SENATE FILE _____

BY  (PROPOSED COMMITTEE ON JUDICIARY BILL BY CHAIRPERSON FRAISE)

A BILL FOR

An Act relating to the operations of certain common interest communities.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

DIVISION I

UNIFORM COMMON INTEREST OWNERSHIP ACT
   Section 1.  NEW SECTION.  499C.101  Title.
   This chapter shall be known and cited as the “Uniform Common Interest Ownership Act”.
   Sec. 2.  NEW SECTION.  499C.102  Public policy.
   The general assembly declares that it is the public policy of the state that the management and affairs of common interest communities be conducted openly, and this chapter shall be construed, to provide open access to the management of the common interest community to the unit owners.
   Sec. 3.  NEW SECTION.  499C.103  Definitions.
   As used in this chapter, unless the context otherwise requires:
   1.  “Assessment” means a sum attributable to each unit and due to the unit owners association as may be provided in a declaration or in the bylaws.
   2.  “Bylaws” means the instruments, however denominated, that contain the procedures for conducting the affairs of the unit owners association or the executive board regardless of the form in which the association is organized, including any amendments to such instruments.
   3.  “Common element” means:
   a.  For a cooperative under chapter 499A or a horizontal property regime under chapter 499B, all portions of the common interest community other than the units.
   b.  For a planned community, any real estate within the planned community which is owned or leased by the unit owners association, other than a unit.
   c.  For all common interest communities, any other interests in real estate for the benefit of unit owners which are subject to the declaration.
   4.  “Common expense liability” means the liability for common expenses allocated to each unit pursuant to a declaration or bylaws.
   5.  “Common expenses” means expenditures made by, or financial liabilities of, the unit owners association or the executive board, together with any allocations to reserves.
   6.
  a.  “Common interest community” means real estate described in a declaration with respect to which a person, by virtue of the person’s ownership of a unit, is obligated to pay for a share of real estate taxes, insurance premiums, maintenance, or improvement of, or services or other expenses related to, common elements, other units, or other real estate described in the declaration. “Common interest community”includes a cooperative under chapter 499A and a horizontal property regime under chapter 499B.
   b.  Common interest community does not include:
   (1)  A covenant that requires the owners of separate parcels of real estate to share costs or other obligations related to a wall, driveway, well, or other similar structure, unless all such owners consent in writing to the creation of a common interest community.
   (2)  Real estate described in paragraph“a” if all units are owned by a single unit owner.
   7.  “Declarant” means any person or group of persons who, as the record title owner of real estate, by a declaration, initially creates a common interest community.
   8.  “Declaration” means the instrument, however denominated, that creates a common interest community, including any amendments to the instrument.
   9.  “Executive board” means the body, regardless of name, designated in the declaration or bylaws to act on behalf of the unit owners association.
   10.  “Planned community” means a common interest community that is not a cooperative under chapter 499A or a horizontal property regime under chapter 499B, and includes property owner or homeowner associations. However, a cooperative under chapter 499A or a horizontal property regime under chapter 499B may be part of a planned community.
   11.  “Rule” means a policy, guideline, restriction, procedure, or regulation, however denominated, which is not set forth in the declaration or bylaws.
   12.  “Unit” means a physical portion of the common interest community designated for separate ownership or occupancy or as otherwise defined in the statute under which the common interest community is organized.
   13.  “Unit owner” means a declarant or other person that owns a unit, but does not include a person having an interest in a unit solely as security for an obligation. In a horizontal property regime under chapter 499B or a planned community, the declarant is the owner of any unit created by the declaration. In a cooperative under chapter 499A, the declarant is the owner of any unit to which an interest has been allocated until that unit has been conveyed to another person.
   14.  “Unit owners association” means a unit owners association organized under section 499C.201.
   Sec. 4.  NEW SECTION.  499C.104  Variation by agreement.
   Except as expressly provided in this chapter, the provisions of this chapter may not be varied by agreement, and rights conferred by it may not be waived.
   Sec. 5.  NEW SECTION.  499C.105  Applicability.
