(Recap) A familiar scene unfolds at many association meetings. Disgruntled unit owners come to the meeting, complaining of leaks, roof problems, mold and myriad of other issues. Some owners demand that the building and the leaks be completely repaired immediately. Others say that the association cannot afford to do significant repairs, and that special assessments will bankrupt them. Others say that the developer should be held responsible to fix these problems. The developer no longer returns the association’s phone calls, emails or faxes, and despite the Board’s invitation, has chosen not to attend a meeting in months. Board members are rightfully frustrated and confused about how to best fulfill their duties to the Association and the owners. Advice pours in from all sides. Seemingly conflicting information is received by different members of the Board. The Board is bombarded with questions and “facts” from owners about how to proceed. Below are some helpful responses to some of the most common of those “facts”:
“When do we have to file a lawsuit?”
There are two considerations when it comes to when an association has to file suit for property damage related to construction defects and related transition claims. The first is the statute of repose. Under the statute of repose, the association cannot file suit after 10 years have passed from the date on which the building was substantially completed (13 years in Pennsylvania). Conservatively, that date is when the first certificates of occupancy are issued. That 10 years may be shortened by the statute of limitations, which, for property damage claims, is 6 years from the date on which the Association knew, or should have known, that it had a problem. For example, if 20 unit owners out of 50 complain of window leaks in June of 2003, then the statute of limitations would likely run in June 2009. The Association needs to be keenly aware of when owners start to complain about certain issues so that it can file suit in plenty of time.