Does Maryland's Homeowners Association Act apply to condominiums and co-ops?

Plain-English summary

A state senator asked the Attorney General to untangle how Maryland's newly amended Homeowners Association Act interacted with condominiums and housing cooperatives, since sellers and their agents were struggling to figure out which disclosures applied to which properties. The Attorney General concluded that the Act, despite a maze of overlapping definitions, was never meant to reach ordinary condominiums or cooperatives at all. It applies to a condominium or cooperative only in the comparatively rare situation where the property is also "part of a development" subject to a separate homeowners association with its own power to charge mandatory fees, something distinct from the condominium's or cooperative's own internal governance. Even in that rare case, the opinion concluded, only the Act's resale disclosure requirement applied to the condominium or cooperative, not its separate rules on open meetings and recordkeeping, which are aimed at the homeowners association itself rather than the condominium or cooperative it oversees. Where both the Homeowners Association Act and the Maryland Condominium Act applied to the same resale, the opinion concluded the two were not in conflict and a seller simply had to satisfy the disclosure requirements of both.

Currency note

This opinion was issued in 1988. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

Did every Maryland condominium have to comply with the Homeowners Association Act?
No, according to this opinion. The Attorney General concluded the Act generally excludes condominiums and cooperatives, and applies to one only if it is also "part of a development" that is subject to a separate homeowners association with authority to charge mandatory fees, something most condominiums and cooperatives are not.

If a condominium was covered by the Homeowners Association Act, did its board have to hold open meetings under that Act?
No. The opinion concluded that the Act's open-meeting and recordkeeping requirements apply only to "the homeowners association" itself, a distinct legal entity that enforces a declaration, not to the condominium or cooperative it oversees, so those rules did not reach the condominium's own council of unit owners or board of directors.

If both the Homeowners Association Act and the Condominium Act applied to a resale, which one governed?
Both did, according to the opinion. It concluded the two laws were not inconsistent and could be read together, so a seller in that situation had to comply with the resale disclosure requirements of both acts, and a buyer's right to cancel the contract could run on two different timelines depending on when each set of disclosures was actually received.

Background and statutory framework

The opinion explained that the Homeowners Association Act, effective July 1, 1987 and substantially amended by emergency legislation in April 1988 to ease compliance burdens on sellers, contains a chain of interlocking definitions governing its scope. RP §11B-102(e) generally excludes any property that is part of a condominium regime or a cooperative housing corporation, but that exclusion has its own exception for property that fits the Act's definition of a "development," meaning property subject to a "declaration" that creates authority for a homeowners association to impose mandatory fees on lots, owners, or another condominium or cooperative. The opinion concluded that a normal condominium declaration, which creates each unit owner's obligation to pay the condominium's own common expenses, is not the kind of "declaration" the Act is talking about, since reading it that way would swallow the Act's express exclusion of condominiums and would also conflict with legislative history showing the Act was meant to supplement, not duplicate, the Condominium Act.

Working through this framework, the opinion concluded the Homeowners Association Act reaches a condominium or cooperative only in the "comparatively rare instance" where it is subject to the fee-setting authority of a separate homeowners association, distinct from its own internal governing board. Where that is true, the resale disclosure requirement in RP §11B-106 applies, requiring specific disclosures to a buyer before or shortly after signing a resale contract, with a right to cancel under RP §11B-108(b)(1) if disclosures arrive late. But the opinion concluded the Act's separate open-meeting requirement (RP §11B-111) and recordkeeping/disclosure requirement (RP §11B-112) apply only to "the homeowners association" as an entity, not to the condominium or cooperative itself, so a condominium's council of unit owners remained governed by the Condominium Act's own meeting and records provisions instead.

Finally, addressing whether the Homeowners Association Act and the Condominium Act conflicted where both applied to the same condominium resale, the opinion applied the general rule from Management Personnel Serv. v. Sandefur that statutes on the same subject should be read together and given full effect where possible. It found no real conflict: the Condominium Act's disclosures inform a buyer about obligations to the condominium itself, while the Homeowners Association Act's disclosures inform the buyer about obligations flowing from the condominium's relationship to the separate homeowners association, so a seller subject to both simply had to satisfy both, with the buyer's cancellation period running separately for disclosures received at different times, or the longer of the two periods applying if all disclosures arrived together.

