View Bill Status
View Bill Text
View Statement of Purpose / Fiscal Impact
H0758......................................................by STATE AFFAIRS
HOMEOWNER'S ASSOCIATION PROPERTY ACT - Adds to existing law to provide for
establishment of a homeowner's association in subdivisions; to provide for
procedures for organization; and to provide for collection of assessments.
02/24 House intro - 1st rdg - to printing
02/25 Rpt prt - to Bus
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-seventh Legislature Second Regular Session - 2004
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 758
BY STATE AFFAIRS COMMITTEE
1 AN ACT
2 RELATING TO HOMEOWNER'S ASSOCIATIONS; AMENDING TITLE 55, IDAHO CODE, BY THE
3 ADDITION OF A NEW CHAPTER 13, TITLE 55, IDAHO CODE, TO PROVIDE A SHORT
4 TITLE, TO DEFINE TERMS, TO PROVIDE REQUIREMENTS TO QUALIFY, TO PROVIDE
5 CONTENTS OF DECLARATION, TO PROVIDE ADMINISTRATION THROUGH BYLAWS AND
6 ARTICLES OF INCORPORATION, TO PROVIDE CONTENTS OF BYLAWS, TO PROVIDE FOR
7 RECORDATION OF INSTRUMENTS AFFECTING PROPERTY, TO PROVIDE FOR REMOVAL OF
8 PROPERTY FROM THE LAW, TO PROVIDE FOR ACTIONS RELATING TO COMMON AREAS AND
9 PERSONS DESIGNATED TO RECEIVE PROCESS, TO PROVIDE FOR ACTIONS BY MANAGE-
10 MENT ON BEHALF OF TWO OR MORE OWNERS, TO PROVIDE FOR SEPARATE TAXATION,
11 LIENS AND TAX DEEDS, TO PROVIDE FOR OWNERS BEING PROPORTIONATELY LIABLE
12 FOR COMMON AREAS, TO PROVIDE FOR LIABILITY OF HOMEOWNERS, TENANTS AND
13 EMPLOYEES, TO PROVIDE LIENS FOR ASSESSMENTS AND OTHER CHARGES, TO PROVIDE
14 LIENS FOR LABOR, SERVICES OR MATERIALS AND TO PROVIDE THAT THE "BLUE SKY
15 LAW" IS INAPPLICABLE.
16 Be It Enacted by the Legislature of the State of Idaho:
17 SECTION 1. That Title 55, Idaho Code, be, and the same is hereby amended
18 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap-
19 ter 13, Title 55, Idaho Code, and to read as follows:
20 CHAPTER 13
21 HOMEOWNER'S ASSOCIATION PROPERTY ACT
22 55-1301. SHORT TITLE. This act shall be known and may be cited as the
23 "Homeowner's Association Property Act."
24 55-1302. DEFINITIONS. As used in this chapter unless the context other-
25 wise requires:
26 (1) "Common area" means the real property within the property owned or
27 leased by the homeowner's association.
28 (2) "Home" shall have the definition of residential improvement as
29 defined in section 63-602G, Idaho Code, except the residential improvement
30 need not be owner occupied, and includes the parcel of land on which it is
31 located.
32 (3) "Homeowner" means an owner of, or holder of a deed in trust to, an
33 estate in real property as defined in section 55-101, Idaho Code.
34 (4) "Homeowner's association" means any person or persons managing a com-
35 mon area, and includes a corporation or association of which the homeowners
36 are members or stockholders, or a management agent selected by the homeowners,
37 by the corporation or association, or named in the declaration.
38 (5) "Limited common areas" means those common areas and facilities desig-
39 nated in the declaration for use of a certain homeowner or homeowners to the
40 exclusion, limitation or restriction of others.
41 (6) "Person" means any individual or any corporation, limited liability
2
1 company, joint venture, limited partnership, partnership, firm, association,
2 trustee or other similar entity or organization.
3 (7) "Property" means the land described in the declaration recorded pur-
4 suant to section 53-1304, Idaho Code, together with every building, improve-
5 ment or structure thereon, and every easement or right appurtenant thereto,
6 but does not include condominiums or stock cooperatives.
