House Bill 371

AS INTRODUCED

130th General Assemly Regular Session

2013-2014

HB 371

Representatives Grossman, Perales

Cosponsor: Representative Anielski

To amend sections 5311.01,  5311.08, 5311.081, 5311.09, 5311.091, and 5311.22 and to enact sections 5311.082, 5311.083, 5311.15, 5311.28 to 5311.33, and 5311.99  of the Revised Code to require certain unit owners  association managers to hold a real estate broker’s license, to make changes to the board meetings, record retention, and budget procedure requirements of the Condominium Law, and to establish a registry of condominium developments and the Ohio Condominium Dispute Resolution Commission.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1.   That sections 5311.01,  5311.08, 5311.081, 5311.09, 5311.091, and 5311.22 be amended and sections 5311.082, 5311.083, 5311.15, 5311.28, 5311.29, 5311.30, 5311.31, 5311.32, 5311.33, and 5311.99  of the Revised Code be enacted to read as follows:

Sec. 5311.01. As used in this chapter, except as otherwise provided:

(A) “Agent” means any person who represents a developer or who acts for or on behalf of a developer in selling or offering to sell any ownership interest in a condominium development. “Agent” does not include an attorney whose representation of a developer consists solely of rendering legal services.

(B) “Additional property” means land, including surface and air rights, or improvements to land that are described in an original declaration and that may be added in the future to an expandable condominium property.

(C) “Affiliate of a developer” means any person who controls a developer or is controlled by a developer.  For the purposes of this division:

(1)  A person “controls” a developer if  any of the following applies:

(a)  The person is a general partner, officer, member, manager, director, or employer of the developer.

(b)  The person owns, controls, holds with power to vote, or holds proxies representing more than twenty per cent of the voting interest in the developer, doing so either directly or indirectly, acting in concert with one or more other persons, or through one or more subsidiaries.

(c)  The person controls, in any manner, the election of a majority of the developer’s directors.

(d)  The person has contributed more than twenty per cent of the developer’s capital.

(2)  A person “is controlled by” a developer if any of the following applies:

(a)  The developer is a general partner, member, manager, officer, director, or employer of the person.

(b)  The developer owns, controls, holds with power to vote, or holds proxies representing more than twenty per cent of the voting interest in the person, doing so either directly or indirectly, acting in concert with one or more other persons, or through one or more subsidiaries.

(c)  The developer controls, in any manner, the election of a majority of the person’s directors.

(d)  The developer has contributed more than twenty per cent of the person’s capital.

(3) “Control” does not exist for purposes of division (C)(1) or (2) of this section if a person or developer holds any power described in either of those divisions  solely as security for an obligation and that power is not exercised.

(D) “Body of water” means a stream, lake, pond, marsh, river, or other body of natural or artificial surface water.

(E) “Common assessments” means  assessments that are charged proportionately against all units for common purposes.

(F) “Common elements” means, unless otherwise provided in the declaration, the following parts of the condominium property:

(1)  The land described in the declaration;

(2)  All other areas, facilities, places, and structures that are not part of a unit, including, but not limited to, the following:

(a)  Foundations, columns, girders, beams, supports, supporting walls, roofs, halls, corridors, lobbies, stairs, stairways, fire escapes, entrances, and exits of buildings;

(b)  Basements, yards, gardens, parking areas, garages, and storage spaces;

(c)  Premises for the lodging of janitors or persons in charge of the property;

(d)  Installations of central services, including, but not limited to, power, light, gas, hot and cold water, heating, refrigeration, air conditioning, and incinerating;

(e)  Elevators, tanks, pumps, motors, fans, compressors, ducts, and, in general, all apparatus and installations existing for common use;

(f)  Community and commercial facilities that are not listed in division (F)(2)(a), (b), (c), (d), or (e) of this section but provided for in the declaration;

(g)  All parts of the condominium property that are not listed in division (F)(2)(a), (b), (c), (d), (e), or (f) of this section that are necessary or convenient to its existence, maintenance, and safety, that are normally in common use, or that have been designated as common elements in the declaration or drawings.

(G) “Common expenses” means expenses designated as common expenses in this chapter or in the declaration.

(H) “Common losses” means the amount by which the common expenses during any period of time exceeds the common assessments and common profits during that period.

(I) “Common profits” means the amount by which the total income received from any of the following exceeds expenses allocable to the particular income, rental, fee, or charge:

(1)  Assessments charged for special benefits to specific units;

(2)  Rents received from the rental of equipment or space in common elements;

(3)  Any other fee, charge, or income other than common assessments.

(J) “Common surplus” means the amount by which common assessments collected during any period exceed common expenses.

(K) “Condominium” means a form of real property ownership in which a declaration has been filed submitting the property to the condominium form of ownership pursuant to this chapter and under which each owner has an individual ownership interest in a unit with the right to exclusive possession of that unit and an undivided ownership interest with the other unit owners in the common elements of the condominium property.

(L) “Condominium development” means a condominium property in which two or more individual residential or water slip units, together with their undivided interests in the common elements of the property, are offered for sale pursuant to a common promotional plan.

(M) “Condominium instruments” means the declaration and accompanying drawings and plans, the bylaws of the unit owners association, the condominium development disclosure statement described in section 5311.26 of the Revised Code, any contracts pertaining to the management of the condominium property, and any other documents, contracts, or instruments establishing ownership of or exerting control over a condominium property or unit.

(N) “Condominium ownership interest” means a fee simple estate or a ninety-nine-year leasehold estate, renewable forever, in a unit, together with an appurtenant undivided interest in the common elements.

