Boards can withhold bid documents from owners
Q. I have requested copies of the competing bids for work in my condominium association from time to time. I received copies of bids for one project in response to my first request. However, the board refused to provide copies of competing bids for any other projects, since I questioned the selection of the highest bidder on a prior project over the lowest bidder. While I can see the law does not specifically list competing bids as a document the board must provide me, can the board legally withhold providing me copies of bids?
A. The board is required to make available for inspection and copying, when requested in writing and for a proper purpose, various books and records including "all contracts, leases and other agreements then in effect to which the association is a party or under which the association or the unit owners have obligations or liabilities." This is set out in Section 19(a)(6) of the Condominium Property Act.
"Bids" are not among the records and contracts required to be made available to owners for examination and copying. Therefore, it would be within the discretion of the board to provide or withhold these bid documents from owners.
As a side note, the lowest bid is not necessarily the best bid, and the highest bid may be. Attendance at the board meeting where the board considers the various bids would likely provide valuable insight into the board's decision, and as to why it favored one bid over the others.
Q. The contract between the management firm and our homeowners association requires the agent to solicit written cost estimates from at least three contractors or suppliers for any work item of $5,000 or more. On several occasions during the past two years the manager has failed to obtain the required minimum number of bids for qualifying work or service. What recourse, if any, do we have with the management firm?
A. The management company's actions would constitute a breach of the described provision of the management agreement. However, a couple of issues come to mind. Was this a simple oversight that if brought to the attention of the manager would be corrected going forward? If so, that would be the preferred resolution, particularly if there are no other significant issues with the management company. Many issues between an association and its managing agent can be favorably resolved through good communication.
Or, has this been problem been brought to the manager's attention, and the provision of the agreement continues to be ignored? This could be grounds for the association to terminate the management agreement. The management agreement would have to be reviewed to determine what is required to terminate the agreement for cause. A typical provision would require that management be given written notice of the breach, and fail to cure the breach within some stated time period, before an association could terminate for cause. Of course, a provision in the agreement that permits termination without cause could be invoked as well.
Q. In one of your articles, you mentioned that a "board can terminate the lease between the owner and the tenant. This is permitted for any violation of the association's declaration, bylaws or rules by the tenant. The lease is terminated by the issuance of a 10-day notice of termination." I was wondering if an association can use this remedy if the tenant is a Section 8 voucher holder?
A. Yes. Section 8 voucher holders are in general subject to the same eviction process, permitted to be used by a condominium association under Section 18(n) of the Condominium Property Act, as any tenant of a condominium unit in Illinois.
• 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.