   Unless otherwise provided by law:
   1.  This chapter applies to all common interest communities established within this state on or after July 1, 2011.
   2.  This chapter does not apply to common interest communities of three or fewer units.
   3.  Sections 499C.301, 499C.302, 499C.401, 499C.402, 499C.403, and 499C.501 apply to common interest communities established before July 1, 2011. Any portion of a declaration, bylaws, covenant, or other contractual provision existing prior to July 1, 2011, that violates section 499C.301, 499C.302, 499C.401, 499C.402, or 499C.403 is not enforceable. However, nothing in this chapter shall be construed to invalidate other provisions of the declaration, bylaws, plats, or plans of those common interest communities established before July 1, 2011.
   Sec. 6.  NEW SECTION.  499C.201  Unit owners association.
   1.  A unit owners association shall be organized not later than the date the first unit in the common interest community is conveyed.
   2.  Membership of a unit owners association shall at all times consist exclusively of all unit owners except following termination of the common interest community, at which time the unit owners association shall consist of all former unit owners entitled to distributions of proceeds or their heirs, successors, or assigns.
   3.  A unit owners association shall have an executive board.
   4.  A unit owners association shall be organized as a profit or nonprofit corporation, trust, limited liability company, partnership, unincorporated association, or any other form of organization authorized by the law of this state. The requirements of this chapter relating to a unit owners association shall preempt any conflicting provision of the statute under which the unit owner association is organized.
   Sec. 7.  NEW SECTION.  499C.202  Unit owners association —— powers and duties.
   1.  Except as otherwise provided in this chapter, a unit owners association shall do all of the following:
   a.  Adopt bylaws which may be amended subject to the provisions of section 499C.301.
   b.  Adopt budgets, collect assessments for common expenses from unit owners, and invest funds of the association, if applicable.
   2.  Unless otherwise limited by a declaration or bylaws, a unit owners association shall have authority to do any of the following:
   a.  Adopt and amend rules for operation of the unit owners association.
   b.  Hire, employ, and discharge employees, agents, and independent contractors.
   c.  Institute, defend, or intervene in litigation, arbitration, mediation, or administrative proceedings on behalf of the unit owners association or for two or more unit owners on matters affecting the common interest community.
   d.  Make contracts and incur liabilities.
   e.  Regulate the use, maintenance, repair, replacement, and modification of common elements.
   f.  Cause additional improvements to be made to the common elements of the common interest community.
   g.  Acquire, hold, encumber, and convey any right, title, or interest to real estate or personal property.
   h.  Grant easements, leases, licenses, and concessions through or over the common elements of the common interest community.
   i.  Impose and receive any payments, fees, or charges for the use, rental, or operation of the common elements, other than limited common elements as defined in section 499B.2, and for services provided to unit owners.
   j.  Impose charges for late payment of assessments and, after notice and an opportunity to be heard, impose reasonable monetary penalties for violations of the declaration, bylaws, and rules of the association.
   k.  Impose reasonable charges for the preparation and recording of statements of unpaid assessments.
   l.  Provide for the indemnification of its officers and executive board, including maintenance of liability insurance for directors and officers of the unit owners association.
   m.  Assign its right to future income, including the right to receive assessments.
   n.  Exercise powers conferred by the declaration or bylaws.
   o.  Exercise all other powers that may be exercised in this state by organizations of the same type as the unit owners association.
   p.  Suspend any right or privilege of a unit owner who fails to pay an assessment. The unit owners association shall not, however, deny a unit owner or other occupant access to the owner’s unit, suspend a unit owner’s right to vote, prevent a unit owner from seeking election as a director or officer of the association, or withhold services provided to a unit or a unit owner by the association if the effect of withholding the service would be to endanger the health, safety, or property of any person.
   q.  Exercise any other powers necessary and proper for the governance and operation of the association. 
   3.  If a tenant of a unit owner violates the declaration, bylaws, or rules of the association, in addition to exercising any of its powers against the unit owner, the association may do any of the following:
   a.  Exercise the powers described in subsection 2, paragraph “j”, against the offending tenant.
   b.  After giving notice to the tenant and the unit owner and providing each an opportunity to be heard, levy reasonable monetary penalties against the tenant for the violation.
   c.  Take other action against the tenant for the violation in the same manner as the unit owner, acting as landlord, could have exercised under the lease or in the manner that the unit owners association could lawfully have taken action directly against the unit owner, or both. Action under this paragraph may only be taken if the tenant or unit owner fails to remedy the violation within ten days after notification by the unit owners association of the violation.
