Article 002 : Creation, Alteration, and Termination of Common Interest Communities

V.S.A. tit. 27A, ch. 2

in effect

27A V.S.A. § 2-101 Creation of common interest communities

2-101. Creation of common interest communities (a) A common interest community may be created pursuant to this title only by recording a declaration executed in the same manner as a deed. The declaration shall be recorded in each town in which any portion of the common interest community is located and shall be indexed in the grantee’s index in the name of the common interest community and the association and in the grantor’s index in the name of each person executing the declaration. (b) In a condominium, a declaration or an amendment to a declaration to add units may not be recorded unless all structural components and mechanical systems of all building containing or comprising any units created by the declaration are substantially completed in accordance with the plans as evidenced by a recorded certificate of completion executed by an independent professional engineer, surveyor, or architect, as appropriate and if authorized by the respective practice acts of each profession in 26 V.S.A. chapters 3, 20, and 45. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999; amended 1999, No. 133 (Adj. Sess.), § 35.

27A V.S.A. § 2-102 Unit boundaries

2-102. Unit boundaries Except as provided by the declaration in a common interest community: (1) if walls, floors, or ceilings are designated as boundaries of a unit, all wallboard, plasterboard, plaster, paneling, tiles, wallpaper, paint, finished flooring, and any other materials constituting any part of the finished surfaces of the unit are part of the unit, and all other portions of the walls, floors, or ceilings are part of the common elements; (2) if any chute, flue, duct, wire, conduit, bearing wall, bearing column, or any other fixture lies partially within and partially outside the designated boundaries of a unit, any portion of it serving only that unit is a limited common element allocated solely to that unit, and any portion of it serving more than one unit or any portion of the common elements is a part of the common elements; (3) subject to the provisions of subdivision (2) of this section, all spaces, interior partitions, and other fixtures and improvements within the boundaries of a unit are part of the unit; and (4) any shutters, awnings, window boxes, doorsteps, stoops, porches, balconies, patios, and all exterior doors and windows or other fixtures designed to serve a single unit but located outside the unit’s boundaries are limited common elements allocated exclusively to that unit. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-103 Construction and validity of declaration and bylaws

2-103. Construction and validity of declaration and bylaws (a) All provisions of the declaration and bylaws are severable. (b) The rule against perpetuities may not be applied to defeat any provision of the declaration, bylaws, or rules adopted pursuant to this title. (c) If a conflict exists between the declaration and the bylaws, the declaration prevails except to the extent the declaration is inconsistent with this title. (d) Title to a unit is not rendered unmarketable or otherwise affected by an insubstantial failure of the declaration to comply with this title. Whether a substantial failure impairs marketability is not affected by this title. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999; amended 2009, No. 155 (Adj. Sess.), § 15, eff. Jan. 1, 2012.

27A V.S.A. § 2-104 Description of units

2-104. Description of units A description of a unit that sets forth the name of the common interest community, the volume and page in which the declaration is recorded, the town in which the common interest community is located, and the identifying number of the unit is a legally sufficient description of that unit and all rights, obligations, and interests appurtenant to that unit that were created by the declaration or bylaws. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-105 Contents of declaration for a common interest community

2-105. Contents of declaration for a common interest community (a) The declaration shall contain all the following: (1) The names of the common interest community and the association and a statement that the common interest community is either a condominium or planned community. (2) The name of each municipality in which any part of the common interest community is located. (3) A legally sufficient description of the real estate included in the common interest community. (4) A statement of the maximum number of units that the declarant reserves the right to create. (5) A description of the boundaries of each unit created by the declaration, including the identifying number of the unit. (6) A description of any limited common elements other than those specified in subdivisions 2-102(2) and (4) of this title as provided in subdivision 2-109(b)(10) of this title and, in a planned community, any real estate that is or will be common elements. (7) A description of any real estate, except real estate subject to development rights, that may be subsequently allocated as limited common elements, other than those specified in subdivisions 2-102(2) and (4) of this title and a statement that they may be so allocated. (8) A description of any declarant rights required by subdivision 1-103(14) of this title and other special declarant rights required by subdivision 1-103(28) of this title reserved by the declarant, and a legally sufficient description of the real estate to which each of those rights applies and a time limit within which each right shall be exercised. (9) A statement of any development rights that may be exercised with respect to different parcels of real estate at different times, and: (A) either a statement fixing the boundaries of those portions and regulating the order in which those portions may be subjected to each development right or a statement that no assurances are made in that regard; and (B) a statement as to whether, if any development right is exercised in any portion of the real estate subject to that development right, that development right must be exercised in all or in any other portion of that real estate. (10) Any other conditions or limitations on the rights described in subdivision (8) of this subsection. (11) An allocation to each unit of the allocated interests pursuant to section 2-107 of this title. (12) Any restrictions: (A) on alienation of the units, including any restrictions on leasing that exceed the restrictions on leasing units that executive boards may impose pursuant to subdivision 3-102(c)(2) of this title; and (B) on the amount for which a unit may be sold or on the amount that may be received by a unit owner on sale, condemnation, or casualty loss to the unit or to the common interest community, or on termination of the common interest community. (13) The volume and page of recorded easements and licenses appurtenant to or included in the common interest community or to which any portion of the common interest community is or may be subject by a reservation in the declaration. (14) All matters required by sections 2-106, 2-107, 2-108, 2-109, 2-110, 2-111, 2-112, 2-113, 2-114, and 2-116 and subsection 3-103(d) of this title. (15) Any authorization pursuant to which the association may establish and enforce construction and design criteria and aesthetic standards as provided in sections 3-103 and 3-106 of this title. (b) The declaration may contain any other matters that the declarant deems appropriate, including any restrictions on the uses of a unit or the number or other qualifications of persons who may occupy units. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999; amended 2009, No. 155 (Adj. Sess.), § 16, eff. Jan. 1, 2012.

