Governing Documents: What You Need to Know!

Association Rules should not surprise anyone, and yet seem to surprise everyone!  In many cases, we have found confusion not only with homeowners, realtors, tenants, and committees, but even among the board of directors themselves!

What is no surprise is why there is so much confusion in our industry, and as you read on you’ll see why.  All board members and committee members should read this communication entirely. We intend to have a similar version available for homeowners soon. Our intent is to lead the industry in education and we hope this information will be an important step in that process.

Where Do the Rules Come From? 

This simple question is at the very heart of the confusion – because there is no simple answer! Many factors are in play. So let’s break down the basics.

We live in the United States and the Constitution guides our actions. We elect a representatives in a democratic society and hope that those we elect will serve our interests.  The association is very similar. It is a corporation. Think of it as a miniature country. It has its own constitution, known as governing documents, or CCRs (Covenants and Bylaws), its own democratic elections, and it’s own politics. Although on the surface that seems simple, here is what is important to remember…..First, there are virtually no regulations surrounding these rule books.

All community governing documents are different.

The election requirements and terms of the officers are different as well.  They are legal documents, as such they are often difficult to understand. In addition, the neighborhood rules are subject to other laws that supersede the community documents such as the Property Owners Act and Georgia Condominium Act, county and state requirements, FHA housing regulations and so on. But wait, there’s more….

Most governing documents allow for some discretion. Interpretations of the documents can vary from board to board and attorney to attorney, to say nothing of case law which shakes things up completely as high-level court decision are made that affect your area and your rights. The governing documents can be changed with amendments, so it is important to know if any are recorded. Finally, let’s not forget that the boards members of these associations are volunteers, they often change, and the state of Georgia currently requires no mandatory training to handle the community’s affairs and make all the decisions. Add to that the popular illusion among homeowners that the management company is pulling the stings, like a landlord in an apartment complex, which is entirely incorrect.  Just when we think it could not get any more convoluted, remember that we are discussing people’s homes and neighbor to neighbor relationships – a sensitive issue altogether, so community politics do exists, just like they do in Washington D.C. – on a very personal level.

Whew! I am tired just writing all that!  Because understanding this unfortunate reality is truly key to being an effective leader, let’s review each of the key elements.

The Key Elements

  1. Georgia Corporate Code
  2. Governing Documents
  3. Guidelines
  4. Amendments
  5. National, State, County and City Laws
  6. Case Law & Attorney Opinion