As a board member for a condominium or homeowners’ association, understanding the importance of a well written contract for service agreements and capital improvement projects is key. Contracts without specific terms and conditions and a clear scope of work usually mean a recipe for misunderstandings between both the board and the contractor or vendor. It is more cost effective overall to have contracts reviewed by legal counsel before any documents are signed, than it is after the fact only to find in some instances, the association has little or no recourse against the contractor or vendor.

     Contractors and vendors typically produce a simple one-page document for the board to sign providing a general cost of the work and vague description of the work to be completed. Those one-page documents are referred to as “proposals” rather than contracts. The contract should contain the correct name of the association, the complete name of the vendor/contractor, the contact information for both parties, a start date, completion date or time period, indemnification provisions, notice of default, confidentiality provisions (in some instances), cost of the work to be performed, a payment schedule, general default provisions, warranty provisions, a detailed scope of work, and other important details which should be in writing and clear to both the association and vendor/contractor.

     If you have a proposal for a capital improvement project or service agreement, our recommendation is to have the proposal reviewed by one of the attorneys at Williams & Strohm, LLC, in order to protect the association as much as possible against any misunderstandings and disputes with a contractor or vendor. As Jesse Kanitz, Esq., stated in his May 2022 blog about contracts, “An Ounce of Prevention is Worth a Pound of Cure”.

CTA Update

            The Corporate Transparency Act reporting requirement for all board members of condominium and homeowners’ associations remains in effect and the deadline for reporting is January 1, 2025, for most associations. Recently in September, Community Associations Institute (CAI) filed a lawsuit in federal court in Virginia requesting the CTA requirement for reporting be eliminated with respect to community association board members. A hearing was held on October 11^th regarding a preliminary injunction seeking an order from the court delaying the reporting requirement while the lawsuit remains pending. Unfortunately, the court did not rule in CAI’s favor and the reporting requirement still remains in place with the deadline remaining January 1, 2025. We will continue to monitor the case filed by CAI and other pending cases with other federal jurisdictions and continue to provide updates on the CTA from time to time.

If you have questions or need more information about the CTA and reporting requirements, please reach out to one of our attorneys at: (614) 228-0207.