27A V.S.A. § 2-106 Leasehold common interest communities

2-106. Leasehold common interest communities (a) Any lease the expiration or termination of which may terminate the common interest community or reduce its size shall be recorded. Every lessor of those leases in a condominium or planned community shall sign the declaration. The declaration shall state all the following: (1) The volume and page in which the lease is recorded or a statement of where the complete lease may be inspected. (2) The date on which the lease is scheduled to expire. (3) A legally sufficient description of the real estate subject to the lease. (4) Any right of the unit owners to redeem the reversion and the manner in which those rights may be exercised, or a statement that the owners do not have those rights. (5) Any right of the unit owners to remove any improvements within a reasonable time after the expiration or termination of the lease, or a statement that the owners do not have those rights. (6) Any rights of the unit owners to renew the lease and the conditions of any renewal, or a statement that the owners do not have those rights. (b) After the declaration for a leasehold condominium or leasehold planned community is recorded, neither the lessor nor the lessor’s successor in interest may terminate the leasehold interest of a unit owner who makes timely payment of his or her share of the rent and otherwise complies with all covenants that if violated would entitle the lessor to terminate the lease. A unit owner’s leasehold interest in a condominium or planned community is not affected by failure of any other person to pay rent or fulfill any other covenant. (c) Acquisition of the leasehold interest of any unit owner by the owner of the reversion or remainder does not merge the leasehold and reversionary or remainder interests unless the leasehold interests of all unit owners subject to that reversion or remainder are acquired. (d) If the expiration or termination of a lease decreases the number of units in a common interest community, the allocated interests shall be reallocated proportionately in accordance with section 1-107 of this title. Reallocations shall be confirmed by an amendment to the declaration prepared, executed, and recorded by the association. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-107 Allocation of allocated interests

2-107. Allocation of allocated interests (a) The declaration shall allocate to each unit: (1) in a condominium, a fraction or percentage of undivided interests in the common elements and in the common expenses of the association pursuant to subsection 3-115(a) of this title and a portion of the votes in the association; and (2) in a planned community, a fraction or percentage of the common expenses of the association pursuant to subsection 3-115(a) of this title and a portion of the votes in the association. (b) The declaration shall state the formulas used to establish allocations of interests. Those allocations may not discriminate in favor of units owned by the declarant or an affiliate of the declarant. (c) If units may be added to or withdrawn from the common interest community, the declaration shall state the formulas to be used to reallocate the allocated interests among all units included in the common interest community after the addition or withdrawal. (d) The declaration may provide: (1) different allocations of votes to the units on particular matters specified in the declaration; (2) cumulative voting only for the purpose of electing members of the executive board; and (3) class voting on specified issues affecting the class if necessary to protect valid interests of the class. A declarant may not utilize cumulative or class voting for the purpose of evading any limitation imposed on declarants by this title nor may units constitute a class because they are owned by a declarant. (e) Except for minor variations due to rounding, the sum of the common expense liabilities and, in a condominium, the sum of the undivided interests in the common elements allocated at any time to all the units shall each equal one if stated as a fraction or 100 percent if stated as a percentage. In the event of discrepancy between an allocated interest and the result derived from application of the pertinent formula, the allocated interest prevails. (f) In a condominium, the common elements are not subject to partition, and any purported conveyance, encumbrance, judicial sale, or other voluntary or involuntary transfer of an undivided interest in the common elements made without the unit to which that interest is allocated, is void. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-108 Limited common elements

