Unit Owners Association of Build America-1 v. Gillman

In 1976 and 1977, the Gillmans purchased two units at Build America-1, a large industrial structure comprising 26 small warehouse/garage-type units surrounded by a parking lot. The Gillmans purchased the units to have a place to repair, clean, and park overnight several of their vehicles that they used in their trash-service business. The units were governed by an owners’ association that delegated management authority for the operation, care, upkeep, and maintenance of the common areas to a board of managers. Bylaws also provided for certain restrictions on the use of units, including a prohibition against nuisances and noxious or offensive activities. The Gillmans operated their business out of their units without incident for almost a year until they received a series of letters from the association complaining about their trucks, including the way the trucks were parked, the way they leaked oil and gas, and the way they smelled. The Gillmans were ordered to remove their trucks from the complex or the association would have them moved and assess the Gillmans for the removal costs. The Gillmans failed to comply, and the association’s counsel notified them that it had imposed a fine on their units, citing bylaw authority to levy fines for rule and regulation violations. The fines continued to add up, and the board ratified the counsel’s actions and, at a meeting, voted to amend the rules and regulations to limit the weight and number of trucks that each unit owner could maintain on condominium property. The Gillmans failed to pay their fines, and the association filed liens on their units and then filed suit to enforce the liens and enjoin the Gillmans from parking their trucks on the common elements. The Gillmans filed suit against the association the next day for a declaratory judgment that the bylaw providing for collection of fines was unlawful. The cases were consolidated, and the trial court found that the bylaw authorizing the fine was unlawful and unenforceable. The association appealed, arguing that state condominium laws providing for a condominium’s self-governance did not limit its power to impose fines for rule and regulation violations.