72nd OREGON LEGISLATIVE ASSEMBLY--2003 Regular Session
Enrolled
House Bill 3385
Sponsored by COMMITTEE ON JUDICIARY (at the request of
Condominium Working Group)
CHAPTER ................
AN ACT
Relating to planned unit development; creating new provisions;
amending ORS 94.550, 94.570, 94.572, 94.580, 94.590, 94.595,
94.604, 94.625, 94.630, 94.640, 94.647, 94.660, 94.670, 94.704,
94.709, 94.712, 94.770, 94.775, 100.100, 100.105, 100.115,
100.130, 100.135, 100.175, 100.405, 100.407, 100.410, 100.417,
100.420, 100.425, 100.427, 100.450, 100.465, 100.475, 100.480,
100.625, 100.655 and 100.740; and declaring an emergency.
Be It Enacted by the People of the State of Oregon:
{ + NOTE: + } Sections 1 and 2 were deleted by amendment.
Subsequent sections were not renumbered.
SECTION 3. ORS 94.550 is amended to read:
94.550. As used in ORS 94.550 to 94.783:
(1) 'Assessment' means any charge imposed or levied by a
homeowners association on or against an owner or lot pursuant to
the provisions of the declaration or the bylaws of the planned
community or provisions of ORS 94.550 to 94.783.
(2) 'Blanket encumbrance' means a trust deed or mortgage or any
other lien or encumbrance, mechanic's lien or otherwise, securing
or evidencing the payment of money and affecting more than one
lot in a planned community, or an agreement affecting more than
one lot by which the developer holds such planned community under
an option, contract to sell or trust agreement.
(3) 'Class I planned community' means a planned community as
defined in ORS 94.550 that:
(a) Contains at least 13 lots or in which the declarant has
reserved the right to increase the total number of lots beyond
12; and
(b) Has an { - initial - } estimated annual assessment,
including an amount required for reserves under ORS 94.595,
exceeding $10,000 for all lots or $100 per lot, whichever is
greater, based on:
(A) For a planned community created on or after January 1,
2002, the initial estimated annual assessment, including a
constructive assessment based on a subsidy of the association
through a contribution of funds, goods or services by the
declarant; or
(B) For a planned community created before January 1, 2002, a
reasonable estimate of the cost of fulfilling existing
obligations imposed by the declaration and bylaws { + as of
January 1, 2002 + }.
Enrolled House Bill 3385 (HB 3385-B) Page 1
(4) 'Class II planned community' means a planned community as
defined in ORS 94.550 that:
(a) Is not a Class I planned community;
(b) Contains at least five lots; and
(c) Has an estimated annual assessment exceeding $1,000 for all
lots based on:
(A) For a planned community created on or after January 1,
2002, the initial estimated annual assessment, including a
constructive assessment based on a subsidy of the association
through a contribution of funds, goods or services by the
declarant; or
(B) For a planned community created before January 1, 2002, a
reasonable estimate of the cost of fulfilling existing
obligations imposed by the declaration and bylaws { + as of
January 1, 2002 + }.
(5) 'Class III planned community' means a planned community as
defined in ORS 94.550 that is not a Class I or II planned
community.
(6) 'Common expenses' means expenditures made by or financial
liabilities incurred by the homeowners association and includes
any allocations to the reserve account under ORS 94.595.
(7) 'Common property' means any real property or interest in
real property within a planned community which is owned, held or
leased by the homeowners association or owned as tenants in
common by the lot owners, or designated in the declaration for
transfer to the association.
(8) 'Condominium' means property submitted to the provisions of
ORS chapter 100.
(9) 'Declarant' means any person who creates a planned
community under ORS 94.550 to 94.785.
(10) 'Declarant control' means any special declarant right
relating to administrative control of a homeowners association,
including but not limited to:
(a) The right of the declarant or person designated by the
declarant to appoint or remove an officer or a member of the
board of directors;
(b) Any weighted vote or special voting right granted to a
declarant or to units owned by the declarant so that the
declarant will hold a majority of the voting rights in the
association by virtue of such weighted vote or special voting
right; and
(c) The right of the declarant to exercise powers and
responsibilities otherwise assigned by the declaration or bylaws
or by the provisions of ORS 94.550 to 94.783 to the association,
officers of the association or board of directors of the
association.
(11) 'Declaration' means the instrument described in ORS 94.580
which establishes a planned community, and any amendments to the
instrument.
{ + (12) 'Governing document' means an instrument or plat
relating to common ownership or common maintenance of a portion
of a planned community and that is binding upon lots within the
planned community. + }
{ - (12) - } { + (13) + } 'Homeowners association' or
'association ' means the organization of owners of lots in a
planned community, created under ORS 94.625, required by a
governing document or formed under ORS 94.572.
{ - (13) - } { + (14) + } 'Majority' or 'majority of votes'
or ' majority of owners' means more than 50 percent of the votes
in the planned community.
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{ - (14) - } { + (15) + } 'Mortgagee' means any person who
is:
(a) A mortgagee under a mortgage;
(b) A beneficiary under a trust deed; or
(c) The vendor under a land sale contract.
{ - (15) - } { + (16) + } 'Owner' means the owner of any
lot in a planned community, unless otherwise specified, but does
not include a person holding only a security interest in a lot.
{ - (16) - } { + (17) + } 'Percent of owners' or
'percentage of owners ' means the owners representing the
specified voting rights as determined under ORS 94.658.
{ - (17) - } { + (18)(a) + } 'Planned community' means any
subdivision under ORS 92.010 to 92.190 { - which - } { +
that + } results in a pattern of ownership of real property and
all the buildings, improvements and rights located on or
belonging to the real property, in which the owners collectively
are responsible for the maintenance, operation, insurance or
other expenses relating to any property within the planned
community, including common property, if any, or for the exterior
maintenance of any property that is individually owned.
{ + (b) + } 'Planned community' does not mean:
{ - (a) - } { + (A) + } A condominium under ORS chapter
100;
{ - (b) - } { + (B) + } A planned community that is
exclusively commercial or industrial; or
{ - (c) - } { + (C) + } A timeshare plan under ORS 94.803
to 94.945.
{ - (18) - } { + (19) + } 'Purchaser' means any person
other than a declarant who, by means of a voluntary transfer,
acquires a legal or equitable interest in a lot, other than as
security for an obligation.
{ - (19) - } { + (20) + } 'Purchaser for resale' means any
person who purchases from the declarant more than two lots for
the purpose of resale whether or not the purchaser for resale
makes improvements to the lots before reselling them.
{ - (20) - } { + (21) + } 'Special declarant rights' means
any rights, in addition to the rights of the declarant as a lot
owner, reserved for the benefit of the declarant under the
declaration or ORS 94.550 to 94.783, including but not limited
to:
(a) Constructing or completing construction of improvements in
the planned community which are described in the declaration;
(b) Expanding the planned community or withdrawing property
from the planned community under ORS 94.580 (3) and (4);
(c) Converting lots into common property;
(d) Making the planned community subject to a master
association under ORS 94.695; or
(e) Exercising any right of declarant control reserved under
ORS 94.600.
{ - (21) - } { + (22) + } 'Successor declarant' means the
transferee of any special declarant right.
{ - (22) - } { + (23) + } 'Turn over' means the act of
turning over administrative responsibility pursuant to ORS 94.609
and 94.616.
{ - (23) - } { + (24) + } 'Unit' means a building or
portion of a building located upon a lot in a planned community
and designated for separate occupancy or ownership, but does not
include any building or portion of a building located on common
property.
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{ - (24) - } { + (25) + } 'Votes' means the votes allocated
to lots in the declaration under ORS 94.580 (2) { - (h) - } .
SECTION 4. ORS 94.570 is amended to read:
94.570. (1) ORS 94.550 to 94.783 apply to a planned community
created before January 1, 2002, { + under ORS 94.550 to
94.783 + } and to a Class I planned community created on or after
January 1, 2002.
(2) ORS 94.550 to 94.783, except for ORS 94.595 and 94.604,
apply to a Class II planned community created on or after January
1, 2002.
(3) Notwithstanding any other provision of ORS 94.550 to
94.783, ORS 94.550 to 94.783 apply to a Class III planned
community or a planned community { - described in ORS 94.550
(17)(b) - } { + that is exclusively commercial or industrial and
that is + } created on or after January 1, 2002, if the
declaration of the planned community so provides.
(4) Nothing in ORS 94.550 to 94.783 prohibits the establishment
of a condominium subject to ORS chapter 100 or a timeshare plan
subject to ORS 94.803 to 94.945 within a planned community.
SECTION 5. ORS 94.572 is amended to read:
94.572. (1)(a) A Class I or Class II planned community created
before January 1, 2002, that { - is - } { + was + } not
{ - subject to - } { + created under + } ORS 94.550 to 94.783
is subject to this section and ORS 94.550, 94.590, { + 94.595
(4) to (8), 94.625, + } 94.630 (1), { + (3) and (4), + } 94.640,
94.645, 94.647, 94.650, 94.655, 94.657, { + 94.658, + } 94.660,
94.662, 94.665, 94.670, 94.675, 94.680, 94.690, 94.695, 94.704,
94.709, 94.712, 94.716, 94.719, 94.723, { + 94.728, + } 94.733,
94.770, 94.775, 94.777 and 94.780 to the extent that those
statutes are consistent with any governing documents. If the
governing documents do not provide for the formation of an
association, the requirements of this subsection are not
effective until the formation of an association in accordance
with paragraph (b) of this subsection. If a provision of the
governing documents is inconsistent with this subsection, the
owners may amend the governing documents using the procedures in
this subsection:
(A) In accordance with the procedures for the adoption of
amendments in the governing documents and subject to any
limitations in the governing documents, the owners may amend the
inconsistent provisions of the governing documents to conform to
the extent feasible with this section and ORS 94.550, 94.590,
{ + 94.595 (4) to (8), 94.625, + } 94.630 (1), { + (3) and
(4), + } 94.640, 94.645, 94.647, 94.650, 94.655, 94.657,
{ + 94.658, + } 94.660, 94.662, 94.665, 94.670, 94.675, 94.680,
94.690, 94.695, 94.704, 94.709, 94.712, 94.716, 94.719, 94.723,
{ + 94.728, + } 94.733, 94.770, 94.775, 94.777 and 94.780.
Nothing in this paragraph requires the owners to amend a
declaration or bylaws to include the information required by ORS
94.580 or 94.635.
(B) If there are no procedures for amendment in the governing
documents:
(i) For an amendment to a recorded governing document other
than bylaws, the owners may amend the inconsistent provisions of
the document to conform to this section and ORS 94.550, 94.590,
{ + 94.595 (4) to (8), 94.625, + } 94.630 (1), { + (3) and
(4), + } 94.640, 94.645, 94.647, 94.650, 94.655, 94.657,
{ + 94.658, + } 94.660, 94.662, 94.665, 94.670, 94.675, 94.680,
94.690, 94.695, 94.704, 94.709, 94.712, 94.716, 94.719, 94.723,
{ + 94.728, + } 94.733, 94.770, 94.775, 94.777 and 94.780 by a
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vote of at least 75 percent of the owners in the planned
community.
(ii) For an amendment to the bylaws, the owners may amend the
inconsistent provisions of the bylaws to conform to this section
and ORS 94.550, 94.590, { + 94.595 (4) to (8), 94.625, + }
94.630 (1), { + (3) and (4), + } 94.640, 94.645, 94.647, 94.650,
94.655, 94.657, { + 94.658, + } 94.660, 94.662, 94.665, 94.670,
94.675, 94.680, 94.690, 94.695, 94.704, 94.709, 94.712, 94.716,
94.719, 94.723, { + 94.728, + } 94.733, 94.770, 94.775, 94.777
and 94.780 by a vote of at least a majority of the owners in the
planned community.
(iii) { - The - } { + An + } amendment may be adopted at a
meeting held in accordance with the governing documents or by
another procedure permitted by the governing documents following
the procedures prescribed in ORS 94.647, 94.650 or 94.660.
(iv) An amendment to a recorded declaration shall be executed,
certified and recorded as provided in ORS 94.590 (2) and (3) and
shall be subject to ORS 94.590 (5). An amendment to the bylaws
and any other governing document shall be executed and certified
as provided in ORS 94.590 (3) and shall be recorded in the office
of the recording officer of every county in which the planned
community is located if the bylaws or other governing document to
which the amendment relates were recorded.
(C) An amendment adopted pursuant to this paragraph shall
include:
(i) A reference to the recording index numbers and date of
recording of the declaration or other governing document, if
recorded, to which the amendment relates; and
(ii) A statement that the amendment is adopted pursuant to the
applicable subparagraph of this paragraph.
(b)(A) If the governing documents do not provide for the
formation of an association of owners, at least 10 percent of the
owners in the planned community or any governing entity may
initiate the formation of an association as provided in this
paragraph. The owners or the governing entity initiating the
association formation shall call an organizational meeting for
the purpose of voting whether to form an association described in
ORS 94.625. The notice of the meeting shall:
(i) Name the initiating owners or governing entity;
(ii) State that the organizational meeting is for the purpose
of voting whether to form an association in accordance with the
proposed articles of incorporation;
(iii) State that if the owners vote to form an association, the
owners may elect the initial board of directors provided for in
the articles of incorporation and may adopt the initial bylaws;
(iv) State that to form an association requires an affirmative
vote of at least a majority of the owners in the planned
community, or, if a larger percentage is specified in the { +
applicable + } governing { - documents - } { + document + },
the larger percentage;
(v) State that to adopt articles of incorporation, to elect the
initial board of directors pursuant to the articles of
incorporation or to adopt the initial bylaws requires an
affirmative vote of at least a majority of the owners present;
(vi) State that if the initial board of directors is not
elected, an interim board of directors shall be elected pursuant
to bylaws adopted as provided in subparagraph (C) of this
paragraph;
(vii) State that a copy of the proposed articles of
incorporation and bylaws will be available at least five business
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days before the meeting and state the method of requesting a
copy; and
(viii) Be delivered in accordance with the declaration and
bylaws. If there is no governing document or the document does
not include applicable provisions, the owners or governing entity
shall follow the procedures prescribed in ORS 94.650 (3).
(B) At least five business days before the organizational
meeting, the initiating owners or governing entity shall cause
articles of incorporation and bylaws to be drafted. The bylaws
shall include, to the extent applicable, the information required
by ORS 94.635.
(C) At the organizational meeting:
(i) Representatives of the initiating owners or governing
entity shall, to the extent not inconsistent with the governing
documents, conduct the meeting according to Robert's Rules of
Order as provided in ORS 94.657.
(ii) The initiating owners or governing entity shall make
available copies of the proposed articles of incorporation and
the proposed bylaws.
(iii) The affirmative vote of at least a majority of the owners
of a planned community, or, if a larger percentage is specified
in the { + applicable + } governing { - documents - } { +
document + }, the larger percentage, is required to form an
association under this paragraph.
(iv) If the owners vote to form an association, the owners
shall adopt articles of incorporation and may elect the initial
board of directors as provided in the articles of incorporation,
adopt bylaws and conduct any other authorized business by an
affirmative vote of at least a majority of the owners present. If
the owners do not elect the initial board of directors, owners
shall elect an interim board of directors by an affirmative vote
of at least a majority of the owners present to serve until the
initial board of directors is elected.
{ + (v) An owner may vote by proxy, or by written ballot, if
approved, in the discretion of a majority of the initiating
owners or governing entity. + }
(D) Not later than 10 business days after the organizational
meeting, the board of directors shall:
(i) Cause the articles of incorporation to be filed with the
Secretary of State under ORS chapter 65;
(ii) Cause the notice of planned community described in
subsection (4) of this section to be prepared, executed and
recorded in accordance with subsection (4) of this section
{ - . - } { + ; + }
(iii) Provide a copy of the notice of planned community to each
owner, together with a copy of the adopted articles of
incorporation and bylaws, if any, or a statement of the procedure
and method for adoption of bylaws described in subparagraph (C)
of this paragraph. The copies and any statement shall be
delivered to each lot, mailed to the mailing address of each lot
or mailed to the mailing addresses designated by the owners in
writing; and
(iv) Cause a statement of association information to be
prepared, executed and recorded in accordance with ORS 94.667.
(E) If the owners vote to form an association, all costs
incurred under this paragraph, including but not limited to the
preparation and filing of the articles of incorporation, drafting
of bylaws, preparation of notice of meeting and the drafting,
delivery and recording of all notices and statements shall be a
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common expense of the owners and shall be allocated as provided
in the appropriate governing document or any amendment thereto.
(2)(a) The owners of lots in a Class I or Class II planned
community that are subject to the provisions of ORS chapter 94
specified in subsection (1) of this section may elect to be
subject to any other provisions of ORS 94.550 to 94.783 upon
compliance with the procedures prescribed in subsection (1) of
this section.
(b) If the owners of lots in a Class I or Class II planned
community elect to be subject to additional provisions of ORS
94.550 to 94.783, unless the notice of planned community
otherwise required or permitted under subsection (4) of this
section includes a statement of the election pursuant to this
paragraph, the board of directors of the association shall cause
the notice of planned community described in subsection (4) of
this section to be prepared, executed and recorded in accordance
with subsection (4) of this section.
(3)(a) The owners of lots in a Class III planned community
created before January 1, 2002, may elect to be subject to
provisions of ORS 94.550 to 94.783 upon compliance with the
applicable procedures in subsection (1) of this section.
(b) If the owners of lots in a Class III planned community
elect to be subject to provisions of ORS 94.550 to 94.783, the
board of directors of the association shall cause the notice of
planned community described in subsection (4) of this section to
be prepared, executed and recorded in accordance with subsection
(4) of this section.
(4) The notice of planned community required or permitted by
this section shall be:
(a) Titled 'Notice of Planned Community { + under ORS
94.572 + } '
{ - under this section - } ;
(b) Executed by the president and secretary of the association;
and
(c) Recorded in the office of the recording officer of every
county in which the property is located.
(5) The notice of planned community shall include:
(a) The name of the planned community and association as
identified in the recorded declaration, conditions, covenants and
restrictions or other governing document and, if different, the
current name of the association;
(b) A list of the properties, described as required for
recordation in ORS 93.600, within the jurisdiction of the
association;
(c) Information identifying the recorded declaration,
conditions, covenants and restrictions or other governing
documents and a reference to the recording index numbers and date
of recording of the governing documents;
(d) A statement that the property described in accordance with
paragraph (b) of this subsection is subject to specific
provisions of the { + Oregon + } Planned Community Act;
(e) A reference to the specific provisions of the
{ + Oregon + } Planned Community Act that apply to the subject
property and a reference to the subsection of this section under
which the application is made; and
(f) If an association is formed under subsection (1)(b)(A) of
this section, a statement to that effect.
(6) An amended statement shall include a reference to the
recording index numbers and the date of recording of prior
statements.
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(7) The county clerk may charge a fee for recording a statement
under this section according to the provisions of ORS 205.320
(4).
{ + (8) The board of directors of an association not
otherwise required to cause a notice of planned community
described in subsection (4) of this section to be prepared and
recorded under this section may cause a notice of planned
community to be prepared, executed and recorded as provided in
subsection (4) of this section. + }
{ - (8) - } { + (9) + } Title to a unit, lot or common
property in a Class I or Class II planned community created
before January 1, 2002, may not be rendered unmarketable or
otherwise affected by a failure of the planned community to be in
compliance with a requirement of this section.
{ - (9) - } { + (10) + } As used in this section:
{ - (a) 'Governing document' means an instrument or plat
relating to common ownership or common maintenance of a portion
of a planned community and that is binding upon lots within the
planned community. - }
{ - (b) - } { + (a) + } 'Governing entity' means an
incorporated or unincorporated association, committee, person or
any other entity that has authority, under a governing document,
to maintain commonly maintained property, impose assessments on
lots or to act on behalf of lot owners within the planned
community on matters of common concern.
