An Omaha condominium unit owner says that he or she has been paying assessments for years, but notwithstanding that, the Association doesn’t have any funds to make repairs to the common elements of the condominium. In one particular lawsuit filed in Omaha in 2019, the Association told the owner that it didn’t have funds to make repairs to the foundation and exterior walls of the condominium. Notwithstanding the fact that the owner had been paying assessments for years. Other owners had also been paying those assessments and this work was not being done.
This is a very typical situation. Some condominium Association directors refuse to permit assessments to increase as is necessary to conduct ordinary and long-term repairs. This results in diminishing values for the entire property. Even though an owner might maintain his or her unit in good condition, the common elements of the condominium are not maintained and deteriorate. As a result, the value of all condominium units plummet.
How can a condominium unit owner force the Board of the condominium Association to conduct these repairs and increase assessments so that there are funds to conduct those repairs? The answer lies both in the Nebraska Condominium Act and the Nebraska Non-Profit Corporation Act.
Pursuant to the Nebraska Condominium Act, the condominium Association and the Board of Directors of the condominium Association are responsible for the maintenance, repair, and replacement of the common elements.
Pursuant to the Nebraska Non-Profit Corporation Act, a director of a non-profit corporation (and a condominium Association is a non-profit corporation) must:
- Discharge his or her duties in good faith;
- With the care an ordinarily prudent person would exercise; and
- In a manner he or she reasonably believes to be in the best interest of the corporation (that is, the condominium Association).
As a result, the failure of the Board of Directors to conduct these repairs, and keep assessments high enough to conduct such repairs, violates all three of these requirements. By failing to conduct the repairs, and to save sufficient funds to conduct such repairs, the Directors of the condominium Association will be personally liable for any damage (including reduction in value) caused by the failure to conduct such repairs.
Therefore, an owner, whether on the Board or not, must notify the Board of the condominium Association that it is obligated to maintain the common areas and have assessments high enough to fund such repairs.