7 55-1303. REQUIREMENTS TO QUALIFY. The requirements of this chapter shall
8 apply to homes only:
9 (1) If there shall be recorded in the county in which such homes are
10 located or to be located a declaration, as provided in this chapter, together
11 with a record of plat or plats; and
12 (2) If said documents, or either of them, contain an expression of intent
13 to create a homeowner's association which is subject to the provisions of this
14 chapter; and
15 (3) If at least one (1) of such documents contains:
16 (a) A plat of the boundary of the property; and
17 (b) A certificate consenting to the recordation of such documents pursu-
18 ant to this chapter, executed and acknowledged by a majority of the
19 homeowners and a majority of the holders of any recorded security interest
20 in such property. A homeowner's association is created if there has been
21 substantial compliance in good faith with the provisions of this section.
22 The declaration and the plat or plats may, prior to the first sale of a
23 home within the property, be amended or revoked by a subsequently recorded
24 instrument executed and acknowledged by the then record owner and the then
25 holder of any recorded security interest in such property. Until such
26 recordation of such a revocation, the provisions of this chapter shall
27 continue to apply to such property.
28 55-1304. CONTENTS OF DECLARATION. (1) The declaration shall contain the
29 following:
30 (a) A legal description of the property;
31 (b) A legal description of each home within the property, which descrip-
32 tion may consist of the identifying number, symbol or name of such home as
33 shown on the plat.
34 (2) The declaration may, but need not also, contain any of the following:
35 (a) A statement of the location of each home, and any other data for its
36 proper identification;
37 (b) A description of the common areas and facilities;
38 (c) A description of any limited common areas and facilities, if any,
39 stating to which homes their use is reserved or the terms of applicable
40 restrictions or limitations;
41 (d) A statement of the purposes for which the common area, limited common
42 area and each of the homes are intended and restricted as to use;
43 (e) Provisions as to the percentage of votes by the homeowners which
44 shall be determinative of whether to rebuild, repair, restore or sell the
45 property in the event of damage, taking or destruction of all or part of
46 the property;
47 (f) Any or all of the provisions hereinafter referred to in section
48 55-1306, Idaho Code, as proper provisions of bylaws;
49 (g) Provisions for the management of the property by any management body
50 or bodies; for the voting majorities, quorums, notices, meeting dates, and
51 other rules governing such body or bodies; and for recordation, from time
52 to time, as provided for in the declaration, of certificates of identity
53 of the persons then composing such management body or bodies, which cer-
3
1 tificates shall be conclusive evidence of the facts recited therein in
2 favor of any person relying thereon in good faith;
3 (h) As to any management body:
4 (i) For the powers thereof, including power to enforce the provi-
5 sions of the declaration by imposing fines or penalties, suspending
6 or revoking privileges, or pursuing any legal or equitable remedy;
7 (ii) For maintenance by it of fire, casualty, liability, worker's
8 compensation and other insurance and for bonding of the members of
9 any management body;
10 (iii) For provision by it of, and payment by it for, maintenance,
11 utility, gardening and other services; for employment of personnel,
12 and legal and accounting services;
13 (iv) For purchase by it of materials, supplies and the like and for
14 maintenance and repair of the common areas;
15 (v) For payment by it of taxes and special assessments which would
16 be a lien upon the common areas, and for discharge by it of any lien
17 or encumbrances levied or imposed on the entire common areas;
18 (vi) For payment by it for reconstruction of any portion or por-
19 tions of the property damaged, taken or destroyed;
20 (vii) For delegation by it of its powers;
21 (viii) For entry by it or its agents into any home when necessary in
22 connection with any maintenance or construction for which the manage-
23 ment body is responsible;
24 (ix) For an irrevocable power of attorney to the management body to
25 sell and convey the entire common areas for the benefit of all of the
26 owners thereof when partition of the project may be had under section
27 55-1308, Idaho Code, which power shall:
28 1. Be binding upon all of the owners, whether they expressly
29 assume the obligations of the declaration or not;
30 2. If so provided in the declaration, be exercisable by less
31 than all, but not less than a majority of the homeowners in the
