As mentioned before, the Tennessee Condominium Act of 2008, Tenn. Code § 66-27-201, et seq. (the “Condominium Act”), applies to all condominium developments completed in Tennessee after January 1, 2009, and in parts to all condominium developments in Tennessee as to matters that arise after January 1, 2009. One of the statutes that may potentially cause condominium associations problems is the required records-keeping provisions. It would apply to the maintenance of required records after January 1, 2009.
Prior to the provisions under the Condominium Act, the only records required of a condominium association were those found in the Tennessee Non-Profit Corporation Act, Tenn. Code § 48-51-101, et seq. With the passage of the Condominium Act, condominium associations are charged with keeping numerous records. Further, Tenn. Code § 66-27-502 provides that an association shall provide certain information related to these records upon request from a unit owner, a purchaser, or any lender to either a unit owner or a purchaser, or their respective authorized agents. The information shall be provided within ten (10) business days following the date of the association’s receipt of the request. The request may be provided in writing or by electronic means (including email or posting on a website). The association will be entitled to charge a reasonable fee for providing the information, which if not paid may be assessed against the unit whose owner, lender, or purchaser requested the information. If the information is not timely provided, the condominium association is subject to fine and potentially paying the costs of any attorney’s fees expended by the requesting party.
Tenn. Code § 66-27-503 outlines in detail what information shall be included upon request by a unit owner, a purchaser, or any lender to either a unit owner or a purchaser, or their respective authorized agents:
(1) The name and principal address of the declarant, during the period of declarant control only, the association, and the condominium;
(2) A copy of the recorded, or if not recorded then in substantially final form to the extent available, master deed or declaration, bylaws, charter or articles of association of the association, and all amendments of and exhibits to the master deed or declaration, bylaws, charter or articles of association of the association;
(3) A copy of the current rules and regulations of the association;
(4) The most recent balance sheet, income statement, and approved budget for the association, or, if there has never been an approved budget, then the projected budget. The budget must include, without limitation:
(A) A statement of the amount, or a statement that there is no amount, included in the budget as a reserve for repairs and replacements, and whether or not any study has been done to determine their adequacy, and if a study has been done, where the study will be made available for review and inspection;
(B) A statement of any other reserves;
(C) The projected aggregate annual common expense assessment by category of expenditures for the association;
(D) The projected monthly common expense assessment, or the method of calculating each unit’s share of the assessment, for each type of unit;
(E) A description of any indebtedness secured by the common elements or other amenities owned by the association or available for the use of the unit owners; and
(F) A description of any lease affecting the common elements or amenities owned by the association or available for the use of the unit owners;
(5) Minutes of all meetings of the members and/or the board of directors of the association for the twenty-four-month period ending on the date of the request;
(6) The current monthly assessment and any special assessment applicable to the unit in question, and the amount of any delinquencies in any assessments applicable to the unit;
(7) Any fees or assessments due as a result of a transfer of the applicable unit;
(8) The amount and nature of any additional fees currently imposed for use by members of the common elements or other amenities;
(9) A statement of the insurance coverage, which may be provided in the form of an appropriate certificate from the insurer, maintained by the association that includes the types of coverage, limits and deductibles of the insurance;
(10) A statement of any unsatisfied judgments and a description of any pending suits against the association;
(11) A description of any pending suits filed by the association, other than for the collection of delinquent assessments;
(12) The total amount of current monthly, annual, or special assessments for all units in the condominium that are more than sixty (60) days past due as of the most recent available report, but in no event more than ninety (90) days prior to the date of the request; and
(13) Whether the board of directors is still under declarant control and, if so, when that period of control ends.
This is a detailed list of information. Since a condominium association is required to provide this information in a timely manner, it logically follows that a condominium association must maintain these records. Boards of Directors of Tennessee condominium associations should verify that they are maintaining these records.