(O) “Condominium property” means  all real and personal property submitted to the provisions of this chapter, including land, the buildings, improvements, and structures on that land, the land under a water slip, the buildings, improvements, and structures that form or that are utilized in connection with that water slip, and all easements, rights, and appurtenances belonging to the land or to the land under a water slip.

(P) “Conversion condominium development” means a condominium development that was operated as a rental property and occupied by tenants immediately prior to the submission of the property to the provisions of this chapter.

(Q) “Convertible unit” means a unit that may be converted into one or more units and common elements, including limited common elements.

(R) “Declaration” means the instrument by which property is submitted to the provisions of this chapter.  “Declaration” includes all amendments to that declaration.

(S) “Developer” means any person who directly or indirectly sells or offers for sale condominium ownership interests in a condominium development. “Developer” includes the declarant of a condominium development and any successor to that declarant who stands in the same relation to the condominium development as the declarant.

(T) “Exclusive use area” means common elements that the declaration reserves for delegation by the board of directors to the use of a certain unit or units, to the exclusion of other units.

(U) “Expandable condominium property” means a condominium property in which the original declaration  reserves the right to add additional property.

(V) “Leasehold condominium development” means a condominium development in which each unit owner owns a ninety-nine-year leasehold estate, renewable forever, in the owner’s unit, in the land upon which that unit is situated, or in both, together with an undivided leasehold interest in the common elements, with all leasehold interests due to expire at the same time.

(W) “Limited common elements” means the common elements that the declaration designates as being reserved for use by a certain unit or units, to the exclusion of the other units.

(X) “Offer” includes any inducement or solicitation to encourage a person to acquire a condominium ownership interest in a condominium development.

(Y) “Par value” means a number, expressed in dollars, points, or as a percentage or fraction, attached to a unit by the declaration.

(Z) “Purchaser” means a person who purchases a condominium ownership interest for consideration pursuant to an agreement for the conveyance or transfer of that interest for consideration.

(AA) “Sale of a condominium ownership interest” means the execution by both parties of an agreement for the conveyance or transfer for consideration of a condominium ownership interest. “Sale of a condominium ownership interest” does not include a transfer of one or more units from the developer to another developer, a subsidiary of the developer, or a financial institution for the purpose of facilitating the sale  or development of the remaining or unsold portion of the condominium property or additional property.

(BB)  “Unit” means the part of the condominium property that is designated as a unit in the declaration, is delineated as a unit on the drawings prepared pursuant to section 5311.07 of the Revised Code, and is one of the following:

(1)  A residential unit, in which the designated part of the condominium property is devoted in whole or in part to use as a residential dwelling consisting of one or more rooms on one or more floors of a building.  A “residential unit” may include exterior portions of the building, spaces in a carport, and parking spaces as described and designated in the declaration and drawings.

(2)  A water slip unit, which consists of the land that is under the water in a water slip and the land that is under the piers or wharves that form the water slip, and that is used for the mooring of watercraft.

(3)  A commercial unit in which the property is designated for separate ownership or occupancy solely for commercial purposes, industrial purposes, or other nonresidential or nonwater slip use.

(CC)  “Unit owner” means a person who owns a condominium ownership interest in a unit.

(DD)  “Unit owners association” means the condominium association or other organization that administers the condominium property and that consists of all the owners of units in a condominium property.

(EE)  “Watercraft” has the same meaning as in division (A) of section 1547.01 of the Revised Code.

(FF) “Water slip” means a channel of water between piers or wharves.

(GG) “Manager” or “managing agent” means a person that is responsible, alone or in concert with others, for the management of a condominium property.

Sec. 5311.08.  (A)(1)  Every condominium property shall be administered by a unit owners association.  All power and authority of the unit owners association shall be exercised by a board of directors, which the unit owners shall elect from among the unit owners or the spouses of unit owners.  If a unit owner is not an individual, that unit owner may nominate for the board of directors any principal, member of a limited liability company, partner, director, officer, or employee of that unit owner.

(2) The board of directors shall elect a president, secretary, treasurer, and other officers that the board may desire.

(3)  Unless otherwise provided in the declaration or the bylaws, all meetings of the unit owners association are open to the unit owners, and those present in person or by proxy when action is taken during a meeting of the unit owners association constitute a sufficient quorum.

(4)(a) All meetings of the board of directors shall be open to all unit owners. A portion of each board meeting shall be allocated for comments by unit owners.  A unit owner may send an agent or a representative, as authorized by a notarized statement of the unit owner, to attend a board meeting in the unit owner’s place.

(b) At least five days prior to a meeting of the board of directors, the board shall post a notice of the meeting in the common areas of the condominium property and on the web site maintained by the association or managing agent, if the association or managing agent has a web site. The board also shall send notice to a unit owner who has requested to be included in a mailing list, by electronic mail to the unit owner’s electronic mail address or by traditional mail to the unit owner’s home mailing address, as requested by the unit owner.  The board shall make all public materials provided to board members for the meeting available to unit owners upon request.

(c) A meeting of the board of directors may be held by any method of communication, including electronic or telephonic communication provided that each member of the board, and each unit owner that participates, can hear, participate, and respond to every other member of the board or unit owner.

(b)  In lieu of conducting a meeting, the (d) The board of directors may take action with the unanimous written consent of the members of the board.  Those written consents shall be filed with the minutes of the meetings of the board shall vote on the record.

