WHAT ARE CATEGORY ONE AND CATEGORY TWO RESTRICTIONS?

Over the past two weeks, we have been discussing the power and authority of Boards to pass rules and regulations.  We discussed the fact that a board may have gone too far in making a rule as they really did an unauthorized amendment to the declaration.  The question for today’s blog is what makes the rule or amendment enforceable in either an arbitration proceeding or a court of law?

In dealing with these issues, the courts have set some guidelines.  There are essentially two categories of cases in which a condominium association attempts to enforce rules of restrictive uses. The first category is that dealing with the validity of restrictions found in the declaration of condominium itself. (A Category One Restriction)  The declaration, which some courts have referred to as the condominium’s “constitution,” strictly governs the relationships among the condominium unit owners and the condominium association. As explained by the court in Pepe v. Whispering Sands Condominium Ass’n, Inc., 351 So.2d 755 (Fla. 2d DCA 1977):

A declaration of a condominium is more than a mere contract spelling out mutual rights and obligations of the parties thereto-it assumes some of the attributes of a covenant running with the land, circumscribing the extent and limits of the enjoyment and use of real property. Stated otherwise, it spells out the true extent of the purchased, and thus granted, use interest therein. Absent consent, or an amendment of the declaration of condominium as may be provided for in such declaration, or as may be provided by statute in the absence of such a provision, this enjoyment and use cannot be impaired or diminished.

In the first category, the restrictions are clothed with a very strong presumption of validity which arises from the fact that each individual unit owner purchases his unit knowing of and accepting the restrictions to be imposed. Such restrictions are very much in the nature of covenants running with the land and they will not be invalidated absent a showing that they are wholly arbitrary in their application, in violation of public policy, or that they abrogate some fundamental constitutional right. See White Egret Condominium, Inc. v. Franklin, 379 So.2d 346 (Fla.1979).

The second category of cases involves the validity of rules promulgated by the association’s board of directors or the refusal of the board of directors to allow a particular use when the board is invested with the power to grant or deny a particular use. (A Category Two Restriction)

Often times, associations are faced with making a decision as to whether a particular policy that the Board wants to impose must be accomplished by way of an amendment to the declaration or by board-made rule.  As you can see, the safer alternative is always an amendment to the governing documents should a legal challenge be made.

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