{ - (c) - } { + (b) + } 'Recorded declaration' means an
instrument recorded with the county recording officer of the
county in which the planned community is located that contains
conditions, covenants and restrictions binding lots in the
planned community or imposes servitudes upon the real property.
SECTION 6. ORS 94.580 is amended to read:
94.580. (1) A declarant shall record, in accordance with ORS
94.565, the declaration for a planned community in the office of
the recording officer of each county in which the planned
community is located.
(2) The declaration shall include:
(a) The name and classification of the planned community;
(b) The name of the association and the type of entity formed
in accordance with ORS 94.625;
(c) A statement that the planned community is subject to ORS
94.550 to 94.783;
(d) A statement that the bylaws adopted under ORS 94.625 must
be recorded;
(e) A legal description, as required under ORS 93.600, of the
real property included in the planned community;
(f) A legal description, as required under ORS 93.600, of any
real property included in the planned community which is or must
become a common property;
(g) A description of any special declarant rights other than
the rights described under subsections (3) and (4) of this
section;
(h) { - A provision for allocating votes - } { + A
statement of the number of votes allocated + } to each lot in
accordance with ORS 94.658;
(i) A method of determining the liability of each lot for
common expenses and the right of each lot to any common profits
of the association;
{ + (j) A statement of when the lots, including lots owned by
the declarant, become subject to assessment; + }
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{ - (j) - } { + (k) + } If a Class I planned community,
provisions for establishing a reserve account and for the
preparation, review and update of the reserve study as required
by ORS 94.595;
{ - (k) - } { + (L) + } Any restrictions on the alienation
of lots. Any such restriction created by any document other than
the declaration may be incorporated by reference to the official
records of the county where the property is located;
{ - (L) - } { + (m) + } A statement of the use, residential
or otherwise, for which each lot is intended;
{ - (m) - } { + (n) + } A statement as to whether or not
the association pursuant to ORS 94.665 may sell, convey or
subject to a security interest any portion of the common property
and any limitation on such authority;
{ - (n) - } { + (o) + } A statement of any restriction on
the use, maintenance or occupancy of lots or units;
{ - (o) - } { + (p) + }The method of amending the
declaration and a statement of the percentage of votes required
to approve an amendment of the declaration in accordance with ORS
94.590;
{ - (p) - } { + (q) + } A description of any contemplated
improvements which the declarant agrees to build, or a statement
that the declarant does not agree to build any improvement or
does not choose to limit declarant's rights to add improvements
not described in the declaration;
{ - (q) - } { + (r) + } A statement of any period of
declarant control or other special declarant rights reserved by
the declarant under ORS 94.600;
{ - (r) - } { + (s) + } A statement of the time at which
the deed to the common property is to be delivered, whether by
date or upon the occurrence of a stipulated event; and
{ - (s) - } { + (t) + } Any provisions restricting a right
of the association with respect to the common property, or an
individual lot owner with respect to the lot or improvements on
the lot, including but not limited to:
(A) A right to divide the lot or to combine it with other lots;
(B) A right to repair or restore improvements on the lot at the
owner's discretion in the event of damage or destruction;
(C) The requirement for architectural controls, including but
not limited to fencing, landscaping or choice of exterior colors
and materials of structures to be placed on the common property
or on a lot; and
(D) The requirement of review of any plans of any structure to
be placed on the common property or a lot.
(3) If the declarant reserves the right to expand the planned
community by annexing lots or common property or by creating
additional lots or common property by developing existing
property in the planned community, the declaration shall contain,
in addition to the provisions required under subsections (1) and
(2) of this section, a general description of the plan of
development including:
(a) The procedure by which the planned community will be
expanded;
(b) The maximum number of lots and units to be included in the
planned community or a statement that there is no limitation on
the number of lots or units which the declarant may create or
annex to the planned community;
(c) A general description of the nature and proposed use of any
common property which the declarant agrees to create or annex to
Enrolled House Bill 3385 (HB 3385-B) Page 9
the planned community or a statement that there is no limitation
on the right of the declarant to create or annex common property;
(d) The method of allocation of votes if additional lots are to
be created or annexed to the planned community; and
(e) The formula to be used for reallocating the common expenses
if additional lots are to be created or annexed to the planned
community, and the manner of reapportioning the common expenses
if lots are created or annexed during the fiscal year.
(4) If the declarant may withdraw property from the planned
community, the declaration shall include in addition to the
provisions required under subsections (1), (2) and (3) of this
section:
(a) The procedure by which property will be withdrawn;
(b) A general description of the property which may be
withdrawn from the planned community;
(c) The method of allocation of votes if lots are withdrawn
from the planned community;
(d) The formula to be used for reallocating the common expenses
if the property to be withdrawn has been assessed for common
expenses prior to withdrawal; and
(e) The date after which the right to withdraw property from
the planned community shall expire or a statement that such a
right shall not expire.
SECTION 7. ORS 94.590 is amended to read:
94.590. (1)(a) The { - homeowners association may amend the
declaration and the plat only by vote or agreement - }
{ + declaration may be amended only with the approval + } of
{ - the - } owners representing at least 75 percent of the
total votes in the planned community or any larger percentage
specified in the declaration.
(b) An amendment under this section may not { - create, - }
{ + :
(A) + }Limit or diminish any { + right of a declarant
reserved under ORS 94.580 (3) or (4) or any other + } special
declarant { - rights, increase the number of lots or units
or - } { + right without the consent of the declarant. A
declarant may waive the declarant's right of consent.
(B) + } Change the boundaries of any lot or any uses to which
any lot or unit is restricted { + as stated in the declaration
under ORS 94.580 (2)(L) or change the method of determining
liability for common expenses, the method of determining the
right to common profits or the method of determining voting
rights of any lot or unit + }unless the owners of the affected
lots { + or units + } unanimously consent to the amendment.
{ + (c) Any changes to the plat, including required approvals
or consents of owners or others, are governed by the applicable
provisions of ORS 92.010 to 92.190. + }
(2)(a) Unless otherwise provided in the declaration, an
amendment to the declaration may be proposed by a majority of the
board of directors or by at least 30 percent of the owners in the
planned community.
(b) When the association adopts an amendment to the
declaration, the association shall record the amendment in the
{ - same place as the declaration - } { + office of the
recording officer in each county in which the planned community
is located + }. An amendment of the declaration is effective only
upon recordation.
(3) Notwithstanding a provision in a declaration that requires
amendments to be executed and acknowledged by all owners
approving the amendment, amendments to a declaration under this
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section shall be executed and certified on behalf of the
association by the president and secretary as being adopted in
accordance with the declaration and the provisions of this
section and acknowledged in the manner provided for
acknowledgment of deeds.
(4) An amendment to a declaration or plat shall be conclusively
presumed to have been regularly adopted in compliance with all
applicable procedures relating to such amendment unless an action
is brought within one year after the date such amendment was
recorded or the face of the recorded amendment indicates that the
amendment received the approval of fewer votes than required for
such approval. However, nothing in this subsection shall prevent
the further amendment of an amended declaration or plat.
(5) During any period of declarant control, voting on an
amendment under subsection (1) of this section shall be without
regard to any weighted vote or special voting right reserved by
the declarant except as otherwise provided under ORS 94.585.
Nothing in this subsection is intended to prohibit a declarant
from reserving the right to require the declarant's consent to an
amendment during the period reserved in the declaration for
declarant control.
{ + (6) The board of directors, upon the adoption of a
resolution, may cause a restated declaration to be prepared and
recorded to codify individual amendments that have been adopted
in accordance with this section or ORS 94.585 without the further
approval of owners. A declaration restated under this subsection
must:
(a) Include all previously adopted amendments in effect and may
not include any other changes except to correct scriveners'
errors or to conform format and style;
(b) Include a statement that the board of directors has adopted
a resolution in accordance with this subsection and is causing
the declaration to be restated and recorded under this
subsection;
(c) Include a reference to the recording index numbers and date
of recording of the initial declaration and all previously
recorded amendments in effect being codified;
(d) Include a certification by the president and secretary of
the association that the restated declaration includes all
previously adopted amendments in effect and no other changes
except, if applicable, to correct scriveners' errors or to
conform format and style; and
(e) Be executed and acknowledged by the president and secretary
of the association and recorded in the deed records of each
county in which the planned community is located. + }
SECTION 8. ORS 94.595 is amended to read:
94.595. (1) The declarant shall:
(a) Conduct a reserve study described in subsection (3) of this
section; and
(b) Establish a reserve account for replacement of all items of
common property which will normally require replacement, in whole
or in part, in more than three and less than 30 years, for
exterior painting if the common property includes exterior
painted surfaces, for other items, whether or not involving
common property, if the association has responsibility to
maintain the items and for other items required by the
declaration or bylaws. The reserve account need not include
reserves for those items:
(A) That could reasonably be funded from operating assessments;
or
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(B) For which one or more owners are responsible for
maintenance and replacement under the provisions of the
declaration or bylaws.
(2)(a) A reserve account established under this section
{ - shall - } { + must + } be funded by assessments against
the individual lots for { - maintenance of items for - } which
the reserves are established.
(b) { + Unless the declaration provides otherwise, + } the
assessments under this subsection begin accruing { + for all
lots + } from the date the first lot { - assessed - } is
conveyed.
(3)(a) The reserve account shall be established in the name of
the homeowners association. The association is responsible for
administering the account and for making periodic payments into
the account.
(b) The reserve portion of the initial assessment determined by
the declarant shall be based on:
(A) The reserve study described in paragraph (c) of this
subsection; or
(B) Other sources of reliable information.
(c) The board of directors of the association annually shall
conduct a reserve study or review and update an existing study to
determine the reserve account requirements and may:
(A) Adjust the amount of payments as indicated by the study or
update; and
(B) Provide for other reserve items that the board of
directors, in its discretion, may deem appropriate.
(d) The reserve study shall include:
(A) Identification of all items for which reserves are required
to be established;
(B) The estimated remaining useful life of each item as of the
date of the reserve study;
(C) The estimated cost of maintenance, repair or replacement of
each item at the end of its useful life; and
(D) A 30-year plan with regular and adequate contributions,
adjusted by estimated inflation and interest earned on reserves,
to meet the maintenance, repair and replacement schedule.
(4)(a) If the declaration or bylaws require a reserve account,
the reserve study requirements of subsection (3) of this section
first apply to the association of a subdivision that meets the
definition of a planned community under ORS 94.550 and is
recorded prior to October 23, 1999, when:
(A) The board of directors adopts a resolution in compliance
with the bylaws that applies the requirements of subsection (3)
of this section to the association; or
(B) A petition signed by a majority of owners is submitted to
the board of directors mandating that the requirements of
subsection (3) of this section apply to the association.
(b) A reserve study shall be completed within one year of
adoption of the resolution or submission of the petition to the
board of directors.
(5)(a) { + Except as provided in paragraph (b) of this
subsection, + } the reserve account may be used only for the
purposes for which reserves have been established and is to be
kept separate from other funds.
(b) After the individual lot owners have assumed responsibility
for administration of the planned community under ORS 94.616,
{ + if the board of directors has adopted a resolution, which
may be an annual continuing resolution, authorizing the borrowing
of funds:
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(A) + } The board of directors may borrow funds from the
reserve account to meet high seasonal demands on the regular
operating funds or to meet unexpected increases in expenses.
{ - Funds borrowed under this subsection must be repaid later
from assessments if the board of directors has adopted a
resolution, which may be an annual continuing resolution,
authorizing the borrowing of funds. - }
{ + (B) + } Not later than the adoption of the budget for the
following year, the board of directors shall adopt by resolution
a written payment plan providing for repayment of the borrowed
funds within a reasonable period.
(6) Nothing in this section prohibits prudent investment of
reserve account funds subject to any constraints imposed by the
declaration, bylaws or rules of the association.
(7) In addition to the authority of the board of directors
under subsection (3)(c) of this section, following the second
year after the association has assumed administrative
responsibility for the planned community under ORS 94.616:
(a) By an affirmative vote of at least 75 percent of the owners
of the planned community, the association may elect to reduce or
increase future assessments for the reserve account; and
(b) The association may, on an annual basis by a unanimous
vote, elect not to fund the reserve account.
(8) Assessments paid into the reserve account are the property
of the association and are not refundable to sellers or owners of
lots.
SECTION 9. ORS 94.604 is amended to read:
94.604. (1) As provided in this section, the declarant or the
owners of a planned community { + that contains at least 20 lots
in either the initial development or with the annexation of
additional property + } shall form a transitional advisory
committee to provide for the transition from administrative
responsibility by the declarant of the planned community under
ORS 94.600 to administrative responsibility by the association.
The declarant shall call a meeting of owners for the purpose of
selecting a transitional advisory committee not later than the
60th day after
{ - the later of: - }
{ - (a) - } the date the declarant conveys 50 percent or
more of the lots { - in the first or only phase of the planned
community to owners other than a successor declarant; or - }
{ - (b) The date the declarant has conveyed 10 lots - }
{ + then existing + } in the planned community to owners other
than a successor declarant.
(2) The transitional advisory committee shall consist of three
or more members. The owners, other than the declarant, shall
select two or more members. The declarant may select no more than
one member. The committee shall have reasonable access to all
information and documents which the declarant is required to turn
over to the association under ORS 94.616.
(3) An owner may call a meeting of owners to select the
transitional advisory committee if the declarant fails to do so
under subsection (1) of this section.
(4) Notwithstanding subsection (1) of this section, if the
owners do not select members for the transitional advisory
committee under subsection (2) of this section, the declarant
shall have no further obligation to form the committee.
(5) The requirement for a transitional advisory committee shall
not apply once the turnover meeting called under ORS 94.609 has
been held.
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SECTION 10. ORS 94.625 is amended to read:
94.625. (1) Not later than the date on which the first lot in
the planned community is conveyed, the declarant shall:
(a) Organize the { + homeowners + } association as a nonprofit
corporation under ORS chapter 65;
(b) Adopt, on behalf of the association, the initial bylaws
required under ORS 94.635 to govern the administration of the
planned community; and
(c) Record the bylaws in the office of the recording officer
{ - in - } { + of + } each county in which the planned
community is located.
{ + (2)(a) The board of directors of an association of a
planned community created under ORS 94.550 to 94.783 before
January 1, 2002, or a planned community described in ORS 94.572
shall cause the bylaws of the association and amendments to the
bylaws in effect but not codified in the bylaws to be certified
as provided in this subsection and recorded in the office of the
recording officer of each county in which the planned community
is located within 180 days of receipt of a written request from
an owner that the bylaws be recorded.
(b) The president and secretary of the association shall
certify and acknowledge, in the manner provided for
acknowledgment of deeds, that:
(A) The bylaws are the duly adopted bylaws of the association;
and
(B) Each amendment to the bylaws was duly adopted in accordance
with the bylaws of the association.
(c) The 180-day period specified in paragraph (a) of this
subsection may be extended as necessary if the board of directors
is unable to record the bylaws for justifiable reasons.
(d) Failure to record the bylaws or amendments to the bylaws in
accordance with this subsection does not render the bylaws or
amendments to the bylaws ineffective. + }
{ - (2) - } { + (3) + } Unless otherwise provided in the
bylaws, amendments to the bylaws may be proposed by a majority of
the board of directors or by at least 30 percent of the owners of
the planned community.
{ - (3) - } { + (4) + } Subject to subsection { - (4) - }
{ + (5) + } of this section, an amendment is not effective
unless the amendment is:
(a) Approved, unless otherwise provided in the bylaws, by a
majority of the votes in a planned community present, in person
or by proxy, at a duly constituted meeting { - or by ballot
vote - } { + , by written ballot in lieu of a meeting under ORS
94.647 or other procedure permitted under the declaration or
bylaws + };
(b) Certified by the president and secretary of the association
as having been adopted in accordance with the bylaws and this
section { + and acknowledged in the manner provided for
acknowledgment of deeds if the amendment is required to be
recorded under paragraph (c) of this subsection + }; and
(c) Recorded in the office of the recording officer if the
bylaws to which the amendment relates were recorded.
{ - (4) - } { + (5) + } If a provision required to be in
the declaration under ORS 94.580 is included in the bylaws, the
voting requirements for amending the declaration shall also
govern the amendment of the provision in the bylaws.
{ + (6) Notwithstanding a provision in the bylaws, including
bylaws adopted prior to the effective date of this 2003 Act, that
requires an amendment to be executed, or executed and
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acknowledged, by all owners approving the amendment, amendments
to the bylaws under this section become effective after approval
by the owners if executed and certified on behalf of the
association by the president and secretary in accordance with
subsection (4)(b) of this section.
(7) An amendment to the bylaws is conclusively presumed to have
been regularly adopted in compliance with all applicable
procedures relating to the amendment unless an action is brought
within one year after the effective date of the amendment or the
face of the amendment indicates that the amendment received the
approval of fewer votes than required for approval. Nothing in
this subsection prevents the further amendment of an amended
bylaw. + }
{ - (5) - } { + (8) + } Failure to comply with subsection
(1) of this section does not invalidate a conveyance from the
declarant to an owner.
{ + (9) The board of directors, by resolution and without the
further approval of the owners, may cause restated bylaws to be
prepared and recorded to codify individual amendments that have
been adopted in accordance with subsection (4) of this section.
Bylaws restated under this subsection must:
(a) Include all previously adopted amendments that are in
effect and may not include any other changes except to correct
scriveners' errors or to conform format and style;
(b) Include a statement that the board of directors has adopted
a resolution in accordance with this subsection and is causing
the bylaws to be restated and recorded under this subsection;
(c) Include a reference to the recording index numbers and date
of recording of the initial bylaws, if recorded, and all
previously recorded amendments that are in effect and are being
codified;
(d) Include a certification by the president and secretary of
the association that the restated bylaws include all previously
adopted amendments that are in effect and no other changes
except, if applicable, to correct scriveners' errors or to
conform form and style; and
(e) Be executed and acknowledged by the president and secretary
of the association and recorded in the deed records of each
county in which the planned community is located. + }
SECTION 11. ORS 94.630 is amended to read:
94.630. (1) Subject to subsection (2) of this section and
except as otherwise provided in its declaration or bylaws, a
homeowners association may:
(a) Adopt and amend bylaws, rules and regulations for the
planned community;
(b) Adopt and amend budgets for revenues, expenditures and
reserves, and collect assessments from owners for common expenses
and the reserve account established under ORS 94.595;
(c) Hire and terminate managing agents and other employees,
agents and independent contractors;
(d) Defend against any claims, proceedings or actions brought
against it;
(e) Subject to subsection (4) of this section, initiate or
intervene in litigation or administrative proceedings in its own
name and without joining the individual owners in the following:
(A) Matters relating to the collection of assessments and the
enforcement of governing documents;
(B) Matters arising out of contracts to which the association
is a party;
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(C) Actions seeking equitable or other nonmonetary relief
regarding matters that affect the common interests of the owners,
including but not limited to the abatement of nuisance;
(D) Matters relating to or affecting common property, including
but not limited to actions for damage, destruction, impairment or
loss of use of any common property;
(E) Matters relating to or affecting the lots or interests of
the owners including but not limited to damage, destruction,
impairment or loss of use of a lot or portion thereof, if:
(i) Resulting from a nuisance or a defect in or damage to
common property; or
(ii) Required to facilitate repair to any common property; and
(F) Any other matter to which the association has standing
under law or pursuant to the declaration or bylaws;
(f) Make contracts and incur liabilities;
(g) Regulate the use, maintenance, repair, replacement and
modification of common property;
(h) Cause additional improvements to be made as a part of the
common property;
(i) Acquire, hold, encumber and convey in its own name any
right, title or interest to real or personal property, except
that common property may be conveyed or subjected to a security
interest only pursuant to ORS 94.665;
(j) Grant easements, leases, licenses and concessions through
or over the common property;
(k) Modify, close, remove, eliminate or discontinue the use of
common property, including any improvement or landscaping,
regardless of whether the common property is mentioned in the
declaration, provided that:
(A) Nothing in this paragraph is intended to limit the
authority of the association to seek approval of the
modification, closure, removal, elimination or discontinuance by
the owners; and
(B) Modification, closure, removal, elimination or
discontinuance other than on a temporary basis of any swimming
pool, spa or recreation or community building must be approved by
at least a majority of owners voting on the matter at a meeting
or by written ballot held in accordance with the declaration,
bylaws or ORS 94.647;
(L) Impose and receive any payments, fees or charges for the
use, rental or operation of the common property and services
provided to owners;
(m) Adopt rules regarding the termination of utility services
paid for out of assessments of the association and access to and
use of recreational and service facilities available to owners
and, after giving { + written + } notice and an opportunity to
be heard, terminate the rights of any owners to receive such
benefits or services until the correction of any violation
covered by such rule has occurred;
(n) Impose charges for late payment of assessments and attorney
fees related to the collection of assessments and, after giving
written notice and an opportunity to be heard, levy reasonable
fines for violations of the declaration, bylaws, rules and
regulations of the association { - if - } { + , provided
that + } the charge imposed or the fine levied { + by the
association + } is based { + :
(A) + }On a schedule contained in the declaration or bylaws,
or an amendment to either that is delivered to each lot, mailed
to the mailing address of each lot or mailed to the mailing
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addresses designated in writing by the owners { - , or based - }
{ + ; or
(B) + } On a resolution of the association or its board of
directors that is delivered to each lot, mailed to the mailing
address of each lot or mailed to the mailing addresses designated
in writing by the owners;
(o) Impose reasonable charges for the preparation and
recordation of amendments to the declaration;
(p) Provide for the indemnification of its officers and the
board of directors and maintain liability insurance for directors
and officers;
(q) Assign its right to future income, including the right to
receive common expense assessments; and
(r) Exercise any other powers necessary and proper for the
administration and operation of the association.
