When one wrong decision can set an unfavorable precedent for years to come, establishing clear guidelines becomes critically important

We've spoken to many board members about rewriting or amending their governing documents, but the question of whether to include the right to grant hardship exemptions can be a tough one. Most of these boards have wanted some flexibility for exemptions regarding the lease or sale of units, conducting maintenance, or making certain alterations to units or common areas.

Avoid setting a problematic precedent

When an exception is granted without a specific process, it may establish a precedent that can prove problematic in the future. Once an exemption is granted, for example, it becomes more difficult to enforce restrictions in the future. If your governing documents do not specifically mention that your board has a right to grant an exemption, you should probably avoid doing so until your board can determine whether these items should be written into your governing documents.

The subjective nature of hardship and its definition can make it difficult for a board to determine whether they should or shouldn't grant the exemption. If your governing documents do give the board authority to grant hardship exemptions, consult your legal counsel to determine whether the pros of granting outweigh the cons.

Set specific guidelines to avoid subjectivity

A governing document that specifically outlines whether hardship exemptions may be granted and if so, under which circumstances, can help your board make fair, across-the-board decisions that don't raise issues among community members concerned that some unit owners are receiving preferential treatment. Clear guidelines for hardship exemptions and defining which situations they may granted in will ultimately help reduce confusion and conflict for all.

If you'd like to discuss a knotty issue your community is having with hardship exemptions, PeytonBolin's experienced association attorneys can help eliminate the confusion and guesswork. Contact us today to get started!