Exam (elaborations)
M100 Community Association Management Review: Q&A
- Course
- Institution
M100 Community Association Management Review: Q&A
[Show more]
Content preview
M100 Community Association Management Review: Q&AEach of the following are key characteristics of community associations EXCEPT: a. Mandatory lien-based economic charges or assessments are levied on each owner in order to operate and maintain the community association.
b. Membership in the community association is mandatory and automatic for all owners.
c. A requirement of community association ownership is serving on the board of directors.
d. Certain documents bind all owners to be governed by the community association. ✔ Ans - c. A requirement of community association ownership is serving on the board of directors.
This is one of the three key characteristics common to all community associations. Members of an association are not legally required to serve on the board of directors; however, the overall success on the community is dependent upon the members' involvement its affairs.
True or False. The primary purpose of a community association is to provide for the governance, business, and communal aspects of the association. ✔ Ans - True
Providing for the governance, business, and communal aspects of the association is achieved by administering, maintaining, and enhancing a residential real estate development, and through the establishment of a system of property rights, binding covenants and restrictions, and rules and regulations.
Each of the following are basic types of residential community associations EXCEPT: a. Planned community
b. Townhouse
c. Cooperative
d. Condominium ✔ Ans - b. Townhouse While many community associations are indeed townhouse communities, not all such developments are necessarily associations. A community association is defined in terms of ownership rights—not architectural style.
Adoption of the annual budget is an example of which of the following type of resolution? a. policy resolution
b. administrative resolution
c. special resolution
d. general resolution ✔ Ans - d. general resolution
General resolutions involve routine events such as adoption of the annual budget.
True or false. The purpose of a community association's governing documents
is to provide for the legal structure and operation of the community. ✔ Ans -
True
The governing documents define the rights and obligations of both the community association and its owners, create a binding relationship between each owner and the community association, and establish the mechanisms for governing and funding the community association's operations.
True or false. According to the general hierarchy of authority for governing documents, the bylaws would control in a conflict with the recorded map, plat,
or plan. ✔ Ans - False
As a general rule, documents lower in the hierarchy of authority cannot conflict with or change the terms of those above them. The recorded map, plat,
or plan is above the bylaws in the hierarchy, and therefore would prevail in such a conflict.
Complete the following sentence: A __________ state statute is one that applies only to one or more types of community associations. a. general
b. complex
c. specific
d. uniform ✔ Ans - c. specific A specific state statute is one that applies only to one or more types of community associations. For example, most states have a condominium act which provides for the establishment and operation of condominiums as legal entities. These acts vary in terms of their complexity—the simplest ones just allow for the creation of condominiums.
True or false. A proprietary lease or occupancy agreement in a cooperative defines the member or stockholder's rights and obligations in relation to the living unit. ✔ Ans - True
In a cooperative, the proprietary lease or occupancy agreement serves generally the same purpose as the declaration, CC&R, or master deed in other community associations. Among other things, the proprietary lease or occupancy agreement identifies the premises that the stockholder is permitted to occupy exclusively, defines the term of the lease and the rent that
is payable by the stockholder, and establishes the powers and obligations of the cooperative's board of directors, including assessment rights.
Complete the following sentence: The __________ bring the community association into existence, define its basic purposes and powers, and indicate whether stock will be issued.
a. recorded map, plat, or plan
b. declaration, CC&Rs, or master deed
c. proprietary lease or occupancy agreement
d. articles of incorporation ✔ Ans - d. articles of incorporation
A community association's corporate structure is established when a developer sets up the association. The developer files articles of incorporation
—sometimes called a corporate charter—with the appropriate state corporation agency.
True or False. The public offering statement is a governing document, as it often distributed along with the governing documents. ✔ Ans - False
The public offering statement is not a governing document; instead, it is simply a disclosure statement that provides information on the community association to prospective buyers. Each of the following legal sources specify management authority and responsibilities for community associations EXCEPT:
a. survey data
b. state statutes
c. community association governing documents
d. court decisions ✔ Ans - a. survey data
All three types of legal sources—state statutes, governing documents, and court decisions—specify the authority or power of different parties in a community association and the responsibilities or duties of the different parties.
True or false. The basic authority in a community association lies with the developer. ✔ Ans - False
The basic authority in a community association lies with the owners. In order for the association to govern effectively the owners elect a board of directors to act on their behalf. The governing documents delegate most of the association's decision-making powers to a board.
Complete the following sentence: The board of directors in a community association has a _____________ to act in the best interests and for the benefit of the community as a whole.
a. bond
b. fiduciary duty
c. ballot
d. quorum ✔ Ans - b. fiduciary duty
The board's fiduciary duty has two components: (1) Board members are required to avoid conflicts of interest and acting out of self-interest. (2) They are also required to act as reasonable people in managing the association's affairs.
True or false. The "business judgment rule" means that if a board has exercised reasonable business judgment in making a decision, the court will generally not consider the board negligent in its fiduciary duty. ✔ Ans - True
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Studyhall. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $19.99. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
71498 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now