(2) Notwithstanding subsection (1) of this section, a
declaration may not impose any limitation on the ability of the
association to deal with a declarant that is more restrictive
than the limitations imposed on the ability of the association to
deal with any other person, except during the period of declarant
control under ORS 94.600.
(3) A permit or authorization, or an amendment, modification,
termination or other instrument affecting a permit or
authorization, issued by the board of directors that is
authorized by law, the declaration or bylaws may be recorded in
the deed records of the county in which the planned community is
located. A permit or authorization, or an amendment,
modification, termination or other instrument affecting a permit
or authorization, recorded under this subsection shall:
(a) Be executed by the president and secretary of the
association and acknowledged in the manner provided for
acknowledgment of instruments by the officers;
(b) Include the name of the planned community and a reference
to where the declaration and any applicable supplemental
declarations are recorded;
(c) Identify, by the designations stated or referenced in the
declaration or applicable supplemental declaration, all affected
lots and common property; and
(d) Include other information and signatures if required by
law, the declaration, bylaws or the board of directors.
(4)(a) Subject to paragraph (f) of this subsection, before
initiating litigation or an administrative proceeding in which
the association and an owner have an adversarial relationship,
the party that intends to initiate litigation or an
administrative proceeding shall offer to use any dispute
resolution program available within the county in which the
planned community is located that is in substantial compliance
with the standards and guidelines adopted under ORS 36.175. The
written offer must be hand-delivered or mailed by certified mail,
return receipt requested, to the address, contained in the
records of the association, for the other party.
(b) If the party receiving the offer does not accept the offer
within 10 days after receipt by written notice hand-delivered or
mailed by certified mail, return receipt requested, to the
address, contained in the records of the association, for the
other party, the initiating party may commence the litigation or
the administrative proceeding. The notice of acceptance of the
offer to participate in the program must contain the name,
address and telephone number of the body administering the
dispute resolution program.
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(c) If a qualified dispute resolution program exists within the
county in which the planned community is located and an offer to
use the program is not made as required under paragraph (a) of
this subsection, litigation or an administrative proceeding may
be stayed for 30 days upon a motion of the noninitiating party.
If the litigation or administrative action is stayed under this
paragraph, both parties shall participate in the dispute
resolution process.
(d) Unless a stay has been granted under paragraph (c) of this
subsection, if the dispute resolution process is not completed
within 30 days after receipt of the initial offer, the initiating
party may commence litigation or an administrative proceeding
without regard to whether the dispute resolution is completed.
(e) Once made, the decision of the court or administrative body
arising from litigation or an administrative proceeding may not
be set aside on the grounds that an offer to use a dispute
resolution program was not made.
(f) The requirements of this subsection do not apply to
circumstances in which irreparable harm to a party will occur due
to delay or to litigation or an administrative proceeding
initiated to collect assessments, other than assessments
attributable to fines.
SECTION 12. ORS 94.640 is amended to read:
94.640. (1) The board of directors of an association may act on
behalf of the association except as limited by the declaration
and the bylaws. In the performance of their duties, officers and
members of the board of directors { - shall exercise the care
required of fiduciaries - } { + are governed by this section
and the applicable provisions of ORS 65.357, 65.361, 65.367,
65.369 and 65.377, whether or not the association is incorporated
under ORS chapter 65 + }.
(2) Unless otherwise provided in the bylaws, the board of
directors may fill vacancies in its membership for the unexpired
portion of any term.
(3) At least annually, the board of directors of an association
shall review the insurance coverage of the association.
(4) The board of directors of the association annually shall
cause to be filed the necessary income tax returns for the
association.
(5) The board of directors of the association may record a
statement of association information as provided in ORS 94.667.
(6) Unless otherwise provided in the declaration or bylaws
{ - , - } { + :
(a) + } The owners may remove any member of the board of
directors, other than members appointed by the declarant or
persons who are ex officio directors, with or without cause, by a
majority vote of all owners present and entitled to vote at any
meeting of the owners at which a quorum is present. { - No - }
{ + (b) + } Removal of a director is { + not + } effective
unless the matter of removal is an item on the agenda and stated
in the notice for the meeting required under ORS 94.650.
(7)(a) All meetings of the board of directors of the
association shall be open to owners, except that at the
discretion of the board the following matters may be considered
in executive session:
(A) Consultation with legal counsel concerning the rights and
duties of the association regarding existing or potential
litigation, or criminal matters;
(B) Personnel matters, including salary negotiations and
employee discipline; { - and - }
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(C) { - The - } Negotiation of contracts with third parties
{ - . - } { + ; and
(D) Collection of unpaid assessments. + }
(b) Except in the case of an emergency, the board of directors
of an association shall vote in an open meeting whether to meet
in executive session. If the board of directors votes to meet in
executive session, the presiding officer of the board of
directors shall state the general nature of the action to be
considered and, as precisely as possible, when and under what
circumstances the deliberations can be disclosed to owners. { +
The statement, motion or decision to meet in executive session
must be included in the minutes of the meeting.
(c) A contract or an action considered in executive session
does not become effective unless the board of directors,
following the executive session, reconvenes in open meeting and
votes on the contract or an action, which must be reasonably
identified in the open meeting and included in the minutes. + }
{ - (c) - } { + (d) + } The meeting and notice requirements
in this section may not be circumvented by chance or social
meetings or by any other means.
(8) In a planned community in which the majority of the lots
are the principal residences of the occupants, meetings
{ - shall be called as follows - } { + of the board of
directors must comply with the following + }:
(a) For other than emergency meetings, notice of board of
directors' meetings shall be posted at a place or places on the
property at least three days prior to the meeting or notice shall
be provided by a method otherwise reasonably calculated to inform
lot owners of such meetings;
(b) Emergency meetings may be held without notice, if the
reason for the emergency is stated in the minutes of the meeting;
and
(c) Only emergency meetings of the board of directors may be
conducted by telephonic communication { + or by the use of a
means of communication that allows all members of the board of
directors participating to hear each other simultaneously or
otherwise to be able to communicate during the meeting. A member
of the board of directors participating in a meeting by this
means is deemed to be present in person at the meeting + }.
(9) The board of directors, in the name of the association,
shall maintain a current mailing address of the association.
{ + (10) The board of directors shall cause the information
required to enable the association to comply with ORS 94.670 (7)
to be maintained and kept current.
(11) As used in this section, 'meeting' means a convening of a
quorum of members of the board of directors where matters
relating to association business are discussed, except a
convening of a quorum of members of the board of directors for
the purpose of participating in litigation, mediation or
arbitration proceedings. + }
SECTION 13. ORS 94.647 is amended to read:
94.647. (1) Unless prohibited or limited by the declaration or
bylaws, any action that may be taken at any annual, regular or
special meeting of the homeowners association may be taken
without a meeting if the association delivers a written ballot to
every association member that is entitled to vote on the
matter. { + Action by written ballot may not substitute for the
following meetings:
(a) A turnover meeting required under ORS 94.616.
Enrolled House Bill 3385 (HB 3385-B) Page 19
(b) An annual meeting of an association if more than a majority
of the lots are the principal residences of the occupants. + }
(2)(a) A written ballot shall set forth each proposed action
and provide an opportunity to vote for or against each proposed
action.
(b) The board of directors must provide owners with at least 10
days' notice before written ballots are mailed or otherwise
delivered. If, at least three days before written ballots are
scheduled to be mailed or otherwise distributed, at least 10
percent of the owners petition the board of directors requesting
secrecy procedures, a written ballot must be accompanied by { + :
(A) + } A secrecy envelope { - , - } { + ; + }
{ + (B) + } A return identification envelope to be signed by
the owner { + ; + } and
{ + (C) + } Instructions for marking and returning the
ballot.
{ + (c) The notice required under paragraph (b) of this
subsection shall state:
(A) The general subject matter of the vote by written ballot;
(B) The right of owners to request secrecy procedures specified
in paragraph (b) of this subsection;
(C) The date after which ballots may be distributed;
(D) The date and time by which any petition must be received by
the board requesting secrecy procedures; and
(E) The address where any petition must be delivered.
(d) + } Notwithstanding the applicable provisions of subsection
(3) or (4) of this section, written ballots that are returned in
secrecy envelopes may not be examined or counted before the
deadline for returning ballots has passed.
(3) Matters that may be voted on by written ballot shall be
deemed approved or rejected as follows:
(a) If approval of a proposed action otherwise would require a
meeting at which a certain quorum must be present and at which a
certain percentage of total votes cast is required to authorize
the action, the proposal shall be deemed to be approved when the
date for the return of ballots has passed, a quorum of owners has
voted and the required percentage of approving votes has been
received. Otherwise, the proposal shall be deemed to be rejected;
or
(b) If approval of a proposed action otherwise would require a
meeting at which a specified percentage of owners must authorize
the action, the proposal shall be deemed to be approved when the
percentage of total votes cast in favor of the proposal equals or
exceeds such required percentage. The proposal shall be deemed to
be rejected when the number of votes cast in opposition renders
approval impossible or when both the date for return of ballots
has passed and such required percentage has not been met. Unless
otherwise prohibited by the declaration or bylaws, the votes may
be counted from time to time before the final return date to
determine whether the proposal has passed or failed by the votes
already cast on the date they are counted.
(4) All solicitations for votes by written ballot shall state
the following:
(a) If approval of a proposal by written ballot requires that
the total number of votes cast equal or exceed a certain quorum
requirement, the number of responses needed to meet such quorum
requirement; and
(b) If approval of a proposal by written ballot requires that a
certain percentage of total votes cast approve the proposal, the
required percentage of total votes needed for approval.
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(5) All solicitations for votes by written ballot shall specify
the period during which the association shall accept written
ballots for counting, which period shall end on the earliest of
the following dates:
(a) If approval of a proposed action by written ballot requires
that a certain percentage of the owners approve the proposal, the
date on which the association has received a sufficient number of
approving ballots;
(b) If approval of a proposed action by written ballot requires
that a certain percentage of the owners approve the proposal, the
date on which the association has received a sufficient number of
disapproving ballots to render approval impossible; or
(c) In all cases, the date certain on which all ballots must be
returned to be counted.
(6) Except as otherwise provided in the declaration or bylaws,
a written ballot may not be revoked.
SECTION 14. ORS 94.660 is amended to read:
94.660. { + (1) + } Unless the bylaws provide otherwise, the
vote or votes of a lot may be cast by absentee ballot or pursuant
to a proxy executed by the owner.
{ + (2) + } An owner may not revoke a proxy given pursuant to
this section except by actual notice of revocation to the person
presiding over a meeting of the association { + or to the board
of directors if a vote is being conducted by written ballot in
lieu of a meeting pursuant to ORS 94.647 + }.
{ + (3) + } A proxy { - shall not be - } { + is not + }
valid if it is undated or purports to be revocable without
notice. A proxy shall terminate one year after its date unless
the proxy specifies a shorter term.
SECTION 15. ORS 94.670 is amended to read:
94.670. (1) A homeowners association shall retain within this
state the documents, information and records delivered to the
association under ORS 94.616 { + and all other records of the
association for not less than the period specified for the record
in ORS 65.771 or any other applicable law except that:
(a) The documents specified in ORS 94.616 (3)(o), if received,
must be retained as permanent records of the association.
(b) Proxies and ballots must be retained for one year from the
date of determination of the vote + }.
(2) All assessments, including declarant subsidies, shall be
deposited in a separate bank account, located within this state,
in the name of the association. All expenses of the association
shall be paid from the association bank account.
(3) The association shall keep financial records sufficiently
detailed for proper accounting purposes. Within 90 days after the
end of the fiscal year, the board of directors shall { + :
(a) Prepare or cause to be prepared an annual financial
statement consisting of a balance sheet and income and expenses
statement for the preceding fiscal year; and
(b) + }Distribute to each owner and, upon written request, any
mortgagee of a lot, a copy of the annual financial statement
{ - consisting of a balance sheet and income and expenses
statement for the preceding fiscal year - } .
(4)(a) The association shall provide, within 10 business days
of receipt of a written request from an owner, a written
statement that provides:
(A) The amount of assessments due from the owner and unpaid at
the time the request was received, including:
(i) Regular and special assessments;
(ii) Fines and other charges;
Enrolled House Bill 3385 (HB 3385-B) Page 21
(iii) Accrued interest; and
(iv) Late payment charges.
(B) The percentage rate at which interest accrues on
assessments that are not paid when due.
(C) The percentage rate used to calculate the charges for late
payment or the amount of a fixed charge for late payment.
(b) The association is not required to comply with paragraph
(a) of this subsection if the association has commenced
litigation by filing a complaint against the owner and the
litigation is pending when the statement would otherwise be due.
(5) The association shall make the documents, information and
records described in subsections (1) and (3) of this section and
all other records of the association reasonably available for
examination { + and, upon written request, available for
duplication + } by an owner and any mortgagee of a lot { - .
Upon the written request of an owner or mortgagee of a lot, the
association shall make available during reasonable hours all such
records for duplication. The documents, information and records
described in subsections (1) and (3) of this section and all
other records of the association shall be located within this
state - } { + that makes the request in good faith for a proper
purpose, except that + } { + records kept by or on behalf of
the association may be withheld from examination and duplication
to the extent the records concern:
(a) Personnel matters relating to a specific identified person
or a person's medical records.
(b) Contracts, leases and other business transactions that are
currently under negotiation to purchase or provide goods or
services.
(c) Communications with legal counsel that relate to matters
specified in paragraphs (a) and (b) of this subsection.
(d) Disclosure of information in violation of law.
(e) Documents, correspondence or management or board reports
compiled for or on behalf of the association or the board of
directors by its agents or committees for consideration by the
board of directors in executive session held in accordance with
ORS 94.640 (7).
(f) Documents, correspondence or other matters considered by
the board of directors in executive session held in accordance
with ORS 94.640 (7).
(g) Files of individual owners, other than those of a
requesting owner or requesting mortgagee of an individual owner,
including any individual owner's file kept by or on behalf of the
association + }.
{ + (6) + } The association shall maintain a copy, suitable
for the purpose of duplication, of the following:
(a) The declaration { - , - } { + and + } bylaws,
{ + including amendments or supplements in effect, the recorded
plat, if feasible, and the + } association rules and regulations
{ - and any amendments or supplements to them - } { +
currently in effect + }.
(b) The most recent financial statement prepared pursuant to
subsection (3) of this section.
(c) The current operating budget of the association.
{ + (d) The reserve study, if any, described in ORS 94.595.
(e) Architectural standards and guidelines, if any. + }
{ - (6) Upon written request of a prospective purchaser, the
association shall make available for examination and duplication
during reasonable hours the documents and information specified
in subsection (5) of this section. - }
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{ + (7) The association, within 10 business days after
receipt of a written request by an owner, shall furnish the
requested information required to be maintained under subsection
(6) of this section. + }
{ - (7) - } { + (8) + } The { - association may
charge - } { + board of directors, by resolution, may adopt
reasonable rules governing the frequency, time, location, notice
and manner of examination and duplication of association records
and the imposition of + } a reasonable fee for furnishing copies
of any documents, information or records described in this
section. The fee may include reasonable personnel costs for
furnishing the documents, information or records.
SECTION 16. ORS 94.704 is amended to read:
94.704. (1) Subject to subsection (2) of this section, the
declarant of a planned community shall pay all common expenses of
the planned community until the individual lots subject to
assessment are assessed for common expenses { + as specified in
the declaration pursuant to ORS 94.580 (2) + }.
(2) { + If the declaration expressly authorizes deferment, + }
the declarant may defer payment of accrued assessments for
reserves required under ORS 94.595 for a lot { + subject to
assessment + } until the date the lot is conveyed. However, the
declarant may not defer payment of accrued assessments for
reserves:
(a) Beyond the date of the turnover meeting provided for in the
bylaws in accordance with ORS 94.635 (3); or
(b) If a turnover meeting is not held, the date the owners
assume administrative control of the association.
(3) Failure of the declarant to deposit the balance due within
30 days after the due date constitutes a violation of ORS 94.777.
(4) The books and records of the association shall reflect the
amount the declarant owes for all reserve account assessments.
(5)(a) Except for assessments under subsections (6), (7) and
(8) of this section, the board of directors shall assess all
common expenses against all the lots that are subject to
assessment according to the allocations stated in the
declaration.
(b) Any assessment or any installment of the assessment past
due shall bear interest at the rate established by resolution of
the board of directors.
(c) Nothing in this section prohibits the board from making
compromises on overdue assessments if the compromise benefits the
association.
(6) { + Unless otherwise provided in the declaration or
bylaws, + } any common expense or any part of a common expense
benefiting fewer than all of the lots may be assessed exclusively
against the lots or units benefited.
(7) { + Unless otherwise provided in the declaration or
bylaws, + } assessments to pay a judgment against the association
may be made only against the lots { - existing in the planned
community at the time the judgment was entered and only - } in
proportion to their common expense liabilities.
(8) If the board of directors determines that any common
expense is the fault of any owner, the homeowners association may
assess the expense exclusively against the lot of the owner.
(9) If the homeowners association reallocates common expense
liabilities, any common expense assessment and any installment of
the assessment not yet due shall be recalculated according to the
reallocated common expense liabilities.
Enrolled House Bill 3385 (HB 3385-B) Page 23
(10)(a) A lot owner may not claim exemption from liability for
contribution toward the common expenses by waiving the use or
enjoyment of any of the common property or by abandoning the
owner's lot.
(b) An owner may not claim to offset an assessment for failure
of the association to perform the association's obligations.
(11)(a) During any period of declarant control, any special
assessment for capital improvements or additions must be approved
by not less than 50 percent of the voting rights, or such greater
percentage as may be specified in the declaration, without regard
to any weighted right or special voting right in favor of the
declarant.
(b) Nothing in this subsection is intended to prohibit a
declarant from reserving a special declarant right to approve any
such assessment.
