8.01 Introduction

• Library: South Carolina Community Association Law: Condominiums and Homeowners Associations (SCBar) (2019 Ed.)

8.01 Introduction

Condominiums are creatures of statute, and typically are defined by a statute. For example, in Florida, a "condominium" is a form of ownership of real property comprised of units to which are appurtenant an undivided share in any common elements.¹ A condominium association is an entity responsible for operation of those common elements.² Thus, a condominium association is a precisely defined, particular type of entity. The same cannot be said of a homeowners association.

The South Carolina Code has a definition of the term "homeowners association" that is used in a number of statutes. That definition is "an organization which is organized and operated to provide for the acquisition, construction, management, and maintenance of property."³ In 2018, a definition was created as a part of the newly enacted "South Carolina Homeowners Association Act."⁴ Under the Act, a "homeowners association" or "association" is an "entity developed to manage and maintain a planned community or horizontal property regime for which there is a declaration requiring a person, by virtue of his ownership of a separate property within the planned community or horizontal property regime, to pay assessments for a share of real estate taxes, insurance premiums, maintenance, or improvement of, or services or other expenses related to, common elements and other real estate described in that declaration."⁵ Those definitions, however, are descriptive, not prescriptive. That is, entities that do not meet them may still be referred to as homeowners associations. Thus, a homeowners association may be an organization in which it is mandatory for all the property owners in a given community to be members and which has the authority to levy assessments, adopt rules, and manage the common property of the community.⁶ It can also be a "civic organization" in which membership is voluntary, there is no common property, and in which, if the members pay dues, it is because they freely choose to do so.⁷ The only way to determine the status of a homeowners association is to examine the documents that created it. To further confuse matters, entities that function as a homeowners association may be known by other names, for example, a property owners association.

Typically, homeowners associations are incorporated as nonprofit corporations under the South Carolina Nonprofit Corporation Act.⁸ However, associations may also be unincorporated.⁹ Unincorporated associations, unlike...