   4.  Unless a lease of a unit otherwise provides, this section does not do any of the following:
   a.  Affect rights that the unit owner possesses to enforce the lease or that the unit owners association has under other provisions of law.
   b.  In the absence of a violation of the declaration, bylaws, or rules, authorize the unit owners association to enforce a lease to which the unit owners association is not a party.
   5.  An executive board may determine whether to exercise the association’s power to impose sanctions or commence an action for a violation of the declaration, bylaws, or rules, including whether to settle any claim for unpaid assessments or other claim made by or against the unit owners association. An executive board does not have a duty to take enforcement action if the executive board determines, following consideration of the facts and circumstances presented, any of the following:
   a.  The association’s legal position does not justify taking any or further enforcement action.
   b.  The covenant, restriction, or rule being enforced is, or is likely to be construed as, inconsistent with law.
   c.  Despite the existence of a violation, the violation is nonmaterial and does not justify expenditure of the unit owners association resources. 
   d.  It is not in the unit owners association’s best interests to pursue an enforcement action.
   6.  The failure of an executive board to take action pursuant to subsection 5 shall not prevent the executive board from taking enforcement action under a similar set of circumstances or facts. The authority of an executive board to take action under this chapter shall not, however, be exercised in a arbitrary or capricious manner.
   Sec. 8.  NEW SECTION.  499C.203  Executive board.
   1.  Except as otherwise provided in the declaration, the bylaws, subsection 2, or provisions of the statute under which the common interest community is organized, an executive board acts on behalf of the unit owners association. In the performance of their duties, officers and members of the executive board appointed by the declarant shall exercise the degree of care and loyalty to the unit owners association required of a trustee. Officers and members of an executive board not appointed by the declarant shall exercise the degree of care and loyalty to the unit owners association required of an officer or director of a corporation organized under chapter 504, and such officers and members are subject to the conflict of interest rules governing directors and officers under chapter 504.
   2.  An executive board shall not act on behalf of the unit owners association to amend the declaration, to terminate the common interest community, to elect members of the executive board, or determine the qualifications, powers and duties, or terms of office of executive board members. An executive board may fill vacancies in its membership for the unexpired portion of any term.
   3.
  a.  Subject to subsection 4, the declaration may provide for a period of declarant control of the unit owners association, during which a declarant, or persons designated by the declarant, may appoint and remove the officers and members of the executive board. In no case, however, shall a period of declarant control continue upon the occurrence of any of the following:
   (1)  Sixty days after the conveyance of seventy-five percent of all units in the common interest community to unit owners other than a declarant;
   (2)  Two years after all declarants have ceased to offer units for sale in the ordinary course of business.
   (3)  Two years after the addition of any number of new units to the common interest community.
   (4)  The date the declarant, after giving written notice to all unit owners, records an instrument voluntarily surrendering all rights to control activities of the unit owners association.
   b.  A declarant may voluntarily surrender the right to appoint and remove officers and members of the executive board before termination of the period under paragraph “a”. However, the declarant may retain, for the duration of the period of declarant control, approval authority for specified actions of the unit owners association or executive board, as described in a recorded instrument executed by the declarant.
   4.
  a.  Not later than sixty days after conveyance of twenty-five percent of the units to unit owners other than a declarant, at least one member and not less than twenty-five percent of the members of the executive board must be elected by unit owners other than the declarant. 
   b.  Not later than sixty days after conveyance of fifty percent of the units to unit owners other than a declarant, not less than one-third of the members of the executive board must be elected by unit owners other than the declarant.
   5.  Following the termination of any period of declarant control under this section, the unit owners shall elect an executive board of at least three members, at least a majority of whom must be unit owners. The executive board members shall elect officers of the executive board. The executive board members and officers shall take office upon election. This subsection shall not apply to a common interest community if all the units of the community are owned by one owner.
   6.  Notwithstanding any provision of the declaration or bylaws to the contrary, the unit owners, by a two-thirds vote of all persons present and entitled to vote at any meeting of the unit owners at which a quorum is present, may remove any member of the executive board with or without cause, other than a member appointed by the declarant.
   Sec. 9.  NEW SECTION.  499C.301  Amendments to governing instruments.
   1.  Except as otherwise provided in this section:
   a.  The declaration, bylaws, or plans of a common interest community established before July 1, 2011, may be amended upon approval of two-thirds of the unit owners or as otherwise provided in the declaration or bylaws.
   b.  The declaration, bylaws, or plans of a common interest community created on or after July 1, 2011, may be amended by two-thirds of the unit owners unless the declaration or bylaws expressly require a greater or lesser percentage.