SECTION 17. ORS 94.709 is amended to read:
94.709. (1) Whenever a homeowners association levies any
assessment against a lot, the association { - , upon complying
with subsection (2) of this section, - } shall have a lien upon
the individual lot for any unpaid assessments { - and interest
as provided in subsection (2)(b) of this section - } { + . The
lien includes interest, late charges, attorney fees, costs or
other amounts imposed under the declaration or bylaws or other
recorded governing document + }. The lien { - shall be - }
{ + is + } prior to a homestead exemption and all other liens or
encumbrances upon the lot except:
(a) Tax and assessment liens; and
(b) A first mortgage or trust deed of record.
{ - (2)(a) An association claiming a lien under subsection
(1) of this section shall file in the county in which the lot or
some part thereof is located a claim containing: - }
{ + (2) Recording of the declaration constitutes record
notice and perfection of the lien for assessments. No further
recording of a claim of lien for assessments or notice of a claim
of lien under this section is required to perfect the
association's lien. The association shall record a notice of
claim of lien for assessments under this section in the deed
records of the county in which a lot is located before any suit
to foreclose may proceed under subsection (4) of this section.
The notice shall contain: + }
{ - (A) - } { + (a) + } A true statement of the amount due
for the unpaid assessments after deducting all just credits and
offsets;
{ - (B) - } { + (b) + } The name of the owner of the lot,
or reputed owner, if known;
{ - (C) - } { + (c) + } The name of the association;
{ - and - }
{ - (D) - } { + (d) + } The description of the lot as
provided in ORS 93.600 { + ; and
(e) A statement that if the owner of the lot thereafter fails
to pay any assessments when due, as long as the original or any
subsequent unpaid assessment remains unpaid, the unpaid amount of
assessments automatically continue to accumulate with interest
without the necessity of further recording + }.
{ - (b) When a claim has been filed and recorded pursuant to
this subsection and the owner of the lot subject to the claim
thereafter fails to pay any assessment chargeable to such lot,
then so long as the original or any subsequent unpaid assessment
remains unpaid, such claim shall automatically accumulate the
Enrolled House Bill 3385 (HB 3385-B) Page 24
subsequent unpaid assessments and interest thereon without the
necessity of further filings under this section. - }
(3) The { - claim - } { + notice + } shall be verified by
the oath of some person having knowledge of the facts and shall
be recorded by the county recording officer. The record shall be
indexed as other liens are required by law to be indexed.
(4) { + (a) + } The proceedings to foreclose liens created by
this section shall conform as nearly as possible to the
proceedings to foreclose liens created by ORS 87.010 { - , - }
except { + , + } { - that - } notwithstanding ORS 87.055, a
lien may be continued in force for a period of time not to exceed
six years from the date the { - claim is filed and recorded
under subsections (2) and (3) of this section - } { + assessment
is due + }. For the purpose of determining the date the
{ - claim is filed - } { + assessment is due + } in those
cases when subsequent unpaid assessments have accumulated under
{ - the claim - } { + a notice recorded + } as provided in
subsection (2) { - (b) - } of this section, the { +
assessment and + } claim regarding each unpaid assessment shall
be deemed to have been { - filed - } { + levied + } at the
time { - such - } { + the + } unpaid assessment became due.
{ + (b) + } The lien may be enforced by the board of
directors acting on behalf of the association.
{ + (c) + } An action to recover a money judgment for unpaid
assessments may be maintained without foreclosing or waiving the
lien securing the claim for unpaid assessments.
(5) Unless the declaration or bylaws provide otherwise, fees,
late charges, fines and interest imposed pursuant to ORS 94.630
(1)(L), (n) and (o) are enforceable as assessments under this
section.
(6) This section does not prohibit an association from pursuing
an action to recover sums for which subsection (1) of this
section creates a lien or from taking a deed in lieu of
foreclosure in satisfaction of the lien.
(7) An action to recover a money judgment for unpaid
{ - common expenses - } { + assessments + } may be maintained
without foreclosing or waiving the lien { - securing the claim
for common expenses - } { + for unpaid assessments + }.
However, recovery on the action operates to satisfy the lien, or
the portion thereof, for which recovery is made.
SECTION 18. ORS 94.712 is amended to read:
94.712. (1) An owner shall be personally liable for all
assessments imposed on the owner or assessed against the owner's
lot by the homeowners association.
(2) { + (a) Subject to paragraph (b) of this subsection, + } in
a voluntary conveyance of a lot, the grantee shall be jointly and
severally liable with the grantor for all unpaid assessments
against the grantor of the lot to the time of the grant or
conveyance, without prejudice to the grantee's right to recover
from the grantor the amounts paid by the grantee therefor.
{ + (b) + } { - However, - } Upon request of { + an owner
or owner's agent, for the benefit of + } a prospective purchaser,
the board of directors shall make and deliver a { + written + }
statement of the unpaid assessments against the prospective
grantor or the lot { + effective through a date specified in the
statement + }, and the grantee in that case shall not be liable
for { - , nor shall the lot when conveyed be subject to, a lien
filed thereafter for - } any unpaid assessments against the
grantor { - in excess of the amount therein set forth - }
{ + not included in the written statement + }.
Enrolled House Bill 3385 (HB 3385-B) Page 25
{ + (3) An escrow agent or a title insurance company
providing escrow services or issuing title insurance in
conjunction with the conveyance:
(a) May rely on a written statement of unpaid assessments
delivered pursuant to this section; and
(b) Is not liable for a failure to pay the association at
closing any amount in excess of the amount set forth in the
written statement. + }
SECTION 19. ORS 94.770 is amended to read:
94.770. (1) The rule against perpetuities may not be applied to
defeat any provision of the declaration, or any bylaws or rules
adopted under ORS 94.630.
(2) In the event of a conflict between the declaration and the
bylaws of a planned community or between the declaration and the
articles of incorporation, the declaration shall prevail except
to the extent the declaration is inconsistent with ORS 94.550 to
94.783.
(3) Title to a unit, lot and common property shall not be
rendered unmarketable or otherwise affected by reason of a
failure of the declarant or the declaration to comply with ORS
94.550 to 94.783.
{ + (4) If the provisions of ORS 94.550 to 94.783 and the
provisions of ORS chapter 65 apply to an association and the
provisions conflict, the provisions of ORS 94.550 to 94.873
control. + }
SECTION 20. ORS 94.775 is amended to read:
94.775. { - No judicial partition may be allowed of any
property in a planned community, nor may any person acquiring any
interest in any damaged or destroyed property in the planned
community seek a judicial partition unless the declarant or the
homeowners association has removed the property from the
provisions of the declaration. - }
{ + (1) Unless the declaration expressly allows the division
of lots in a planned community, judicial partition by division of
a lot in a planned community is not allowed under ORS 105.205.
The lot may be partitioned by sale and division of the proceeds
under ORS 105.245.
(2) The restriction specified in subsection (1) of this section
does not apply if the homeowners association has removed the
property from the provisions of the declaration. + }
{ + NOTE: + } Section 21 was deleted by amendment. Subsequent
sections were not renumbered.
SECTION 22. ORS 100.100 is amended to read:
100.100. (1) In order to submit any property to the provisions
of this chapter, the declarant shall record a declaration in the
office of the recording officer of every county in which such
property is located. The declaration shall comply with ORS
100.105 and shall be executed in accordance with subsection (2)
of this section and acknowledged in the manner provided for
acknowledgment of deeds.
(2) If the declarant is not the fee owner of the property, the
fee owner and the vendor under any instrument of sale shall also
execute the declaration for the purpose of consenting to the
property being submitted to the provisions of this chapter.
(3) If the condominium contains any variable property, the
holder of any mortgage or trust deed shall also execute the
declaration for the purpose of consenting to the property being
submitted to the provisions of ORS 100.005 to 100.625 and the
terms and conditions of the declaration and bylaws.
Enrolled House Bill 3385 (HB 3385-B) Page 26
(4) A flexible or staged condominium may be created only as
provided in ORS 100.005 to 100.625.
(5) The provisions of and rights conferred by ORS 100.005 to
100.910 shall not be varied or waived except as expressly
provided in those statutes. A declarant shall not act under a
power of attorney or use any other device to evade the
limitations or prohibitions in the declaration, bylaws or ORS
100.005 to 100.910.
{ + (6) If the provisions of this chapter and the provisions
of ORS chapter 65 apply to an association and the provisions
conflict, the provisions of this chapter control. + }
SECTION 23. ORS 100.105 is amended to read:
100.105. (1) A declaration shall contain:
(a) A description of the property, including property on which
a unit or a limited common element is located, whether held in
fee simple, leasehold, easement or other interest or combination
thereof, that is being submitted to the condominium form of
ownership and that conforms to the description in the surveyor's
certificate provided under ORS 100.115 (2).
(b) Subject to subsection (11) of this section, a statement of
the interest in the property being submitted to the condominium
form of ownership, whether fee simple, leasehold, easement or
other interest or combination thereof.
(c) Subject to subsection (5) of this section, the name by
which the property shall be known and a general description of
each unit and the building or buildings, including the number of
stories and basements of each building, the total number of units
and the principal materials of which they are constructed.
(d) The unit designation, a statement that the location of each
unit is shown on the plat, a description of the boundaries and
area in square feet of each unit and any other data necessary for
proper identification. The area of a unit shall be the same as
shown for that unit on the plat described in ORS 100.115 (2).
(e) A description of the general common elements.
(f) An allocation to each unit of an undivided interest in the
common elements in accordance with ORS 100.515 and the method
used to establish the allocation.
(g) The designation of any limited common elements including:
(A) A general statement of the nature of the limited common
element;
(B) A statement of the unit to which the use of each limited
common element is reserved, provided the statement is not a
reference to an assignment of use specified on the plat; and
(C) The allocation of use of any limited common element
appertaining to more than one unit.
(h) The method of determining liability for common expenses and
right to common profits in accordance with ORS 100.530.
(i) The voting rights allocated to each unit in accordance with
ORS 100.525 or in the case of condominium units committed as
property in a timeshare plan defined in ORS 94.803, the voting
rights allocated in the timeshare instrument.
(j) A statement of the use, residential or otherwise, for which
the building or buildings and each of the units is intended.
(k) A statement that the designated agent to receive service of
process in cases provided in ORS 100.550 (1) is named in the
Condominium Information Report which will be filed with the Real
Estate Agency in accordance with ORS 100.250 (1)(a).
(L) The method of amending the declaration and the percentage
of voting rights required to approve an amendment of the
declaration in accordance with ORS 100.135.
Enrolled House Bill 3385 (HB 3385-B) Page 27
(m) A statement as to whether or not the association { + of
unit owners + } pursuant to ORS 100.405 (5) and (8) has authority
to grant leases, easements, rights of way, licenses and other
similar interests affecting the general and limited common
elements of the condominium and consent to vacation of roadways
within and adjacent to the condominium.
(n) If the condominium contains a floating structure described
in ORS 100.020 (3), a statement regarding the authority of the
board of directors of the association, subject to ORS 100.410, to
temporarily relocate the floating structure without a majority
vote of affected unit owners.
(o) Any restrictions on alienation of units. Any such
restrictions created by documents other than the declaration may
be incorporated by reference in the declaration to the official
records of the county in which the property is located.
(p) Any other details regarding the property that the person
executing the declaration considers desirable. However, if a
provision required to be in the bylaws under ORS 100.415 is
included in the declaration, the voting requirements for amending
the bylaws shall also govern the amendment of the provision in
the declaration.
(2) In the event the declarant proposes to annex additional
property to the condominium under ORS 100.125, the declaration
shall also contain a general description of the plan of
development, including:
(a) The maximum number of units to be included in the
condominium.
(b) The date after which any right to annex additional property
will terminate.
(c) A general description of the nature and proposed use of any
additional common elements which declarant proposes to annex to
the condominium, if such common elements might substantially
increase the proportionate amount of the common expenses payable
by existing unit owners.
(d) A statement that the method used to establish the
allocation of undivided interest in the common elements, the
method used to determine liability for common expenses and right
to common profits and the method used to allocate voting rights
for each unit annexed shall be as stated in the declaration in
accordance with subsection (1)(f), (h) and (i) of this section.
(e) Such other information as the Real Estate Commissioner
shall require in order to carry out the purposes of ORS 100.015,
100.635 to 100.730 and 100.740 to 100.910.
(3) Except where expressly prohibited by the declaration and
subject to the requirements of ORS 100.135 { - (1) - } { +
(2) + } and subsections (9) and (10) of this section:
(a) Not later than two years following the termination dates
specified in subsections (2)(b) and (7)(d) of this section, such
termination dates may be extended for a period not exceeding two
years; and
(b) The general description under subsection (2)(c) of this
section and the information included in the declaration in
accordance with subsection (7)(c), (g) and (h) of this section
may be changed by an amendment to the declaration.
(4) The information included in the declaration in accordance
with subsection (2)(a) and (d) of this section and subsection
(7)(a), (b), (e), (f) and (k) of this section may not be changed
unless all owners agree to the change and record an amendment to
the declaration in accordance with this chapter.
Enrolled House Bill 3385 (HB 3385-B) Page 28
(5) The name of the property shall include the word '
condominium' or 'condominiums' or the words 'a condominium. '
(6) A condominium may not bear a name which is the same as or
deceptively similar to the name of any other condominium located
in the same county.
(7) If the condominium is a flexible condominium containing
variable property, the declaration shall also contain a general
description of the plan of development, including:
(a) A statement that the rights provided for under ORS 100.150
(1) are being reserved.
(b) A statement:
(A) Of any limitations on rights reserved under ORS 100.150
(1), including whether the consent of any unit owner shall be
required, and if so, a statement of the method by which the
consent shall be ascertained; or
(B) That there are no limitations on rights reserved under ORS
100.150 (1).
(c) A statement of the total number of tracts of variable
property within the condominium, including:
(A) A designation of each tract as withdrawable or
nonwithdrawable variable property;
(B) Identification of each variable tract by a label in
accordance with ORS 100.115 (2)(i);
(C) A statement of the method of labeling each tract depicted
on the plat in accordance with ORS 100.115 (2)(i); and
(D) A statement of the total number of tracts of each type of
variable property.
(d) The termination date, which is the date or time period
after which any right reserved under ORS 100.150 (1) will
terminate, and a statement of the circumstances, if any, that
will terminate any right on or before the date or time period
specified. The date or time period may not exceed seven years
from the recording of the conveyance of the first unit in the
condominium to a person other than the declarant. Recording shall
be in the county in which the property is located.
(e) The maximum number of units that may be created.
(f) A statement that the method used to establish the
allocations of undivided interest in the common elements, the
method used to determine liability for common expenses and right
to common profits and the method used to allocate voting rights
as additional units are created shall be the same as stated in
the declaration in accordance with subsection (1)(f), (h) and (i)
of this section.
(g) A general description of all existing improvements and the
nature and proposed use of any improvements that may be made on
variable property if the improvements might substantially
increase the proportionate amount of the common expenses payable
by existing unit owners.
(h) A statement of whether or not the declarant reserves the
right to create limited common elements within any variable
property, and if so, a general description of the types that may
be created.
(i) A statement that the plat shows the location and dimensions
of all withdrawable variable property that is labeled '
WITHDRAWABLE VARIABLE PROPERTY. '
(j) A statement that if by the termination date all or a
portion of the withdrawable variable property has not been
withdrawn or reclassified, the withdrawable property shall
automatically be withdrawn from the condominium as of the
termination date.
Enrolled House Bill 3385 (HB 3385-B) Page 29
(k) A statement of the rights of the association under ORS
100.155 (2).
(L) A statement of whether or not all or any portion of the
variable property may not be withdrawn from the condominium and,
if so, with respect to the nonwithdrawable variable property:
(A) A statement that the plat shows the location and dimensions
of all nonwithdrawable property that is labeled ' NONWITHDRAWABLE
VARIABLE PROPERTY. '
(B) A description of all improvements that may be made and a
statement of the intended use of each improvement.
(C) A statement that, if by the termination date all or a
portion of the variable property designated as 'nonwithdrawable
variable property' has not been reclassified, the property shall
automatically be reclassified as of the termination date as a
general common element of the condominium and any interest in
such property held for security purposes shall be automatically
extinguished by such classification.
(D) A statement of the rights of the association under ORS
100.155 (3).
(m) A statement by the local governing body or appropriate
department thereof that the withdrawal of any variable property
designated as 'withdrawable variable property' in the declaration
in accordance with paragraph (L) of this subsection, will not
violate any applicable planning or zoning regulation or
ordinance. The statement may be attached as an exhibit to the
declaration.
(8) The plan of development for any variable property included
in the declaration or any supplemental declaration of any stage
in accordance with subsection (7) of this section shall be
subject to any plan of development included in the declaration in
accordance with subsection (2) of this section, except that the
time limitation specified in subsection (7)(d) of this section
shall govern any right reserved under ORS 100.150 (1) with
respect to any variable property.
(9) The information included in the declaration in accordance
with subsection (7)(j), (k) and (m) of this section may not be
deleted by amendment.
(10) Approval by the unit owners shall not be required to
redesignate variable property as 'nonwithdrawable variable
property' by supplemental declaration or amendment if such
redesignation is required by the local governing body or
appropriate department thereof to comply with any planning or
zoning regulation or ordinance. If as a result of such
redesignation the information required to be included in the
supplemental declaration or an amendment under subsection
(7)(L)(B) of this section is inconsistent with the information
included in the declaration or supplemental declaration in
accordance with subsection (7)(g) of this section, an amendment
to the declaration approved by at least 75 percent of owners
shall be required.
(11) The statement of an interest in property other than fee
simple submitted to the condominium form of ownership and any
easements, rights or appurtenances belonging to property
submitted to the condominium form of ownership, whether leasehold
or fee simple, shall include:
(a) A reference to the recording index numbers and date of
recording of the instrument creating the interest; or
(b) A reference to the law, administrative rule, ordinance or
regulation that creates the interest if the interest is created
under law, administrative rule, ordinance or regulation and not
Enrolled House Bill 3385 (HB 3385-B) Page 30
recorded in the office of the recording officer of the county in
which the property is located.
SECTION 24. ORS 100.115 is amended to read:
100.115. (1) When a declaration or a supplemental declaration
under ORS 100.125 is made and approved as required, it shall,
upon the payment of the fees provided by law, be recorded by the
recording officer. The fact of recording and the date thereof
shall be entered thereon. At the time of recording the
declaration or supplemental declaration, the person offering it
for record shall also file an exact copy, certified by the
recording officer to be a true copy thereof, with the county
assessor.
(2) A plat of the land described in the declaration or a
supplemental plat described in a supplemental declaration,
complying with ORS 92.050, 92.060 (1) and (2), 92.080 and 92.120,
shall be recorded simultaneously with the declaration or
supplemental declaration. Upon request, the person offering the
plat or supplemental plat for recording shall also file an exact
copy, certified by the surveyor who made the plat to be an exact
copy of the plat, with the county assessor and the county
surveyor. The exact copy shall be made on suitable drafting
material having the characteristics of strength, stability and
transparency required by the county surveyor. The plat or
supplemental plat, titled in accordance with subsection (4) of
this section, shall:
(a) Show the location of:
(A) All buildings and public roads. The location shall be
referenced to a point on the boundary of the property; and
(B) For a condominium containing units described in ORS 100.020
(3)(b)(C) or (D), the moorage space or floating structure. The
location shall be referenced to a point on the boundary of the
upland property regardless of a change in the location resulting
from a fluctuation in the water level or flow.
(b) Show the designation, location, dimensions and area in
square feet of each unit including:
(A) For units in a building described in ORS 100.020 (3)(b)(A),
the horizontal and vertical boundaries of each unit and the
common elements to which each unit has access. The vertical
boundaries shall be referenced to a known benchmark elevation or
other reference point as approved by the city or county surveyor;
(B) For a space described in ORS 100.020 (3)(b)(B), the
horizontal boundaries of each unit and the common elements to
which each unit has access. If the space is located within a
structure, the vertical boundaries also shall be shown and
referenced to a known benchmark elevation or other reference
point as approved by the city or county surveyor;
(C) For a moorage space described in ORS 100.020 (3)(b)(C), the
horizontal boundaries of each unit and the common elements to
which each unit has access; and
(D) For a floating structure described in ORS 100.020
(3)(b)(D), the horizontal and vertical boundaries of each unit
and the common elements to which each unit has access. The
vertical boundaries shall be referenced to an assumed elevation
of an identified point on the floating structure even though the
assumed elevation may change with the fluctuation of the water
level where the floating structure is moored.
