Covenant & Rule Enforcement Against Tenants
“And what’s worse, (or – I’m not surprised,) they are not even owners!” Common are perceptions among board members and managers, not only that tenants violate use restrictions more frequently (than do owners), but also that that an association’s remedies to address tenant conduct are limited. While the debate about bad owners vs. bad tenants continues (and will not be addressed in the following paragraphs), tenant occupancy should present no obstacle to enforcement.
At the outset, the importance of consistent, methodical and timely rule enforcement cannot be overstated. Ignoring minor violations, deviating from procedures (written notices, cure periods, right to appeal), and delaying action, can each result in allegations of arbitrary enforcement – and can thus render compliance unachievable. It is therefore recommended that enforcement decisions be made in a uniform manner, and that a violator’s status of tenant or owner be given little relevance.
Tenants are vested with no greater privileges than are owners. Accordingly, rules and restrictions which apply to the owner of a unit similarly apply to the occupant or tenant. And, while a tenant did not “sign on” to the governing documents in the same way as the owner did by taking title to the unit, a lease cannot grant rights beyond those vested in the landlord (the owner). Most modern documents expressly address this issue; examples of typical lease restrictions are the following:
• No Owner shall be permitted to lease his Unit unless the Owner has complied with the relevant provisions of this Declaration, the Bylaws and any applicable rules and regulations.
• Each lease shall be in writing and shall provide that the terms of the lease shall be subject in all respects to the provisions of the Act, this Declaration, the Bylaws and the rules and regulations of the Association, and that any failure by the lessee to comply with the terms of such documents shall be an event of default under the lease. The Association shall be a third-party beneficiary of such covenants in any lease and shall have the right to enforce them.
• All leases shall provide that the lessee shall be subject in all respects to the provisions of this Declaration, the Bylaws and any rules and regulations of the Association as may be promulgated from time to time by the Executive Board.
• The leasing of a Unit shall not affect the liability of the Owner with respect to his obligations under this Declaration, the Bylaws and any rules and regulations of the Association.
• In the event the Owner shall fail to pay any charge or Assessment levied by the Executive Board against a leased Unit, and this failure to pay continues for sixty (60) days, the Executive Board shall notify the lessee of the Unit in writing of the amount(s) due and, within fifteen (15) days after the date of the notice, the lessee shall pay to the Executive Board the amount(s) of all unpaid charges or Assessments, subject, however, to Subsection (h) hereof. The amounts of unpaid charges or Assessments paid to the Executive Board by the lessee after the nonpayment by the Owner shall be a credited against and shall offset the next monthly rental installment due to the Owner from the lessee following the payment by the lessee of the charges or Assessments to the Executive Board.
• In no event shall the lessee be responsible to the Executive Board for any amount of unpaid charges or Assessments during any one month in excess of one monthly rental installment.
While having such provisions in a declaration is always preferred, boards should confer with legal counsel to determine whether implementing similar requirements by rule or amendment is necessary. In any event, whether already contained in existing documents (in one form or another) or adopted by rule or amendment, these provisions vest associations with significant enforcement powers to address delinquencies and violations related to tenant occupied units.
Owners and tenants can additionally be reminded of the remedies and procedures in mandatory lease addenda and registration forms. More than merely satisfying census and documentation requirements, these forms put tenants (and owners) on notice of the benefits and restrictions of the association-controlled community (and serve as a reminder that they are part of it). Once in place, the remedies of enforcement include the following:
• Informal rent garnishment (collection of monthly rent from a tenant to satisfy an owner’s assessment delinquency)
• Application of all enforcement powers otherwise contained in the governing document (assessment of fines, suspension of privileges, legal action)
• The right of the association to enforce the lease against the tenant (including the filing of an eviction action)
Again, most important is that enforcement decisions be made uniformly and in strict compliance with existing policies and procedures. While tenant conduct adds a party to the dispute, this complication should present no bar to achieving compliance. It is true that owners are ultimately responsible for tenant conduct, including the fines and penalties levied by the association for infractions. However, tenants need (should) not be kept out of the enforcement loop. It is compliance that is sought; fines and penalties are merely levers to achieve it.
It is therefore recommended that enforcement procedures specifically address tenant conduct, and that consideration be given to the implementation of the sample policies and connected forms. A tenant’s first notice that they are living in an association should not be a violation letter. If it is, then the owner and the association have missed an opportunity. A lease addendum and registration form could mitigate this disconnect; and if it does not, then both the owner and the tenant have fully been advised of the restrictions applicable to the association, as well as of the consequences of noncompliance.
This article is not legal advice and is provided for informational purposes only. Actual legal advice can only be provided after consultation by an attorney licensed in your jurisdiction.