32 project;
33 3. Be exercisable only after recordation of a certificate by
34 those who have the right to exercise such power of attorney,
35 that such power of attorney is properly exercisable under the
36 declaration, which certificate shall be conclusive evidence of
37 the facts recited therein in favor of any person relying thereon
38 in good faith;
39 (i) Provisions for amendments of such declaration or the bylaws, if any,
40 which amendments, if made upon the vote or consent of more than a majority
41 of the homeowners in the homeowner's association, shall be binding upon
42 every owner and every home whether the burdens thereon are increased or
43 decreased thereby, and whether or not the owner of each and every home
44 consents thereto;
45 (j) Provisions for independent audit of the accounts of the homeowner's
46 association and any management body;
47 (k) (i) Provisions for assessments to meet authorized expenditures of
48 any management body, and for a method for notice and levy thereof,
49 each home to be assessed separately for its share of such expenses in
50 proportion, unless otherwise provided, to its owner's interest in the
51 common areas;
52 (ii) For the subordination of the liens securing such assessments to
53 other liens either generally or specifically described;
54 (l) Provisions for the conditions upon which partition of the common
55 areas may be had pursuant to this chapter. Such right to partition may be
4
1 conditioned upon failure of the homeowners to elect to rebuild within a
2 certain period, specified inadequacy of insurance or condemnation pro-
3 ceeds, or upon any other condition;
4 (m) Provisions for restrictions upon the severability of the interest in
5 the home from the interest in the homeowner's association. Such restric-
6 tions shall not be deemed conditions repugnant to the interest created nor
7 unlawful restraints on alienation;
8 (n) Any document, agreement or writing pertinent to the property or its
9 financing as may be attached to, incorporated in or made an exhibit to the
10 declaration and/or any bylaws;
11 (o) Such other provisions not inconsistent with this chapter as the
12 homeowner or homeowners may deem desirable in order to promote, facilitate
13 or preserve the property or the common area or the use, development or
14 administration thereof.
15 (3) Subsection (2) of this section shall not be construed as a limitation
16 upon permissible contents and provisions of a declaration.
17 55-1305. ADMINISTRATION -- BYLAWS -- ARTICLES OF INCORPORATION -- RECOR-
18 DATION REQUIRED TO MODIFY OR AMEND. The administration of every homeowner's
19 association shall be governed by bylaws, which may either be embodied in the
20 declaration or in a separate instrument, which shall be recorded with the dec-
21 laration. If a domestic corporation is formed and designated by the homeowner
22 or homeowners to be the management body, the homeowner or homeowners shall
23 append to and record with the declaration a certified copy of its articles of
24 incorporation from which it must appear: (1) that the purpose for which such
25 corporation was formed and its powers are consistent with the provisions of
26 this chapter; and (2) that the members or stockholders of the corporation must
27 be and remain owners of homes within the property and include all owners of
28 homes within the property. No modification or amendment of the declaration, of
29 such articles or of recorded bylaws shall be effective until the same is
30 recorded in the county where the original document was first recorded.
31 55-1306. CONTENTS OF BYLAWS. The bylaws referred to in section 55-1305,
32 Idaho Code, when required, shall provide for at least the following:
33 (1) The election from among the homeowners of a board of managers, the
34 number of persons constituting such board, and that the terms of at least one-
35 third (1/3) of the members of the board shall expire annually; the powers and
36 duties of the board; the compensation, if any, of the members of the board;
37 the method of removal from office of members of the board; and whether or not
38 the board may engage the services of a manager or managing agent.
39 (2) Method of calling meetings of the homeowners; what percentage of the
40 homeowners, if other than a majority, shall constitute a quorum.
41 (3) Election of a president from among the board of managers, who shall
42 preside over the meetings of the board of managers and of the homeowners.
43 (4) Election of a secretary, who shall keep the minutes of all meetings
44 of the board of managers and of the homeowners and who shall, in general, per-
45 form all the duties incident to the office of secretary.
46 (5) Election of a treasurer, who shall keep the financial records and
47 books of account.
