2006 Code of Virginia § 55-512 - Contents of association disclosure packet; other requirements

55-512. Contents of association disclosure packet; other requirements.

A. Subject to the provisions of subsections C and F, the association shallmake available to an owner or his authorized agent within 14 days afterreceipt of a written request therefor and receipt of the appropriate fee, anassociation disclosure packet, which, upon receipt, the seller shall deliverto the purchaser. The information contained in the association disclosurepacket shall be current as of a date specified on the association disclosurepacket. If hand or electronically delivered, the written request and fee aredeemed received on the date of delivery. If sent by United States mail, therequest and fee are deemed received six days after the postmark date. Anassociation disclosure packet shall contain the following:

1. The name of the association and, if incorporated, the state in which theassociation is incorporated and the name and address of its registered agentin Virginia;

2. A statement of any expenditure of funds approved by the association or theboard of directors which shall require an assessment in addition to theregular assessment during the current year or the immediately succeedingfiscal year;

3. A statement, including the amount of all assessments and any othermandatory fees or charges currently imposed by the association and associatedwith the purchase, disposition and maintenance of the lot and to the right ofuse of common areas, and the status of the account;

4. A statement whether there is any other entity or facility to which the lotowner may be liable for fees or other charges;

5. The current reserve study report or summary thereof, a statement of thestatus and amount of any reserve or replacement fund and any portion of thefund allocated by the board of directors for a specified project;

6. A copy of the association's current budget or a summary thereof preparedby the association, and a copy of its statement of income and expenses orstatement of its financial condition for the last fiscal year for which suchstatement is available;

7. A statement of the nature and status of any pending suit or unpaidjudgment to which the association is a party which either could or would havea material impact on the association or its members or which relates to thelot being purchased;

8. A statement setting forth what insurance coverage is provided for all lotowners by the association, including any fidelity bond maintained by theassociation, and what additional insurance would normally be secured by eachindividual lot owner;

9. A statement that any improvement or alteration made to the lot, or usesmade of the lot or common area assigned thereto by the prior lot owner, arenot in violation of any of the instruments referred to in subdivision 12 ofthis subsection;

10. A statement setting forth any restriction, limitation, or prohibition onthe right of a lot owner to place a sign on the owner's lot advertising thelot for sale;

11. A statement setting forth any restriction, limitation, or prohibition onthe right of a lot owner to display any flag on the owner's lot including,but not limited to reasonable restrictions as to the size, place and mannerof placement or display of such flag and the installation of any flagpole orsimilar structure necessary to display such flag;

12. A copy of the current declaration, the association's articles ofincorporation and bylaws, and any rules and regulations or architecturalguidelines adopted by the association;

13. A copy of the notice given to the lot owner by the association of anycurrent or pending rule or architectural violation;

14. A copy of the fully completed one-page cover sheet developed by the RealEstate Board pursuant to 54.1-2105.1; and

15. Certification, if applicable, that the association has filed with theReal Estate Board the annual report required by 55-516.1; whichcertification shall indicate the filing number assigned by the Real EstateBoard and the expiration date of such filing.

Failure to receive copies of such documents shall not excuse any failure tocomply with the provisions thereof.

The disclosure packet, once received by the seller from the association,shall be delivered by the seller to the purchaser. The association shall haveno obligation to deliver the disclosure packet to the purchaser of the lot.The disclosure packet required by this section, shall not, in and of itself,be deemed a security within the meaning of 13.1-501.

B. The purchaser may submit a copy of the contract to the association with arequest for assurance that the information required by this sectionpreviously furnished remains materially unchanged, or, if there have beenmaterial changes, a statement specifying such changes. The purchaser shall beprovided with such assurances or such statement within 10 days of the receiptof such request by the association. The purchaser may be required to pay afee for the preparation and issuance of the requested assurances. The feeshall reflect the actual cost incurred by the association in providing suchassurances but shall not exceed $0.10 per page of copying costs or a total of$50 for all costs incurred in updating the association disclosure packet. Theassociation may also collect from the purchaser the actual costs incurred ofany mailing or delivery requested by the purchaser pursuant to thissubsection. In no event, however, shall the association require reimbursementof any costs not expressly authorized in this subsection. Nor shall theassociation charge any other fee for the preparation or issuance of suchassociation disclosure packet or making such packet available by electronicmeans except as expressly provided in this subsection.

