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Pitfalls of Permits, Licenses & Variances

Most every community association possesses discretion to grant a permit, license or variance for specified conduct of its members. For example, a homeowner association that has a 30-foot height limitation for structures on lots conceivably could grant a variance to an owner who wanted to build a 21 foot home due to extraordinary topography conditions.  Or perhaps a condominium association could grant a permit for a disabled owner to use an elevator ordinarily restricted to commercial use.  There is a limitless set of examples where permits, licenses or variances may be acceptable in the community association context.

Before continuing, it may be helpful to explain the difference between a permit, license or variance.  There really isn’t a substantive difference between the three terms. The terms “permit” and “license” often are interchangeable, as they both refer to “an authoritative or official certificate of permission; written order granting special permission to do something.”  On the other hand, a variance often is used when granting permission specifically related to regulations.  The official definition of “variance” from refers to “an official permit to do something normally forbidden by regulations, especially by building in a way or for a purpose normally forbidden by a zoning law or a building code.”    

Thus, in the community association world, I commonly find permits or licenses relating to human conduct, and variances used for construction or building approvals. Regardless of which term or protocol is used, association boards who grant such exceptions should keep the following pitfalls in mind:

1.         Always document the approval, and when feasible, describe the rationale behind the exception.  Form or template documents should be used whenever possible, with a section for “comments.”  To avoid claims of selective enforcement by a future owner who is not granted a similar exception, a board should ensure reasonable, appropriate, and if possible, uniform discretion in both granting and denying these requests.

2.         The notice to the owner granting the approval, (whether in a form, template or correspondence) should include standard disclaimer language:

(a)  Stating that in approving the permit/license/variance, the association is not warranting that the work complies with building codes or any requirements as imposed by local or statewide governmental jurisdictions, or manufacturer’s recommendations or requirements.

(b)  In proceeding with the work, the owner agrees to indemnify and hold harmless the association from any and all claims by third parties that arise or relate to the work being conducted by the owner.

3.         If the permit, license or variance is denied by a committee, then the Association should provide an opportunity for the owner to appeal to the board of directors.

The foregoing recommendations are summarized in this post.  To ensure your association is utilizing best practices, following its governing documents, and adhering to applicable laws, we recommend that you have your attorney review your permit, license or variance protocols and forms.  Do not hesitate to contact the team at Barker Martin if you have any questions regarding this important topic.