Citations and references

Statutes:

• RP §11B-102(e)
• RP §11B-101(f)
• RP §11B-101(d)(1)
• RP §11B-101(g)(1)
• RP §11B-106
• RP §11B-106(a)(1)
• RP §11B-108(b)(1)
• RP §11B-111
• RP §11B-111(1)
• RP §11B-112
• RP §11B-101(h)(2)
• RP §11-101(e)
• RP §11-103(a)(5)
• RP §11-107(b)
• RP §11-109
• RP §11-109(c)
• RP §11-109.1
• RP §11-110(b)
• RP §11-116(c)
• RP §11-135(a)
• RP §11-135(b)
• §5-6B-01(f) and (g) of the Corporations and Associations Article
• Chapter 321 (Senate Bill 96), Laws of Maryland 1987
• Chapter 82 (House Bill 388) of the Laws of Maryland 1988

Cases:

• Management Personnel Serv. v. Sandefur, 300 Md. 332, 341, 478 A.2d 310 (1984)

Source

• Landing page: https://oag.maryland.gov/resources-info/Pages/attorney-general%E2%80%99s-opinions.aspx
• Original PDF: https://oag.maryland.gov/resources-info/Documents/pdfs/Opinions/1988/Volume73_1988.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain, the linked PDF is authoritative.

HOMEOWNERS ASSOCIATION ACT

Condominiums / Cooperatives — Act Applies Only to Those Condominiums and Cooperatives That Are Subject to the Fee-Setting Authority of a Separate Homeowners Association.

May 16, 1988

The Honorable Idamae Garrott
Senate of Maryland

You have requested our opinion concerning the applicability of the Maryland Homeowners Association Act, Title 11B of the Real Property Article ("RP" Article), to condominiums and cooperatives. Specifically, you pose the following questions:

1. Do RP §§11B-106, 11B-111, and 11B-112 apply to condominiums?

2. Do any of these sections apply to cooperatives?

3. Are the provisions of the Homeowners Association Act and the Maryland Condominium Act incompatible with respect to the resale of a condominium unit subject to both acts?

For the reasons stated below, we conclude as follows:

1. The Homeowners Association Act does not apply to condominiums as such. It applies to condominiums only if they are part of a development, as defined in RP §11B-101(e). If a condominium is part of a development, RP §11B-106 applies to the resale of condominium units. However, even if the condominium is part of a development, RP §§11B-111 and 11B-112 do not govern the meeting and recordkeeping practices of the condominium itself.

2. The applicability of the Homeowners Association Act to cooperatives is the same as its applicability to condominiums.

3. The Homeowners Association Act and the Condominium Act require different disclosures. However, the two acts may be read together so that, if both apply to the resale of a condominium unit, the seller is required to provide all of the disclosures required by both acts.

                                     I
                              Background
   
   The Maryland Homeowners Association Act became effective on July 1, 1987. Chapter 321 (Senate Bill 96), Laws of Maryland 1987. The background of the legislation and a detailed analysis of many of its provisions are set out in an earlier opinion of this office. 72 Opinions of the Attorney General 158 (1987).
   

   In practice, sellers and their agents faced significant practical problems in complying with the Homeowners Association Act. In an effort to preserve the consumer protection objectives of the original act while easing some of the burdens on sellers, the Department of Housing and Community Development led an effort to amend it.1 This effort culminated in the enactment of emergency legislation, Chapter 82 (House Bill 388) of the Laws of Maryland 1988, which took effect on April 12, 1988.2

1
We received your inquiry when the Department was engaged in the effort to develop revisions to the act. So as to avoid providing you with an interpretation that might immediately be outdated, we held your request pending the outcome of the legislative process.
2
All references in this opinion are to the Homeowners Association Act as amended by Chapter 82.

                                     II
         Applicability To Condominiums And Cooperatives

The Homeowners Association Act contains a maze of definitions that must be traced to determine its applicability to condominiums and cooperatives. These provisions are confusing, even seemingly self-contradictory. Nevertheless, the General Assembly's intention is clear: The Homeowner Association Act is not meant to apply to most condominiums and cooperatives. It only applies to those few condominiums and cooperatives in which the owners are subject to an obligation to pay fees not only to the condominium or cooperative itself but also to a separate homeowners association.