   2.  Notwithstanding any provision of law to the contrary, a declaration may expressly reserve authority to the executive board, with or without the consent of unit owners, to amend the declaration, bylaws, or plans of a common interest community to add land, buildings, or both.
   3.
  a.  Following adoption of an amendment to a declaration, bylaws, or plans, the amendment or a copy of the amended declaration, bylaws, or plan shall be recorded with the county recorder of the county where the property is located. 
   b.  An amendment may be recorded on behalf of the required number of unit owners by the officers of the association if the officers verify under oath that the proceedings to approve the amendment satisfied the requirements of this chapter.
   4.  An amendment to a declaration, the bylaws, or plans to prohibit or materially restrict the permitted uses of a unit, the permitted uses of a common element, or the number or other qualifications of persons who may occupy units shall only be approved upon the affirmative vote of unit owners equal in number to at least eighty percent of the total unit owner votes in the association, unless the declaration requires a larger percentage. An amendment approved under this subsection shall provide reasonable protection for a use or occupancy permitted prior to adoption of the amendment.
   5.
  a.  If a declaration, the bylaws, or a plan requires the consent of a holder of a security interest in a unit as a condition to the adoption or implementation of an amendment, consent is deemed provided if a written refusal to consent is not received by the association within sixty days after the association delivers notice of the proposed amendment to the holder of the security interest at an address provided by the holder or after the association mails the notice of the proposed amendment to the holder by certified mail, return receipt requested, at the address provided. If the holder of a security interest has not provided to the association an address for notice, the association shall provide notice to the address in the security interest of record, if available.
   b.  Notwithstanding any provision of this section to the contrary, an amendment to the declaration, bylaws, or plans that affects the priority of a holder’s security interest or the ability of a holder to foreclose a security interest may not be adopted without the security holder’s written consent if the declaration, bylaws, or plans requires that consent as a condition to the adoption or implementation of the amendment.
   6.  If a declaration requires that amendments, including amendments under subsection 4, to the declaration, bylaws, or plans be adopted only upon the affirmative vote of unit owners equal in number to at least eighty percent of the total unit owner votes in the association, the amendment is approved if one of the following is met:
   a.  A number of unit owners comprising at least eighty percent of the total unit owner votes in the association votes affirmatively for the proposed amendment, no owner votes against the proposed amendment, all required notices of the proposed amendment are delivered to each unit owner as required under this chapter, and the association does not receive a written objection to the proposed amendment within sixty days after delivery of the notice.
   b.  A number of unit owners comprising at least eighty percent of the total unit owner votes in the unit owners association votes affirmatively for the proposed amendment unit, one or more owner votes against the proposed amendment, and pursuant to an action brought by the association in the district court of the county where the property 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, bylaws, or plans was intended to protect.
   7.  An action challenging the validity of an amendment adopted pursuant to this chapter shall not be brought more than one year after the amendment is recorded.
   Sec. 10.  NEW SECTION.  499C.302  Rules.
   1.  Unless otherwise limited by a declaration or bylaws, an executive board may adopt and amend rules for the operation of the executive board or other matters authorized in the declaration or bylaws. Before adopting, amending, or repealing a rule, the executive board shall give each unit owner a notice that states the executive board’s intention to adopt, amend, or repeal a rule, provides the text of the rule or the proposed change, and states the date the executive board intends to act on the proposed rule or amendment following consideration of comments from unit owners. 
   2.  A unit owners association may adopt rules to establish and enforce construction and design criteria and aesthetic standards if the declaration so provides. In accordance with the declaration, a unit owners association shall adopt procedures for enforcement of those standards and for approval of construction applications, including a timeline within which the unit owners association must act on an application and the consequences of a unit owners association’s failure to act. 
   3.  Following adoption, amendment, or repeal of a rule, the officers of the unit owners association or executive board, as applicable, shall notify each unit owner of the action and provide a copy of any new or revised rule.
   4.  A rule regulating display of the flag of the United States shall be consistent with federal law. A unit owners association shall not prohibit on a unit or on a limited common element, as defined in section 499B.2, adjoining a unit the display of the flag of this state, or signs regarding candidates for public office or unit owners association office or public measures, but the association may adopt rules governing the time, place, size, number, and manner of those displays.