2-108. Limited common elements (a) Except for the limited common elements described in subdivisions 2-102(2) and (4) of this title and except to the extent that a right to allocate a limited common element is reserved pursuant to subsection (c) of this section, the declaration shall specify to which unit or units each limited common element is allocated. That allocation may not be altered without the consent of the unit owners whose units are affected. (b) Except as the declaration otherwise provides, a limited common element may be reallocated by an amendment to the declaration executed by the unit owners between or among whose units the reallocation is made. The persons executing the amendment shall provide a copy thereof to the association, which shall record it. The amendment shall be recorded in the names of the parties and the common interest community. (c) A common element not previously allocated as a limited common element may be allocated only pursuant to the declaration made in accordance with subdivision 2-105(a)(7) of this title. The allocations shall be made by amendments to the declaration. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-109 Plats and plans

2-109. Plats and plans (a) Plats and plans are a part of the declaration and required for condominiums and planned communities. Separate plats and plans are not required by this title if all the information required by this section is contained in either a plat or plan. Each plat and plan shall be clear and legible and contain a certification that the plat or plan contains all information required by this section. (b) Each plat shall show or project: (1) the name and a plat or general schematic map of the entire common interest community; (2) the location and dimensions of all real estate not subject to development rights, or subject only to the development right to withdraw, and the location and dimensions of all existing improvements within that real estate; (3) a legally sufficient description of any real estate subject to development rights, labeled to identify the rights applicable to each parcel, but plats and plans need not designate or label which development rights are applicable to each parcel if that information is clearly delineated in the declaration; (4) the extent of any encroachments by or on any portion of the common interest community; (5) to the extent feasible, a legally sufficient description of all easements serving or burdening any portion of the common interest community; (6) except as otherwise provided in subsection (h) of this section, the approximate location and dimensions of any vertical unit boundaries not shown or projected on plans recorded pursuant to subsection (d) of this section and that unit’s identifying number; (7) except as otherwise provided in subsection (h) of this section, the approximate location with reference to an established datum of any horizontal unit boundaries not shown or projected on plans recorded pursuant to subsection (d) of this section and that unit’s identifying number; (8) a legally sufficient description of any real estate in which the unit owners will own only an estate for years, labeled as “leasehold real estate”; (9) the distance between noncontiguous parcels of real estate comprising the common interest community; (10) the approximate location and dimensions of porches, balconies, and patios and excluding parking spaces allocated as limited common elements, and show or contain a narrative description of any other limited common elements; and (11) in the case of real estate not subject to development rights, all other matters customarily shown on land plats. (c) A plat may also show the intended location and dimensions of any contemplated improvement to be constructed anywhere within the common interest community. Any contemplated improvement shown shall be labeled either “must be built” or “need not be built.” (d) Except as otherwise provided in subsection (h) of this section, to the extent not shown or projected on the plats, plans of the units shall show or project: (1) the approximate location and dimensions of the vertical boundaries of each unit and that unit’s identifying number; (2) the approximate location of any horizontal unit boundaries with reference to an established datum and that unit’s identifying number; and (3) the approximate location of any units in which the declarant has reserved the right to create additional units or common elements pursuant to subdivision 2-111(3) of this title, identified appropriately. (e) Unless the declaration provides otherwise, the horizontal boundaries of part of a unit located outside a building that have the same elevation as the horizontal boundaries of the inside part need not be depicted on the plats and plans. (f) Upon exercising any development right, the declarant shall record either new plats and plans necessary to conform to the requirements of subsections (a), (b), and (d) of this section or new certifications of plats and plans previously recorded if those plats and plans otherwise conform to the requirements of those subsections. (g) Any certification of a plat or plan required by this section shall be made by an independent professional surveyor, architect, or engineer, as appropriate and if authorized by the respective practice acts of each profession in 26 V.S.A. chapters 3, 20, and 45. (h) Plats and plans need not show the location and dimensions of the units’ boundaries or their limited common elements if: (1) the plat shows the location and dimensions of all buildings containing or comprising the units; and (2) the declaration includes other information that shows or contains a narrative description of the general layout of the units in those buildings and the limited common elements allocated to those units. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999; amended 1999, No. 133 (Adj. Sess.), § 36; 2009, No. 155 (Adj. Sess.), § 17, eff. Jan. 1, 2012.

