2019 -- H 5756

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LC000479

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2019

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A N   A C T

RELATING TO PROPERTY -- CONDOMINIUM LAW -- MANAGEMENT CONTRACTS

     Introduced By: Representatives Solomon, Casey, Johnston, Vella-Wilkinson, and
O'Brien

     Date Introduced: February 27, 2019

     Referred To: House Judiciary

     It is enacted by the General Assembly as follows:

     SECTION 1. Section 34-36.1-3.2 of the General Laws in Chapter 34-36.1 entitled

"Condominium Law" is hereby amended to read as follows:

     34-36.1-3.02. Powers of unit owners' association.

     (a) Except as provided in subsection (b), and subject to the provisions of the declaration,

the association, even if unincorporated, may:

     (1) Adopt and amend bylaws and rules and regulations;

     (2) Adopt and amend budgets for revenues, expenditures, and reserves and collect

assessments for common expenses from unit owners;

     (3) Hire and discharge managing agents and other employees, agents and independent

contractors;

     (4) Institute, defend, or intervene in litigation or administrative proceedings in its own

name on behalf of itself or two (2) or more unit owners on matters affecting the condominium;

     (5) Make contracts and incur liabilities; provided, however, that any property

management company or agent retained by the association under contract to provide

condominium management services, including the control of or disbursement of funds of the

association, shall maintain an "acts or omissions" or "fidelity bond" insurance policy in effect

with respect to the fiduciary relationship between the management agent and condominium

association. The officers of the unit owners' association shall be personally liable for their failure

to ensure such a policy is in place.

     (6) Regulate the use, maintenance, repair, replacement and modification of common

elements;

     (7) Cause additional improvements to be made as a part of the common elements;

     (8) Acquire, hold, encumber, and convey in its own name any right, title or interest to real

or personal property, but common elements may be conveyed or subjected to a security interest or

mortgage only pursuant to § 34-36.1-3.12;

     (9) Grant easements, leases, licenses and concessions through or over the common

elements;

     (10) Impose and receive any payments, fees, or charges for the use, rental, or operation of

the common elements other than limited common elements described in § 34-36.1-2.02(2) and (4)

and for services provided to unit owners;

     (11) Impose charges for late payment of assessments and, after notice and an opportunity

to be heard, levy reasonable fines for violations of the declaration, bylaws, and rules and

regulations of the association as provided in § 34-36.1-3.20;

     (12) Impose reasonable charges for the preparation and recordation of amendments to the

declaration, resale certificates required by § 34-36.1-4.09 or statements of unpaid assessments;

     (13) Provide for the indemnification of its officers and executive board and maintain

directors' and officers' liability insurance;

     (14) Borrow funds including the right to assign and/or pledge its right to future income,

including the right to receive common expense assessments;

     (15) Exercise any other powers conferred by the declaration or bylaws;

     (16) Exercise all other powers that may be exercised in this state by legal entities of the

same type as the association; and

     (17) Exercise any other powers necessary and proper for the governance and operation of

the association.

     (b) The declaration may not impose limitations on the powers of the association to deal

with the declarant that are more restrictive than the limitations imposed on the power of the

association to deal with other persons.

     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO PROPERTY -- CONDOMINIUM LAW -- MANAGEMENT CONTRACTS

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     This act would require condominium unit owners' association officers to verify that

management agents or companies retained by the association are insured with respect to the

services they provide to the condominium.

     This act would take effect upon passage.

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