   5.  Unit owners may peacefully assemble on common elements to consider matters related to the common interest community, but the unit owners association may adopt rules governing the time, place, and manner of such assemblies.
   6.  A unit owners association may adopt rules that restrict the use of unit or behavior within units that may be used for residential purposes, but only to do the following:
   a.  Implement a provision of the declaration.
   b.  Regulate a behavior in or the occupancy of a unit that violates the declaration or adversely affects the use and enjoyment of other units or the common elements by other unit owners.
   c.  Restrict the leasing of residential units to the extent the rules are reasonably designed to meet underwriting requirements of institutional lenders that regularly make loans secured by first mortgages on units in common interest communities or regularly purchase such mortgages.
   7.  A unit owners association’s internal business operating procedures are exempt from the requirements of this section.
   8.  Each rule adopted by a unit owners association or executive board shall be reasonable in nature and scope.
   Sec. 11.  NEW SECTION.  499C.401  Meetings.
   1.  Meetings of a unit owners association, whether such association is incorporated or unincorporated, shall comply with all of the following:
   a.  A unit owners association shall hold a meeting of unit owners annually at a time, date, and place stated in or determined in accordance with the declaration or bylaws.
   b.  A unit owners association shall hold a special meeting of unit owners to address any matter affecting the unit owners association if the association’s president, a majority of the executive board, or an amount of unit owners comprising at least twenty percent of all votes in the association, unless a different percentage is specified in the bylaws, request that the secretary call the meeting. If the unit owners association does not notify unit owners of a special meeting within thirty days after the required number of unit owners has requested the secretary to call a special meeting, the requesting members may directly notify all unit owners of the meeting. Only matters described in the meeting notice may be considered at a special meeting.
   c.  A unit owners association shall notify each unit owner of the time, date, and place of each annual and special unit owners meeting not less than ten days and not more than sixty days before the meeting date. Notice may be by any means described in section 499C.403. Each meeting notice shall state the time, date, and place of the meeting and the items on the agenda, including but not limited to:
   (1)  A statement of the general nature of any proposed amendment to the declaration or bylaws.
   (2)  A statement describing any budget changes.
   (3)  Any proposal to remove an officer or member of the executive board.
   d.  The requirements relating to the timing of meeting notices under paragraph“c” may be reduced or waived for a meeting called to address an emergency. A meeting called to address an emergency shall be limited to matters arising out of the emergency. The decision of an officer of the unit owners association to convene a meeting for an emergency shall be ratified by a majority of unit owners required by the bylaws to conduct the business of the unit owners association.
   e.  Each unit owner shall be given a reasonable opportunity at any meeting to comment on any matter affecting the common interest community or the unit owners association.
   f.  The declaration or bylaws may allow for meetings of unit owners to be conducted by telephonic, video, or other conferencing method, if such method is consistent with subsection 2, paragraph “g”.
   2.  Meetings of the executive board and committees of the unit owners association, authorized to act for the unit owners association, shall comply with all of the following:
   a.  Meetings shall be open to the unit owners except during executive sessions. The executive board and committees of the unit owners association may hold an executive session only during a regular or special meeting of the board or the committee. No final vote or action may be taken during an executive session. An executive session may only be held for the following reasons:
   (1)  To consult with the unit owners association’s attorney concerning legal matters governed by attorney-client privilege.
   (2)  To discuss existing or potential litigation or mediation, arbitration, or administrative proceedings.
   (3)  To discuss labor or personnel matters. 
   (4)  To discuss contracts, leases, and other commercial transactions for goods or services that are under negotiation, including the review of bids or proposals, if public disclosure of such matters would place the unit owners association at a disadvantage.
