Board can take action without president present
Q. I have several short questions, so I hope you can respond. Can a board call a meeting, or just the president? If the president isn't at a meeting, can the board vote to approve a special assessment? If the president isn't at a board meeting, can the board vote to hire a new management company?
A. In a condominium, special meetings of the board of managers can be called by the president, or by 25 percent of the members of the board. In a common interest community association, special meetings of the board may be called by the president, by 25 percent of the members of the board, or by any other method that is prescribed in the community instruments.
As long as a quorum of the board is present, and with proper notice, board meetings can occur, and the board may act on association business, whether or not the president is in attendance. If the president is not at the meeting, the board members present at the meeting can appoint a chairperson for the meeting. If the association's governing documents provide for the office of a vice president, the vice president would chair the meeting in the absence of the president.
Q. Is there any Illinois statute or case law on what constitutes a "leasing hardship?" My board says that because I'm not an original owner, I need a hardship to rent out my unit under the declaration. Is being "under water" sufficient? What other situations would qualify - medical, military, etc.?
A. Neither Illinois statute nor case law establishes criteria upon which the board should determine whether a hardship exists. Assuming the declaration includes a "hardship" exception to the lease restriction, and does not specifically define hardship, determining what is a hardship is generally intended to be a matter within the discretion of the board, and the criteria may change from time to time.
The declaration, or amendment to a declaration, that imposes leasing restrictions often includes a definition of, or criteria as to what constitutes, a hardship. My personal preference is to leave such details out of the declaration, and provide for the adoption of rules on the issue. This is because what constitutes a hardship may change from time to time, and it is certainly easier to amend rules than the declaration.
In the absence of language in the declaration as to what constitutes a hardship, it would typically be appropriate for the board to prepare and adopt rules to address the criteria upon which the hardship request would be considered. The following are examples of the types of hardships, but by no means exclusive, that a board could consider: sudden transfer of a unit owner to a new job location requiring the lease of the unit on a temporary basis; or, if illness of the unit owner or a relative requires a temporary absence; or, if an owner is a soldier and deployed for training or a tour of duty; or, if a resident is in a rehabilitation facility for an extended period of time.
The common thread here is temporary absence of the owner with the intent to return to the unit. However, I have seen a growing number of associations grant a hardship exception in this current real estate market (when they would not have done so in the past) if the owner has purchased a new home but is having difficulty selling their unit through a broker and if it is reasonably priced, or, for example, if the owner gets married, divorced or dies. Being "under water" could be considered by the board if the alternative to leasing is a foreclosure, resulting in a potentially below-market sale of the unit by the lender after the foreclosure.
• David M. Bendoff is an attorney with Kovitz Shifrin Nesbit in the Chicago suburbs. Send questions for the column to him at CondoTalk@ksnlaw.com. The firm provides legal service to condominium, townhouse, homeowner associations and housing cooperatives. This column is not a substitute for consultation with legal counsel.