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7 LONG TITLE
8 General Description:
9 This bill amends provisions related to condominium and community associations.
10 Highlighted Provisions:
11 This bill:
12 ▸ defines terms;
13 ▸ provides that an unconstructed unit is allocated:
14 • the unconstructed unit's share of undivided interest in common areas and
15 facilities; and
16 • voting rights; and
17 ▸ provides that a declarant of a condominium or community project may, under
18 certain conditions, appoint the declarant's officers, employees, or agents to the
19 association board or management committee.
20 Money Appropriated in this Bill:
21 None
22 Other Special Clauses:
23 This bill provides a special effective date.
24 Utah Code Sections Affected:
25 AMENDS:
26 57-8-3, as last amended by Laws of Utah 2015, Chapters 22, 34, 213, 325, and 387
27 57-8-16.5, as enacted by Laws of Utah 1975, Chapter 173
28 57-8-24, as last amended by Laws of Utah 1975, Chapter 173
29 57-8a-502, as enacted by Laws of Utah 2013, Chapter 152
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31 Be it enacted by the Legislature of the state of Utah:
32 Section 1. Section 57-8-3 is amended to read:
33 57-8-3. Definitions.
34 As used in this chapter:
35 (1) "Assessment" means any charge imposed by the association, including:
36 (a) common expenses on or against a unit owner pursuant to the provisions of the
37 declaration, bylaws, or this chapter; and
38 (b) an amount that an association of unit owners assesses to a unit owner under
39 Subsection 57-8-43(9)(g).
40 (2) "Association of unit owners" or "association" means all of the unit owners:
41 (a) acting as a group in accordance with the declaration and bylaws; or
42 (b) organized as a legal entity in accordance with the declaration.
43 (3) "Building" means a building, containing units, and comprising a part of the
44 property.
45 (4) "Commercial condominium project" means a condominium project that has no
46 residential units within the project.
47 (5) "Common areas and facilities" unless otherwise provided in the declaration or
48 lawful amendments to the declaration means:
49 (a) the land included within the condominium project, whether leasehold or in fee
50 simple;
51 (b) the foundations, columns, girders, beams, supports, main walls, roofs, halls,
52 corridors, lobbies, stairs, stairways, fire escapes, entrances, and exits of the building;
53 (c) the basements, yards, gardens, parking areas, and storage spaces;
54 (d) the premises for lodging of janitors or persons in charge of the property;
55 (e) installations of central services such as power, light, gas, hot and cold water,
56 heating, refrigeration, air conditioning, and incinerating;
57 (f) the elevators, tanks, pumps, motors, fans, compressors, ducts, and in general all
58 apparatus and installations existing for common use;
59 (g) such community and commercial facilities as may be provided for in the
60 declaration; and
61 (h) all other parts of the property necessary or convenient to its existence, maintenance,
62 and safety, or normally in common use.
63 (6) "Common expenses" means:
64 (a) all sums lawfully assessed against the unit owners;
65 (b) expenses of administration, maintenance, repair, or replacement of the common
66 areas and facilities;
67 (c) expenses agreed upon as common expenses by the association of unit owners; and
68 (d) expenses declared common expenses by this chapter, or by the declaration or the
69 bylaws.
70 (7) "Common profits," unless otherwise provided in the declaration or lawful
71 amendments to the declaration, means the balance of all income, rents, profits, and revenues
72 from the common areas and facilities remaining after the deduction of the common expenses.
73 (8) "Condominium" means the ownership of a single unit in a multiunit project
74 together with an undivided interest in common in the common areas and facilities of the
75 property.
76 (9) "Condominium plat" means a plat or plats of survey of land and units prepared in
77 accordance with Section 57-8-13.
78 (10) "Condominium project" means a real estate condominium project; a plan or
79 project whereby two or more units, whether contained in existing or proposed apartments,
80 commercial or industrial buildings or structures, or otherwise, are separately offered or
81 proposed to be offered for sale. Condominium project also means the property when the
82 context so requires.
83 (11) "Condominium unit" means a unit together with the undivided interest in the
84 common areas and facilities appertaining to that unit. Any reference in this chapter to a
85 condominium unit includes both a physical unit together with its appurtenant undivided interest
86 in the common areas and facilities and a time period unit together with its appurtenant
87 undivided interest, unless the reference is specifically limited to a time period unit.
88 (12) "Contractible condominium" means a condominium project from which one or
89 more portions of the land within the project may be withdrawn in accordance with provisions
90 of the declaration and of this chapter. If the withdrawal can occur only by the expiration or
91 termination of one or more leases, then the condominium project is not a contractible
92 condominium within the meaning of this chapter.
93 (13) "Convertible land" means a building site which is a portion of the common areas
94 and facilities, described by metes and bounds, within which additional units or limited common
95 areas and facilities may be created in accordance with this chapter.
96 (14) "Convertible space" means a portion of the structure within the condominium
97 project, which portion may be converted into one or more units or common areas and facilities,
98 including limited common areas and facilities in accordance with this chapter.