   (5)  To prevent public knowledge of a matter if the executive board or the committee determines that public disclosure would violate the privacy of any person.
   b.  For purposes of this section, a gathering of board members at which the board members do not conduct unit owners association business is not a meeting of the executive board. Executive board members shall not use incidental or social gatherings of board members or any other method to evade the meeting and notice requirements of this section.
   c.  During a period of declarant control, the executive board shall meet at least four times a year. At least one of the meetings shall be held at the common interest community or at a place convenient to the unit owners of the common interest community. After termination of the period of declarant control, all executive board meetings shall be at the common interest community or at a place convenient to the unit owners of the common interest community unless the unit owners amend the bylaws to vary the location of such meetings.
   d.  At each executive board meeting, the executive board shall provide a reasonable opportunity for unit owners to comment on any matter affecting the common interest community and the unit owners association.
   e.  Unless the meeting is included in a schedule given to the unit owners or the meeting is called to address an emergency, the secretary or other officer specified in the bylaws shall give notice of each executive board meeting to each executive board member and to each unit owner. Such notice shall be given at least ten days before the meeting and shall state the time, date, place, and agenda of the meeting.
   f.  If any materials are distributed to the executive board before a meeting, the executive board, upon receipt of the materials, shall make copies reasonably available to unit owners, except that the executive board is not required to make available copies of unapproved minutes or materials that are to be considered during an executive session.
   g.  Unless otherwise provided in the declaration or bylaws, the executive board may conduct a meeting by telephonic, video, or other conferencing method if all of the following conditions are met:
   (1)  The meeting notice states the conferencing method to be used and provides information explaining how unit owners may participate in the conference directly or by meeting at a central location or conference connection.
   (2)  The process provides all unit owners the opportunity to hear or perceive the discussion and to comment on matters before the executive board.
   h.  Following termination of the period of declarant control, unit owners may amend the bylaws to vary the procedures for meetings described in paragraph “g”.
   i.  In lieu of a meeting, the executive board may act by unanimous consent if such action is documented in a record authenticated by all executive board members. The secretary shall give prompt notice to all unit owners of any action taken by unanimous consent. After termination of the period of declarant control, an executive board may act by unanimous consent only to undertake ministerial actions or to implement actions previously taken at a meeting of the executive board. 
   j.  Unless otherwise restricted by this chapter or the common interest community’s bylaws, an executive board may determine rules of procedure for the executive board.
   k.  An executive board may remove any person from a meeting of the executive board upon a finding by a majority of the board members that the person is being disruptive to the meeting. An executive board may bar any person from meetings of the executive board or other meetings of the common interest community for a period of up to one year if the person has been twice removed from a meeting within the preceding twelve months.
   l.  An action by an executive board that is not in compliance with this section is valid unless invalidated by a court. A challenge to the validity of an action of the executive board for failure to comply with this section shall not be brought more than sixty days after the minutes of the executive board of the meeting at which the action was taken are approved or the record of that action is distributed to unit owners, whichever is later.
   Sec. 12.  NEW SECTION.  499C.402  Association records.
   1.  A unit owners association shall retain all of the following:
   a.  Detailed records of receipts and expenditures relating to the operation and administration of the unit owners association and other appropriate accounting records.
   b.  Minutes of all unit owners meetings and executive board meetings other than executive sessions, a record of all actions taken by the unit owners or the executive board without a meeting, and a record of all actions taken by a committee in place of the executive board on behalf of the unit owners association.
   c.  The names of all unit owners in a form that permits preparation of a list of the names of all owners and the addresses at which the unit owners association communicates with them, the records shall indicate the number of votes each unit owner is entitled to cast.
   d.  The unit owners association’s original and amended organizational documents, bylaws including all amendments to the bylaws, and all rules of the common interest community currently in effect.
   e.  All financial statements and tax returns of the unit owners association for the past three years. 
   f.  A list of the names and addresses of the current executive board members and officers.
   g.  The unit association’s most recent annual report delivered to the secretary of state, if applicable.
   h.  Copies of each contract to which the unit owners association is currently a party.
   i.  Records of executive board or committee actions relating to requests for design or architectural approval from unit owners.
   j.  Ballots, proxies, and other records related to voting by unit owners for one year after the election, action, or vote.
   2.  Except as provided under subsections 3 and 4, all records retained by a unit owners association must be available for examination and copying by a unit owner or the unit owner’s authorized agent during reasonable business hours or at a mutually convenient time and location upon providing a five days’ notice that reasonably identifies the specific records that are being requested.