27A V.S.A. § 2-110 Exercise of development rights

2-110. Exercise of development rights (a) To exercise any development right reserved under subdivision 2-105(a)(8) of this title, the declarant shall prepare, execute, and record an amendment to the declaration pursuant to section 2-117 of this title and in a condominium or planned community comply with section 2-109 of this title. The declarant is the unit owner of any units created. The amendment to the declaration shall assign an identifying number to each new unit created and, except in the case of subdivision or conversion of units described in subsection (b) of this section, reallocate the allocated interests among all units. The amendment shall include a description of any common elements and any limited common elements thereby created and, in the case of limited common elements, designate the unit to which each is allocated to the extent required by section 2-108 of this title. (b) Development rights may be reserved within any real estate added to the common interest community if the amendment adding that real estate includes all matters required by section 2-105 or 2-106 of this title and the plats and plans include all matters required by section 2-109 of this title. This provision does not extend the time limit on the exercise of development rights imposed by the declaration pursuant to subdivision 2-105(a)(8) of this title. (c) Whenever a declarant exercises a development right to subdivide or convert a unit previously created into additional units, common elements, or both: (1) if the declarant converts the unit entirely to common elements, the amendment to the declaration shall reallocate all the allocated interests of that unit among the other units as if that unit had been taken by eminent domain; and (2) if the declarant subdivides the unit into two or more units, whether or not any part of the unit is converted into common elements, the amendment to the declaration must reallocate all the allocated interests of the unit among the units created by the subdivision in any reasonable manner prescribed by the declarant. (d) If the declaration provides, pursuant to subdivision 2-105(a)(8) of this title, that all or a portion of the real estate is subject to the development right of withdrawal: (1) if all the real estate is subject to withdrawal, and the declaration does not describe separate portions of real estate subject to that right, none of the real estate may be withdrawn after a unit has been conveyed to a purchaser; and (2) if a portion or portions are subject to withdrawal, no portion may be withdrawn after a unit in that portion has been conveyed to a purchaser. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-111 Alterations of units

2-111. Alterations of units Subject to the provisions of the declaration and other provisions of law, a unit owner: (1) May make any improvements or alterations to his or her unit that do not impair the structural integrity or mechanical systems or lessen the support of any portion of the common interest community. (2) May not change the appearance of the common elements or the exterior appearance of a unit or any other portion of the common interest community without permission of the association. (3) After acquiring an adjoining unit or an adjoining part of an adjoining unit, may remove or alter any intervening partition or create apertures in it even if the partition in whole or in part is a common element if those acts do not impair the structural integrity or mechanical systems or lessen the support of any portion of the common interest community. Removal of partitions or creation of apertures under this subdivision is not an alteration of boundaries. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-112 Relocation of boundaries between adjoining units

2-112. Relocation of boundaries between adjoining units (a) Subject to the provisions of the declaration and other provisions of law, the boundaries between adjoining units may be relocated by an amendment to the declaration upon application to the association by the owners of those units. If the owners of the adjoining units have specified a reallocation between their units of their allocated interests, the application must state the proposed reallocations. Unless the executive board determines, within 30 days after receipt of the application, that the reallocations are unreasonable, the association shall prepare an amendment that identifies the units involved and states the reallocations. The amendment shall be executed by those unit owners, shall contain words of conveyance between them, and, on recordation, shall be indexed in the name of the grantor and the grantee and in the grantee’s index in the name of the association. (b) Subject to the provisions of the declaration and other provisions of law, boundaries between units and common elements may be relocated to incorporate common elements within a unit by an amendment to the declaration upon application to the association by the owner of the unit who proposes to relocate a boundary. Unless the declaration provides otherwise, the amendment may be approved only if persons entitled to cast at least 67 percent of the votes in the association, including 67 percent of the votes allocated to units not owned by the declarant, agree to the action. The amendment may describe any fees or charges payable by the owner of the affected unit in connection with the boundary relocation, and the fees and charges are assets of the association. The amendment must be executed by the unit owner of the unit whose boundary is being relocated and by the association, contain words of conveyance between them, and on recordation be indexed in the name of the unit owner and the association as grantor or grantee, as appropriate. (c) The association: (1) in a condominium or planned community shall prepare and record plats or plans necessary to show the altered boundaries of affected units and their dimensions and identifying numbers; and (2) in a cooperative shall prepare and record amendments to the declaration, including any plans, necessary to show or describe the altered boundaries of affected units and their dimensions and identifying numbers. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-113 Subdivision of units

2-113. Subdivision of units (a) If the declaration expressly so permits, a unit may be subdivided into two or more units. Subject to the declaration and law other than this title, upon application to subdivide a unit, the association shall prepare, execute, and record an amendment to the declaration, including the plats and plans, subdividing that unit. (b) The amendment to the declaration shall be executed by the owner of the unit to be subdivided, shall assign an identifying number to each unit created, and shall reallocate the allocated interests formerly allocated to the subdivided unit to the new units in any reasonable manner prescribed by the owner of the subdivided unit or on any other basis the declaration requires. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999; amended 2009, No. 155 (Adj. Sess.), § 18, eff. Jan. 1, 2012.

