It's a common enough story: the condominium was relatively new, but from the start its board of directors was stingy with maintenance and repair dollars. Then the recession struck, and a large percentage of unpaid maintenance fees spiked.
After several years of neglected physical facilities, half the condo's elevators weren’t working. Unpainted interior hallways and uncleaned carpeting and tile encouraged mold and mildew growth. Utility bills went unpaid for so long that the electric company threatened to cut off the power, and garbage collection was sporadic. Due to mismanaged collections and finances, the community was on the verge of bankruptcy.
In such a situation, “The board has to put on some pants and pass a special assessment to take care of things,” says Maria C. Upthegrove, manager of Paradise Pointe Condominium Association, Inc., near Cutler Bay in southwest Miami-Dade County. Not fixing things for which money isn’t available “is not an unreasonable position,” she says, “but that doesn’t relieve the board of liability.”
Liability also concerns Jonathan Louis, chief executive officer of American Management Group, LLC, in Pembroke Pines. “When doing upgrades, replacement, or repairs, prolonging something that could affect life safety is never an option,” he says. “A board does not want to be found grossly negligent or not fulfilling its fiduciary responsibility. If that happens, they lose some of their shield with respect to liability.”
At the top of everyone’s maintenance list should be life-safety items for which code violations could prompt steep fines from a government inspector, or even closure of a building. Steven Cohen, vice president for operations at A&N Management, Inc., in Boca Raton says this category includes elevators, fire extinguishers, sprinkler systems, smoke alarms, carbon monoxide detectors, and painting of curb corners to meet fire-marshal requirements. “All must receive annual maintenance,” he says.