2024 -- S 2645

========

LC005357

========

     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2024

____________

A N   A C T

RELATING TO PROPERTY -- CONDOMINIUM LAW

     Introduced By: Senators McKenney, and Raptakis

     Date Introduced: March 01, 2024

     Referred To: Senate Housing & Municipal Government

     It is enacted by the General Assembly as follows:

     SECTION 1. Sections 34-36.1-1.2 and 34-36.1-3.3 of the General Laws in Chapter 34-36.1

entitled "Condominium Law" are hereby amended to read as follows:

     34-36.1-1.02. Applicability.

     (a)(1) This chapter applies to all condominiums created within this state after July 1, 1982,

except that any condominium created within this state prior to July 1, 1982, may voluntarily accept

the provisions of this chapter in lieu of the provisions under which it was originally organized.

Acceptance shall be evidenced by an agreement in writing executed by and in behalf of the

condominium association and by all of the owners of all of the individual condominium units within

the condominium, in which agreement it is clearly stated that they all accept the provisions of this

chapter in lieu of those in the statute under which the condominium was organized and wish to be

governed in the future by the provisions of this chapter. The agreement shall be recorded in the

land evidence records of each and every town or city where all or any part of the land in the

condominium concerned may be located and shall become effective when first so recorded. The

acceptance shall only apply to the governance of the condominium concerned as to all matters

which are prospective or executory in nature; and nothing herein shall be deemed to abrogate,

amend, limit, effect, or impair the continued effectiveness, legality, or validity of all actions

lawfully taken by or in behalf of the condominium prior to the effective date of the acceptance,

including, but without limitation, the condominium declaration and all amendments thereto, the by-

laws of the condominium and/or of its association, all deeds, mortgages, leases and any further

documents affecting the titles or rights of unit owners, or of the condominium or the prior lawful

acts or deeds of any kind, of the condominium association, its officers, directors, or members.

     (2) Sections 34-36.1-1.05 (separate titles and taxation), 34-36.1-1.06 (applicability of local

ordinances, regulations, and building codes), 34-36.1-1.07 (eminent domain), 34-36.1-2.03

(construction and validity of declaration and bylaws), 34-36.1-2.04 (description of units), 34-36.1-

3.02(a)(1) — (6) and (11) — (17) (powers of unit owners’ association), 34-36.1-3.03 (executive

board members and officers), 34-36.1-3.11 (tort and contract liability), 34-36.1-3.16 (lien for

assessments), 34-36.1-3.18 (association records), 34-36.1-4.09 (resale of units), and 34-36.1-4.17

(effect of violation on rights of action; attorney’s fees), § 34-36.1-3.20 (enforcement of declaration,

bylaws and rules), and 34-36.1-1.03 (definitions), to the extent necessary in construing any of those

sections, apply to all condominiums created in this state before July 1, 1982; but those sections

apply only with respect to events and circumstances occurring after July 1, 1982 and do not

invalidate existing provisions of the declaration, bylaws, plats, or plans of those condominiums.

     (3) A condominium created as an additional phase by amendment of a condominium

created prior to July 1, 1982, if the original declaration contemplated the amendment, shall be

deemed to be a condominium created prior to July 1, 1982; provided, however, the provisions of

subdivision (a)(2) shall apply as defined therein.

     (4) Section 34-36.1-3.21 (foreclosure of condominium lien) applies, with respect to all

condominiums created in this state prior to June 19, 1991, only with respect to events and

circumstances occurring after June 18, 1991, does not invalidate existing provisions of the

declarations, bylaws, plats, or plans of those condominiums, and applies in all respects to all

condominiums created in this state after June 18, 1991.

     (b) The provisions of the Condominium Ownership Act, chapter 36 of this title, do not

apply to condominiums created after July 1, 1982 and do not invalidate any amendment to the

declaration, bylaws, plats, and plans of any condominium created before July 1, 1982 if the

amendment would be permitted by this chapter. The amendment must be adopted in conformity

with the procedures and requirements specified by those instruments and by chapter 36 of this title.

If the amendment grants to any person any rights, powers, or privileges permitted by this chapter,

all correlative obligations, liabilities, and restrictions in this chapter also apply to that person.