(B)  The unit owners association shall be governed by bylaws. No modification of or amendment to the bylaws is valid unless it is set forth in an amendment to the declaration, and the amendment to the declaration is filed for record. Unless otherwise provided by the declaration, the bylaws shall provide for the following:

(1)(a)  The election of the board of directors of the unit owners association;

(b)  The number of persons constituting the board;

(c) The terms of the directors, with not less than one-fifth to expire annually;

(d)  The powers and duties of the board;

(e)  The compensation of the directors;

(f) The method of removal of directors from office;

(g) The election of officers of the board;

(h)  Whether or not the services of a manager or managing agent may be engaged.

(2)  The time and place for holding meetings; the manner of and authority for calling, giving notice of, and conducting meetings; and the requirement, in terms of undivided interests in the common elements, of a quorum for meetings of the unit owners association;

(3)   By whom and the procedure by which maintenance, repair, and replacement of the common elements may be authorized;

(4)  The common expenses for which assessments may be made and the manner of collecting from the unit owners their respective shares of the common expenses;

(5)  The method of distributing the common profits;

(6)  By whom and the procedure by which administrative rules governing the operation and use of the condominium property or any portion of the property may be adopted and amended.  These rules may govern any aspect of the condominium property that is not required to be governed by bylaws and may include  standards governing the type and nature of information and documents that are subject to examination and copying by unit owners pursuant to section 5311.091 of the Revised Code, including the times and location at which items may be examined or copied and any required fee for copying the information or documents.

(C)(1) The unit owners association shall be established not later than the date that the deed or other evidence of ownership is filed for record following the first sale of a condominium ownership interest in a condominium development.  Membership in the unit owners association shall be limited to unit owners, and all unit owners shall be members. Until the unit owners association is established, the developer shall act in all instances in which action of the unit owners association or its officers is authorized or required by law or the declaration.

(2)(a)  Not later than sixty days after the  developer has sold and conveyed condominium ownership interests appertaining to  twenty-five per cent of the undivided interests in the common  elements in a condominium development, the unit owners association shall meet, and the unit owners other than the developer shall elect not less than one-third of the members of the board of directors.

(b)  When computing undivided interests in expandable condominium properties for purposes of divisions (C) and (D) of this section, the undivided interests in common elements shall be computed by comparing the number of units sold and conveyed to the maximum number of units that may be created, as stated in the declaration pursuant to division (C)(8) of section 5311.05 of the Revised Code.

(D)(1)  Except as provided in division (C) of this section, the declaration or bylaws of a condominium development may authorize the developer or persons the developer designates to appoint and remove members of the board of directors of the unit owners association and to exercise the powers and responsibilities otherwise assigned by law, the declaration, or the bylaws to the unit owners association or to the board of directors.  The authorization for developer control may extend from the date  the unit owners association is established until sixty  days after the sale and conveyance to purchasers in good faith for value of condominium ownership interests to which  seventy-five per cent of the undivided interests in the common elements appertain, except that in no case may the authorization extend for more than five years after the unit owners association is established if the declaration includes expandable condominium property or more than three years after the unit owners association is established if the declaration does not include expandable condominium property.

(2)  If there is a unit owner other than the developer, the declaration of a condominium development shall not be amended to increase the scope or the period of the developer’s control.

(3)  Within sixty days after the expiration of  the period during which the developer  has control pursuant to division (D)(1) of this section, the unit owners association shall meet and elect all members of the board of directors of the association.  The persons elected shall take office at the end of the meeting during which they are elected and shall, as soon as reasonably possible, appoint officers.

(E) The board of directors, or the developer while in control of the association, may take any measures necessary to incorporate the unit owners association as a not-for-profit corporation.

(F) If the services of a manager or managing agent are engaged, the manager or managing agent shall comply with section 5311.15 of the Revised Code.

Sec. 5311.081. (A)  Unless otherwise provided in the declaration or bylaws, the unit owners association, through the board of directors, shall do both of the following:

(1)  Adopt and amend budgets for revenues, expenditures, and reserves in an amount adequate to repair and replace major capital items in the normal course of operations without the necessity of special assessments, provided that the amount set aside annually for reserves shall not be less than ten per cent of the budget for that year unless the reserve requirement is waived annually by the unit owners exercising not less than a majority of the voting power of the unit owners association;

(2)  Collect assessments for common expenses from unit owners.

(B)  Unless otherwise provided in the declaration, the unit owners association, through the board of directors, may exercise all powers of the association, including the power to do the following:

(1)  Hire Subject to section 5311.15 of the Revised Code, hire and fire managing agents, attorneys, accountants, and other independent contractors and employees that the board determines are necessary or desirable in the management of the condominium property and the association;

(2)  Commence, defend, intervene in, settle, or compromise any civil, criminal, or administrative action or proceeding that is in the name of, or threatened against, the unit owners association, the board of directors, or the condominium property, or that involves two or more unit owners and relates to matters affecting the condominium property;

(3)  Enter into contracts and incur liabilities relating to the operation of the condominium property;

(4)  Regulate the use, maintenance, repair, replacement, modification, and appearance of the condominium property;

(5)  Adopt rules that regulate the use or occupancy of units, the maintenance, repair, replacement, modification, and appearance of units, common elements, and limited common elements when the actions regulated by those rules affect common elements or other units;

(6)  Cause additional improvements to be made as part of the common elements;

(7) Purchase, encumber, and convey units, and, subject to any restrictions in the declaration or bylaws and with the approvals required by division (H)(2) or (3) of section 5311.04 of the Revised Code, acquire an interest in other real property and encumber or convey that interest.  All expenses incurred in connection with the acquisition, encumbrance, use, and operation of that interest are common expenses.