27A V.S.A. § 2-114 Easement for encroachments

2-114. Easement for encroachments To the extent that any unit or common element in a common interest community encroaches on any other unit or common element, a valid easement for the encroachment exists. The easement does not relieve a unit owner of liability for the owner’s willful misconduct nor relieve a declarant or any other person of liability for failure to adhere to any plats and plans. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-115 Use for sales purposes

2-115. Use for sales purposes A declarant may maintain sales offices, management offices, and models in units or on common elements in the common interest community only if the declaration so provides and specifies the rights of a declarant with regard to the number, size, location, and relocation of it. In a condominium, any sales office, management office, or model not designated a unit by the declaration is a common element. If a declarant ceases to be a unit owner, that declarant ceases to have any rights with regard to the common element unless it is removed promptly in accordance with a right to remove reserved in the declaration. Subject to any limitations in the declaration, a declarant may maintain signs on the common elements advertising the common interest community. The provisions of this section are subject to local ordinances. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-116 Easement rights

2-116. Easement rights (a) Subject to the declaration, a declarant has such easement through the common elements as may be reasonably necessary for the purpose of discharging a declarant’s obligations or exercising special declarant rights, whether arising under this title or reserved in the declaration. (b) Subject to subdivision 3-102(a)(6) and section 3-112 of this title, the unit owners have an easement in the common elements for access to their units. (c) Subject to the declaration and the rules, the owners have a right to use the common elements that are not limited common elements and all real estate that must become common elements for the purposes for which they were intended. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999; amended 2009, No. 155 (Adj. Sess.), § 19, eff. Jan. 1, 2012.

27A V.S.A. § 2-117 Amendment of declaration

2-117. Amendment of declaration (a) Except in cases of amendments that may be executed by a declarant under subsection 2-109(f) or section 2-110 of this title, or the association under subsections 2-106(d), 2-108(c), and 2-112(a) or section 2-113 of this title, or by certain unit owners under subsection 2-108(b), 2-112(a), 2-113(b), or 2-118(b) of this title, and except as limited by other subsections of this section, the declaration, including any plats and plans, may be amended only by vote or agreement of unit owners of units to which at least 67 percent of the votes in the association is allocated unless the declaration specifies a different percentage for all amendments or for specific subjects of amendment. If the declaration requires the approval of another person as a condition of its effectiveness, the amendment is not valid without that approval. (b) No action to challenge the validity of an amendment adopted by the association pursuant to this section may be brought more than one year after the amendment is recorded. (c) Every amendment to the declaration shall be recorded in every town in which any portion of the common interest community is located, and is effective only upon recordation. An amendment, except an amendment pursuant to subsection 2-112(a) of this title, shall be indexed in the grantee’s index in the name of the common interest community and the association, and in the grantor’s index in the name of the parties executing the amendment. (d) Except to the extent expressly permitted or required by other provisions of this title, no amendment may create or increase special declarant rights, increase the number of units, change the boundaries of any unit, or change the allocated interests of a unit, or the uses to which any unit is restricted, in the absence of unanimous consent of the unit owners. (e) Amendments to the declaration required by this title to be recorded by the association shall be prepared, executed, recorded, and certified on behalf of the association by any officer of the association designated for that purpose or, in the absence of designation, by the president of the association. (f) Provisions in the declaration creating special declarant rights that have not expired may not be amended without the consent of the declarant. (g) The time limits specified in the declaration pursuant to subdivision 2-105(a)(8) of this title within which reserved development rights must be exercised may be extended, and additional development rights may be created, if persons entitled to cast at least 80 percent of the votes in the association, including 80 percent of the votes allocated to units not owned by the declarant, agree to that action. The agreement is effective 30 days after an amendment to the declaration reflecting the terms of the agreement is recorded unless all the persons holding the affected special declarant rights, or security interests in those rights, record a written objection within the 30-day period, in which case the amendment is void, or consent in writing at the time the amendment is recorded, in which case the amendment is effective when recorded. (h) If any provision of this title or of the declaration requires the consent of a holder of a security interest in a unit as a condition to the effectiveness of an amendment to the declaration, that consent is deemed granted if a refusal to consent in a record is not received by the association within 60 days after the association delivers notice of the proposed amendment to the holder at an address for notice provided by the holder or mails the notice to the holder by certified mail, return receipt requested, at that address. If the holder has not provided to the association an address for notice, the association shall provide notice to the address in the security interest of record. Notwithstanding this section, an amendment to the declaration that affects the priority of a holder’s security interest or the ability of that holder to foreclose its security interest may not be adopted without that holder’s consent in a record if the declaration requires that consent as a condition to the effectiveness of the amendment. (i) If the declaration contains a provision requiring that amendments to the declaration may be adopted only by the vote or agreement of unit owners of units to which more than 80 percent of the votes in the association are allocated, the amendment is approved: (1) if: (A) unit owners of units to which at least 80 percent of the votes in the association are allocated vote for or agree to the proposed amendment; (B) no unit owner votes against the proposed amendment; and (C) notice of the proposed amendment is delivered to the unit owners holding the votes in the association that have not voted or agreed to the proposed amendment and no written objection to the proposed amendment is received by the association within 60 days after the association delivers notice; or (2) unit owners of units to which at least 80 percent of the votes in the association are allocated vote for or agree to the proposed amendment but at least one unit owner objects to the proposed amendment and, pursuant to an action brought by the association in the Superior Court for the county in which the common interest community is located against all objecting unit owners, the court finds that the objecting unit owners do not have an interest, different in kind from the interests of the other unit owners, that the voting requirement of the declaration was intended to protect. (j) An amendment to the declaration may prohibit or materially restrict the permitted uses of or behavior in a unit or the number or other qualifications of persons who may occupy units only by vote or agreement of unit owners of units to which at least 80 percent of the votes in the association are allocated, unless the declaration specifies that a larger percentage of unit owners must vote or agree to that amendment or that such an amendment may be approved by unit owners of units having at least 80 percent of the votes of a specified group of units that would be affected by the amendment. An amendment approved under this subsection must provide reasonable protection for a use or occupancy permitted at the time the amendment was adopted. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999; amended 2009, No. 155 (Adj. Sess.), § 20, eff. Jan. 1, 2012.

