes!
Ah, here you are, having to be the neighborhood police again. We know it’s definitely no fun, but it’s a necessary job in a community association. And, you guessed it, there are some rules surrounding your job moonlighting as the town sheriff!
It is crucial that you avoid having vague or subjective language in your governing documents for both states. Being vague makes it extremely hard to enforce the provisions of the governing documents and can sometimes land you a front-row seat in the courtroom.
Further, you don’t want to keep the violations, fining, and suspension process a secret from owners – if your association has a detailed process regarding these topics, make members aware of it by publishing an enforcement policy to explain the consequences.
Once again, you can find very detailed info on violations in the state statutes we’ve mentioned throughout the article. Still, the gist is that you need to have a process in place, stick to it, and hand out violations uniformly.
If your community doesn’t have a process for dealing with violations, you’re required by statute to have a hearing before suspending an owner’s privileges or fining them. However, if your covenants do lay out a process, follow that to the letter – if you end up in court, a judge will always prefer that your association has followed due process.
If you’ve stuck with us so far, you can probably guess that, in South Carolina, you can find information on violations in each community’s master deed or declaration. In SC, you always have the option to sue an owner and enforce the rules, but you must keep in mind that lawsuits are costly, and, in many instances, that may not be worth it. For example, do you really want to take Ms. Rose to court over her trash can being left out too long? Probably not. Also, if your documents do not speak to any fining or suspension process, sorry, you can’t do it.
While North and South Carolina are happy neighbors with beautiful beaches, mountains, and just about everything in between, you can see that the rules regarding community associations can vary greatly. If you have questions about your documents or what they allow board members to do, reach out to your attorney or community manager. They can provide you with trusted guidance to ensure that you’re doing the right thing the right way every time.
Also, while they’re super long and tedious, do some reading up on the state laws applicable to community associations and non-profit organizations. As they say, better the devil you know than the devil you don’t (and, as always, he’s in the details too)!
Is your community getting the Trusted Guidance it deserves? Reach out to us on our website or call us at 888.798.2624 to learn more about the services CAMS can provide to your association.
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