(8)  Acquire, encumber, and convey or otherwise transfer personal property;

(9)  Hold in the name of the unit owners association the real property and personal property acquired pursuant to divisions (B)(7) and (8) of this section;

(10)  Grant easements, leases, licenses, and concessions through or over the common elements;

(11)  Impose and collect fees or other charges for the use, rental, or operation of the common elements or for services provided to unit owners;

(12)  Impose interest and late charges for the late payment of assessments; impose returned check charges; and, pursuant to division (C) of this section, impose reasonable enforcement assessments  for violations of the declaration, the bylaws, and the rules of the unit owners association, and reasonable charges for damage to the common elements or other property;

(13)  Adopt and amend rules that regulate the collection of delinquent assessments and the application of payments of delinquent assessments;

(14)  Subject to applicable laws, adopt and amend rules that regulate the termination of utility or other service to a commercial unit if the unit owner is delinquent in the payment of an assessment that pays, in whole or in part, the cost of that service;

(15)  Impose reasonable charges for preparing, recording, or copying amendments to the declaration, resale certificates, or statements of unpaid assessments;

(16)  Enter a unit for bona fide purposes when conditions exist that involve an imminent risk of damage or harm to common elements, another unit, or to the health or safety of the occupants of that unit or another unit;

(17)  To the extent provided in the declaration or bylaws, assign the unit owners association’s rights to common assessments, or other future income, to a lender as security for a loan to the unit owners association;

(18)  Suspend the voting privileges and use of recreational facilities of a unit owner who is delinquent in the payment of assessments for more than thirty days;

(19)  Purchase insurance and fidelity bonds the directors consider appropriate or necessary;

(20)  Invest excess funds in investments that meet standards for fiduciary investments under Ohio law;

(21)  Exercise powers that are:

(a)  Conferred by the declaration or the bylaws of the unit owners association or the board of directors;

(b)  Necessary to incorporate the unit owners association as a not-for-profit corporation;

(c)  Permitted to be exercised in this state by a not-for-profit corporation;

(d)  Necessary and proper for the government and operation of the unit owners association.

(C)(1)  Prior to imposing a charge for damages or an enforcement assessment pursuant to division (B)(12) of this section, the  board of directors shall give the unit owner a written notice that includes all of the following:

(a)  A description of the property damage or violation;

(b)  The amount of the proposed charge or assessment;

(c)  A statement that the owner has a right to a hearing before the board of directors to contest the proposed charge or assessment;

(d) A statement setting forth the procedures to request a hearing pursuant to division (C)(2) of this section;

(e)  A reasonable date by which the unit owner must cure the violation to avoid the proposed charge or assessment.

(2)(a) To request a hearing, the owner shall deliver a written notice to the board of directors not later than the tenth day after receiving the notice required by  division (C)(1) of this section. If the owner fails to make a timely request for a hearing, the right to that hearing is waived, and the board may immediately impose a charge for damages or an enforcement assessment pursuant to division (C) of this section.

(b) If a unit owner requests a hearing, at least seven days prior to the hearing the board of directors shall provide the unit owner with a written notice that includes the date, time, and location of the hearing.

(3)  The board of directors shall not levy a charge or assessment before holding any hearing requested pursuant to division (C)(2) of this section.

(4) The unit owners, through the board of directors, may allow a reasonable time to cure a violation described in division (B)(12) of this section before imposing a charge or assessment.

(5) Within thirty days following a hearing at which the board of directors imposes a charge or assessment, the unit owners association shall deliver a written notice of the charge or assessment to the unit owner.

(6)  Any written notice that division (C) of  this section requires shall be delivered to the unit owner or any occupant of the unit by personal delivery, by certified mail, return receipt requested, or by regular mail.

(D) Not later than thirty days after the board of directors adopts a budget in accordance with division (A)(1) of this section, the board shall provide to all the unit owners a summary of the budget including an explanation of the amount and method of calculating and funding reserves, if applicable.

 

Sec. 5311.082. (A) The division of real estate and professional licensing in the department of commerce  shall establish and maintain a registry, in the form of a database, of the names of unit owners associations in the state.  Information in the database shall be available for public viewing.  The division shall include access to the information in the database on the division’s web site and in other materials, as determined by the superintendent of real estate and professional licensing.

(B) The division shall perform all of the following duties:

(1)  Adopt, amend, and rescind rules in accordance with Chapter 119. of the Revised Code to carry out sections 5311.082 and 5311.083 of the Revised Code governing the registration of unit owners associations;

(2)  Prescribe the form and content of all applications to be used for registration and renewal of registration pursuant to section 5311.083 of the Revised Code;

(3)  Review applications for registration and issue registration certificates to unit owners associations that meet the requirements for registration pursuant to section 5311.083 of the Revised Code;

(4)  Collect all fees related to the registration and renewal of registration certificates for unit owners associations;

(5)  Maintain a written record of each unit owners association registered with the division, which shall include such documentation as required by the division.  The record shall be available for inspection by the public through the web site and copies shall be made available pursuant to division (B) of section 149.43 of the Revised Code.

(6) Hire all division personnel necessary to implement sections 5311.082 and 5311.083 of the Revised Code.

