Court of Appeals Victory for HindmanSanchez
The Colorado Court of Appeals has just issued a decision concerning the Court approved document amendment process which should be helpful for many associations across Colorado. The Court of Appeals adopted a broad definition of the type of communities which are entitled to use this Court petition process.
In 1999, the Colorado General Assembly amended the CCIOA statute to allow associations to apply to the District Court to approve an amendment to the declaration in situations where the community could not muster the necessary votes to amend through a normal voting process. The statute requires that the proposed amendment be approved by at least 50% of the votes necessary to adopt the proposed amendments. If the petition meets all of the statutory conditions, and no more than 33% of the unit owners file written objections to the proposed amendments, the amendment is approved by the Court. This statute allows communities to update old and out of date declarations in situations where apathy prevents the community from getting the votes of 67% of the unit owners, which is what is normally required. The statute applies to all common interest communities in Colorado.
In a recent case handled by William H. Short of HindmanSanchez, Hiwan Homeowners Association v. Knotts (Hiwan), the issue presented to the Court of Appeals was whether the Hiwan community satisfied the statutory definition of a "common interest community". Hiwan's covenants provided for mandatory assessments which were utilized to improve and enhance the community through forest fire mitigation plans, community cleanups and covenant enforcement actions. Hiwan is a single-family home community which does not have any common elements. The appeal focused on whether a community which did not have commonly owned property or common elements was a common interest community. The Court of Appeals found that definition of common interest community is very broad, and merely requires that the assessments be utilized for the improvement and maintenance of "other real estate". The Court of Appeals held that improvement, maintenance and betterment of lots within the community via fire mitigation plan, clean-ups and covenant enforcement satisfied the statutory definition.
The Hiwan decision will be important for many older communities which may not have common elements, but which want to update and improve their governing documents. If you would like to discuss the applicability of this case to your community, feel free to call one of our attorneys at 303.432.9999.
In 1999, the Colorado General Assembly amended the CCIOA statute to allow associations to apply to the District Court to approve an amendment to the declaration in situations where the community could not muster the necessary votes to amend through a normal voting process. The statute requires that the proposed amendment be approved by at least 50% of the votes necessary to adopt the proposed amendments. If the petition meets all of the statutory conditions, and no more than 33% of the unit owners file written objections to the proposed amendments, the amendment is approved by the Court. This statute allows communities to update old and out of date declarations in situations where apathy prevents the community from getting the votes of 67% of the unit owners, which is what is normally required. The statute applies to all common interest communities in Colorado.
In a recent case handled by William H. Short of HindmanSanchez, Hiwan Homeowners Association v. Knotts (Hiwan), the issue presented to the Court of Appeals was whether the Hiwan community satisfied the statutory definition of a "common interest community". Hiwan's covenants provided for mandatory assessments which were utilized to improve and enhance the community through forest fire mitigation plans, community cleanups and covenant enforcement actions. Hiwan is a single-family home community which does not have any common elements. The appeal focused on whether a community which did not have commonly owned property or common elements was a common interest community. The Court of Appeals found that definition of common interest community is very broad, and merely requires that the assessments be utilized for the improvement and maintenance of "other real estate". The Court of Appeals held that improvement, maintenance and betterment of lots within the community via fire mitigation plan, clean-ups and covenant enforcement satisfied the statutory definition.
The Hiwan decision will be important for many older communities which may not have common elements, but which want to update and improve their governing documents. If you would like to discuss the applicability of this case to your community, feel free to call one of our attorneys at 303.432.9999.
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