C. The association may charge a fee for the preparation and issuance of thedisclosure packet required by this section. Any fee shall reflect the actualcost of the preparation of the packet, but shall not exceed $0.10 per page ofcopying costs or a total of $100 for all costs incurred in preparing theassociation disclosure packet, except that the association, upon mutualagreement with the seller, may collect for actual costs incurred, in additionto any fee charged pursuant to this subsection (i) a rush fee, not to exceed$25, for furnishing the resale certificate within three business days fromthe actual receipt of the request; (ii) the actual cost of any mailing ordelivery requested by the seller pursuant to this subsection; and (iii) anyactual cost incurred at the request and with the consent of the purchaser.Neither the association nor its management agent, if any, shall require cashor certified funds unless the lot owner is delinquent in any payments due tothe association in excess of 30 days or if a check of the lot owner madepayable to the association was returned for insufficient funds within thelast six months. In no event, however, shall the association requirereimbursement of any costs not expressly authorized in this subsection. Norshall the association charge any other fee for the preparation or issuance ofsuch association disclosure packet or making such packet available byelectronic means except as expressly provided in this subsection.

D. When a disclosure packet has been issued as required by this section, theassociation shall, as to the purchaser, be bound by the statements set forththerein as to the status of the assessment account and the status of the lotwith respect to any violation of any of the instruments referred to insubdivision 12 of subsection A as of the date of the statement unless thepurchaser had actual knowledge that the contents of the disclosure packetwere in error.

E. If the association has been requested to furnish the disclosure packetrequired by this section and has been paid the appropriate fee, its failureto provide the disclosure packet in substantially the form provided hereinwithin 14 days from the actual receipt of the request by an officer, directoror agent of the association shall be deemed a waiver of any claim fordelinquent assessments or of any violation of the declaration, bylaws, rulesand regulations, or architectural guidelines existing as of the date of therequest with respect to the subject lot. The association shall be liable tothe seller in an amount equal to the actual damages sustained by the sellerin an amount not to exceed $500. The purchaser shall nevertheless beobligated to abide by the declaration, bylaws, rules and regulations, andarchitectural guidelines of the association as to all matters arising afterthe date of the settlement of the sale. The settlement agent, as defined in 6.1-2.20, when transmitting funds to the association or otherwise uponrequest, shall provide the association with (i) the name of the seller, (ii)the name and address of the purchaser, (iii) the address of the subjectproperty, (iv) the date of settlement, and (v) a brief explanation of theapplication of any funds transmitted. Providing a copy of the HUD-1settlement statement, unless otherwise prohibited, shall satisfy theserequirements.

F. The contract disclosures required by 55-511 and the disclosure packetrequired by this section need not be provided in the case of:

1. A disposition of a lot by gift;

2. A disposition of a lot pursuant to court order if the court so directs;

3. A disposition of a lot by foreclosure or deed in lieu of foreclosure;

4. A disposition of a lot that is zoned for or otherwise restricted tononresidential use; or

5. A disposition of a lot to a person or entity who is not acquiring the lotfor his own residence or for the construction thereon of a dwelling unit tobe occupied as his own residence, unless requested by such person or entity.If such disclosures are not requested, a statement in the contract of salethat the purchaser is not acquiring the lot for such purpose shall beconclusive and may be relied upon by the seller of the lot. The person orentity acquiring the lot shall nevertheless be obligated to abide by thedeclaration, bylaws, rules and regulations, and architectural guidelines ofthe association as to all matters.

G. In any transaction in which a disclosure packet is required and a trusteeacts as the seller in the sale or resale of a lot, the trustee shall obtainthe disclosure packet from the association and provide the packet to thepurchaser.

(1989, c. 679; 1991, c. 667; 1993, c. 96; 1995, c. 573; 1997, c. 222; 1998,cc. 32, 463; 2000, c. 891; 2001, c. 556; 2002, cc. 399, 459, 509; 2005, c.415.)

Disclaimer: These codes may not be the most recent version. Virginia may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.