(c) Identify and show, to the extent feasible, the location and
dimensions of all limited common elements described in the
declaration. The plat may not include any statement indicating to
Enrolled House Bill 3385 (HB 3385-B) Page 31
which unit the use of any noncontiguous limited common element is
reserved.
(d) Include a statement, including signature and official seal,
of a registered architect, registered professional land surveyor
or registered professional engineer certifying that the plat
fully and accurately depicts the boundaries of the units of the
building and that construction of the units and buildings as
depicted on the plat has been completed, except that the
professional land surveyor who prepared the plat need not affix a
seal to the statement.
(e) Include a surveyor's certificate, complying with ORS
92.070, that includes information in the declaration in
accordance with ORS 100.105 (1)(a) and a metes and bounds
description or other description approved by the city or county
surveyor.
(f) Include a statement by the declarant that the property and
improvements described and depicted on the plat are subject to
the provisions of ORS 100.005 to 100.625.
(g) Include such signatures of approval as may be required by
local ordinance or regulation.
(h) Include any other information or data not inconsistent with
the declaration that the declarant desires to include.
(i) If the condominium is a flexible condominium, show the
location and dimensions of all variable property identified in
the declaration and label the variable property as 'WITHDRAWABLE
VARIABLE PROPERTY' or 'NONWITHDRAWABLE VARIABLE PROPERTY,' with a
letter different from those designating a unit, building or other
tract of variable property. If there is more than one tract, each
tract shall be labeled in the same manner.
(3) The supplemental plat required under ORS 100.150 (1) shall
be recorded simultaneously with the supplemental declaration.
Upon request, the person offering the supplemental plat for
recording shall also file an exact copy, certified by the
surveyor who made the plat to be an exact copy of the plat, with
the county assessor and the county surveyor. The exact copy shall
be made on suitable drafting material having the characteristics
of strength, stability and transparency required by the county
surveyor. The supplemental plat, titled in accordance with
subsection (4) of this section, shall:
(a) Comply with ORS 92.050, 92.060 (1), (2) and (4), 92.080,
92.120 and subsections (4) and (5) of this section.
(b) If any property is withdrawn:
(A) Show the resulting perimeter boundaries of the condominium
after the withdrawal; and
(B) Show the information required under subsection (2)(i) of
this section as it relates to any remaining variable property.
(c) If any property is reclassified, show the information
required under subsection (2)(a) to (d) of this section.
(d) Include a 'Declarant's Statement' that the property
described on the supplemental plat is reclassified or withdrawn
from the condominium and that the condominium exists as described
and depicted on the plat.
(e) Include a surveyor's affidavit complying with ORS 92.070.
(4) The title of each supplemental plat described in ORS
100.120 shall include the complete name of the condominium,
followed by the additional language specified in this subsection
{ + and the appropriate reference to the stage being annexed or
tract of variable property being reclassified + }. Each
supplemental plat for a condominium recorded on or after January
1, 2002, shall be numbered sequentially and shall:
Enrolled House Bill 3385 (HB 3385-B) Page 32
(a) If property is annexed under ORS 100.125, include the words
'Supplemental Plat No. ___: Annexation of Stage { + ___ + } ; or
(b) If property is reclassified under ORS 100.150, include the
words 'Supplemental Plat No. ___: Reclassification of Variable
Property { + , Tract ___ + } .
(5) Before a plat or a supplemental plat may be recorded, it
must be approved by the city or county surveyor as provided in
ORS 92.100. Before approving the plat as required by this
section, the city or county surveyor shall:
(a) Check the boundaries of the plat and units and take
measurements and make computations necessary to determine that
the plat complies with this section.
(b) Determine that the name complies with ORS 100.105 (5) and
(6).
(c) Determine that the following are consistent:
(A) The designation and area in square feet of each unit shown
on the plat and the unit designations and areas contained in the
declaration in accordance with ORS 100.105 (1)(d);
(B) Limited common elements identified on the plat and the
information contained in the declaration in accordance with ORS
100.105 (1)(g);
(C) The description of the property in the surveyor's
certificate included on the plat and the description contained in
the declaration in accordance with ORS 100.105 (1)(a); and
(D) For a flexible condominium, the variable property depicted
on the plat and the identification of the property contained in
the declaration in accordance with ORS 100.105 (7)(c).
(6) The person offering the plat for approval shall:
(a) Submit a copy of the proposed declaration and bylaws or
applicable supplemental declaration at the time the plat is
submitted; and
(b) Submit the original or a copy of the executed declaration
and bylaws or the applicable supplemental declaration approved by
the commissioner if required by law prior to approval.
(7) For performing the services described in subsection (5)(a)
to (c) of this section, the city surveyor or county surveyor
shall collect from the person offering the plat for approval a
fee of $150 plus $25 per building. The governing body of a city
or county may establish a higher fee by resolution or order.
(8)(a) Whenever variable property is reclassified or withdrawn
as provided in ORS 100.155 (1) or (2) or property is removed as
provided in ORS 100.600 (2), the county surveyor shall, upon the
surveyor's copy of all previously recorded plats relating to the
variable property or property being removed and upon any copy
thereof certified by the county clerk, trace, shade or make other
appropriate marks or notations, including the date and the
surveyor's name or initials, with archival quality black ink in
such manner as to denote the reclassification, withdrawal or
removal. The recording index numbers and date of recording of the
supplemental declaration and plat or amendment and amended plat
shall also be referenced on the copy of each plat. The original
plat may not be changed or corrected after the plat is recorded.
(b) For performing the activities described in this subsection,
the county clerk shall collect a fee set by the county governing
body. The county clerk shall also collect a fee set by the county
governing body to be paid to the county surveyor for services
provided under this subsection.
(9) In addition to the provisions of subsection (10) of this
section, a plat, including any floor plans that are a part of the
plat, may be amended as provided in this subsection.
Enrolled House Bill 3385 (HB 3385-B) Page 33
(a)(A) Except as otherwise provided in ORS 100.600, a change to
the boundary of the property, a unit or a limited common element
or a change to the configuration of other information required to
be graphically depicted on the plat shall be made by a plat
entitled 'Plat Amendment' that shall reference in the title of
the amendment the recording information of the original plat and
any previous plat amendments.
(B) The plat amendment shall comply with ORS 92.050, 92.060
(1), (2) and (4), 92.080 and 92.120 and shall include:
(i) A graphic depiction of the change.
(ii) For a change to the boundary of the property, a surveyor's
certificate, complying with ORS 92.070.
(iii) For a change to a boundary of a unit or a limited common
element or a change to other information required to be
graphically depicted, the statement of a registered architect,
registered professional land surveyor or registered professional
engineer described in subsection (2)(d) of this section.
(iv) A declaration by the chairperson and secretary on behalf
of the association of unit owners that the plat is being amended
pursuant to this subsection. Such declaration shall be executed
and acknowledged in the manner provided for acknowledgment of
deeds.
(C) The plat amendment shall be accompanied by an amendment to
the declaration authorizing such plat amendment. The declaration
amendment shall be executed, approved and recorded in accordance
with ORS 100.110 and 100.135.
(D) Before a plat amendment may be recorded, it must be
approved by the city or county surveyor as provided in ORS
92.100. The surveyor shall approve the plat amendment if it
complies with the requirements of this subsection. The person
offering the plat amendment shall:
(i) Submit a copy of the proposed amendment to the declaration
required under this paragraph when the plat amendment is
submitted; and
(ii) Submit the original or a copy of the executed amendment to
the declaration approved by the commissioner if required by law
prior to approval of the plat amendment.
(E) Upon request, the person offering the plat amendment for
recording shall also file an exact copy, certified by the
surveyor who made the plat to be an exact copy of the plat
amendment, with the county assessor and the county surveyor. The
exact copy shall be made on suitable drafting material having the
strength, stability and transparency required by the county
surveyor.
(b)(A) A change to a restriction or other information not
required to be graphically depicted on the plat may be made by
amendment of the declaration without a plat amendment described
in paragraph (a) of this subsection. An amendment under this
paragraph shall include:
(i) A reference to recording index numbers and date of
recording of the declaration, plat and any applicable
supplemental declarations, amendments, supplemental plats or plat
amendments.
(ii) A description of the change to the plat.
(iii) A statement that the amendment was approved in accordance
with the declaration and ORS 110.135.
(B) The amendment shall be executed, approved and recorded in
accordance with ORS 100.110 and 100.135.
(C) Before the amendment may be recorded, it must be approved
by the city or county surveyor as provided in ORS 92.100. The
Enrolled House Bill 3385 (HB 3385-B) Page 34
surveyor shall approve the amendment if it complies with this
subsection. Such approval shall be evidenced by execution of the
amendment or by written approval attached thereto.
(c)(A) Floor plans of a condominium for which a plat was not
required at the time of creation may be amended by an amendment
to the declaration. An amendment under this paragraph shall
include:
(i) A reference to recording index numbers and date of
recording of the declaration and any applicable supplemental
declarations or amendments.
(ii) A description of the change to the floor plans.
(iii) A graphic depiction of any change to the boundaries of a
unit or common element and a statement by a registered architect,
registered professional land surveyor or registered professional
engineer certifying that such graphic depiction fully and
accurately depicts the boundaries of the unit or common element
as it currently exists.
(B) The amendment shall be approved and recorded in accordance
with ORS 100.110 and 100.135 except that any change to the floor
plans need only comply with the requirements of the unit
ownership laws in effect at the time the floor plans were
initially recorded.
(d) After recording of any declaration amendment or plat
amendment pursuant to this subsection, the county surveyor shall,
upon the surveyor's copy of all previously recorded plats
relating to the condominium and any copies filed under ORS 92.120
(3), make such appropriate marks or notations, including the date
and the surveyor's name or initials, with archival quality black
ink in such manner as to denote the changes. The recording index
numbers and date of recording of the declaration amendment and
any plat amendment shall also be referenced on the copy of each
plat. The original plat may not be changed or corrected after the
plat is recorded. For performing the services described in this
subsection, the county surveyor shall collect from the person
offering the plat amendment or declaration amendment for approval
a fee established by the county governing body.
(10) The following may be amended by an affidavit of correction
in accordance with ORS 92.170:
(a) A plat, whenever recorded.
(b) Floor plans recorded prior to October 15, 1983.
SECTION 25. ORS 100.130 is amended to read:
100.130. (1) Subject to any limitations contained in the
declaration, the boundaries between adjoining units, including
any intervening common elements, may be relocated or eliminated
by an amendment to the declaration. The owners of the affected
units shall submit to the board of directors of the association a
proposed amendment which shall identify the units involved, state
any reallocations of common element interest, voting rights,
common expense liability and right to common profits and contain
words of conveyance. The board of directors shall approve the
amendment unless it determines within 45 days that the
reallocations are unreasonable or the relocation or elimination
will impair the structural integrity or mechanical systems of the
condominium or lessen the support of any portion of the
condominium.
(2) The board of directors of the association { + of unit
owners + } may require the owners of the affected units to submit
an opinion of a registered architect or registered professional
engineer that the proposed relocation or elimination will not
impair the structural integrity or mechanical systems of the
Enrolled House Bill 3385 (HB 3385-B) Page 35
condominium or lessen the support of any portion of the
condominium.
(3) The board of directors of the association or any agent
appointed by the board of directors may supervise the work
necessary to effect the boundary relocation or elimination.
(4) Any expenses incurred under subsections (2) and (3) of this
section shall be charged to the owners of the units requesting
the boundary relocation or elimination.
(5) The amendment shall be executed by the owners and
mortgagees or trust deed beneficiaries of the affected units,
certified by the { - chairman - } { + chairperson + } and
secretary of the association and approved and recorded in
accordance with ORS 100.135 { - (1)(b) - } { + (2)(b) + }.
(6) An amendment to the plat and any floor plans necessary to
show the altered boundaries between the adjoining units shall be
recorded in accordance with ORS 100.115.
SECTION 26. ORS 100.135 is amended to read:
100.135. { + (1) Unless otherwise provided in the declaration,
an amendment to the declaration may be proposed by a majority of
the board of directors of the association of unit owners or by
least 30 percent of the unit owners. + }
{ - (1) - } { + (2) + } Except as otherwise provided in ORS
100.005 to 100.625, an amendment of the declaration is not
effective unless:
(a) The amendment is approved by the unit owners as provided in
this section and the Real Estate Commissioner and county assessor
according to ORS 100.110; and
(b) The amendment, certified by the chairperson and secretary
of the association of unit owners as being adopted in accordance
with the declaration and the provisions of this section and
acknowledged in the manner provided for acknowledgment of deeds,
is recorded notwithstanding a provision in a declaration,
including a declaration recorded before January 1, 2002, that
requires amendments to be executed and acknowledged by all owners
approving the amendment.
{ - (2) - } { + (3) + } Except as otherwise provided in ORS
100.105 or 100.130 or this section, the declaration may be
amended only with the approval of at least 75 percent of owners,
or such greater percentage as may be required by the declaration.
{ - (3) - } { + (4) + } Unless the declaration requires a
greater percentage:
(a) The declaration and plat may be amended to change a general
common element to a limited common element or change the boundary
of a limited common element with the approval of at least 75
percent of owners and approval of the owners of all units to
which the limited common element appertains.
(b) The declaration may be amended to change a limited common
element, or portion thereof, to a general common element with the
approval of the owners of all units to which the limited common
element appertains and the board of directors.
{ - (4)(a) - } { + (5)(a) + } Except as otherwise provided
in ORS 100.120, 100.130, 100.515, 100.600, 100.605 and 100.625
and paragraph (b) of this subsection or other provisions of the
Oregon Condominium Act, an amendment that changes the boundary of
the property or a unit shall be approved by all unit owners. Such
amendment shall constitute a conveyance and shall include words
of conveyance. In addition to the certification required under
subsection { - (1)(b) - } { + (2)(b) + } of this section, an
amendment to the boundary of a unit shall also be executed by the
owners of all affected units.
Enrolled House Bill 3385 (HB 3385-B) Page 36
(b) An amendment that adds property owned by the association to
the condominium as a common element shall constitute a conveyance
and shall:
(A) Be approved by at least 75 percent of owners;
(B) Contain words of conveyance;
(C) Be executed by the chairperson and secretary of the
association on behalf of the unit owners and be certified in
accordance with subsection { - (1)(b) - } { + (2)(b) + } of
this section; and
(D) Be accompanied by a plat amendment in accordance with ORS
100.115.
(c) Nothing in paragraph (b) of this subsection is intended to
require property acquired or held by the association pursuant to
ORS 100.405 (4)(i) to be added to the condominium.
{ - (5) - } { + (6) + } Except as otherwise provided in ORS
100.005 to 100.625, { - no - } { + an + } amendment may
{ + not + } change the allocation of undivided interest in the
common elements, { + the + } method of determining liability for
common expenses, { + the method of determining the + } right to
common profits or { + the method of determining + } voting
rights of any unit unless such amendment has been approved by the
owners of the affected units.
{ - (6) - } { + (7) + } The declaration may not be amended
to limit or diminish any right of a declarant reserved under ORS
100.105 (2) or (7) or any other special declarant right without
the consent of the declarant. However, the declarant may waive
the declarant's right of consent.
{ - (7) - } { + (8) + } Nothing in this section shall
affect any other approval that may be required by the
declaration, bylaws or other instrument.
{ + (9) During a period of declarant control reserved under
ORS 100.200, voting on an amendment under this section must be
without regard to any weighted vote or other special voting
allocation reserved by the declarant unless the declaration
provides that the declarant has the right to exercise the voting
rights with respect to specifically described amendments. Nothing
in this subsection prohibits a declarant from reserving the right
that declarant's consent is required for an amendment during a
period of declarant control reserved in the declaration. + }
{ - (8) - } { + (10) + } An amendment to a declaration or a
supplemental declaration shall be conclusively presumed to have
been regularly adopted in compliance with all applicable
procedures relating to such amendment unless an action is brought
within one year after the date such amendment was recorded or the
face of the recorded amendment indicates that the amendment
received the approval of fewer votes than are required for such
approval. However, nothing in this subsection shall prevent the
further amendment of an amended declaration or plat in accordance
with ORS 100.005 to 100.625.
{ + (11)(a) The board of directors, by resolution and without
the further approval of the unit owners, may cause a restated
declaration to be prepared and recorded to codify individual
amendments that have been adopted in accordance with this
section.
(b) A declaration restated under this subsection must:
(A) Include all previously adopted amendments that are in
effect and may not include any other changes except to correct
scriveners' errors or to conform format and style;
(B) Include a statement that the board of directors has adopted
a resolution in accordance with paragraph (a) of this subsection
Enrolled House Bill 3385 (HB 3385-B) Page 37
and is causing the declaration to be restated and recorded under
this subsection;
(C) Include a reference to the recording index numbers and date
of recording of the initial declaration and all previously
recorded amendments that are in effect and are being codified;
(D) Include a certification by the chairperson and secretary of
the association that the restated declaration includes all
previously adopted amendments that are in effect, that amendments
were approved by the county assessor and tax collector if
required under ORS 100.110 and that no other changes were made
except, if applicable, to correct scriveners' errors or to
conform format and style;
(E) Be executed and acknowledged by the chairperson and
secretary of the association and recorded in the deed records of
each county in which the condominium is located; and
(F) Be approved by the commissioner, and by the county assessor
and the tax collector under ORS 100.110 if the restated
declaration includes any amendments required to be approved by
the county assessor and the tax collector under ORS 100.110 but
not previously approved.
(c) The board of directors shall cause a copy of the recorded
restated declaration, including the recording information, to be
filed with the commissioner. + }
SECTION 27. ORS 100.175 is amended to read:
100.175. (1) The declarant shall:
(a) Conduct a reserve study described in subsection (3) of this
section; and
(b) Establish a reserve account for replacement of those common
elements all or part of which will normally require replacement
in more than three and less than 30 years, for exterior painting
if the common elements include exterior painted surfaces, and for
such other items as may be required by the declaration or bylaws.
The reserve account need not include:
(A) Items that could reasonably be funded from operating
assessments; or
(B) A reserve for limited common elements for which maintenance
and replacement are the responsibility of one or more unit owners
under the provisions of the declaration or bylaws.
(2)(a) The reserve account must be funded by assessments
against the individual units for the purposes for which the
reserve account is being established.
(b) The assessment under this subsection will accrue from the
time of the conveyance of the first individual unit assessed as
provided in ORS 100.530.
(3)(a) The reserve account shall be established in the name of
the association of unit owners that will be responsible for
administering the account and for making periodic payments into
the account.
(b) The reserve portion of the initial assessment determined by
the declarant shall be based on the following:
(A) The reserve study described in paragraph (c) of this
subsection;
(B) In the case of a conversion condominium, the statement
described in ORS 100.655 (1)(g); or
(C) Other reliable information.
(c) The board of directors of the association annually shall
conduct a reserve study or review and update an existing study to
determine the reserve account requirements and may:
(A) Adjust the amount of payments in accordance with the study
or review; and
Enrolled House Bill 3385 (HB 3385-B) Page 38
(B) Provide for other reserve items that the board of
directors, in its discretion, may deem appropriate.
(d) The reserve study shall include:
(A) Identification of all items for which reserves are to be
established;
(B) The estimated remaining useful life of each item as of the
date of the reserve study;
(C) An estimated cost of maintenance, repair or replacement of
each item at the end of its useful life; and
(D) A 30-year plan with regular and adequate contributions,
adjusted by estimated inflation and interest earned on reserves,
to meet the maintenance, repair and replacement schedule.