99 (15) "Declarant" means all persons who execute the declaration or on whose behalf the
100 declaration is executed. From the time of the recordation of any amendment to the declaration
101 expanding an expandable condominium, all persons who execute that amendment or on whose
102 behalf that amendment is executed shall also come within this definition. Any successors of
103 the persons referred to in this subsection who come to stand in the same relation to the
104 condominium project as their predecessors also come within this definition.
105 (16) "Declaration" means the instrument by which the property is submitted to the
106 provisions of this act, as it from time to time may be lawfully amended.
107 (17) "Electrical corporation" means the same as that term is defined in Section 54-2-1.
108 (18) "Expandable condominium" means a condominium project to which additional
109 land or an interest in it may be added in accordance with the declaration and this chapter.
110 (19) "Gas corporation" means the same as that term is defined in Section 54-2-1.
111 (20) "Governing documents":
112 (a) means a written instrument by which an association of unit owners may:
113 (i) exercise powers; or
114 (ii) manage, maintain, or otherwise affect the property under the jurisdiction of the
115 association of unit owners; and
116 (b) includes:
117 (i) articles of incorporation;
118 (ii) bylaws;
119 (iii) a plat;
120 (iv) a declaration of covenants, conditions, and restrictions; and
121 (v) rules of the association of unit owners.
122 (21) "Independent third party" means a person that:
123 (a) is not related to the unit owner;
124 (b) shares no pecuniary interests with the unit owner; and
125 (c) purchases the unit in good faith and without the intent to defraud a current or future
126 lienholder.
127 (22) "Leasehold condominium" means a condominium project in all or any portion of
128 which each unit owner owns an estate for years in his unit, or in the land upon which that unit
129 is situated, or both, with all those leasehold interests to expire naturally at the same time. A
130 condominium project including leased land, or an interest in the land, upon which no units are
131 situated or to be situated is not a leasehold condominium within the meaning of this chapter.
132 (23) "Limited common areas and facilities" means those common areas and facilities
133 designated in the declaration as reserved for use of a certain unit or units to the exclusion of the
134 other units.
135 (24) "Majority" or "majority of the unit owners," unless otherwise provided in the
136 declaration or lawful amendments to the declaration, means the owners of more than 50% in
137 the aggregate in interest of the undivided ownership of the common areas and facilities.
138 (25) "Management committee" means the committee as provided in the declaration
139 charged with and having the responsibility and authority to make and to enforce all of the
140 reasonable rules covering the operation and maintenance of the property.
141 (26) (a) "Means of electronic communication" means an electronic system that allows
142 individuals to communicate orally in real time.
143 (b) "Means of electronic communication" includes:
144 (i) web conferencing;
145 (ii) video conferencing; and
146 (iii) telephone conferencing.
147 (27) "Meeting" means a gathering of a management committee, whether in person or
148 by means of electronic communication, at which the management committee can take binding
149 action.
150 (28) "Mixed-use condominium project" means a condominium project that has both
151 residential and commercial units in the condominium project.
152 (29) "Par value" means a number of dollars or points assigned to each unit by the
153 declaration. Substantially identical units shall be assigned the same par value, but units located
154 at substantially different heights above the ground, or having substantially different views, or
155 having substantially different amenities or other characteristics that might result in differences
156 in market value, may be considered substantially identical within the meaning of this
157 subsection. If par value is stated in terms of dollars, that statement may not be considered to
158 reflect or control the sales price or fair market value of any unit, and no opinion, appraisal, or
159 fair market transaction at a different figure may affect the par value of any unit, or any
160 undivided interest in the common areas and facilities, voting rights in the unit owners'
161 association, liability for common expenses, or right to common profits, assigned on the basis
162 thereof.
163 (30) "Period of administrative control" means the period of control described in
164 Subsection 57-8-16.5(1).
165 (31) "Person" means an individual, corporation, partnership, association, trustee, or
166 other legal entity.
167 (32) "Property" means the land, whether leasehold or in fee simple, the building, if any,
168 all improvements and structures thereon, all easements, rights, and appurtenances belonging
169 thereto, and all articles of personal property intended for use in connection therewith.
170 (33) "Record," "recording," "recorded," and "recorder" have the meaning stated in
171 [
172 (34) "Size" means the number of cubic feet, or the number of square feet of ground or
173 floor space, within each unit as computed by reference to the record of survey map and rounded
174 off to a whole number. Certain spaces within the units including attic, basement, or garage
175 space may be omitted from the calculation or be partially discounted by the use of a ratio, if the
176 same basis of calculation is employed for all units in the condominium project and if that basis
177 is described in the declaration.
178 (35) "Time period unit" means an annually recurring part or parts of a year specified in
179 the declaration as a period for which a unit is separately owned and includes a timeshare estate
180 as defined in Subsection 57-19-2(19).
181 (36) "Unconstructed unit" means a unit that:
182 (a) is intended, as depicted in the condominium plat, to be fully or partially contained
183 in a building; and
184 (b) is not constructed.
185 [
186 for any type of independent use, [
187
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189 unit boundaries.
190 (b) "Unit" includes one or more rooms or spaces located in one or more floors or a
191 portion of a floor in a building.
