2018 New Mexico Statutes
Chapter 47 - Property Law
Article 7C - Condominium Act - Management of Condominium
Section 47-7C-2 - Powers of unit owners' association.

A. Except as provided in Subsection B of this section, and subject to the provisions of the declaration, the association may:

(1) adopt and amend bylaws and rules and regulations;

(2) adopt and amend budgets for revenues, expenditures and reserves and collect assessments for common expenses from unit owners;

(3) hire and discharge managing agents and other employees, agents and independent contractors;

(4) institute, defend or intervene in litigation or administrative proceedings in its own name on behalf of itself or two or more unit owners on matters affecting the condominium;

(5) make contracts and incur liabilities;

(6) regulate the use, maintenance, repair, replacement and modification of common elements;

(7) cause additional improvements to be made as a part of the common elements;

(8) acquire, hold, encumber and convey in its own name any right, title or interest to real or personal property, but common elements shall be conveyed or subjected to a security interest only pursuant to Section 45 [47-7C-12 NMSA 1978] of the Condominium Act;

(9) grant easements, leases, licenses and concessions through or over the common elements;

(10) impose and receive any payments, fees or charges for the use, rental or operation of the common elements, other than limited common elements described in Subsections B and D of Section 14 [47-7B-2 NMSA 1978] of the Condominium Act, and for services provided to the unit owners;

(11) impose charges for late payment of assessments and, after notice and an opportunity to be heard, levy reasonable fines for violations of the declaration, bylaws and rules and regulations of the association;

(12) impose reasonable charges for the preparation and recordation of amendments to the declaration, resale certificates required by Section 61 [47-7D-9 NMSA 1978] of the Condominium Act or statements of unpaid assessments;

(13) provide for the indemnification of its officers and executive board and maintain directors' and officers' liability insurance;

(14) assign its right to future income, including the right to receive common expense assessments, but only to the extent the declaration expressly so provides;

(15) exercise any other powers conferred by the declaration or bylaws;

(16) exercise all other powers that may be exercised in this state by legal entities of the same type as the association; and

(17) exercise any other powers necessary and proper for the governance and operation of the association.

B. The declaration shall not impose limitations on the power of the association to deal with the declarant which are more restrictive than the limitations imposed on the power of the association to deal with other persons.

History: Laws 1982, ch. 27, § 35.

Compiler's notes. — This section is substantially similar to § 3-102 of the Uniform Condominium Act, with the following main exception: the introductory paragraph of subsection (a) of § 3-102 of the Uniform Condominium Act includes the bracketed language "even if unincorporated" following "the association."

COMMISSIONERS' COMMENT

1. This section permits the declaration, subject to the limitations of subsection (b) [Subsection B], to include limitations on the exercise of any of the enumerated powers. The bracketed language making a specific reference to unincorporated associations is not intended to exclude other forms of association; the unincorporated association would have such powers, subject to the declaration, regardless of the legal status of an unincorporated association in the state. If a state wishes to permit the association to be unincorporated and the law of the state is unclear whether an unincorporated association would have such powers in the absence of the language, the bracketed language should be retained and the brackets removed.

2. Required provisions of the bylaws of the association, referenced in paragraph [(a)] (1) [Subsection A(1)], are set forth in § 3-106 [47-7C-6 NMSA 1978].

3. Many state condominium statutes give the association the power to sue and be sued in its own name. In the absence of a statutory grant of standing such as that set forth in paragraph [(a)] (4) [Subsection A(4)], some courts have held that the association, because it has no ownership interest in the condominium, has no standing to bring, defend or to intervene in litigation or administrative proceedings in its own name.

4. Paragraph [(a)] (8) [Subsection A(8)] refers to the power granted by § 3-112 [47-7C-12 NMSA 1978] to sell or encumber common elements without a termination of the condominium upon a vote of the requisite number of unit owners. Paragraph [(a)] (9) [Subsection A(9)] permits the association to grant easements, leases, licenses and concessions with respect to the common elements without a vote of the unit owners.

5. The powers granted the association in paragraph [(a)] (11) [Subsection A(11)] to impose charges for late payment of assessments and to levy reasonable fines for violations of the association's rules reflect the need to provide the association with sufficient powers to exercise its "governmental" functions as the ruling body of the condominium community. These powers are intended to be in addition to any rights which the association may have under other law.

6. Under paragraph [(a)] (14) [Subsection A(14)], the declaration may provide for the assignment of income of the association, including common expense assessment income, as security for, or payment of, debts of the association. The power may be limited in any manner specified in the declaration - for example, the power might be limited to specified purposes such as repair of existing structures, or to income from particular sources such as income from tenants, or to a specified percentage of common expense assessments. The power, in many instances, should help materially in securing credit for the association at favorable interest rates. The inability of associations to borrow because of a lack of assets, in spite of its income stream, has been a significant problem.

7. If the association is incorporated, it may, pursuant to paragraph [(a)] (16) [Subsection A(16)], exercise all other powers of a corporation. Similarly, if the association is unincorporated, the association may, by virtue of paragraph [(a)] (16) [Subsection A(16)], exercise all other powers of an unincorporated association. Inconsistent provisions of state corporation or unincorporated association law are subject to the provisions of this act, as provided in § 1-108 [47-7A-8 NMSA 1978].

Am. Jur. 2d, A.L.R. and C.J.S. references. — 15A Am. Jur. 2d Condominiums and Cooperative Apartments §§ 28, 29, 37.

Liability of condominium association or corporation for injury allegedly caused by condition of premises, 45 A.L.R.3d 1171.

Proper party plaintiff in action for injury to common areas of condominium development, 69 A.L.R.3d 1148.

Construction of contractual or state regulatory provisions respecting formation, composition and powers of governing body of condominium association, 13 A.L.R.4th 598.

Adequacy and application of guidelines relating to condominium association's requisite approval of individual unit owner's improvements or decoration, 25 A.L.R.4th 1059.

Right of condominium association's management or governing body to inspect individual units, 41 A.L.R.4th 730.

Standing to bring action relating to real property of condominium, 74 A.L.R.4th 165.

31 C.J.S. Estates § 153 et seq.