Sec. 5311.083. (A)(1)  The board of directors of a unit owners association shall apply to the division of real estate and professional licensing in the department of commerce to register the association on forms prescribed by the division.  With the application, the applicant shall submit any information required by the division and a registration fee as specified in rules adopted by the Ohio condominium dispute resolution commission pursuant to division (A)(2) of section 5311.31 of the Revised Code. In no event shall the registration fee exceed three dollars for each unit.

(2)  The director of commerce, by rule adopted in accordance with Chapter 119. of the Revised Code, may reduce the amount of the registration fee required by this section in any year if the director determines that the total amount of funds the fee is generating at the amount specified in the rules adopted by the commission exceeds the amount of funds the division and the commission need to carry out their powers and duties under this chapter.  If the director so reduces the amount of the registration fee, the director shall reduce it for all owners or other persons required to pay the fee under division (A)(1) of this section.  If the director has reduced the fee under division (A)(2) of this section, the director may later raise it up to the amounts permitted under  division (A)(1) of this section if, in any year, the director determines that the total amount of funds the fee is generating at the reduced amount is insufficient for the division and the commission to carry out their powers and duties under this chapter.

(B)  Upon receipt of the completed application form, documentation, and registration fee, the division shall issue a certificate of registration to the unit owners association.  The board of directors of the unit owners association shall display the certificate in a conspicuous place on the premises of the condominium property for which the registration was obtained.  If no appropriate place for displaying the certificate exists on the premises, the board of directors shall keep the certificate of registration on file and available for public inspection at the board’s office or at the office of the unit association’s managing agent.

(C)(1)   Except as otherwise provided in this division, each registration issued pursuant to this section shall expire annually on the thirty-first day of August and may be renewed.  The renewal fee shall be the same as the initial registration fee prescribed under division (A) of this section.

(2) The board of directors of a unit owners association that fails to timely file its renewal with the division also shall  be required to pay a late penalty fee in an amount equal to  fifty per cent of the renewal fee prescribed under  division (C)(1) of this section.

(D)  All registration and renewal fees collected pursuant to this section shall be paid into the state treasury to the credit of the division to be used by the division to carry out its powers and duties under this chapter and by the commission.

Sec. 5311.09.  (A)(1) The   unit owners association shall keep  all of the following:

(a)  Correct and complete books and records of account that specify the receipts and expenditures relating to the common elements and other common receipts and expenses;

(b)  Records showing the allocation, distribution, and collection of the common profits, losses, and expenses among and from the unit owners;

(c)  Minutes of the meetings of the association and the board of directors;

(d)  Records of the names and addresses of the unit owners and their respective  undivided interests in the common elements;

(e) Records showing the names and addresses of the members of the board of directors and association officers;

(f) Records of all actions taken without a meeting of the board of directors;

(g) The original or restated documents described in division (B)(1)(b) of this section;

(h) All financial statements and tax returns, which shall be kept for a minimum of three years;

(i) All current contracts into which the condominium development has entered;

(j) Records of approvals or denials for requests for design or architectural approval from the board of directors or the unit owners association;

(k) Ballots, proxies, and other voting records of the board of directors and the unit owners association, which shall be kept for a minimum of one year.

(2)  Within thirty days after a unit owner obtains a condominium ownership interest, the unit owner shall provide the following information in writing to the unit owners association through the board of directors:

(a)  The home address, home and business mailing addresses, and the home and business telephone numbers of the unit owner and all occupants of the unit;

(b)  The name, business address, and business telephone number of any person who manages the owner’s unit as an agent of that owner and, if that person is required to be licensed under section 4735.02 of the Revised Code, a copy of that person’s license as a real estate broker or salesperson.

(3)  Within thirty days after a change in any information that division (A)(2) of this section requires, a unit owner shall notify the association, through the board of directors, in writing of the change.  When the board of directors requests, a unit owner shall verify or update the information.

(B)(1) When elected members of a board of directors of a unit owners association take control of the association, the declarant or developer shall deliver to the board correct and complete copies of all of the following:

(a)  The books, records, and minutes referred to in division (A) of this section;

(b)  The declaration, the bylaws, the drawings prepared pursuant to section 5311.07 of the Revised Code, as recorded, and any articles of incorporation of the unit owners association, as recorded;

(c)  Except in the case of a conversion condominium, documents, information, and sources of information concerning the location of underground utility lines, and plans and specifications that are not proprietary or copyrighted, of the buildings, other improvements, and structures of the condominium property that are reasonably available to the developer, but only in connection with condominium developments declared on or after the effective date of this amendment July 20, 2004, and condominium developments that are declared prior to that date but originally built or constructed on or after that date.

(2) The board of directors may commence a civil action on behalf of the unit owners association in the court of common pleas of the county in which the condominium property is located to obtain injunctive relief  or recover damages for harm resulting from the declarant’s or developer’s failure to comply with division (B)(1) of this section.

Sec. 5311.091. (A)(1)  Except as otherwise prohibited by this section, any member of a unit owners association or any manager or managing agent of the condominium property may examine and copy the books, records, and minutes information described in division (A) of section 5311.09 of the Revised Code pursuant to reasonable standards set forth in the declaration, bylaws, or rules the board promulgates, which may include, but are not limited to, standards governing the type of documents that are subject to examination and copying, the times and locations at which those documents may be examined or copied, and the specification of a reasonable fee for copying the documents or the supervision of examination.  A member of the unit owners association, manager, or managing agent desiring to examine or copy the information shall submit a notice five days in advance of the date of examination.