27A V.S.A. § 2-118 Termination of common interest community

2-118. Termination of common interest community (a) Except in the case of a taking of all the units by eminent domain or in the circumstances described in section 2-124 of this title, a common interest community may be terminated only by agreement of unit owners of units to which at least 80 percent of the votes in the association is allocated or any larger percentage the declaration specifies, and with any other approvals required by the declaration. The declaration may specify a smaller percentage only if all the units are restricted exclusively to nonresidential uses. (b) An agreement to terminate shall be executed or ratified in the same manner as a deed by the requisite number of unit owners. The termination agreement shall specify a date after which the agreement is void unless it is recorded. A termination agreement and all ratifications of it shall be recorded in each town in which a portion of the common interest community is situated. (c) In the case of a common interest community containing only units having horizontal boundaries described in the declaration, a termination agreement may provide that all the common elements and units of the common interest community shall be sold following termination. If, pursuant to the agreement, any real estate in the common interest community is to be sold following termination, the termination agreement shall set forth the minimum terms of the sale. (d) In the case of a common interest community containing any units not having horizontal boundaries described in the declaration, a termination agreement may provide for sale of the common elements, but may not require that the units be sold following termination, unless the declaration as originally recorded provided otherwise or unless all the unit owners consent to the sale. (e) The association on behalf of the unit owners may contract for the sale of real estate in a common interest community, but the contract is not binding on the unit owners until approved pursuant to subsections (a) and (b) of this section. If any real estate is to be sold following termination, title to that real estate upon termination vests in the association as trustee for the holders of all interests in the units. Thereafter, the association has all powers necessary and appropriate to effect the sale. Until the sale has been concluded and the proceeds distributed, the association continues in existence with all powers it had before termination. Proceeds of the sale shall be distributed to unit owners and lienholders as their interests appear, in accordance with subsections (h), (i), and (j) of this section. Unless otherwise specified in the termination agreement, while the association holds title to the real estate, each unit owner and the unit owner’s successors in interest have an exclusive right to occupy the portion of the real estate that formerly constituted his or her unit. During the period of that occupancy, each unit owner and the unit owner’s successors in interest remain liable for all assessments and other obligations imposed on unit owners by this title or the declaration. (f) If the real estate constituting the common interest community is not to be sold following termination, title to the common elements and, in a common interest community containing only units having horizontal boundaries described in the declaration, title to all the real estate in the common interest community vests in the unit owners upon termination as tenants in common in proportion to their respective interests as provided in subsection (j) of this section and liens on the units shift accordingly. While the tenancy in common exists, each unit owner and the unit owner’s successors in interest have an exclusive right to occupy the portion of the real estate that formerly constituted his or her unit. (g) Following termination of the common interest community, the proceeds from the sale of real estate and assets of the association are held by the association as trustee for unit owners and holders of liens on the units as their interests may appear. (h) Following termination of the common interest community, creditors of the association holding liens on the units that were recorded pursuant to 12 V.S.A. § 2904 before termination may enforce those liens in the same manner as any lienholder. All other creditors of the association shall be treated as if they had perfected liens on the units immediately before termination. (i) The respective interests of unit owners referred to in subsections (e), (f), (g), and (h) of this section are as follows: (1) Except as otherwise provided in subdivision (2) of this subsection, the respective interests of unit owners are the fair market values of their units, allocated interests, and any limited common elements immediately before the termination as determined by one or more independent appraisers selected by the association. The independent appraisals shall be distributed to the unit owners and become final unless the unit owners to whom 25 percent or more of the votes in the association are allocated disapprove the appraisal. A unit owner’s interest is determined by dividing the fair market value of that unit owner’s unit and its allocated interests by the total fair market value of all the units and their allocated interests. (2) If any unit or any limited common element is destroyed to the extent that an appraisal of its fair market value before destruction cannot be made, the interests of all unit owners are: (A) in a condominium, their respective common element interests immediately before the termination; (B) in a planned community, their respective common expense liabilities immediately before the termination. (j) Except as provided in subdivision (i)(1) of this section, foreclosure or enforcement of a lien or encumbrance against the entire common interest community does not terminate the common interest community, and foreclosure or enforcement of a lien or encumbrance against a portion of the common interest community, other than withdrawable real estate, does not withdraw that portion from the common interest community. Foreclosure or enforcement of a lien or encumbrance against withdrawable real estate does not, of itself, withdraw that real estate from the common interest community, but the person taking title to it has the right to request from the association an amendment excluding the real estate from the common interest community. (k) If a lien or encumbrance against a portion of the real estate comprising the common interest community has priority over the declaration and the lien or encumbrance has not been partially released, the parties foreclosing the lien or encumbrance may, upon foreclosure, record an instrument excluding the real estate subject to that lien or encumbrance from the common interest community. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999; amended 2009, No. 155 (Adj. Sess.), § 21, eff. Jan. 1, 2012.

