                                 CODE OF VIRGINIA

CONTROL OF CONDOMINIUM BY DECLARANT (§ 55.1-1943)

A. The condominium instruments may authorize the declarant, or a managing agent
or some other person selected or to be selected by the declarant, to appoint and
remove some or all of the officers of the unit owners&#8217; association or its
executive board, or to exercise powers and responsibilities otherwise assigned
by the condominium instruments and by this chapter to the unit owners&#8217;
association, the officers, or the executive board. The declarant, managing
agent, or other person selected by the declarant to so appoint and remove
officers or the executive board or to exercise such powers and responsibilities
otherwise assigned to the unit owners&#8217; association, the officers, or the
executive board shall be subject to liability as fiduciaries of the unit owners
for their action or omissions during the period of declarant control as
specified in the condominium instruments or, if not so specified, within such
period as defined in this section. But no amendment to the condominium
instruments shall increase the scope of such authorization if there is any unit
owner other than the declarant, and no such authorization shall be valid after
the time limit set by the condominium instruments or after units to which
three-fourths of the undivided interests in the common elements appertain have
been conveyed, whichever occurs first. For the purposes of the preceding
sentence only, the calculation of the fraction of undivided interest shall be
based upon the total undivided interests assigned or to be assigned to all units
registered with the Common Interest Community Board pursuant to subsection B of
&#xA7; 55.1-1978 and described pursuant to subdivision A 4, B 2, or C 8 of
&#xA7; 55.1-1916.

B. The time limit initially set by the condominium instruments shall not exceed
five years in the case of an expandable condominium; three years in the case of
a condominium other than an expandable condominium, containing any convertible
land; or two years in the case of any other condominium. Such time period shall
begin upon settlement of the first unit to be sold in any portion of the
condominium.
			Notwithstanding the foregoing, at the request of the declarant, such time
limits may be extended for a period not to exceed 15 years from the settlement
of the first unit to be sold in any portion of the condominium or after units to
which three-fourths of the undivided interests in the common elements appertain
have been conveyed, whichever occurs first, provided that (i) a special meeting
is held prior to the expiration of the initial period of declarant control; (ii)
at such special meeting, the extension of such time limits is approved by a
two-thirds affirmative vote of the unit owners other than the declarant; and
(iii) at such special meeting, there is an election of a warranty review
committee consisting of no fewer than three persons unaffiliated with the
declarant.
			Prior to any such vote, the declarant shall furnish to the unit owners in the
notice of such special meeting made in accordance with &#xA7; 55.1-1949 a
written statement in a form provided by the Common Interest Community Board that
discloses that an affirmative vote extends the right of the declarant, or a
managing agent or some other person selected by the declarant, to (a) appoint
and remove some or all of the officers of the unit owners&#8217; association or
its executive board and (b) exercise powers and responsibilities otherwise
assigned by the condominium instruments and by this chapter. In addition, such
statement shall contain both a notice of the effect of the extension of
declarant control on the enforcement of the warranty against structural defects
provided by the declarant in accordance with &#xA7; 55.1-1955 and a statement
that a unit owner is advised to exercise whatever due diligence the unit owner
deems necessary to protect his interest.

C. If entered into any time prior to the expiration of the period of declarant
control, no contract or lease entered into with the declarant or any entity
controlled by the declarant, management contract, employment contract, or lease
of recreational or parking areas or facilities, which is directly or indirectly
made by or on behalf of the unit owners&#8217; association, its executive board,
or the unit owners as a group, shall be entered into for a period in excess of
two years. Any such contract or agreement entered into on or after July 1, 1978,
may be terminated without penalty by the unit owners&#8217; association or its
executive board upon not less than 90 days&#8217; written notice to the other
party given not later than 60 days after the expiration of the period of
declarant control. Any such contract or agreement may be renewed for periods not
in excess of two years; however, at the end of any two-year period the unit
owners&#8217; association or its executive board may terminate any further
renewals or extensions of such contract or agreement. The provisions of this
subsection shall not apply to any lease referred to in &#xA7; 55.1-1910 or
subject to subsection E of &#xA7; 55.1-1916.

D. If entered into at any time prior to the expiration of the period of
declarant control, any contract, lease, or agreement, other than those subject
to the provisions of subsection C, may be entered into by or on behalf of the
unit owners&#8217; association, its executive board, or the unit owners as a
group, if such contract, lease, or agreement is bona fide and is commercially
reasonable to the unit owners&#8217; association at the time entered into under
the circumstances.

E. This section does not apply to any contract, incidental to the disposition of
a condominium unit, to provide to a unit owner for the duration of such unit
owner&#8217;s life, or for any term in excess of one year, nursing services,
medical services, other health-related services, board and lodging and care as
necessary, or any combination of such services. The rule of property law known
as the rule restricting unreasonable restraints on alienation shall not be
applied to defeat any provision of the condominium instruments requiring that
the unit owners be parties to such contracts.

F. If the unit owners&#8217; association is not in existence or does not have
officers at the time of the creation of the condominium, the declarant shall,
until there is such an association with such officers, have the power and the
responsibility to act in all instances where this chapter requires action by the
unit owners&#8217; association, its executive board, or any officer.

G. Thirty days prior to the expiration of the period of declarant control, the
declarant shall notify the governing body of the locality in which the
condominium is located of the forthcoming termination of declarant control.
Prior to the expiration of the 30-day period, the local governing body or an
agency designated by the local governing body shall advise the principal elected
officer of the condominium unit owners&#8217; association of any outstanding
violations of applicable building codes or local ordinances or other
deficiencies of record.

H. Within 45 days from the expiration of the period of declarant control, the
declarant shall deliver to the president of the unit owners&#8217; association
or his designated agent (i) all unit owners&#8217; association books and records
held by or controlled by the declarant, including minute books and all rules,
regulations, and amendments to such rules and regulations that may have been
promulgated; (ii) an accurate and complete statement of receipts and
expenditures prepared using the accrual method of accounting from the date of
the recording of the condominium instruments to the end of the regular
accounting period immediately succeeding the first annual meeting of the unit
owners, not to exceed 60 days from the date of the election; (iii) a copy of the
latest available approved plans and specifications for all improvements in the
project or as-built plans, if available; (iv) all association insurance policies
that are currently in force; (v) written unexpired warranties of the
contractors, subcontractors, suppliers, and manufacturers, if any; (vi)
contracts in which the association is a contracting party, if any; (vii) a list
of manufacturers of paints, roofing materials, and other similar materials if
specified for use on the condominium property; and (viii) an inventory and
description of stormwater facilities located on the common elements or which
otherwise serve the condominium and for which the unit owners&#8217; association
has, or subsequently may have, maintenance, repair, or replacement
responsibility, together with the requirements for maintenance thereof.
			The requirement for delivery of stormwater facility information required by
clause (viii) shall be deemed satisfied by delivery to the association of a
final site plan or final construction drawing showing stormwater facilities as
approved by a local government jurisdiction and applicable recorded easements,
or agreements if any, containing requirements for the maintenance, repair, or
replacement of the stormwater facilities.
			If the unit owners&#8217; association is managed by a management company in
which the declarant, or its principals, have no pecuniary interest or management
role, then such management company shall have the responsibility to provide the
documents and information required by clauses (i), (ii), (iv), and (vi).

I. This section shall be strictly construed to protect the rights of the unit
owners.

HISTORY: 1974, c. 416, § 55-79.74; 1975, c. 415; 1978, c. 332; 1980, c. 738;
1984, c. 601; 1985, c. 83; 1996, c. 977; 2008, cc. 851, 871; 2013, c. 599; 2019,
cc. 712, 724.