48 (6) Maintenance, repair and replacement of the common elements and pay-
49 ments therefor, including the method of approving payment vouchers.
50 (7) Method of estimating the amount of the annual budget, and the manner
51 of assessing and collecting from the homeowners their respective shares of
52 such estimated expenses, and of any other expenses lawfully agreed upon.
53 (8) That upon ten (10) days' notice to the manager or board of managers
5
1 and payment of a reasonable fee, any homeowner shall be furnished a statement
2 of his or her account setting forth the amount of any unpaid assessments or
3 other charges due and owing from such owner.
4 (9) Designation and removal of personnel necessary for the maintenance,
5 repair and replacement of the common elements.
6 (10) Such restrictions on, and requirements respecting the use and mainte-
7 nance of, the homes and the use of the common areas, not set forth in the dec-
8 laration, as are designed to prevent unreasonable interference with the use of
9 their respective homes and of the common areas by the several homeowners.
10 (11) Method of adopting and of amending administrative rules and regula-
11 tions governing the operation and use of the common areas.
12 (12) The percentage of votes required to modify or amend the bylaws, but
13 each one (1) of the particulars set forth in this section shall always be
14 embodied in the bylaws.
15 55-1307. RECORDATION OF INSTRUMENTS AFFECTING PROPERTY. The declaration,
16 plat or plats, deeds, bylaws, administrative provisions, articles of incorpo-
17 ration as provided in section 55-1305, Idaho Code, any instrument by which the
18 provisions of this chapter may be waived, and every instrument affecting the
19 homeowner's association and any amendment or amendments to such documents,
20 shall be entitled to be recorded by the county recorder in the county or coun-
21 ties where the property is located, and such official shall accept the same
22 for recordation when requested to do so.
23 55-1308. REMOVAL OF PROPERTY FROM LAW -- COMMON OWNERSHIP -- RESUBMIS-
24 SION. Unless otherwise provided in the declaration, a portion or all of the
25 common area may be removed from the provisions of this chapter by a vote or
26 written consent of the homeowners owning at least a two-thirds (2/3) interest
27 in the homeowner's association, and by filing for record in the county where
28 the property is located a written instrument signed and acknowledged by such
29 owners wherein it is stated that such described property is so withdrawn, pro-
30 vided, holders of all liens affecting any of the homes or the common area must
31 consent or agree thereto in writing by recorded written instrument in which
32 event their liens shall be deemed forthwith, and without change of seniority,
33 transferred: (1) to the former homeowner's undivided interest in the property
34 as hereinafter provided if such lien was upon a home; and (2) upon the entire
35 property if the lien was specifically upon the common areas or the property as
36 a whole and not upon any particular home or homes; provided further, however,
37 nothing herein contained shall be construed to restrict the right to limit,
38 prohibit or make other provisions respecting withdrawal from this chapter by
39 provision in the declaration. Removal of a common area from the provisions of
40 this chapter shall in no way bar the subsequent resubmission of the property
41 to the provisions of this chapter.
42 55-1309. ACTIONS RELATING TO COMMON AREAS -- PERSONS DESIGNATED TO RECEIVE
43 PROCESS -- NEW DESIGNATION FILED -- SERVICE ON AUDITOR -- COPY FROM AUDITOR TO
44 MANAGEMENT BODY. In the case of unincorporated homeowner's associations, at
45 the time the declaration is recorded one (1) or more persons shall be desig-
46 nated to receive service of process in any action relating to the common areas
47 and facilities. Such designation shall be filed with the county auditor in the
48 county in which the property is located together with an acknowledgment in
49 writing of acceptance of such designation by the person so designated. The
50 person so designated shall be a resident of the state of Idaho, and service
51 upon such person shall be the exclusive method of service in any action relat-
52 ing to the common areas and facilities. Upon termination of such person's
6
1 capacity or authority to receive service, a new designation shall be made by
2 the management body of the project, and such designation shall be filed with
3 the county auditor in the county in which the project is located together with
4 an acknowledgment in writing of acceptance of such designation by the person
5 so designated.