(4)(a) If the declaration or bylaws require a reserve account,
the reserve study requirements of subsection (3) of this section
first apply to the association of a condominium recorded prior to
October 23, 1999:
(A) Upon adoption of a resolution by the board of directors in
accordance with the bylaws providing that the requirements of
subsection (3) of this section apply to the association; or
(B) Upon submission to the board of directors of a petition
signed by a majority of unit owners mandating that the
requirements of subsection (3) of this section apply to the
association.
(b) The reserve study shall be completed within one year of the
date of adoption of the resolution or submission of the petition
to the board of directors.
(5)(a) Except as provided in paragraph (b) of this subsection,
the reserve account is to be used only for the purposes for which
reserves have been established and is to be kept separate from
other funds.
(b) After the individual unit owners have assumed
administrative responsibility for the association under ORS
100.210, { + if the board of directors has adopted a resolution,
which may be an annual continuing resolution, authorizing the
borrowing of funds:
(A) + } The board of directors may borrow funds from the
reserve account to meet high seasonal demands on the regular
operating funds or to meet unexpected increases in expenses
{ - which will later be paid from assessments if the board of
directors has adopted a resolution, which may be an annual
continuing resolution, authorizing the borrowing of funds - } .
{ + (B) + } Not later than the adoption of the budget for the
following year, the board of directors shall adopt by resolution
a written payment plan providing for repayment of the borrowed
funds within a reasonable period.
(6) Restrictions on the use of the reserve account do not
prohibit its prudent investment subject to any constraints on
investment of association funds imposed by the declaration,
bylaws or rules of the association of unit owners.
(7) Assessments paid into the reserve account are the property
of the association of unit owners and are not refundable to
sellers of units.
(8) In addition to the authority of the board of directors
under subsection (3)(c) of this section, following turnover, the
association may:
(a) On an annual basis, elect not to fund the reserve account
described in subsection (1) of this section by unanimous vote of
the owners; or
Enrolled House Bill 3385 (HB 3385-B) Page 39
(b) Elect to reduce or increase future assessments for the
reserve account described in subsection (1) of this section by an
affirmative vote of at least 75 percent of the owners.
SECTION 28. ORS 100.405 is amended to read:
100.405. (1)(a) An association of unit owners shall be
organized to serve as a means through which the unit owners may
take action with regard to the administration, management and
operation of the condominium. The association shall be organized
as a corporation for profit or nonprofit corporation or as an
unincorporated association. If the association is incorporated,
the name of the association shall include the complete name of
the condominium.
(b) Unless otherwise provided in the declaration or bylaws, an
unincorporated association may be incorporated if such action is
approved by a majority of unit owners in person, by written
ballot or by proxy at a meeting at which a quorum is present.
(2) Membership in the association of unit owners shall be
limited to unit owners.
(3) The affairs of the association shall be governed by a board
of directors as provided for in the bylaws adopted under ORS
100.410.
(4) Subject to the provisions of the condominium's declaration
and bylaws, and whether or not the association is unincorporated,
the association may:
(a) Adopt and amend bylaws and rules and regulations;
(b) Adopt and amend budgets for revenues, expenditures and
reserves and levy and collect assessments for common expenses
from unit owners;
(c) Hire and terminate managing agents and other employees,
agents and independent contractors;
(d) Defend against any claims, proceedings or actions brought
against it;
(e) Subject to subsection (11) of this section, initiate or
intervene in litigation or administrative proceedings in its own
name, and without joining the individual unit owners, in the
following:
(A) Matters relating to the collection of assessments and the
enforcement of { - governing documents - } { + declarations
and bylaws + };
(B) Matters arising out of contracts to which the association
is a party;
(C) Actions seeking equitable or other nonmonetary relief
regarding matters that affect the common interests of the unit
owners, including but not limited to the abatement of nuisance;
(D) Matters relating to or affecting common elements, including
but not limited to actions for damage, destruction, impairment or
loss of use of any common element;
(E) Matters relating to or affecting the units or interests of
unit owners including but not limited to damage, destruction,
impairment or loss of use of a unit or portion thereof, if:
(i) Resulting from a nuisance or a defect in or damage to a
common element; or
(ii) Required to facilitate repair to any common element; and
(F) Any other matter to which the association has standing
under law or pursuant to the declaration, bylaws or any articles
of incorporation;
(f) Make contracts and incur liabilities;
(g) Regulate the use, maintenance, repair, replacement and
modification of common elements;
Enrolled House Bill 3385 (HB 3385-B) Page 40
(h) Cause additional improvement to be made as a part of the
common elements;
(i) Acquire by purchase, lease, devise, gift or voluntary grant
real or personal property or any interest therein and take, hold,
possess and dispose of real or personal property or any interest
therein;
(j) Impose and receive any payments, fees or charges for the
use, rental or operation of the common elements;
(k) Impose charges for late payments of assessments, attorney
fees for collection of assessments and, after giving
{ + written + } notice and an opportunity to be heard, levy
reasonable fines for violations of the declaration, bylaws and
rules and regulations of the association { - if - } { + ,
provided that + } the charge imposed or fine levied { + by the
association + } is based { + :
(A) + } On a schedule contained in the declaration or bylaws,
or an amendment to either that is delivered to each unit, mailed
to the mailing address of each unit or mailed to the mailing
addresses designated in writing by the owners { - , or based - }
{ + ; or
(B) + } On a resolution adopted by the board of directors or
the association that is delivered to each unit, mailed to the
mailing address of each unit or mailed to the mailing addresses
designated by the owners in writing;
(L) Adopt rules regarding the termination of utility services
paid for out of assessments of the association and access to and
use of recreational and service facilities available to unit
owners and, after giving written notice and an opportunity to be
heard, terminate the rights of any owners to receive such
benefits or services until the correction of any violation
covered by such rule has occurred;
(m) Impose reasonable charges for the preparation and
recordation of amendments to the declaration or statements of
assessments;
(n) Assign its right to future income, including the right to
receive common expense assessments;
(o) Provide for the indemnification of its officers and
executive board, as may be limited by ORS 61.218 (3)(d) (1987
Replacement Part), and maintain directors' and officers'
liability insurance;
(p) Exercise any other powers conferred by the declaration or
bylaws;
(q) Exercise all other powers that may be exercised in this
state by any such association; and
(r) Exercise any other powers determined by the association to
be necessary and proper for the governance and operation of the
association.
(5) Subject to subsection (6) of this section, unless expressly
limited or prohibited by the declaration, the association has the
authority to grant, execute, acknowledge, deliver and record on
behalf of the unit owners leases, easements, rights of way,
licenses and other similar interests affecting the general common
elements and consent to vacation of roadways within and adjacent
to the condominium.
(6) { + (a)(A) Except as provided in subparagraph (B) of this
paragraph, + } the granting of a lease, easement, right of way,
license or other similar interest { - in excess of two years or
consent - } pursuant to subsection (5) of this section shall be
first approved by at least 75 percent of owners.
Enrolled House Bill 3385 (HB 3385-B) Page 41
{ + (B) + } Unless the declaration otherwise
provides { + : + } { - , a grant of any such interest affecting
the general common elements for a term of two years or less shall
not be considered the granting of an interest for which approval
by the unit owners is required under this subsection. - }
{ + (i) The granting of a lease, easement, right of way,
license or other similar interest affecting the general common
elements for a term of two years or less shall require the
approval of a majority of the board of directors.
(ii) The granting of a lease, easement, right of way, license
or other similar interest affecting the general common elements
for a term of more than two years to a public body, as defined in
ORS 174.109, or to a utility or a communications company for
underground installation and maintenance of power, gas, electric,
water or other utility and communication lines and services
requires the approval of a majority of the board of directors.
(iii) The granting of a lease, easement, license or other
similar interest to an owner for the exclusive use of a part of
the general common elements to which the owner's unit provides
primary access requires the approval of a majority of the board
of directors. If the approval by the board of directors includes
the right of the owner to make improvements to the general common
elements to which the owner is being granted exclusive use, ORS
100.535 applies to the general common elements to the same extent
that ORS 100.535 applies to a unit, including the right of the
board under ORS 100.535 to require an owner, at owner's expense,
to submit an opinion of a registered architect or registered
professional engineer that the proposed improvement will not
impair the structural integrity or mechanical systems of the
condominium.
(b) Unless the declaration otherwise provides, the consent to
vacation of roadways within and adjacent to the condominium must
be approved first by at least a majority of unit owners present
voting in person or by proxy at a duly constituted meeting of the
association called for the purpose. + }
(7) The instrument granting an interest or consent pursuant to
subsection (5) of this section shall be executed by the
chairperson and secretary of the association and acknowledged in
the manner provided for acknowledgment of such instruments by
such officers and shall state that such grant or consent was
approved, if appropriate, by at least { - 75 - } { + the + }
percent of owners { + required under subsection (6) of this
section + }.
(8) Unless expressly prohibited by the declaration, any action
permitted under subsections (5) and (6) of this section regarding
a general common element may be taken with respect to any limited
common element, provided that the owner of the unit to which the
use of the limited common element is reserved and the holder of
any mortgage or trust deed affecting the unit consent to the
action and also execute an instrument as provided under
subsection (7) of this section.
(9) Except as otherwise provided in the association's
declaration or bylaws, the board of directors of the association
may modify, close, remove, eliminate or discontinue the use of a
general common element facility or improvement or portion of the
common element landscaping, regardless of whether such facility,
improvement or landscaping is mentioned in the declaration or
shown on the plat provided that:
(a) Nothing in this subsection shall be construed as limiting
the authority of the board of directors, in its discretion, to
Enrolled House Bill 3385 (HB 3385-B) Page 42
seek approval of such modification, closure, removal, elimination
or discontinuance by the unit owners; and
(b) Modification, closure, removal, elimination or
discontinuance other than on a temporary basis of any swimming
pool, spa or recreation or community building must be approved by
at least a majority of the unit owners voting on such matter at a
meeting or by written ballot held in accordance with the
declaration, bylaws or ORS 100.425.
(10)(a) A permit or authorization issued by the board of
directors pursuant to authority granted to the board under law,
the declaration or the bylaws, may be recorded in the deed
records of the county where the condominium is located. An
instrument recorded under this subsection shall:
(A) Include the name of the condominium and a reference to
where the declaration and any applicable supplemental
declarations are recorded;
(B) Identify, by the designations stated in the declaration or
applicable supplemental declaration, all affected units and
common elements;
(C) Include such other information and signatures as may be
required by law, under the declaration or bylaws or as the board
of directors may desire; and
(D) Be executed by the chairperson and secretary of the
association and acknowledged in the manner provided for
acknowledgment of such instruments by the officers.
(b) The board of directors may record an amendment,
modification, termination or other instrument relating to the
permit or authorization described in this subsection. Any such
instrument shall include a reference to the location of the
recorded instrument and be executed by the chairperson and
secretary of the association and acknowledged in the manner
provided for acknowledgment of such instruments.
(11)(a) Subject to paragraph (f) of this subsection, before
initiating litigation or an administrative proceeding in which
the association and an owner have an adversarial relationship,
the party that intends to initiate litigation or an
administrative proceeding shall offer to use any dispute
resolution program available within the county in which the
condominium is located that is in substantial compliance with the
standards and guidelines adopted under ORS 36.175. The written
offer must be hand-delivered or mailed by certified mail, return
receipt requested, to the address, contained in the records of
the association, for the other party.
(b) If the party receiving the offer does not accept the offer
within 10 days after receipt by written notice hand-delivered or
mailed by certified mail, return receipt requested, to the
address, contained in the records of the association, for the
other party, the initiating party may commence the litigation or
the administrative proceeding. The notice of acceptance of the
offer to participate in the program must contain the name,
address and telephone number of the body administering the
dispute resolution program.
(c) If a qualified dispute resolution program exists within the
county in which the condominium is located and an offer to use
the program is not made as required under paragraph (a) of this
subsection, litigation or an administrative proceeding may be
stayed for 30 days upon a motion of the noninitiating party. If
the litigation or administrative action is stayed under this
paragraph, both parties shall participate in the dispute
resolution process.
Enrolled House Bill 3385 (HB 3385-B) Page 43
(d) Unless a stay has been granted under paragraph (c) of this
subsection, if the dispute resolution process is not completed
within 30 days after receipt of the initial offer, the initiating
party may commence litigation or an administrative proceeding
without regard to whether the dispute resolution is completed.
(e) Once made, the decision of the court or administrative body
arising from litigation or an administrative proceeding may not
be set aside on the grounds that an offer to use a dispute
resolution program was not made.
(f) The requirements of this subsection do not apply to
circumstances in which irreparable harm to a party will occur due
to delay or to litigation or an administrative proceeding
initiated to collect assessments, other than assessments
attributable to fines.
SECTION 29. { + Unless the declaration of a condominium
recorded before the effective date of this 2003 Act expressly
limits or prohibits the authority of the association of unit
owners to grant, execute, acknowledge, deliver and record on
behalf of the unit owners leases, easements, rights of way,
licenses and other similar interests affecting the general common
elements and consent to vacation of roadways within and adjacent
to the condominium pursuant to ORS 100.405 (6) in effect at the
time the declaration was recorded, the amendments to ORS 100.405
(6) by section 28 of this 2003 Act apply to a condominium
recorded before the effective date of this 2003 Act. + }
SECTION 29a. { + Section 29 of this 2003 Act is added to and
made a part of ORS chapter 100. + }
SECTION 30. ORS 100.407 is amended to read:
100.407. (1) The association of unit owners shall hold at least
one meeting of the owners each calendar year.
(2) { + (a) + } Special meetings of the association may be
called by the chairperson of the board of directors, a majority
of the board of directors or a percentage of owners specified in
the bylaws. However, the bylaws may not require a percentage
greater than 50 percent or less than 10 percent of the owners for
the purpose of calling a meeting.
{ + (b) If the bylaws do not specify a percentage of owners
that may call a special meeting, 30 percent or more of the owners
may call a special meeting, notice of which shall be given as
specified in this section. + }
(3) { + (a) + } Not less than 10 nor more than 50 days before
any meeting called under this section, the secretary or other
officer of the association specified in the bylaws shall cause
notice to be hand delivered or mailed to the mailing address of
each unit or to the mailing address designated in writing by the
owner, and to all mortgagees that have requested such notice.
{ - Mortgagees may designate a representative to attend a
meeting called under this section. - }
{ + (b) + } The notice shall state the time and place of the
meeting and the items on the agenda, including the general nature
of any proposed amendment to the declaration or bylaws, any
budget changes or any proposal to remove a director or officer of
the association.
{ + (c) Mortgagees may designate a representative to attend a
meeting called under this section. + }
SECTION 31. ORS 100.410 is amended to read:
100.410. (1) The declarant shall adopt on behalf of the
association { + of unit owners + } the initial bylaws
{ - which shall - } { + that + } govern the administration of
Enrolled House Bill 3385 (HB 3385-B) Page 44
the condominium. The bylaws shall be recorded simultaneously with
the declaration as an exhibit or as a separate instrument.
(2) Unless otherwise provided in the declaration or bylaws,
amendments to the bylaws may be proposed by a majority of the
board of directors or by at least 30 percent of the owners.
(3) Subject to subsections (4) and (5) of this section and ORS
100.415 (20), an amendment of the bylaws is not effective unless
{ + the amendment is:
(a) + } Approved by at least a majority of the unit owners
{ - and until a copy of the amendment, - } { + ; and
(b) + } Certified by the chairperson and secretary of the
association of unit owners as being adopted in accordance with
the bylaws and the provisions of this section, { - is - }
{ + acknowledged in the manner provided for acknowledgment of
instruments and + } recorded.
(4) In condominiums { - which - } { + that + } are
exclusively residential:
(a) The bylaws may not provide that greater than a majority
{ + of the unit owners + } is required to amend the bylaws
except for amendments relating to age restrictions, pet
restrictions, limitations on the number of persons who may occupy
units and limitations on the rental or leasing of units.
(b) An amendment relating to a matter specified in paragraph
(a) of this subsection is not effective unless approved by at
least 75 percent of the owners or a greater percentage specified
in the bylaws.
(5) The bylaws may not be amended to limit or diminish any
special declarant right without the consent of the declarant.
However, the declarant may waive the declarant's right of
consent.
(6) { + (a) + } For five years after { + the + } recording
{ + of + } the initial bylaws, before any amended { - bylaws
or amendment to a - } bylaw may be recorded, { - it - }
{ + the amended bylaw + } must be approved by the Real Estate
Commissioner. The commissioner shall approve such amendment if
the requirements of ORS 100.415 and this section have been
satisfied.
{ + (b) The approval by the commissioner under paragraph (a)
of this subsection is not required for bylaws restated under
subsection (10) of this section unless the bylaws are restated
during the five-year period after the recording of the initial
bylaws. + }
(7) Before the commissioner approves amended bylaws { - or an
amendment to a bylaw - } { + or restated bylaws + } under this
section, the person submitting the amended bylaws { - or
amendment to a bylaw - } { + or restated bylaws + } shall pay
to the commissioner the fee provided by ORS 100.670.
{ + (8) Notwithstanding a provision in the bylaws, including
bylaws adopted prior to the effective date of this 2003 Act, that
requires an amendment to be executed, or executed and
acknowledged, by all owners approving the amendment, amendments
to the bylaws under this section become effective after approval
by the owners if executed and certified on behalf of the
association by the chairperson and secretary in accordance with
subsection (3)(b) of this section.
(9) An amendment to the bylaws must be conclusively presumed to
have been regularly adopted in compliance with all applicable
procedures relating to the amendment unless an action is brought
within one year after the effective date of the amendment or the
face of the amendment indicates that the amendment received the
Enrolled House Bill 3385 (HB 3385-B) Page 45
approval of fewer votes than required for the approval. Nothing
in this subsection prevents the further amendment of an amended
bylaw.
(10)(a) The board of directors, by resolution and without the
further approval of unit owners, may cause restated bylaws to be
prepared and recorded to codify individual amendments that have
been adopted in accordance with this section.
(b) Bylaws restated under this subsection must:
(A) Include all previously adopted amendments that are in
effect, state that the amendments were approved by the
commissioner as required under this section and state that no
other changes were made except, if applicable, to correct
scriveners' errors or to conform format and style;
(B) Include a statement that the board of directors has adopted
a resolution in accordance with paragraph (a) of this subsection
and is causing the bylaws to be restated and recorded under this
subsection;
(C) Include a reference to the recording index numbers and date
of recording of the initial bylaws and all previously recorded
amendments that are in effect and are being codified;
(D) Include a certification by the chairperson and secretary of
the association that the restated bylaws include all previously
adopted amendments that are in effect, that amendments were
approved by the commissioner if required under this section and
that no other changes except, if applicable, to correct
scriveners' errors or to conform format and style;
(E) Be executed and acknowledged by the chairperson and
secretary of the association and recorded in the deed records of
each county in which the condominium is located; and
(F) If required under subsection (6) of this section, be
approved by the commissioner.
(c) The board of directors shall cause a copy of the recorded
restated bylaws, including the recording information, to be filed
with the commissioner. + }
SECTION 32. ORS 100.417 is amended to read:
100.417. (1) The board of directors of an association of unit
owners may act on behalf of the association except as limited by
the declaration or bylaws. In the performance of their duties,
officers and members of the board of directors { - shall
exercise the care required of fiduciaries - } { + shall be
governed by this section and the applicable provisions of ORS
65.357, 65.361, 65.367, 65.369 and 65.377 whether or not the
association is incorporated under ORS chapter 65 + }.
(2) Unless otherwise provided in the bylaws, the board of
directors of an association may fill vacancies in its membership
for the unexpired portion of any term.
(3) At least annually, the board of directors of an association
shall review the insurance coverage of the association.
(4) The board of directors of the association annually shall
cause to be filed the necessary income tax returns for the
association.