     (c) This chapter does not apply to condominiums or units located outside this state, but the

public offering statement provisions (§§ 34-36.1-4.02 — 34-36.1-4.07) apply to all contracts for

the disposition thereof signed in this state by any party unless exempt under § 34-36.1-4.01(b).

     34-36.1-3.03. Executive board members and officers.

     (a) Except as provided in the declaration, the bylaws, subsection (b), or in other provisions

LC005357 - Page 2 of 5

of this chapter, the executive board may act in all instances on behalf of the association. In the

performance of their duties, the officers and members of the executive board are required to

exercise:

     (1) If appointed by the declarant, the care required of fiduciaries of the unit owners; and

     (2) If elected by the unit owners, ordinary and reasonable care.

     (b) The executive board may not act on behalf of the association to amend the declaration

(§ 34-36.1-2.17), to terminate the condominium, or to elect members of the executive board or

determine the qualifications, powers and duties, or terms of office of executive board members, but

the executive board may fill vacancies in its membership for the unexpired portion of any term.

     (c)(1) Within thirty (30) days after adoption of any proposed budget for the condominium,

the executive board shall provide a summary of the budget to all the unit owners, and shall set a

date for a meeting of the unit owners to consider ratification of the budget not less than fourteen

(14) nor more than thirty (30) days after mailing of the summary. Unless at that meeting a majority

of all the unit owners or any larger vote specified in the declaration reject the budget, the budget is

ratified, whether or not a quorum is present. In the event the proposed budget is rejected, the

periodic budget last ratified by the unit owners shall be continued until such time as the unit owners

ratify a subsequent budget proposed by the executive board.

     (2) Any provision in any declaration or bylaws that limits an increase in the total amount

of any association annual assessment relative to the prior annual assessment by a percentage

amount or otherwise shall be void.

     (d)(1) Subject to subsection (e), the declaration may provide for a period of declarant

control of the association, during which period a declarant, or persons designated by him, may

appoint and remove the officers and members of the executive board. Regardless of the period

provided in the declaration, a period of declarant control terminates no later than the earlier of:

     (i) Sixty (60) days after conveyance of eighty percent (80%) of the units which may be

created to unit owners other than a declarant;

     (ii) Two (2) years after all declarants have ceased to offer units for sale in the ordinary

course of business; or

     (iii) Two (2) years after any development right to add new units was last exercised.

     (2) A declarant may voluntarily surrender the right to appoint and remove officers and

members of the executive board before terminations of that period, but in that event he or she may

require, for the duration of the period of declarant control, that specified actions of the association

or executive board, as described in a recorded instrument executed by the declarant, be approved

by the declarant before they become effective.

LC005357 - Page 3 of 5

     (e) Not later than sixty (60) days after conveyance of twenty-five percent (25%) of the units

which may be created to unit owners other than a declarant, at least one member and not less than

twenty-five percent (25%) of the members of the executive board must be elected by unit owners

other than the declarant. Not later than sixty (60) days after conveyance of fifty percent (50%) of

the units which may be created to unit owners other than a declarant, not less than one-third (⅓) of

the members of the executive board must be elected by unit owners other than the declarant.

     (f) Not later than the termination of any period of declarant control, the unit owners shall

elect an executive board of at least three (3) members, at least a majority of whom must be unit

owners. The executive board shall elect the officers. The executive board members and officers

shall take office upon election.

     (g) Notwithstanding any provision of the declaration or bylaws to the contrary, the unit

owners, by a two-thirds (⅔) vote of all persons present and entitled to vote at any meeting of the

unit owners at which a quorum is present, may remove any member of the executive board with or

without cause, other than a member appointed by the declarant.

     SECTION 2. This act shall take effect upon passage.

========

LC005357

========

LC005357 - Page 4 of 5

EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO PROPERTY -- CONDOMINIUM LAW

***

     This act would eliminate unreasonable and fiscally irresponsible constraints of budget caps

created in some condominium documents by developers to help sell units.

     This act would take effect upon passage.

========

LC005357

========

LC005357 - Page 5 of 5