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Review of Indentures/Restrictive Covenants and Condominium Documents (“Recorded Governing Documents”)

This article is the second in the series entitled “When Can You Get Out Of A Contract Without Adverse Consequences?” I had originally intended to move on to the next planned topic, but I decided to divert from that plan and talk about something that is very important but often ignored. In fact, I almost ignored it in considering topics for this column!
 
These Recorded Governing Documents basically tell you what you can and cannot do with the property you are buying. However, they are generally overlooked because they are lengthy, tedious, legal documents, and real estate agents and title companies cannot review and interpret them for the buyer because they are not attorneys and cannot give legal advice. Buyers typically do not read them because they are lengthy, tedious and legal.
 
Consider these examples from experience:
 
  • A desired tennis court was prohibited by the Governing Document;
  • A desired batting cage was prohibited by the Governing Document;
  • An addition was prohibited by the Trustees under the authority granted them under the Governing Document;
  • Re-siding the house in a different color was prohibited by the Trustees under the authority granted them under the Governing Document;
  • Replacing windows with a different style in a villa-type condominium was prohibited by the Trustees under the authority granted them under the Governing Document.
 
In short, make a review of the Governing Documents a contingency under the Contract that will allow you to get out of the Contract if you don’t approve them. There is a standard form for this your agent can supply. Have an attorney review them, or at least plan on sitting down with a glass of wine and reviewing them thoroughly yourself, particularly if you plan on making improvements to the property.

 Michael J. Doster

Attorney at Law

Doster, Ullom & Boyle, LLC
 
Michael Doster acts as general counsel to Wm French Buyers Real Estate.

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