(2) Unless otherwise provided in the declaration or bylaws pursuant to division (B)(6) of section 5311.08 of the Revised Code, the board of directors may establish a policy requiring a unit owner, manager, or managing agent that requests records in accordance with division (A)(1) of this section to pay a reasonable charge for copies of the records or supervision for examination of the records.

(B)  The unit owners association is not required to permit the examination and copying of any of the following from books, records, and minutes:

(1)  Information that pertains to condominium property-related personnel matters;

(2)  Communications with legal counsel or attorney work product pertaining to pending litigation or other condominium property-related matters;

(3)  Information that pertains to contracts or transactions currently under negotiation, or information that is contained in a contract or other agreement containing confidentiality requirements and that is subject to those requirements;

(4)  Information that relates to the enforcement of the declaration, bylaws, or rules of the unit owners association against unit owners;

(5)  Information the disclosure of which is prohibited by state or federal law.

Sec. 5311.15.   (A)  No manager or managing agent of a condominium development containing more than ten units shall manage or be hired by a unit owners association pursuant to sections 5311.08 and 5311.081 of the Revised Code unless the manager or managing agent holds an active real estate broker’s license or real estate salesperson’s license issued under Chapter 4735. of the Revised Code.

(B) A real estate salesperson may not perform the duties of a manager or managing agent pursuant to division (A) of this section unless the salesperson is affiliated with a broker who has executed a management agreement with the unit owner’s association.

Sec. 5311.22.  (A)  Unless otherwise provided in the declaration or bylaws, each unit owner may exercise that percentage of the total voting power of all unit owners on any question for which the vote of unit owners is permitted or required that is equivalent to the undivided interest in the common elements appurtenant to the owner’s unit.

(B)  Fiduciaries  who are owners of record of a unit or units may vote their respective interests as unit owners. Unless otherwise provided in the declaration or bylaws, if  two or more persons, whether fiduciaries, tenants in common, or otherwise, own undivided interests in a unit, each person may exercise the proportion of the voting power of all of the owners of the unit that is equivalent to the person’s proportionate undivided interest in the unit.

(C)  A fiduciary for a unit owner or of the estate of a unit owner may vote as though the fiduciary were the unit owner when the fiduciary has furnished to the unit owners association proof, satisfactory to it, of the fiduciary’s appointment and qualification as  an executor under the last will of a deceased unit owner, an administrator of the estate of a deceased unit owner, a guardian, committee, or conservator of the estate of a minor or incompetent who is a unit owner, a trustee in bankruptcy of a unit owner, a statutory or judicial receiver or liquidator of the estate or affairs of a unit owner, or an assignee for the benefit of creditors of a unit owner.

(D)  When any  fiduciary or representative of a unit owner who is not described in division (C) of this section has furnished  the unit owners association with satisfactory proof of authority, that person may vote as though a unit owner.

(E) Unless otherwise provided in the declaration or bylaws, votes allocated to a unit may be cast by a directed or undirected proxy executed by a unit owner, provided that a person shall not cast votes representing more than fifteen per cent of the votes in the unit owners association pursuant to undirected proxies.

Sec. 5311.28. (A) There is hereby created the Ohio condominium dispute resolution commission, consisting of the following  seven members, who shall be appointed by the governor, with the advice and consent of the senate:

(1) Two members shall be unit owners and members of a unit owners association, but not members of a unit owners association board of directors.  One of these members shall be from a small association and one shall be from a large association.

  (2) Two members shall be members of a unit association board of directors.  One of these members shall be from a small association and one shall be from a large association.

(3) One member shall be a certified public accountant.

(4) One member shall be a real estate attorney.

(5)  One member shall represent the public and be a noncondominium property homeowner.

(B)(1) Within a reasonable time, the governor shall make initial appointments to the commission. The initial members of the commission shall serve staggered terms ending on the thirtieth day of June one, two, three, four, or five years after appointment, as determined by the governor. Thereafter, terms of office shall be for five years, commencing on the first day of July and ending on the thirtieth day of June.  Each member shall hold office from the date of appointment until the end of the term for which appointed.  No more than four members shall be members of any one political party. No member of the Ohio condominium dispute resolution commission shall serve concurrently as a member of the Ohio real estate commission or the Ohio real estate appraiser board.  Each member, before entering upon the duties of office, shall subscribe to and file with the secretary of state the constitutional oath of office. The governor may remove any member for misconduct, neglect of duty, incapacity, or malfeasance in accordance with section 3.04 of the Revised Code.  All vacancies that occur shall be filled in the manner prescribed for the regular appointments to the Ohio condominium dispute resolution commission.  Any member appointed to fill a vacancy occurring prior to the expiration of the term for which the member’s predecessor was appointed shall hold office for the remainder of such term.  Any member shall continue in office subsequent to the expiration date of the member’s term until the member’s successor takes office, or until a period of sixty days has elapsed, whichever occurs first.  No member shall hold office for more than two consecutive full terms.

(2)  Annually, upon the qualification of the member appointed in such year, the Ohio condominium dispute resolution commission shall organize by selecting from its members a chairperson and vice-chairperson and shall do all things necessary and proper to carry out and enforce this chapter. 

The Ohio condominium dispute resolution  commission may do all of the following:

(a)  Administer oaths;

(b)  Issue subpoenas;

(c)  Summon witnesses;

(d)  Compel the production of books, papers, records, and other forms of evidence;

(e)  Fix the time and place for hearing any matter related to compliance with sections 5311.08, 5311.081, 5311.083, 5311.09, and 5311.091 of the Revised Code.

(3) The Ohio condominium dispute resolution commission shall meet at least once each calendar quarter to conduct the business of the commission.