We begin with a provision generally excluding condominiums and cooperatives from the act. RP §11B-102(e) provides that:

  Except as provided in §11B-101(f) of this title, this title does not apply to any property which is:
   (1) Part of a condominium regime governed by Title 11 of this article;
    (2) Part of a cooperative housing corporation; or
    (3) To be occupied and used for nonresidential purposes.

The exception "as provided in §11B-101(f)" refers to the definition of the key term "development." This definition is as follows:

   (1) "Development" means property subject to a declaration.
   (2) "Development" includes property comprising a condominium or cooperative housing corporation to the extent that the property is part of a development.
   (3) "Development" does not include a cooperative housing corporation or a condominium.

Reading §§11B-102(e) and 11B-101(f) together, we conclude that the Homeowners Association Act applies to a condominium or cooperative only if the condominium or cooperative, apart from its independent legal status as such, also is "part of a development."3
Because the definition of "development" refers to the term "declaration," we turn next to that definition. RP §11B-101(d)(1) provides as follows:

    "Declaration" means an instrument, however denominated, recorded among the land records of the county in which the property of the declarant is located, that creates the authority

3
The general exclusion in RP §11B-102(e) refers to a "property which is ... [p]art of a condominium" or cooperative. Likewise, the inclusive provision in RP §11B-101(f)(2) refers to "property comprising a condominium or cooperative ... to the extent that the property is part of a development." On the other hand, the reiterated exclusion in RP §11B-101(f)(3) refers to a "cooperative ... or a condominium," with no reference to "property." Cf. RP §11B-101(h)(2) ("'lot' includes a unit within a condominium or cooperative ... if the condominium or cooperative ... is part of a development"). We do not believe that these variances in phrasing are significant. Under the Maryland Condominium Act, "'condominium' means property subject to the condominium regime established under this title." RP §11-101(e). See also §5-6B-01(f) and (g) of the Corporations and Associations Article (definitions of "cooperative housing corporation" and "cooperative interest").

      for a homeowners association to impose on lots, or on the owners or occupants of lots, or on another homeowners association, condominium, or cooperative housing corporation any mandatory fee in connection with the provision of services or otherwise for the benefit of some or all of the lots, the owners or occupants of lots, or the common areas.

A "homeowners association," referred to in this definition, "means a person having the authority to enforce the provisions of a declaration." RP §11B-101(g)(1).
These labyrinthine definitions do lead to a conclusion: The owners of most units in condominiums or interests in cooperative housing corporations are not subject to any instrument regarding mandatory fees, other than the documents creating and governing the condominium or cooperative itself.4 The ordinary condominium, for instance, is subject to the authority of its own council of unit owners and board of directors regarding fees, RP §11-109; it is not subject to the authority of a separate homeowners association. The Homeowners Association Act would apply to a condominium or cooperative only in the comparatively rare instance in which it is "part of a development" because it is subject to the authority of a separate homeowners association.
If the condominium or cooperative is part of a development, a "contract for the resale of a lot within [the] development ... is not enforceable by the vendor" unless the disclosure requirements in RP §11B-106 are satisfied.5 The seller is required to provide the buyer with these disclosures "on or before entering into the contract for

4
Under the Maryland Condominium Act, a recorded instrument also called a "declaration" establishes the obligation of each unit owner to bear a proportional share of the condominium's common expenses. RP §§11-103(a)(5), 11-107(b) and 11-110(b). The General Assembly could not have intended a condominium declaration to fall within the definition of "declaration" in the Homeowners Association Act, however. Such a construction would necessarily apply the Homeowners Association Act to all condominiums, thus improperly negating the express exclusion of condominiums in RP §§11B-101(b)(3) and 11B-102(e)(1). Moreover, the legislative history confirms that the Homeowners Association Act was generally intended to supplement the Condominium Act, not duplicate it. Letter to Governor Hughes from Governor's Commission on Condominiums, Cooperatives, and Homeowners Associations at 8-9 (Jan. 27, 1986).
5
RP §11B-101(h)(2) provides that the term "'lot' includes a unit within a condominium or cooperative housing corporation if the condominium or cooperative housing corporation is part of a development."

