Chapter 4 - § 4.8 • CHANGES TO UNIT BOUNDARIES

• Jurisdiction: Colorado

§ 4.8 • CHANGES TO UNIT BOUNDARIES⁷³

The CCIOA addresses relocation of boundaries between adjoining units and subdivision of units. Generally, these boundary changes are more likely to occur in commercial, rather than residential, units. This section discusses boundary relocations and subdivision by owners other than the declarant. Subdivision of units is one of the specifically enumerated "development rights" of declarants,⁷⁴ and a specific statute governs exercise of those development rights.⁷⁵

Generally, boundaries between adjoining units may be relocated by an amendment to the declaration, and the owners of the units must apply to the association for the amendment.⁷⁶ The process must follow the statutory procedures for amending a declaration.⁷⁷ The right to relocate boundaries is subject to the provisions of the declaration and any other provisions of law. A comment to the Uniform Act, which also allows for relocation of boundaries, says that declarations generally prohibit relocating unit boundaries without the unanimous, or nearly unanimous, consent of all the unit owners.⁷⁸ The statute allowing relocations, therefore, represents a change from the norm, but one that may "be varied by restrictions in the declaration." Presumably that means any declaration restriction on boundary relocations, including one requiring the unanimous consent of all owners, will override the statute. To avoid any confusion, it would probably be wise for the declaration clause to specifically refer to the boundary relocation statute and state that it is inapplicable to whatever extent the drafter wishes to exclude its application.

To relocate the boundaries between adjoining units, the owners of the units must submit an application to the governing board of the association.⁷⁹ The application must be executed by those owners, and it must include:

• Sufficient evidence for the governing board to determine that there has been compliance with all local rules and ordinances and that the proposed relocation does not violate the terms of any document evidencing a security interest.
• The proposed reallocation of interests, if any.
• The proposed form for amendments to the declaration, including the plats or maps, as may be necessary to show the changed boundaries between the units and their dimensions,⁸⁰ and identifying numbers.
• A deposit against attorney fees and costs that the association will incur in reviewing and effectuating the application, in an amount reasonably estimated by the governing board.
• Any other information reasonably requested by the governing board.⁸¹

A boundary relocation may not be effected unless the necessary amendments to the declaration, plats, or maps are properly executed and recorded.⁸² Nonetheless, one court has said that substantial, rather than strict or absolute, compliance with the subdivision statute may be sufficient.⁸³ The costs and attorney fees incurred by the association as a result of an application are the sole obligation of the unit owners who apply for the relocation.⁸⁴ The statute on amending declarations provides that, except to the extent expressly permitted or required by other provisions of the CCIOA, an amendment may not change the boundaries of any unit without a vote or agreement of unit owners of units to which at least 67 percent of the votes in the association, including 67 percent of the votes allocated to units not owned by a declarant, are allocated or any larger percentage the declaration specifies.⁸⁵

The comparable Uniform Act provision requires unanimous consent of the unit owners to change the boundaries of any unit or the allocated interests of a unit, except to the extent expressly permitted or required by other provisions of the Act.⁸⁶

In 1994, the Uniform Act was amended to add a subsection not found in the CCIOA. The Uniform Act provision concerns common elements being relocated to incorporate them within a unit. The incorporation may only be accomplished by a declaration amendment with the approval of those entitled to cast at least 67 percent of the votes in the association.⁸⁷ A comment to the Uniform Act says it is intended to address a "frequently occurring" issue: new additions to existing units that commonly encroach on the common elements. The comment notes that limited common elements may be used to address the issue and that the new subsection does not prohibit their use for that purpose, but the drafters believed the new subsection offered a more direct means to address this matter.⁸⁸ While the CCIOA did not adopt the 1994 amendment, there is a statute that allows portions of the common elements to be conveyed in condominiums and planned developments if those entitled to cast at least 67 percent of the votes in the association — or any larger percentage the declaration specifies — agree to the conveyance.⁸⁹ The agreement to convey must be evidenced by execution by the association of an agreement in the same manner as a deed, and that agreement is void unless approved by the requisite percentage of owners.⁹⁰ Any grant, conveyance, or deed executed by the association is effective only on recording.

The subdivision of units is addressed by another statute.⁹¹ That statute provides that a unit may be subdivided into two or more units if the declaration expressly allows subdivision. It allows a unit owner to apply to the association to subdivide a unit, "subject to the provisions of the declaration and other provisions of law."⁹² To subdivide a unit, the owner must execute and submit an application to the governing board that includes all of the following:

• Evidence that the

...