Engineering report lacks repair path for board

 
Posted4/2/2022 7:00 AM

Q. An engineer inspected the balconies in our association, built in the 1980s. The engineer's report was rather sparse. The report concludes there are construction defects with the spindles of the balconies that need to be corrected. Is there something we should be asking the engineer?

A. The phrase "construction defect" can refer to a variety of issues. The engineer needs to be more specific. For example, does the construction of the balconies deviate from the building code that was in place at the time the balconies were constructed, as opposed to current code requirements? Does the construction deviate from the approved building plans? Or, is there some sort of design defect? The responses to these questions will assist the board in determining its responsibility to correct the issue.

 

Q. An owner in our condominium has requested a current listing of the names, addresses, email addresses, telephone numbers and weighted vote of all members entitled to vote. Are there restrictions as to what this information can be used for, and can the association require an owner to sign a confidentiality agreement when they are provided this?

A. Under Section 19(a)(7) of the Illinois Condominium Property Act, an owner may examine and copy the names, addresses, email addresses, telephone numbers and weighted vote of all members entitled to vote.

A member of the association has the right to inspect, examine and make copies of those records, but only for a purpose that relates to the association. As a condition for exercising this right, the board of managers or authorized agent of the association may require the member to certify in writing that the information contained in the records obtained by the member will not be used by the member for any commercial purpose or for any purpose that does not relate to the association. "Commercial purpose" means the use of any part of such record, or information derived from such records, in any form for sale, resale or solicitation or advertisement for sales or services.

In addition to obtaining such a certification, many associations require the owner to sign a nondisclosure agreement. I do not view requiring a confidentiality agreement, under these circumstances, as unreasonable. That is, just because a particular owner is entitled to the requested records does not mean another owner would be.

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Do note that condominiums located in the city of Chicago are not subject to the same broad disclosure requirements as set forth in Section 19(a)(7) of the Act. This is because Chicago enacted an ordinance to limit the availability of this information under its "home rule" authority.

Q. Our condominium association is not FHA approved. Can a prospective purchaser of a unit still get an FHA loan to purchase a unit in the association? I have received conflicting information about this.

A. A Federal Housing Authority loan is a government backed mortgage loan. FHA does allow for what was formerly referred to as "spot approval." The FHA Single Unit Approval program was started in late 2019. The FHA Single Unit Approval program, which was formerly known as Spot Approval, does allow an FHA mortgage to fund a single unit loan in an association, without the association itself having to obtain FHA certification.

To be eligible for Single Unit Approval, the unit must be located in a project that is not FHA approved, the unit must be complete and ready for occupancy, and the association must have at least five dwelling units. The project must also meet certain requirements regarding FHA insurance concentration guidelines, owner-occupancy percentage and financial condition of the project, to be eligible for FHA Single Unit Approval.

• 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.

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