   3.  Records retained by a unit owners association may be withheld from inspection and copying to the extent that they concern:
   a.  Personally identifiable information, salary, and medical records relating to specific individuals.
   b.  Information relating to contracts, leases, and other commercial transactions to purchase or provide goods or services, currently under negotiation.
   c.  Information relating to existing or potential litigation, mediation, arbitration, or administrative proceedings. 
   d.  Information relating to existing or potential matters involving federal, state, or local administrative proceedings or other proceedings before a government tribunal for enforcement of the declaration, bylaws, or rules. 
   e.  Communications with the unit owners association attorney which are otherwise protected by the attorney-client privilege or the attorney work-product doctrine. 
   f.  Information that if disclosed would violate another provision of law. 
   g.  Records of an executive session of the executive board.
   h.  Records relating to a specific unit owner, if the person requesting the records is not the unit owner that is the subject of the records.
   4.  A unit owners association may charge a reasonable fee for providing copies of any records under this section and for supervising the inspection of such records.
   5.  The right to inspect records under this section includes the right to copy records by photocopying or other means including copies through an electronic transmission, if available, upon request of the requester.
   6.  A unit owners association is not obligated to compile or synthesize information or records under this section.
   7.  Information or records obtained under this section shall not be used for commercial purposes.
   Sec. 13.  NEW SECTION.  499C.403  Notice to unit owners.
   1.  A unit owners association or an executive board, as applicable, shall deliver each notice required to be given by the association or board under this chapter to the regular mail address or electronic mail address provided by each unit owner. If a regular mail address or electronic mail address is not provided by the unit owner, the notice may be delivered using any of the following methods:
   a.  Hand delivery to the unit owner.
   b.  Mailing by regular mail or certified mail, as defined in section 618.15, to the address of the unit.
   c.  Any other method reasonably calculated to provide notice to the unit owner.
   2.  The ineffectiveness of a good-faith effort to deliver notice under subsection 1 does not invalidate an action taken at a meeting or an action taken by other means.
   Sec. 14.  NEW SECTION.  499C.501  Cause of action —— attorney fees.
   A declarant, unit owners association, unit owner, or any other person subject to this chapter may bring an action to enforce a right granted or obligation imposed by this chapter, the declaration, or the bylaws. In any action under this chapter, the court may award reasonable attorney fees to the prevailing party.

DIVISION II

ADDITIONAL PROVISIONS AND

CORRESPONDING CHANGES
   Sec. 15.  NEW SECTION.  499A.1A  Applicability.
   This chapter shall apply to cooperatives established under this chapter unless otherwise provided in chapter 499C.
   Sec. 16.  NEW SECTION.  499B.1A  Applicability.
   This chapter applies to horizontal property regimes established under this chapter unless otherwise provided in chapter 499C.
   Sec. 17.  Section 499B.2, Code 2011, is amended by adding the following new subsection:
   NEW SUBSECTION.  1A.  “As-built certificate” means a certificate and any accompanying documentation from a competent licensed professional engineer, licensed land surveyor, or registered architect, that certifies that such individual has examined the plan filed with the declaration and that the plan does diagrammatically represent, insofar as may be reasonably determined through the use of nondestructive measurement techniques, the building, the general common elements, and the limited common elements that have been constructed on the real estate described in the declaration and plans.
   Sec. 18.  Section 499B.6, Code 2011, is amended to read as follows:
   499B.6  Copy ofthe floor plans to be filed.
   1.  There shall be attached to the declaration, at the time it is filed, a full and an exact copy of the plans of the building, which copy shall be entered of record along with the declaration or buildings and an as-built certificate or a certificate described in subsection 2, paragraph “a”.
   2.
  a.  If a portion of the horizontal property regime is not completed at the time the declaration is filed, the declaration may be filed, in lieu of an as-built certificate, with a certification that the plans diagrammatically represent, insofar as reasonably ascertainable, the buildings the declarant intends to construct.
   b.  Upon completion of all buildings of a horizontal property regime, for which a certificate under paragraph“a” was filed, the declarant shall file for recording an as-built certificate.
   c.  Upon completion of a discrete portion of a horizontal property regime project, a declarant may file an as-built certificate for the portion then completed.
   d.  The absence of a certificate described in this subsection for a declaration recorded before July 1, 2011, shall not affect the marketability of title.
   3.  The plans described in subsection 1 shall show graphically all particulars of the building, including, but not limited to, the dimensions, area, and location of common elements affording access to each apartment. Other common elements, both limited and general, shall be shown graphically insofar as possible and shall be certified to by an engineer, architect, or land surveyor, who is registered or licensed to practice that profession in this state.
   Sec. 19.  Section 499B.15, subsection 2, Code 2011, is amended by striking the subsection.