the sale of such lot, or within 20 calendar days of entering into the contract." RP §11B-106(a)(1).6
Apart from the disclosure requirements in RP §11B-106, you also asked about the applicability of RP §§11B-111 and 11B-112.7 As we read them, neither of these sections applies to a condominium or cooperative, even if the condominium or cooperative is "part of a development" and therefore subject to the act. RP §11B-111 imposes certain open meeting requirements on "all meetings of the homeowners association, including meetings of the board of directors or other governing body of the homeowners association or a committee of the homeowners association...." RP §11B-111(1). Similarly, the requirements of RP §11B-112, pertaining to certain information disclosures and the availability of books and records, applies to "the homeowners association." The condominium or cooperative, even when covered by the act, is not the "homeowners association."8 That association is the legal entity empowered to enforce the provisions of a declaration against the condominium or cooperative. RP §11B-101(g)(1).

                                      III
               Construction With Condominium Act

In our view, the Homeowners Association Act and the Condominium Act are not incompatible in their respective disclosure requirements. The Condominium Act requires a seller of a condominium unit to make certain disclosures to the buyer. RP §11-135(a). These disclosures are intended to inform the buyer of the financial and other obligations that he or she will be undertaking with respect to the condominium itself.

6
The act affords the buyer a right to cancel the contract in light of post-contractual disclosures: "Any purchaser who has not received all of the disclosures ... 5 calendar days or more before the contract was entered into, within 5 calendar days following receipt by the purchaser of the disclosures ... may cancel in writing the contract without stating a reason and without liability on the part of purchaser." RP §11B-108(b)(1).
7
These are the section numbers in the act as amended by Chapter 82. In the original version of the act, what is now RP §11B-111 was RP §11B-110; and what is now RP §11B-112 was RP §11B-111.
8
The Maryland Condominium Act itself regulates the meeting and record access practices of each council of unit owners and board of directors of a condominium. RP §§11-109(c), 11-109.1 and 11-116(c).

If the Homeowners Association Act applies to a condominium because it is "part of a development," the owner of a condominium unit who resells the unit will also be subject to the disclosure requirements in RP §11B-106.9 These disclosures are intended to inform the buyer of the financial and other obligations that he or she will be undertaking as a result of the condominium's relationship to the homeowners association.10
A basic principle of statutory construction is that "where two statutes deal with the same subject matter, ... they must be construed together if they are not inconsistent with one another. Thus, to the extent possible, full effect should be given to each." Management Personnel Serv. v. Sandefur, 300 Md. 332, 341, 478 A.2d 310 (1984). That rule is easy to apply here. There is no inconsistency between the two acts. The seller is obligated to comply with the disclosure requirements of both acts and the buyer has the rights afforded by both acts.11

                                        IV
                                  Conclusion

  In summary, it is our opinion that:

1. The Homeowners Association Act does not apply to condominiums as such. It applies to condominiums only if they are part of a development, as defined in RP §11B-101(e). If a condominium is part of a development, RP §11B-106 applies to the resale of condominium units. However, even if the condominium is part of a development, RP §§11B-111 and 11B-112 do not govern the meeting and recordkeeping practices of the condominium itself.

9
See note 5 above and accompanying text.
10
Even if individual condominium unit owners do not pay a fee directly to the homeowners association, the condominium's obligation to pay the fee has a direct financial impact on the unit owners, for the fee will simply be passed through by the condominium to the owners as part of their monthly condominium fee.
11
The time period within which a buyer may cancel a contract after receiving the required disclosure differs under the two acts. Compare RP §11B-108(b)(1) (five days) with RP §11-135(b) (seven days). If the buyer receives the disclosures at different times, each cancellation period applies separately. If the buyer receives all of the disclosures required by both acts at the same time, the longer period applies.

2. The applicability of the Homeowners Association Act to cooperatives is the same as its applicability to condominiums.
3. The Homeowners Association Act and the Condominium Act require different disclosures. However, the two acts may be read together so that, if both apply to the resale of a condominium unit, the seller is required to provide all of the disclosures required by both acts.

       J. Joseph Curran, Jr., Attorney General
       Jack Schwartz
       Chief Counsel
          Opinions & Advice