6 55-1310. ACTIONS BY MANAGEMENT ON BEHALF OF TWO OR MORE OWNERS. Without
7 limiting the rights of any property owner, actions may be brought by the man-
8 agement body on behalf of two (2) or more of the homeowners with respect to
9 any cause of action relating to the common areas or more than one (1) home.
10 55-1311. SEPARATE TAXATION -- LIEN -- TAX DEED. (1) Notwithstanding any
11 contrary or inconsistent provision of the Idaho Code or of this chapter, prop-
12 erty taxes, assessments, special assessments, and all special taxes or charges
13 of the state of Idaho or of any political subdivision thereof, or other lawful
14 taxing or assessing body, which are authorized by law to be assessed against
15 or levied upon real or personal property shall be assessed against and levied
16 upon each home and not upon the group of homes as a whole, and such tax,
17 assessment or charge on each such home shall constitute a lien solely thereon.
18 (2) A person acquiring or entitled to the issuance of a tax deed convey-
19 ing the interest of any homeowner, shall acquire only an interest subject to
20 such provisions of this chapter as may be applicable, and subject to all law-
21 ful terms, provisions, covenants, conditions, and limitations which may apply
22 thereto and appear in any recorded declaration, plat, deed or bylaws then in
23 force and affecting such interest.
24 55-1312. OWNERS PROPORTIONATELY LIABLE FOR COMMON AREAS -- REMAINING BAL-
25 ANCE NOT PREJUDICED BY SETTLEMENT -- INDEMNIFICATION. Each homeowner's liabil-
26 ity for claims, judgments or awards arising out of or in connection with the
27 ownership, use, operation or management of the common areas, is limited to a
28 proportionate sum which equals the amount of any such claim, judgment or award
29 multiplied by the homeowner's percentage interest in the homeowner's associa-
30 tion. In any suit to establish liability for claims, judgments or awards aris-
31 ing out of or in connection with the ownership, use, operation or management
32 of the common areas there shall be introduced no evidence as to the percentage
33 interest in the homeowner's association of any homeowner until and unless such
34 fact becomes material and liability is fixed by judgment or agreed upon in
35 writing signed by all affected parties to the litigation and filed with the
36 court. Any homeowner may compromise or settle his portion of any such claim
37 without prejudice to the remaining balance thereof and without the same con-
38 stituting evidence or an admission for or against any such claimant. The pro-
39 visions of this section shall not alter or affect the respective rights and
40 obligations of homeowners to or between one another to the extent that one (1)
41 or more may have any legal right arising from contract, statute, or the common
42 law to be wholly or partially indemnified by one (1) or more other persons who
43 are likewise owners of homes within the same homeowner's association.
44 55-1313. LIABILITY OF HOMEOWNERS, TENANTS, EMPLOYEES -- DUTIES AND POWERS
45 OF OWNERS. All homeowners, tenants of such owners, employees of owners and
46 tenants, or any other persons that may in any manner use property or any part
47 thereof submitted to the provisions of this chapter shall be subject to this
48 chapter and to the declaration and bylaws of the homeowner's association
49 adopted pursuant to the provisions of this chapter. All agreements, decisions
50 and determinations lawfully made by the management body shall be deemed to be
51 binding on all homeowners and shall inure to the benefit of all such owners.
7
1 Each homeowner and any group of owners shall have standing and authority,
2 unless otherwise provided, to enforce the provisions of the declaration and
3 any recorded bylaws of the homeowner's association.