EXPLANATION
   Division I of this bill creates a uniform common interest ownership Act, new Code chapter 499C. The bill provides that it is the public policy of the state that the management and affairs of common interest communities be conducted to provide open access to the management of the common interest community to the unit owners.
   New Code chapter 499C defines “common interest community” to mean real estate described in a declaration with respect to which a person, by virtue of the person’s ownership of a unit, is obligated to pay for a share of real estate taxes, insurance premiums, maintenance, or improvement of, or services or other expenses related to, common elements, other units, or other real estate described in the declaration. Cooperatives under Code chapter 499A and horizontal property regimes under Code chapter 499B are also defined to be common interest communities. The bill specifies that a common interest community does not include a covenant that requires the owners of separate parcels of real estate to share certain costs or other obligations, unless all such owners consent in writing to the creation of a common interest community, and does not include community where all units are owned by a single unit owner.
   The bill does not allow for the provisions of new Code chapter 499C to be varied by agreement, and rights conferred by new Code chapter 499C may not be waived.
   The bill specifies that unless otherwise provided by law new Code chapter 499C applies to all common interest communities established within this state on or after July 1, 2011. New Code chapter 499C does not apply to common interest communities of three or fewer units. The bill provides that new Code sections 499C.301 (amendments to governing instruments), 499C.302 (rules), 499C.401 (meetings), 499C.402 (records), 499C.403 (notices), and 499C.501 (enforcement actions) apply to common interest communities established before July 1, 2011, and any portion of a declaration, bylaws, covenant, or other contractual provision existing prior to July 1, 2011, that violates Code section 499C.301, 499C.302, 499C.401, 499C.402, or 499C.403 is not enforceable.
   The bill establishes requirements and procedures for common interest communities, unit owners associations, and executive boards relating to amending governing instruments, including declarations, bylaws, and plans. The bill also establishes requirements and procedures for the adoption of rules by executive boards and unit owners associations.
   New Code section 499C.201 establishes requirements for unit owners associations, as defined in the bill. A unit owners association must be organized not later than the date the first unit in the common interest community is conveyed. The bill provides that the membership of a unit owners association shall at all times consist exclusively of all unit owners except following termination of the common interest community, at which time the unit owners association shall consist of all former unit owners entitled to distributions of proceeds or their heirs, successors, or assigns. The bill requires each unit owners association to have an executive board. A unit owners association must be organized as a profit or nonprofit corporation, trust, limited liability company, partnership, unincorporated association, or any other form of organization authorized by the law of this state. The bill provides that the requirements of new Code chapter 499C relating to a unit owners association preempt any conflicting provision of the statute under which the unit owners association is organized.
   The bill specifies the duties and powers of a unit owners association, including powers of the unit owners association for enforcement of the provisions of declaration, bylaws, or rules.
   The bill specifies the duties and powers of an executive board. An executive board, except as otherwise provided in the declaration, the bylaws, or other provision of law, acts on behalf of the unit owners association. The bill specifies the duty of care required for members and officers of the executive board. 
   The bill establishes requirements relating to meetings of unit owners associations, executive boards, and committees of such entities including requirements for the contents of meeting notices, allowable actions during meetings, requirements relating to unit owner comments, and the manner in which meetings may be conducted. The bill also specifies the manner and the reasons for which certain meetings may be called.
   The bill enacts requirements relating to the retention of records by unit owners associations and specifies the records retained by a unit owners association which may be withheld from inspection and copying.
   The bill requires a unit owners association or executive board, as applicable, to deliver each notice required to be given by the association under new Code chapter 499C to the regular mail address or electronic mail address provided by each unit owner. If a regular mail or electronic mail address is not provided by the unit owner, the unit owners association may deliver the notice by a different method specified in the bill. The bill provides that the ineffectiveness of a good-faith effort to deliver notice does not invalidate an action taken at a meeting or an action taken by other means.
   The bill provides that a declarant, unit owners association, unit owner, or any other person subject to new Code chapter 499C may bring an action to enforce a right granted or obligation imposed by the Code chapter, the declaration, or the bylaws. In any such action, the court may award reasonable attorney fees to the prevailing party.
   Division II of the bill amends provisions relating to certain plans and documents filed with a declaration of a horizontal property regime and makes corresponding changes relating to the enactment of new Code chapter 499C.