(4) A majority of the members of the commission shall constitute a quorum.

(5) Members of the Ohio condominium dispute resolution commission shall receive no compensation but shall be reimbursed for their actual and necessary expenses incurred in the discharge of their duties.

(C) The division of real estate and professional licensing in the department of commerce shall provide the Ohio condominium dispute resolution commission with meeting space, staff services, and other technical assistance required by the commission in carrying out its duties pursuant to sections 5311.29 to 5311.33 of the Revised Code.

(D) As used in this section:

(1) “Small association” means a condominium development with fifty units or less;

(2) “Large association” means a condominium development with more than fifty units.

Sec. 5311.29. The Ohio condominium dispute resolution commission or the superintendent of real estate and professional licensing may compel, by order or subpoena, the production of any book, paper, or document in relation to any matter over which the commission or superintendent has jurisdiction and which is the subject of inquiry and investigation by the commission or superintendent.  The commission or the superintendent also may compel, by order or subpoena, the attendance of witnesses to testify in a hearing held pursuant to section 5311.32 of the Revised Code.  For those purposes, the commission or superintendent shall have the same power as judges of courts of common pleas to administer oaths, compel the attendance of witnesses, and compel the production of any book, paper, or document.  Service of the subpoena may be made by sheriffs or constables, or by certified mail, return receipt requested, and the subpoena shall be deemed served on the date delivery is made or the date the person refused to accept delivery.  Witnesses shall receive, after their appearance before the commission or superintendent, the fees and mileage  provided for under section 119.094 of the Revised Code.  If two or more witnesses travel together in the same vehicle, the mileage fee shall be paid to only one of those witnesses, but the witnesses may agree to divide the fee among themselves in any manner.

In addition to the powers granted to the commission and superintendent under this section, in case any person fails to file any statement or report, obey any subpoena, give testimony, answer questions, or produce any books, records, or papers as required by the commission or superintendent under this chapter, the court of common pleas of any county in the state, upon application made to it by the commission or superintendent setting forth such failure, may make an order awarding process of subpoena or subpoena duces tecum for the person to appear and testify before the commission or superintendent, and may order any person to give testimony and answer questions, and to produce books, records, or papers, as required by the commission or superintendent.  Upon the filing of such order in the office of the clerk of the court of common pleas, the clerk, under the seal of the court, shall issue process of subpoena for the person to appear before the commission or superintendent at a time and place named in the subpoena, and each day thereafter until the examination of such person is completed.  The subpoena may contain a direction that the witness bring with  the witness to the examination any books, records, or papers mentioned in the subpoena.  The clerk shall also issue, under the seal of the court, such other orders, in reference to the examination, appearance, and production of books, records, or papers, as the court directs.  If any person so summoned by subpoena fails to obey the subpoena, to give testimony, to answer questions as required, or to obey an order of the court, the court, on motion supported by proof, may order an attachment for contempt to be issued against the person charged with disobedience of any order or injunction issued by the court under this chapter.  If the person is brought before the court by virtue of the attachment, and if upon a hearing the disobedience appears, the court may order the offender to be committed and kept in close custody.

Sec. 5311.30.  (A)  The Ohio condominium dispute resolution commission is a part of the department of commerce for administrative purposes. The director of commerce is ex officio the executive officer of the commission, or the director may appoint the superintendent of real estate and professional licensing to act as executive officer of the commission.

(B)  The commission or the  superintendent, except as otherwise provided, shall do all of the following:

(1)   Hear and investigate all of the following:

(a) General complaints and disputes between a unit owner and a unit owners association or board of directors;

(b) Requests by a majority of unit owners in a unit owners association or upon a motion of the board of directors of a unit owners association to audit the elections of the unit owners association;

(c) Disputes over access to records of a unit owners association or board of directors.

(2)  Establish and maintain an investigation and audit section to investigate complaints and conduct inspections, audits, and other inquiries as in the judgment of the commission or superintendent are appropriate.  The investigators or auditors have the right to review and audit the records described in division (A)(1) of section 5311.09 of the Revised Code during normal business hours.

(C)  The commission or superintendent may, in connection with investigations and audits under division (B) of this section, subpoena witnesses as provided in section 5311.29 of the Revised Code.

(D)  All information that is obtained by the commission, superintendent, investigators, and auditors performing investigations or conducting inspections, audits, and other inquiries pursuant to division (B) of this section and all reports, documents, and other work products that arise from that information and that are prepared by the commission, investigators, auditors, or other personnel of the department, shall be held in confidence by the superintendent or commission, the investigators and auditors, and other personnel of the department.

Sec. 5311.31. The Ohio condominium dispute resolution commission shall perform all of the following duties:

(A)  Adopt, amend, and rescind such rules in accordance with Chapter 119. of the Revised Code as are necessary in carrying out sections 5311.29 to 5311.33 of the Revised Code, including rules relative to the following:

(1)  Transacting the commission’s business and managing its affairs;

(2) Establishing registration and renewal fees pursuant to section 5311.083 of the Revised Code;

(3)  Establishing procedures for receiving, reviewing, and responding to complaints filed pursuant to section 5311.32 of the Revised Code;

(4)  Conducting investigations in response to complaints filed pursuant to division (A) of section 5311.32 of the Revised Code;

(5) Auditing elections pursuant to division (B) of section 5311.30 of the Revised Code or as part of an investigation in response to complaints filed pursuant to division (A) of section 5311.32 of the Revised Code;