27A V.S.A. § 2-119 Rights of secured lenders

2-119. Rights of secured lenders (a) The declaration may require that all or a specified number or percentage of the lenders who hold security interests in the units or common elements approve specified actions of the unit owners or the association as a condition to the effectiveness of those actions, but lack of approval will not have the effect of: (1) denying or delegating control over the general administrative affairs of the association by the unit owners or the executive board; (2) preventing the association or the executive board from participating in any litigation or proceeding; or (3) preventing an insurance trustee or the association from receiving and distributing insurance proceeds except pursuant to section 3-113 of this title. (b) A lender who has extended credit to an association secured by an assignment of income (subdivision 3-102(a)(14) of this title) or an encumbrance on the common elements (section 3-112) may enforce its security agreement in accordance with its terms, subject to the requirements of this title and other law. Requirements that the association must deposit its periodic common charges before default with the lender to which the association’s income has been assigned, or increase its common charges at the lender’s direction by amounts reasonably necessary to amortize the loan in accordance with its terms, do not violate the prohibitions on lender approval contained in subsection (a) of this section. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-120 Master associations

2-120. Master associations (a) If the declaration provides that any of the powers described in section 3-102 of this title may be exercised by or may be delegated to a corporation or association on behalf of one or more common interest communities or for the benefit of the unit owners of one or more common interest communities, the provisions of this title applicable to unit owners’ associations apply to that corporation or unincorporated association, except as modified by this section. (b) Unless a master association is acting in the capacity of an association described in section 3-101 of this title, it may exercise the powers provided in subdivision 3-102(a)(2) of this title only to the extent permitted in the declaration or described in the delegations of power of those common interest communities to the master association. (c) If the declaration provides that the executive board may delegate certain powers to a master association, the members of the executive board shall not be liable for acts or omissions of the master association with respect to those powers after the delegation. (d) The rights and responsibilities of unit owners with respect to the unit owners’ association as provided in sections 3-103, 3-106, and 3-109 of this title apply only to the conduct of the affairs of a master association in regard to those persons who elect the board of a master association, whether or not those persons are unit owners. (e) Even if a master association is also an association under section 3-101 of this title, the instrument creating the master association and the declaration may provide that the executive board of the master association shall be elected after the period of declarant control in any one of the following ways: (1) All unit owners of all common interest communities subject to the master association may elect all members of that executive board. (2) All members of the executive boards of all common interest communities subject to the master association may elect all members of that executive board. (3) All unit owners of each common interest community subject to the master association may elect specified members of that executive board. (4) All members of the executive board of each common interest community subject to the master association may elect specified members of that executive board. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-121 Merger or consolidation of common interest communities