192 (c) "Unit" includes a convertible space [
193 Subsection 57-8-13.4(3). [
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195
196 [
197 letters designating the unit in the declaration and in the record of survey map.
198 [
199 an undivided interest in the fee simple estate of the common areas and facilities in the
200 percentage specified and established in the declaration or, in the case of a leasehold
201 condominium project, the person or persons whose leasehold interest or interests in the
202 condominium unit extend for the entire balance of the unexpired term or terms.
203 Section 2. Section 57-8-16.5 is amended to read:
204 57-8-16.5. Appointment and removal of committee members and association
205 officers -- Renewal or ratification of contracts -- Failure to establish association or
206 committee.
207 (1) (a) The declaration may authorize the declarant, or a managing agent or some other
208 person or persons selected or to be selected by the declarant, to appoint and remove some or all
209 of the members of the management committee or some or all of the officers of the [
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211 assigned by the declaration and by this act to the [
212 officers, or the management committee.
213 (b) If the declaration authorizes the declarant to appoint or remove some or all
214 members of the management committee or some or all of the officers of the association of unit
215 owners during the period of control contemplated by this Subsection (1), the declarant may
216 appoint the declarant's officers, employees or agents as members of the management committee
217 or as officers of the association of unit owners.
218 (c) No amendment to the declaration not consented to by all unit owners shall increase
219 the scope of this authorization, and no such authorization shall be valid after the first to occur
220 of the following:
221 [
222 years in the case of an expandable condominium, four years in the case of a condominium
223 project containing any convertible land, or three years in the case of any other condominium
224 project; or
225 [
226 areas and facilities appertain have been conveyed, or after all additional land has been added to
227 the project and all convertible land has been converted, whichever last occurs.
228 (2) If entered into during the period of control contemplated by Subsection (1), no
229 management contract, lease of recreational areas or facilities, or any other contract or lease
230 designed to benefit the declarant which was executed by or on behalf of the [
231 association of unit owners or the unit owners as a group shall be binding after such period of
232 control unless then renewed or ratified by the consent of unit owners of units to which a
233 majority of the votes in the [
234 (3) If the [
235 existence or does not have officers at the time of the creation of a condominium project, the
236 declarant shall, until there is an association or management committee with these officers, have
237 the power and responsibility to act in all instances where this act or the declaration requires
238 action by the [
239 the officers of them.
240 (4) This section shall be strictly construed to protect the rights of the unit owners.
241 Section 3. Section 57-8-24 is amended to read:
242 57-8-24. Common profits, common expenses, and voting rights -- Unit --
243 Unconstructed unit.
244 [
245
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247 (1) A unit is created by the recording of the declaration and a condominium plat that
248 describes the unit.
249 (2) An association of unit owners shall, according to each unit owner's respective
250 percentage or fractional undivided interests in the common areas and facilities[
251 (a) distribute the property's common profits among the unit owners;
252 (b) except as otherwise provided in the declaration for unconstructed units, assess the
253 unit owners the property's common expenses; and
254 (c) make voting rights available to the unit owners.
255 (3) (a) After the recording of a condominium project's declaration, an unconstructed
256 unit is a unit for the purposes of the declaration and this chapter, including:
257 (i) allocation of undivided interests in the common areas and facilities in accordance
258 with Subsection 57-8-7(2); and
259 (ii) voting rights in accordance with Section 57-8-24.
260 (b) Subsection (3)(a) applies to a condominium project regardless of when the
261 condominium project's initial declaration was recorded.
262 Section 4. Section 57-8a-502 is amended to read:
263 57-8a-502. Period of administrative control.
264 (1) Unless otherwise provided for in a declaration, a period of administrative control
265 terminates on the first to occur of the following:
266 (a) 60 days after 75% of the lots that may be created are conveyed to lot owners other
267 than a declarant;
268 (b) seven years after all declarants have ceased to offer lots for sale in the ordinary
269 course of business; or
270 (c) the day the declarant, after giving written notice to the lot owners, records an
271 instrument voluntarily surrendering all rights to control activities of the association.
272 (2) (a) A declarant may voluntarily surrender the right to appoint and remove a member
273 of the board before the period of administrative control terminates under Subsection (1).
274 (b) Subject to Subsection (2)(a), the declarant may require, for the duration of the
275 period of administrative control, that actions of the association or board, as specified in a
276 recorded instrument executed by the declarant, be approved by the declarant before they
277 become effective.
278 (c) During a period of administrative control, except as provided in Subsection (2)(a), a
279 declarant may appoint the declarant's officers, employees, or agents as members of the board.
280 (3) (a) Upon termination of the period of administrative control, the lot owners shall
281 elect a board consisting of an odd number of at least three members, a majority of whom shall
282 be lot owners.
283 (b) Unless the declaration provides for the election of officers by the lot owners, the
284 board shall elect officers of the association.
285 (c) The board members and officers shall take office upon election or appointment.
286 Section 5. Effective date.
287 If approved by two-thirds of all the members elected to each house, this bill takes effect
288 upon approval by the governor, or the day following the constitutional time limit of Utah
289 Constitution, Article VII, Section 8, without the governor's signature, or in the case of a veto,
290 the date of veto override.