(6) Conducting audits pursuant to division (B) of section 5311.30 of the Revised Code;

(7)  Resolving complaints by using informal techniques of mediation, conciliation, and persuasion, including requiring the parties involved in a complaint to be given prompt notice of any offers to resolve disputes and responses thereto;

(8)  Advising all parties making a complaint, or who are the subject of a complaint, of any recommendations or findings of fact made by the commission with respect to the complaint;

(9)  Requesting the party who has filed a complaint or is the subject of a complaint, and is affected by recommendations of the commission made with respect to the complaint, to notify the commission within a time specified by the commission of any action the party has taken in response to the commission’s recommendations;

(10)  Conducting nonpublic hearings and maintaining commission proceedings and records as confidential, notwithstanding sections 121.22 and 149.43 of the Revised Code when the commission determines that the nature of the complaints merits that action;

(11)  Determining the method to be used in serving notices as required by section 5311.32 of the Revised Code.

(B)  Publicize information concerning the existence and duties of the commission and the procedure for filing complaints pursuant to section 5311.32 of the Revised Code;

(C)  Conduct hearings on complaints pursuant to section 5311.32 of the Revised Code;

(D)  Submit at least annually by the thirty-first day of March a report on the commission’s activities of the immediately preceding calendar year to the governor and the majority and minority leaders of the senate and house of representatives.  The report shall indicate the total number of complaints received, initiated, and investigated under sections 5311.32 and 5311.33 of the Revised Code; the total number of complaints for which hearings were held; and the total number of referrals made to prosecuting attorneys pursuant to section 5311.33 of the Revised Code.

(E)  Review, at least once each year, all actions taken by the prosecuting attorneys in response to referrals made to them by the commission or the superintendent of real estate and professional licensing.  The commission shall include in the report required in division (D) of this section information regarding the nature of the inappropriate conduct alleged in each referral and the status or disposition made of each referral occurring during the preceding two years.

(F)  Perform all functions as are necessary in administering and enforcing sections 5311.29 to 5311.33 of the Revised Code.

Sec. 5311.32. (A)  Any person may file a complaint regarding the activity, practice, policy, or procedure of, or regarding an alleged violation of section 5311.08, 5311.081, 5311.09, or 5311.091 of the Revised Code by, any board of directors of a unit owners association registered pursuant to section 5311.083 of the Revised Code that adversely affects or may adversely affect the interest of a unit owner.  All complaints shall be in writing and submitted to the division of real estate and professional licensing  in the department of commerce on forms provided by the division.

(B)  With respect to complaints filed pursuant to division (A) of this section, the division shall do all of the following:

(1)  Acknowledge receipt of the complaint by sending written notice to the person who filed the complaint not more than twenty days after receipt of the complaint;

(2)  Send written notice of the complaint within seven days after receipt of the complaint to the entity that is the subject of the complaint;

(3)  Before taking further action, allow the entity that is the subject of a complaint thirty days after the date the division sends notice of the complaint to respond to the division with respect to the complaint.

(C)  The Ohio  condominium dispute resolution commission shall hear each complaint filed pursuant to division (A) of this section within one hundred eighty days after its filing, unless it has been resolved by the parties to the complaint.

Sec. 5311.33. (A)  The superintendent of real estate and professional licensing or the Ohio  condominium dispute resolution commission, on the superintendent’s or the commission’s own motion or as a result of a complaint received pursuant to section 5311.32 of the Revised Code and with good cause shown, shall investigate or cause to be investigated alleged violations of sections 5311.08, 5311.081, 5311.09, and 5311.091 of the Revised Code.  If the commission or the superintendent of real estate and professional licensing believes that a violation has occurred, the commission or superintendent shall  do all of the following:

(1) Request the prosecuting attorney of the county in which the alleged violation occurred to initiate such proceedings as are appropriate;

(2) In accordance with section 5311.30 of the Revised Code, audit the records of the condominium association named in the complaint to ensure compliance with this chapter.

(B) The commission or superintendent, at any time, may dismiss a complaint if the commission or superintendent determines there is not good cause shown for the complaint. If the commission or superintendent dismisses a complaint, the commission or superintendent shall notify the person who filed the complaint within twenty days of reaching the  commission’s or superintendent’s decision and identify the reason why the complaint was dismissed.

(C)  When necessary for the division of real estate and professional licensing in the department of commerce  to perform the duties required by sections 5311.32 and 5311.33 of the Revised Code, the superintendent may issue subpoenas and compel the production of books, papers, records, and other forms of evidence.

Sec. 5311.99. (A) Whoever violates section 5311.083 of the Revised Code is guilty of a misdemeanor of the third degree.

(B) Whoever violates section 5311.08, 5311.09, or 5311.091 of the Revised Code is guilty of a misdemeanor of the first degree.

(C) Whoever violates section 5311.081 of the Revised Code is guilty of a felony of the fifth degree, and, notwithstanding section 2929.18 of the Revised Code,  the court may impose upon the offender an additional fine of not more than two thousand five hundred dollars.

Section 2.   That existing sections 5311.01,  5311.08, 5311.081, 5211.09, 5311.091, and 5311.22 of the Revised Code are hereby repealed.

Section 3. Sections 5311.082, 5311.083, and  5311.15 of the Revised Code, as enacted by this act, shall take effect one hundred twenty days after the effective date of this act. During that period, the Superintendent of Real Estate and Professional Licensing shall collect and process applications for unit owners association registration and shall issue certificates of registration.  During that time, no association is required to have a certificate of registration.