(5) The board of directors of the association may record a
statement of association information as provided in ORS 94.667.
{ + (6) The board of directors, in the name of the
association, shall maintain a current mailing address.
(7) The board of directors shall cause to be maintained and
kept current the information required to enable the association
to comply with ORS 100.480 (7). + }
{ - (6) - } { + (8) + } Unless otherwise provided in the
declaration or bylaws { - , - } { + :
Enrolled House Bill 3385 (HB 3385-B) Page 46
(a) + } The unit owners may remove any member of the board of
directors of the association, other than members appointed by the
declarant or persons who are ex officio directors, with or
without cause, by a majority vote of all owners present and
entitled to vote at any meeting of the owners at which a quorum
is present.
{ + (b) + } { - No - } Removal of a member of the board of
directors is { + not + } effective unless the matter of removal
is an item on the agenda and stated in the notice for the meeting
required under ORS 100.407.
SECTION 33. ORS 100.420 is amended to read:
100.420. (1)(a) All meetings of the board of directors of the
association of unit owners shall be open to unit owners except
that, in the discretion of the board, the following matters may
be considered in executive session:
(A) Consultation with legal counsel concerning the rights and
duties of the association regarding existing or potential
litigation, or criminal matters;
(B) Personnel matters, including salary negotiations and
employee discipline; { - and - }
(C) { - The - } Negotiation of contracts with third
parties { + ; and
(D) Collection of unpaid assessments + }.
(b) Except in the case of an emergency, the board of directors
of an association shall vote in an open meeting whether to meet
in executive session. If the board of directors votes to meet in
executive session, the presiding officer of the board of
directors shall state the general nature of the action to be
considered { - and - } , as precisely as possible, when and
under what circumstances the deliberations can be disclosed to
owners. { + The statement, motion or decision to meet in
executive session must be included in the minutes of the meeting.
(c) A contract or an action considered in executive session
does not become effective unless the board of directors,
following the executive session, reconvenes in open meeting and
votes on the contract or action, which must be reasonably
identified in the open meeting and included in the minutes. + }
{ - (c) - } { + (d) + } The meeting and notice requirements
in this section may not be circumvented by chance or social
meetings or by any other means.
(2) Except as provided in subsection (3) of this section, board
of directors' meetings may be conducted by telephonic
communication { + or by the use of a means of communication that
allows all members of the board of directors participating to
hear each other simultaneously or otherwise to be able to
communicate during the meeting. A member of the board of
directors participating in a meeting by this means is deemed to
be present in person at the meeting + }.
(3) In condominiums where the majority of the units are the
principal residences of the occupants { + , meetings of the board
of directors shall comply with the following + }:
(a) For other than emergency meetings, notice of board of
directors' meetings shall be posted at a place or places on the
property at least three days prior to the meeting or notice shall
be provided by a method otherwise reasonably calculated to inform
unit owners of such meetings.
(b) Only emergency meetings of the board of directors may be
conducted by telephonic communication { + or in a manner
described in subsection (2) of this section + }.
Enrolled House Bill 3385 (HB 3385-B) Page 47
(4) Subsection (3)(a) of this section first applies to property
submitted to the provisions of this chapter prior to October 3,
1979, upon receipt by the board of directors of the association
of unit owners of a written request from at least one unit owner
that notice of board of directors meetings be given in accordance
with subsection (3)(a) of this section.
{ + (5) As used in this section, 'meeting' means a convening
of a quorum of members of the board of directors where matters
relating to association business are discussed, except a
convening of a quorum of members of the board of directors for
the purpose of participating in litigation, mediation or
arbitration proceedings. + }
SECTION 34. ORS 100.425 is amended to read:
100.425. (1) Unless prohibited or limited by the declaration,
articles of incorporation or bylaws, any action that may be taken
at any annual, regular or special meeting of the association of
unit owners may be taken without a meeting if the association
delivers a written ballot to every association member that is
entitled to vote on the matter. { + Action by written ballot may
not substitute for the following meetings:
(a) The turnover meeting required under ORS 100.210.
(b) The annual meeting of an association if more than a
majority of the units are the principal residences of the
occupants. + }
(2)(a) A written ballot shall set forth each proposed action
and provide an opportunity to vote for or against each proposed
action.
(b) The board of directors must provide owners with at least 10
days' notice before written ballots are mailed or otherwise
delivered. If, at least three days before written ballots are
scheduled to be mailed or otherwise distributed, at least 10
percent of the owners petition the board of directors requesting
secrecy procedures, a written ballot must be accompanied by { + :
(A) + } A secrecy envelope { - , - } { + ; + }
{ + (B) + } A return identification envelope to be signed by
the owner { + ; + } and
{ + (C) + } Instructions for marking and returning the
ballot.
{ + (c) The notice required under paragraph (b) of this
subsection shall state:
(A) The general subject matter of the vote by written ballot;
(B) The right of owners to request secrecy procedures specified
in paragraph (b) of this subsection;
(C) The date after which ballots may be distributed;
(D) The date and time by which any petition must be received by
the board requesting secrecy procedures; and
(E) The address where any petition must be delivered.
(d) + } Notwithstanding the applicable provisions of subsection
(3) or (4) of this section, written ballots that are returned in
secrecy envelopes may not be examined or counted before the
deadline for returning ballots has passed.
(3) Matters that may be voted on by written ballot shall be
deemed approved or rejected as follows:
(a) If approval of a proposed action otherwise would require a
meeting at which a certain quorum must be present and at which a
certain percentage of total votes cast is required to authorize
the action, the proposal shall be deemed to be approved when the
date for return of ballots has passed, a quorum of unit owners
has voted and the required percentage of approving votes has been
Enrolled House Bill 3385 (HB 3385-B) Page 48
received. Otherwise, the proposal shall be deemed to be rejected;
and
(b) If approval of a proposed action otherwise would require a
meeting at which a specified percentage of unit owners must
authorize the action, the proposal shall be deemed to be approved
when the percentage of total votes cast in favor of the proposal
equals or exceeds such required percentage. The proposal shall be
deemed to be rejected when the number of votes cast in opposition
renders approval impossible or when both the date for return of
ballots has passed and such required percentage has not been met.
Unless otherwise prohibited by the declaration, articles of
incorporation or bylaws, the votes may be counted from time to
time before the final return date to determine whether the
proposal has passed or failed by the votes already cast on the
date they are counted.
(4) All solicitations for votes by written ballot shall state
the following:
(a) If approval of a proposal by written ballot requires that
the total number of votes cast equal or exceed a certain quorum
requirement, the number of responses needed to meet such quorum
requirement; and
(b) If approval of a proposal by written ballot requires that a
certain percentage of total votes cast approve the proposal, the
required percentage of total votes needed for approval.
(5) All solicitations for votes by written ballot shall specify
the period during which the association shall accept written
ballots for counting, which period shall end on the earliest of
the following dates:
(a) If approval of a proposed action by written ballot requires
that a certain percentage of the unit owners approve the
proposal, the date on which the association has received a
sufficient number of approving ballots;
(b) If approval of a proposed action by written ballot requires
that a certain percentage of the unit owners approve the
proposal, the date on which the association has received a
sufficient number of disapproving ballots to render approval
impossible; and
(c) In all cases, a date certain on which all ballots must be
returned to be counted.
(6) Except as otherwise provided in the declaration, articles
of incorporation, or bylaws, a written ballot may not be revoked.
SECTION 35. ORS 100.427 is amended to read:
100.427. { + (1) + } Unless the bylaws provide otherwise, the
vote or votes of a unit owner may be cast by absentee ballot or
pursuant to a proxy executed by the owner.
{ + (2) + } An owner may not revoke a proxy given pursuant to
this section except by actual notice of revocation to the person
presiding over a meeting of the association of unit owners { +
or to the board of directors if a vote is being conducted by
written ballot in lieu of a meeting pursuant to ORS 100.425 + }.
{ + (3) + } A proxy { - shall not be - } { + is not + }
valid if it is undated or purports to be revocable without
notice. A proxy shall terminate one year after its date unless
the proxy specifies a shorter term.
SECTION 36. ORS 100.450 is amended to read:
100.450. (1) Whenever an association of unit owners levies any
assessment against a unit, the association of unit owners { - ,
upon complying with subsection (2) of this section, - } shall
have a lien upon the individual unit and the undivided interest
in the common elements appertaining to such unit for any unpaid
Enrolled House Bill 3385 (HB 3385-B) Page 49
assessments { - and interest as provided in subsection (2)(b)
of this section - } . { + The lien includes interest, late
charges, attorney fees, costs or other amounts levied under the
declaration or bylaws. + } The lien { - shall be - }
{ + is + } prior to a homestead exemption and all other liens or
encumbrances upon the unit except:
(a) Tax and assessment liens; and
(b) A { - prior - } { + first + } mortgage or trust deed of
record unless:
(A) The condominium consists of fewer than seven units, all of
which are to be used for nonresidential purposes;
(B) The declaration provides that the lien of any mortgage or
trust deed of record affecting the property shall be subordinate
to the lien of the association provided under subsection (1) of
this section; and
(C) The holder of any mortgage or trust deed of record
affecting the property when the declaration is recorded executes
a separate subordination of the holder's interest to the
declaration which is attached as an exhibit and which states that
the holder understands that the declaration subordinates the
holder's lien to the assessment lien of the association provided
under subsection (1) of this section.
(2) { - (a) An association of unit owners claiming the
benefits of subsection (1) of this section shall record in the
county in which the unit or some part thereof is located a claim
containing - } { + Recording of the declaration constitutes
record notice and perfection of the lien for assessments. No
further recording of a claim of lien for assessments or notice of
a claim of lien under this section is required to perfect the
association's lien. The association shall record a notice of
claim of lien for assessments under this section in the deed
records of the county in which the unit is located before any
suit to foreclose may proceed under subsection (4) of this
section. The notice shall contain:
(a) + } A true statement of the amount due for the unpaid
assessments after deducting all just credits and offsets;
{ + (b) + } The name of the owner of the unit, or reputed
owner, if known;
{ + (c) + } The name of the condominium and the designation
of the unit as stated in the declaration or applicable
supplemental declaration { + ; and
(d) A statement that if the owner of the unit thereafter fails
to pay any assessments when due, as long as the original or any
subsequent unpaid assessment remains unpaid, the unpaid amount of
assessments automatically continue to accumulate with interest
without the necessity of further recording + }.
{ - (b) When a claim has been filed and recorded pursuant to
this section and the owner of the unit subject to the claim
thereafter fails to pay any assessment chargeable to such unit,
then so long as the original or any subsequent unpaid assessment
remains unpaid such claim shall automatically accumulate the
subsequent unpaid assessments and interest thereon without the
necessity of further filings under this section. - }
(3) The { - claim - } { + notice + } shall be verified by
the oath of some person having knowledge of the facts and shall
be recorded by the county recording officer. The record shall be
indexed as other liens are required by law to be indexed.
(4) { + (a) + } The proceedings to foreclose liens created by
this section shall conform as nearly as possible to the
proceedings to foreclose liens created by ORS 87.010 { - , - }
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except { + , + } { - that - } notwithstanding ORS 87.055, a
lien may be continued in force for a period of time not to exceed
six years from the date the { - claim is filed under subsection
(3) of this section - } { + assessment is due + }. For the
purpose of determining the date the { - claim is filed - }
{ + assessment is due + } in those cases { - where - }
{ + when + } subsequent unpaid assessments have accumulated
under { - the claim - } { + a notice recorded + } as provided
in subsection (2) { - (b) - } of this section, the
{ + assessment and + } claim regarding each unpaid assessment
shall be deemed to have been { - filed - } { + levied + } at
the time { - such - } { + the + } unpaid assessment became
due.
{ + (b) + } The lien may be enforced by the board of
directors acting on behalf of the association of unit owners.
{ + (c) + } An action to recover a money judgment for unpaid
assessments may be maintained without foreclosing or waiving the
lien securing the claim for unpaid assessments.
{ + (d) + } { - No - } { + An + } action to foreclose a
lien under this section or recover a money judgment for unpaid
assessments may { + not + } be maintained unless the Condominium
Information Report and the Annual Report described in ORS 100.250
are designated current as provided in ORS 100.255.
(5) Unless the declaration or bylaws provides otherwise, fees,
late charges, fines and interest imposed pursuant to ORS 100.405
(4)(j), (k), (L) and (m) are enforceable as assessments under
this section.
(6) With respect to condominium units also constituting
timeshare property as defined by ORS 94.803, liens created by
this section shall be assessed to the timeshare owners in the
timeshare property according to the method for determining each
owner's liability for common expenses under the timeshare
instrument and shall be enforced individually against each
timeshare owner in the condominium unit.
(7) Notwithstanding the priority established for a lien for
unpaid assessments and interest under subsection (1) of this
section, the lien shall also be prior to the lien of { - any
prior - } { + a first + } mortgage or trust deed of record for
the unit and the undivided interest in the common elements, if:
(a) The association of unit owners for the condominium in which
the unit is located has given the lender under the mortgage or
trust deed 90 days prior written notice that the owner of the
unit is in default in payment of an assessment. The notice shall
contain:
(A) Name of borrower;
(B) Recording date of trust deed or mortgage;
(C) Recording information;
(D) Name of condominium, unit owner and unit designation stated
in the declaration or applicable supplemental declaration; and
(E) Amount of unpaid assessment.
(b) The notice under paragraph (a) of this subsection shall set
forth the following in 10-point type:
_________________________________________________________________
NOTICE: The lien of the association may become prior to that of
the lender pursuant to ORS 100.450.
_________________________________________________________________
(c) The lender has not initiated judicial action to foreclose
the mortgage or requested issuance of a trustee's notice of sale
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under the trust deed or accepted a deed in lieu of foreclosure in
the circumstances described in ORS 100.465 prior to the
expiration of 90 days following the notice by the unit owners'
association.
(d) The unit owners' association has provided the lender, upon
request, with copies of any liens filed on the unit, a statement
of the assessments and interest remaining unpaid on the unit and
other documents which the lender may reasonably request.
(e) The borrower is in default under the terms of the mortgage
or trust deed as to principal and interest.
(f) A copy of the notice described in paragraph (a) of this
subsection, together with an affidavit of notice by a person
having knowledge of the facts, has been recorded in the manner
prescribed in subsection (3) of this section. The affidavit shall
recite the date and the person to whom the notice was given.
SECTION 36a. ORS 100.465 is amended to read:
100.465. { - (1) - } Unless the declarations or bylaws
otherwise provide, a deed in lieu of foreclosure accepted by the
holder of a first mortgage or the beneficiary of a first deed of
trust in respect to a condominium unit shall have the effect of
extinguishing a lien of the association { - filed to secure - }
{ + securing + } unpaid assessments { + through the date of
recording of the deed in lieu of foreclosure + } in the following
circumstances:
{ - (a) - } { + (1) + } Written notice has been given to
the association, addressed to the individual authorized to accept
service of process sent by first class mail, return receipt
requested, notifying the association of the mortgagee or
beneficiary's intent to accept a deed in lieu of foreclosure and
stating that the lien of the association may be extinguished in
the circumstances specified in this section; and
{ - (b) - } { + (2) + } The deed in lieu of foreclosure is
recorded not later than 30 days after the date the notice is
mailed to the association.
{ - (2) Unless the declarations or bylaws provide otherwise,
any assessment lien filed by an association after receipt of the
notice described in subsection (1) of this section and less than
30 days before the deed in lieu of foreclosure is recorded, shall
also be extinguished without further notice or action. - }
SECTION 37. ORS 100.475 is amended to read:
100.475. (1) A unit owner shall be personally liable for all
assessments imposed on the unit owner or assessed against the
unit by the association of unit owners.
(2) Where the purchaser of a unit obtains title to the unit as
a result of foreclosure of the first mortgage or trust deed, such
purchaser, the successors and assigns of the purchaser, shall not
be liable for any of the assessments against such unit or its
owner which became due prior to the acquisition of title to such
unit by such purchaser except as specifically provided otherwise
in ORS 100.450. Such unpaid assessments shall be a common expense
of all the unit owners including such purchaser, the successors
and assigns of the purchaser.
(3) { + (a) Subject to paragraph (b) of this subsection, + } in
a voluntary conveyance of a unit, the grantee shall be jointly
and severally liable with the grantor for all unpaid assessments
against the grantor of the unit to the time of the grant or
conveyance, without prejudice to the grantee's right to recover
from the grantor the amounts paid by the grantee therefor.
{ + (b) + } { - However, - } Upon request of { + an owner
or owner's agent, for the benefit of + } a prospective
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purchaser { + , + } the board of directors shall make and deliver
a { + written + } statement of the unpaid assessments against
the prospective grantor or the unit { + effective through a date
specified in the statement + }, and the grantee in that case
shall not be liable for { - , nor shall the unit when conveyed
be subject to, a lien filed thereafter for - } any unpaid
assessments against the grantor { - in excess of the amount
therein set forth - } { + not included in the written
statement + }.
{ + (4) An escrow agent or a title insurance company
providing escrow services or issuing title insurance in
conjunction with the conveyance:
(a) May rely upon a written statement of unpaid assessments
delivered pursuant to this section; and
(b) Is not liable for a failure to pay to the association at
closing any amount in excess of the amount set forth in the
written statement. + }
SECTION 38. ORS 100.480 is amended to read:
100.480. (1) { - The - } { + An + } association of unit
owners shall retain within this state the documents, information
and records delivered to the association under ORS 100.210 { +
and all other records of the association for not less than the
period specified for the record in ORS 65.771 or any other
applicable law, except that:
(a) The documents specified in ORS 100.210 (5)(j), if received,
must be retained as permanent records of the association.
(b) Proxies and ballots must be retained for one year from the
date of determination of the vote + }.
(2) The association of unit owners shall keep financial records
sufficient for proper accounting purposes. All assessments shall
be deposited in a separate bank account, located within this
state, in the name of the association. All expenses of the
association shall be paid from the association bank account.
(3) Within 90 days after the end of the fiscal year, the board
of directors shall { + :
(a) Prepare or cause to be prepared an annual financial
statement consisting of a balance sheet and income and expenses
statement for the preceding fiscal year; and
(b) + } Distribute to each unit owner a copy of the annual
financial statement { - consisting of a balance sheet and
income and expense statement for the preceding fiscal year - } .
(4)(a) The association shall provide, within 10 business days
of receipt of a written request from an owner, a written
statement that provides:
(A) The amount of assessments due from the owner and unpaid at
the time the request was received, including:
(i) Regular and special assessments;
(ii) Fines and other charges;
(iii) Accrued interest; and
(iv) Late payment charges.
(B) The percentage rate at which interest accrues on
assessments that are not paid when due.
(C) The percentage rate used to calculate the charges for late
payment or the amount of a fixed charge for late payment.
(b) The association is not required to comply with paragraph
(a) of this subsection if the association has commenced
litigation by filing a complaint against the owner and the
litigation is pending when the statement would otherwise be due.
(5) { + (a) Except as provided in paragraph (b) of this
subsection, + } the documents, information and records described
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in subsections (1) to (3) of this section and all other records
of the association of unit owners { - shall be located within
this state and shall - } { + must + } be reasonably available
for examination { + and, upon written request, available for
duplication + } by a unit owner and any mortgagee of a unit { +
that makes the request in good faith for a proper purpose + }.
{ - Upon the written request of an owner or mortgagee of a unit,
the association shall make the documents, information and records
described in subsections (1) to (3) of this section and other
records available for duplication during reasonable hours. - }
{ + (b) Records kept by or on behalf of the association may
be withheld from examination and duplication to the extent the
records concern:
(A) Personnel matters relating to a specific identified person
or a person's medical records.
(B) Contracts, leases and other business transactions that are
currently under negotiation to purchase or provide goods or
services.
(C) Communications with legal counsel that relate to matters
specified in subparagraphs (A) and (B) of this paragraph.