2-121. Merger or consolidation of common interest communities (a) Any two or more common interest communities with the same form of ownership, by agreement of the unit owners as provided in subsection (b) of this section, may be merged or consolidated into a single common interest community by agreement of the unit owners. In the event of a merger or consolidation, unless the agreement otherwise provides, the resultant common interest community is the successor, for all purposes, of all the preexisting common interest communities, and the operations and activities of all associations of the preexisting common interest communities are merged or consolidated into a single association that holds the powers, rights, obligations, assets, and liabilities of the preexisting associations. (b) An agreement of two or more common interest communities to merge or consolidate pursuant to subsection (a) of this section shall be evidenced by an agreement prepared, executed, recorded, and certified by the president of the association of each of the preexisting common interest communities following approval by owners of units to which are allocated the percentage of votes in each common interest community required to terminate that common interest community. The agreement shall not be effective until it is recorded in all municipalities in which the common interest community is located. (c) Every merger or consolidation agreement shall provide for the reallocation of the allocated interests in the new association among the units of the resultant common interest community either: (1) by stating the reallocations or the formulas upon which they are based; or (2) by stating the percentage of overall allocated interests of the new common interest community that are allocated to all of the units comprising each of the preexisting common interest communities and providing that the portion of the percentages allocated to each unit formerly comprising a part of a preexisting common interest community must be equal to the percentages of allocated interests allocated to that unit by the declaration of the preexisting common interest community. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-122 Addition of unspecified real estate

2-122. Addition of unspecified real estate If the right to add unspecified real estate is reserved in the declaration of a planned community, the declarant, in addition to any other development right, may amend the declaration at any time during the time specified in the declaration to add additional real estate to the planned community without describing that real estate in the original declaration, provided the amount of real estate added to the planned community does not exceed 10 percent of the real estate described in subdivision 2-105(a)(3) of this title and the number of units is not increased beyond the number stated in the original declaration. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999.

27A V.S.A. § 2-123 Master planned communities

2-123. Master planned communities (a) The declaration for a common interest community may state that it is a master planned community if the declarant has reserved the development right to create at least 500 units that may be used for residential purposes and at the time of the reservation that declarant owns or controls more than 500 acres on which the units may be built. (b) If the requirements of subsection (a) of this section are satisfied, the declaration for the master planned community need not state a maximum number of units and need not contain any of the information required by subdivisions 2-105(a)(3) through (14) of this title until the declaration is amended under subsection (c) of this section. (c) When each unit in a master planned community is conveyed to a purchaser, the declaration must contain: (1) a sufficient legal description of the unit and all portions of the master planned community in which any other units have been conveyed to a purchaser; and (2) all the information required by subdivisions 2-105(a)(3) through (14) of this title with respect to that real estate. (d) The only real estate in a master planned community that is subject to this title is units that have been declared or that are being offered for sale and any other real estate described pursuant to subsection (c) of this section. Other real estate that is or may become part of the master planned community is only subject to other law and to any other restrictions and limitations that appear as encumbrances duly recorded and indexed in the town clerk’s office. (e) If the public offering statement conspicuously identifies the fact that the community is a master planned community, the disclosure requirements contained in Article 4 of this title apply only with respect to units that have been declared or are being offered for sale in connection with the public offering statement and to the real estate described pursuant to subsection (c) of this section. (f) Limitations in this title on the addition of unspecified real estate (section 2-122 of this title) do not apply to a master planned community. (g) The period of declarant control of the association for a master planned community terminates in accordance with any conditions specified in the declaration or otherwise at the time the declarant, in a recorded instrument and after giving notice in a record to all the unit owners, voluntarily surrenders all rights to control the activities of the association. Added 1997, No. 104 (Adj. Sess.), § 3, eff. Jan. 1, 1999; amended 2009, No. 155 (Adj. Sess.), § 22, eff. Jan. 1, 2012.

27A V.S.A. § 2-124 Termination following catastrophe

2-124. Termination following catastrophe If substantially all the units in a common interest community have been destroyed or are uninhabitable and the available methods for giving notice under section 3-121 of this title of a meeting of unit owners to consider termination under section 2-118 of this title will not likely result in receipt of the notice, the executive board or any other interested person may commence an action in superior court seeking to terminate the common interest community. During the pendency of the action, the court may issue whatever orders it considers appropriate, including appointment of a receiver. After a hearing, the court may terminate the common interest community or reduce its size and may issue any other order the court considers to be in the best interests of the unit owners and persons holding an interest in the common interest community. Added 2009, No. 155 (Adj. Sess.), § 23, eff. Jan. 1, 2012.

Source: Vermont General Assembly (legislature.vermont.gov)URL: https://legislature.vermont.gov/statutes/chapter/27A/002Fetched: 10/21/2026