4 55-1314. ASSESSMENT AND OTHER CHARGES A LIEN -- NOTICE RECORDED -- PAY-
5 MENT AND RELEASE -- PRIORITY OF LIENS -- EXPIRATION -- EXTENSION -- ENFORCE-
6 MENT BY SALE -- PURCHASE BY MANAGEMENT BODY. An assessment upon any home made
7 in accordance with the declaration, any recorded bylaws, or any duly promul-
8 gated project regulation, shall be a debt of the owner thereof at the time the
9 assessment is made. The amount of any such assessment, together with those
10 other charges thereon, such as interest, costs (including attorney's fees) and
11 penalties, which may be provided for in the declaration, shall be and become a
12 lien upon the home assessed when the management body causes to be recorded
13 with the county recorder of the county in which such home is located a notice
14 of assessment, which shall state the amount of such assessment and such other
15 charges thereon as may be authorized by the declaration, a description of the
16 home against which the same has been assessed, and the name of the record
17 owner thereof. Such notice shall be signed by an authorized representative of
18 the management body or as otherwise provided in the declaration. Upon payment
19 of said assessment and charges in connection with which such notice has been
20 so recorded, or other satisfaction thereof, the management body shall cause to
21 be recorded a further notice stating the satisfaction and the release of the
22 lien thereof. Such lien shall be prior to all other liens filed or recorded
23 subsequent to the recordation of said notice of assessment except that the
24 declaration may provide for the subordination thereof to other liens either
25 generally or specifically described and except further that tax or medical
26 indigency liens or labor or materialmen's liens arising under the laws of
27 Idaho and timely and duly filed shall have priority if the date fixed by stat-
28 ute for such lien to arise is prior to recording as provided in this section.
29 Unless sooner satisfied and released or the enforcement thereof initiated as
30 hereafter provided, such lien shall expire and be of no further force or
31 effect one (1) year from the date of recordation of said notice of assessment;
32 provided however, that said one (1) year period may be extended by the manage-
33 ment body for not to exceed one (1) additional year by recording a written
34 extension thereof. Such lien may be enforced by sale by the management body,
35 its attorney or other person authorized to make the sale, after failure of the
36 owner to pay such an assessment in accordance with its terms, such sale to be
37 conducted in the manner permitted by law for the exercise of powers of sale in
38 deeds of trust or any other manner permitted by law. Unless otherwise provided
39 in the declaration, the management body shall have the power to purchase the
40 home at foreclosure sale and to hold, lease, encumber and convey the same.
41 55-1315. LIENS FOR LABOR, SERVICES OR MATERIALS -- EXPRESS CONSENT --
42 EMERGENCY REPAIRS -- PROPORTIONATE PAYMENT FOR REMOVAL OF LIEN. No labor per-
43 formed or services or materials furnished with the consent of or at the
44 request of a homeowner or his agent or his contractor or subcontractor shall
45 be the basis for the filing of a lien against the home of any other homeowner,
46 or against any part thereof, or against any other property of any other
47 homeowner, unless such other owner has expressly consented to or requested the
48 performance of such labor or furnishing of such materials or services. Such
49 express consent shall be deemed to have been given by the owner of any home in
50 the case of emergency repairs thereto. Labor performed or services or mate-
51 rials furnished for the project, if duly authorized by the management body,
52 shall be deemed to be performed or furnished with the express consent of each
53 homeowner. The owner of any home may remove his home from a lien against two
8
1 (2) or more homes or any part thereof by payment to the holder of the lien of
2 the fraction of the total sum secured by such lien which is attributable to
3 his home.
4 55-1316. "BLUE SKY LAW" INAPPLICABLE. The provisions of title 26, Idaho
5 Code, shall not apply to the creation, issuance, sale, offer for sale, solici-
6 tation of an offer to buy, conveyance, transfer, or other disposition, or
7 encumbrance or other hypothecation, or management, of homes or common areas
8 created pursuant to this chapter, or of evidences of membership in or owner-
9 ship of or stock in any entity created solely to manage the affairs of a
10 homeowner's association, or to the negotiation or taking of subscriptions in
11 respect of any of the foregoing.
STATEMENT OF PURPOSE
RS 13881C2
The purpose of this legislation is to clarify existing law
relating to the powers of planned community homeowner
associations; to provide a means of governance for planned
communities similar to condominium owner associations; to require
disclosure to homeowners; and to permit imposition of fines,
penalties and suspension of membership privileges as enforcement
measures.
FISCAL IMPACT
There are no fiscal impacts to the state or local
government.
Contact
Name: Representative Wendy Jaquet
Phone: 332-1000
STATEMENT OF PURPOSE/FISCAL NOTE H 758