(D) Disclosure of information in violation of law.
(E) Documents, correspondence or management or board reports
compiled for or behalf of the association or the board of
directors by its agents or committees for consideration by the
board of directors in executive session held in accordance with
ORS 100.420 (1).
(F) Documents, correspondence or other matters considered by
the board of directors in executive session held in accordance
with ORS 100.420 (1).
(G) Files of individual owners, other than those of a
requesting owner or requesting mortgagee of an individual owner,
including any individual owner's file kept by or on behalf of the
association.
(6) + } The association of unit owners shall maintain a copy,
suitable for the purpose of duplication, of the following:
(a) The declaration { - , - } { + and + } bylaws,
{ + including amendments or supplements in effect, the recorded
plat, if feasible, and the + } association rules and regulations
{ - and any amendments or supplements thereto - }
{ + currently in effect + };
(b) The most recent annual financial statement prepared in
accordance with subsection (3) of this section; { - and - }
(c) The current operating budget of the association { - . - }
{ + ;
(d) The reserve study, if any, described in ORS 100.175; and
(e) Architectural standards and guidelines, if any. + }
{ - (6) Upon the written request of a prospective purchaser,
the association of unit owners shall make available for
examination and duplication during reasonable hours the documents
and information specified in subsection (5) of this section. - }
{ + (7) The association, within 10 business days after
receipt of a written request by an owner, shall furnish the
requested information required to be maintained under subsection
(6) of this section. + }
{ - (7) - } { + (8) + } The { - association of unit
owners may charge - } { + board of directors, by resolution,
may adopt reasonable rules governing the frequency, time,
location, notice and manner of examination and duplication of
association records and the imposition of + } a reasonable fee
for furnishing copies of any documents, information or records
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described in this section. The fee may include reasonable
personnel costs incurred to furnish the information.
{ - (8) - } { + (9) + }Subsection (3) of this section
first applies to property submitted to the provisions of this
chapter before January 1, 1982, when the board of directors of
the association of unit owners receives a written request from at
least one unit owner that a copy of the annual financial
statement be distributed in accordance with subsection (3) of
this section.
SECTION 39. ORS 100.625 is amended to read:
100.625. (1) Subject to the provisions of the declaration and
any applicable law, and upon compliance with this section:
(a) A unit designated in the declaration to be used for
commercial, industrial or other nonresidential purpose may be
divided by an owner, including the declarant, into two or more
units.
(b) A unit owned by the declarant and located in a condominium
that consists exclusively of units designated in the declaration
to be used for nonresidential purposes, may be divided or
converted into two or more units, common elements or a
combination of units and common elements.
(2) The owner of a unit to be divided or converted shall submit
to the board of directors of the association of unit owners a
proposed amendment which shall:
(a) State the purposes of the amendment;
(b) Assign an identifying number to each unit created;
(c) Reallocate the interest in the common elements and the use
of any limited common elements, voting rights, common expense
liability and the right to common profits in the manner
prescribed in the declaration;
(d) Indicate the means of access for each unit to common
elements; and
(e) Include any additional provisions necessary to conform any
other provisions of the declaration or bylaws.
(3) The board of directors shall approve the proposed amendment
unless the board determines within 45 days that the amendment is
inconsistent with the declaration or bylaws, or the division or
conversion will impair the structural integrity or mechanical
systems of the condominium or lessen the support of any portion
of the condominium.
(4) The board of directors may require the owner of the unit to
be divided or converted to submit an opinion of a registered
professional engineer as to whether or not the proposed division
or conversion will impair the structural integrity or mechanical
systems of the condominium or weaken the support of any portion
of the condominium. The board of directors or any agent appointed
by the board of directors may supervise the work necessary to
effect the division or conversion. Any expenses incurred under
this section shall be charged to the owner of the unit requesting
the division or conversion.
(5) The amendment shall be executed by the owner and mortgagees
or trust deed beneficiaries of the affected unit, certified by
the chairperson and secretary of the association and approved and
recorded in accordance with ORS 100.135 { - (1)(b) - }
{ + (2)(b) + }.
(6) A plat showing each unit created or the conversion of a
unit to common elements or combination thereof shall be recorded
in accordance with ORS 100.115.
(7) This section applies only if the declaration expressly
permits and contains:
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(a) A statement of the maximum number of units into which a
unit may be divided under subsection (1) of this section;
(b) A general description of the nature and proposed use of any
unit or portion of any unit which the declarant may convert to
common elements; and
(c) A statement of the method to be used to reallocate interest
in the common elements, the use of any limited common elements,
voting rights, common expense liability and right to common
profits.
SECTION 40. ORS 100.655 is amended to read:
100.655. (1) The disclosure statement submitted to the Real
Estate Commissioner as part of a filing under ORS 100.635 shall
contain the following information:
(a) The name and address of the condominium, and the name,
address and telephone number of the developer;
(b) A general narrative description of the condominium stating
the total number of units, a description of the types of units,
the total number of units that may be included in the condominium
pursuant to ORS 100.105 (2), and a precise statement of the
nature of the interest which is being offered;
(c) If at the time of filing:
(A) The construction of the project is not completed, general
disclosure of the status of construction and the actual or
scheduled dates of completion of buildings, recreational
facilities and other common elements, including a statement
describing any recreational facilities or improvements to the
common elements that the developer reserves the right to develop
or promises to develop, or a statement that there are no such
facilities or improvements; or
(B) The construction of the project is completed, the actual
dates of completion of buildings, recreational facilities and
other common elements if known by the developer;
(d) The nature and significant terms of any financing offered
by the developer to purchasers of the condominium units;
(e) Copies of any warranties for structural elements and
mechanical and other systems or a brief description of such
warranties;
(f)(A) A current or projected budget of the association of unit
owners for the operation and maintenance and any other common
expenses of the condominium, including an amount for a subsidy of
the association by the declarant, if any, by a contribution of
funds, goods or services;
(B) A brief statement of the method of determining liability
for common expenses and the right to common profits; and
(C) The following notice in at least { - 14-point - }
{ + 12-point + }type that is either all capitals or boldface:
_________________________________________________________________
NOTICE TO PROSPECTIVE PURCHASERS
THE PROJECTION OF THE BUDGET OF THE ASSOCIATION OF UNIT OWNERS
FOR THE OPERATION AND MAINTENANCE AND OTHER COMMON EXPENSES OF
THE CONDOMINIUM IS ONLY AN ESTIMATE, PREPARED WITH DUE CARE.
_________________________________________________________________
(g) If a provision for reserves under ORS 100.175 is included
in the budget disclosed under paragraph (f) of this subsection:
(A) A statement identifying the information constituting the
basis for the reserve assessment under ORS 100.175 (3)(b); and
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(B) A statement that the information constituting the basis for
the reserve assessment identified under ORS 100.175 (3)(b) is
available for review upon written request to the declarant or the
designated person, unless included in the disclosure statement;
(h) In the case of a conversion condominium, a statement of:
(A) The present condition of all structural components and
major mechanical and utility installations in the condominium,
including the approximate date of construction and a reasonable
estimate of the remaining useful life of, at a minimum, the roof,
siding, plumbing, electrical, HVAC system, asphalt, sidewalks and
decks;
(B) Whether or not the assessment of conditions under
subparagraph (A) of this paragraph, which shall be in at least
{ - 14-point - } { + 12-point + } type that is all capitals
or boldface, was prepared by a licensed engineer, architect or
home inspector; and
(C) The statutory procedure required to create a conversion
condominium;
(i) A cross-reference to the portions of the declaration, any
supplemental declaration and bylaws containing the general power
and authority of the board of directors, the method of
apportionment of voting rights among the members of the
association of unit owners and a statement of the nature and
extent of control of the board of directors retained by the
developer by voting rights or otherwise;
(j) A list of the documents by which purchasers may be bound,
including the declaration, bylaws, ground leases, management
agreement, easements, covenants, restrictions and conditions;
(k) A statement of whether there are any restrictions on
alienation of units or any use or occupancy restrictions, such as
limitations on residential or commercial use, pets, age of
occupants or number of occupants, and a cross-reference to those
portions of the declaration, any supplemental declaration, bylaws
or any other document containing the principal provisions
relating to those restrictions; and
(L) If the condominium is a staged condominium:
(A) Whether the declarant reserves the right to annex
additional property to the condominium pursuant to ORS 100.125
and, if so:
(i) The maximum number of units;
(ii) The date after which annexation right terminates;
(iii) The description of additional common elements declarant
reserves right to annex to the property and whether such common
elements might substantially increase the proportionate amount of
common expenses by current unit owners; and
(iv) The effect of annexation of additional units on allocation
of interest in the common elements and voting rights.
(B) If the condominium or any stage being filed under ORS
100.635 contains or may contain any variable property, a
statement of the rights reserved by the declarant under ORS
100.150 (1) and the results specified in ORS 100.155 if such
rights are not exercised.
(2) In lieu of the disclosure statement required under
subsection (1) of this section, the commissioner may accept a
disclosure report issued or approved by another state or
governmental agency.
(3) No disclosure statement is required for condominiums
described in ORS 100.660.
Enrolled House Bill 3385 (HB 3385-B) Page 57
(4) The declarant is not liable to the association or the
owners with respect to a statement of condition or estimate of
useful life contained in the disclosure statement if:
(a) The declarant did not have actual knowledge of any
inaccuracies in the statement at the time of delivery of the
disclosure statement to the purchaser; and
(b) The declarant relied upon reports prepared by licensed
engineers or architects in making the statement { + or, if the
condominium has four or fewer units, reports prepared by licensed
engineers, architects or home inspectors + }.
SECTION 41. ORS 100.740 is amended to read:
100.740. (1) Subject to ORS 100.730 (8), a unit sales agreement
shall contain, either upon the first page or upon a separate
sheet attached to such first page, the following notice in at
least { - 14-point - } { + 12-point + } type that is all
capitals or boldface:
_________________________________________________________________
NOTICE TO PURCHASER
(RIGHT OF CANCELLATION)
BY SIGNING A UNIT SALES AGREEMENT YOU ARE INCURRING A
CONTRACTUAL OBLIGATION TO PURCHASE AN INTEREST IN A CONDOMINIUM.
HOWEVER, YOU HAVE THE RIGHT TO CANCEL THIS AGREEMENT FOR ANY
REASON FOR FIVE BUSINESS DAYS (EXCLUDING SATURDAYS AND HOLIDAYS)
AFTER WHICHEVER OF THE FOLLOWING IS LAST TO OCCUR:
(1) SIGNING BY THE PURCHASER OF THE UNIT SALES AGREEMENT;
(2) SIGNING BY THE PURCHASER OF THE RECEIPT FOR THE DISCLOSURE
STATEMENT, IF ANY; OR
(3) SIGNING BY THE PURCHASER OF THE RECEIPT FOR A COPY OF THE
CONDOMINIUM DECLARATION AND BYLAWS AND ANY AMENDMENTS OR
SUPPLEMENTS THERETO AFFECTING THE UNIT.
TO CANCEL THIS AGREEMENT, YOU MUST GIVE WRITTEN NOTICE TO THE
DEVELOPER OR THE AGENT OF THE DEVELOPER AT THE FOLLOWING ADDRESS:
____________
____________
____________
____________
____________
(SUGGESTED PROCEDURE)
BEFORE EXECUTING THIS AGREEMENT, OR BEFORE THE CANCELLATION
PERIOD ENDS, YOU SHOULD DO THE FOLLOWING:
(1) CAREFULLY EXAMINE THE DISCLOSURE STATEMENT, IF ANY, ISSUED
BY THE REAL ESTATE COMMISSIONER ON THE CONDOMINIUM AND ALL
ACCOMPANYING INFORMATION DELIVERED BY THE DEVELOPER. OREGON LAW
REQUIRES THE DEVELOPER TO DELIVER TO YOU A COPY OF THE
DECLARATION AND BYLAWS OF THE CONDOMINIUM AND ANY SUPPLEMENTS AND
AMENDMENTS THERETO AFFECTING THE UNIT PRIOR TO THE TIME THE UNIT
SALES AGREEMENT IS FULLY EXECUTED BY ALL PARTIES. A COPY OF THE
DECLARATION AND BYLAWS, AND ANY SUPPLEMENTS AND AMENDMENTS
Enrolled House Bill 3385 (HB 3385-B) Page 58
THERETO, ARE AVAILABLE FROM THE ASSOCIATION FOR EXAMINATION AND
DUPLICATION, AT A REASONABLE FEE, UPON YOUR WRITTEN REQUEST.
(2) INQUIRE OF YOUR LENDER WHETHER YOU CAN GET ADEQUATE
FINANCING ON AN ACCEPTABLE BASIS.
(3) INQUIRE OF THE DEVELOPER AND THE LENDER WHAT THE AMOUNT OF
THE CLOSING COSTS WILL BE.
OREGON LAW REQUIRES THAT YOU IMMEDIATELY BE GIVEN A COPY OF THIS
NOTICE AND A COPY OF THE UNIT SALES AGREEMENT WHEN IT HAS BEEN
FULLY EXECUTED BY ALL PARTIES.
_________________________________________________________________
(2) Except as provided in ORS 100.665, a copy of the notice set
forth in subsection (1) of this section shall be given to each
purchaser at the time of or immediately following the purchaser's
signing of the unit sales agreement, for the use of the
purchaser.
SECTION 42. { + Sections 43 and 44 of this 2003 Act are added
to and made a part of ORS chapter 100. + }
SECTION 43. { + (1) The owner of fee title interest in the
real property underlying a leasehold condominium may submit the
fee title to the provisions of this chapter by the procedures set
forth in this section. Submission has the effect set forth in
section 44 of this 2003 Act.
(2) The fee title interest of a leasehold condominium may be
submitted to the provisions of this chapter by an amendment to
the declaration. The amendment must:
(a) Include a reference to the recording index numbers and date
of recording of the initial declaration, supplemental
declarations recorded pursuant to ORS 100.120 and the lease;
(b) State that the fee title interest in the real property
subject to the leasehold is submitted to the provisions of this
chapter pursuant to this section;
(c) State that the submission of the fee title interest in the
real property subject to the leasehold to the provisions of this
chapter has the effect set forth in section 44 of this 2003 Act;
(d) State that there are no encumbrances against the fee title
interest securing payment of moneys except for the assessments of
the owners association that are not yet due;
(e) Be approved by at least 75 percent of the unit owners or,
if a larger percentage is specified in the declaration to effect
amendments to the declaration, the larger percentage;
(f) Be executed by the fee title holder and the chairperson and
secretary of the association and acknowledged in the manner
provided for acknowledgment of instruments;
(g) Be certified by the chairperson and secretary as being
adopted in accordance with this section;
(h) Be approved as required by ORS 100.110; and
(i) Be recorded in the office of the recording officer of each
county in which the condominium is located.
(3) At the time of submission, the fee title interest being
submitted may not be subject to an encumbrance securing payment
of money except for the assessments of an association that are
not yet due.
(4) Nothing in this section precludes the declarant of a
leasehold condominium, all unit owners and the association from
Enrolled House Bill 3385 (HB 3385-B) Page 59
agreeing to other procedures for submitting the fee title
interest to the provisions of this chapter, provided the
procedures are set forth in:
(a) The declaration; or
(b) An amendment to the declaration approved by at least 75
percent of the unit owners or, if a larger percentage is
specified in the declaration to effect amendments to the
declaration, the larger percentage, and 75 percent of the lenders
holding a first-priority security position in any unit in the
condominium. + }
SECTION 44. { + (1) After an amendment submitting the fee
title interest underlying a leasehold condominium has been
recorded as provided in section 43 of this 2003 Act:
(a) The leasehold or leaseholds affecting the fee title
interest of the land underlying the condominium property must be
converted to individual leaseholds of the units;
(b) The former owner of the underlying fee title interest of
the condominium property shall become the holder of the fee title
interest to all individual units and the lessor of the individual
units. The individual unit owners of the leasehold condominium
units shall become lessees of the fee title condominium units;
(c) Unless otherwise provided by the lease or agreed by the
lessor and lessee of the fee title condominium units, the
obligations to pay rent under the former lease must be allocated
among all former leasehold units on the basis of the percentage
ownership in the common elements of the condominium allocated to
each unit;
(d) Liens against leasehold condominium units become liens on
the lessee's interest in the leased unit and have the same
priority and rights against the leasehold of the individual unit
in the fee title condominium formerly held against the leasehold
condominium unit;
(e) The holder of the fee title to the unit in the fee
condominium shall have the same priority and rights in the
individual leasehold of the fee title condominium unit as was
held under the leases prior to submission of the fee title
interest; and
(f) The fee title interest is not subject to the liens suffered
or incurred by the unit lessee, except for property taxes and
condominium association assessment liens.
(2) The assessor shall assign all value of the fee simple
interest to the fee title condominium units and allocate any
additional value in accordance with the allocation of interest of
each unit in the common elements.
(3) All easements, covenants, conditions and restrictions or
other interests encumbering the fee title and the leasehold at
the time of submission of the fee title to the provisions of this
chapter continue and remain in full force, unaffected by the
submission.
(4)(a) Options to purchase that were granted to unit owners or
to the association prior to submission of the fee title interest
to the provisions of this chapter pursuant to section 43 of this
2003 Act continue according to their terms, except that purchaser
options must be segregated so that each option pertains to an
individual unit only.
(b) Unless the purchase options provide otherwise, the purchase
price must be allocated among the individual units on the basis
of the percentage ownership interest in the common elements
pertaining to individual units.
Enrolled House Bill 3385 (HB 3385-B) Page 60
(c) Except for segregating the former leasehold into individual
leaseholds in each of the units and reallocating lease payments
among the units as provided in this section, the terms and
provisions of the former lease are unaffected by submission of
the fee title to the provisions of this chapter.
(d) Except for segregating the purchase options and allocating
the purchase price, if not otherwise allocated by the terms of
the purchase option, the terms and provisions of the purchase
option are unaffected by submission of the fee title to the
provisions of this chapter. + }
SECTION 45. { + Section 46 of this 2003 Act is added to and
made a part of ORS chapter 65. + }
SECTION 46. { + For a corporation organized under this chapter
and formed pursuant to ORS chapter 100 or subject to regulation
under all or part of the provisions of ORS 94.550 to 94.783 or
under ORS 94.803 and 94.807 to 94.945:
(1) A provision of this chapter that may be avoided by a
corporation by a provision in the corporation's articles of
incorporation, bylaws or otherwise also may be avoided by a
provision in the declaration, bylaws or other recorded governing
document of a planned community or a condominium.
(2) In the event of a conflict between the provisions of this
chapter and:
(a) The declaration and bylaws of a condominium and the
provisions of ORS chapter 100, the declaration and bylaws and the
provisions of ORS chapter 100 control.
(b) The declaration, bylaws and other recorded governing
documents of a planned community and the provisions of ORS 94.550
to 94.783, the declaration, bylaws and other governing documents
and the provisions of ORS 94.550 to 94.873 control.
(c) The recorded timeshare instrument of a timeshare plan and
the provisions of ORS 94.803 and 94.807 to 94.945, the recorded
timeshare instrument and the provisions of ORS 94.803 and 94.807
to 94.945 control. + }
SECTION 47. { + This 2003 Act being necessary for the
immediate preservation of the public peace, health and safety, an
emergency is declared to exist, and this 2003 Act takes effect on
its passage. + }
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Passed by House May 21, 2003
Repassed by House June 26, 2003
...........................................................
Chief Clerk of House
...........................................................
Speaker of House
Passed by Senate June 24, 2003
...........................................................
President of Senate
Enrolled House Bill 3385 (HB 3385-B) Page 61
Received by Governor:
......M.,............., 2003
Approved:
......M.,............., 2003
...........................................................
Governor
Filed in Office of Secretary of State:
......M.,............., 2003
...........................................................
Secretary of State
Enrolled House Bill 3385 (HB 3385-B) Page 62