The Mountain Times

°F Fri, April 18, 2014

Central Vermont's Most Popular Weekly Newspaper

Dispute headed to Vt. Supreme Court

KILLINGTON - A lawsuit brought by an owner at the Village Square condominium complex at Pico is on its way to the state Supreme Court.

Marcia Ratner brought the suit, claiming the condo association failed in its duties to properly maintain the building in a financially responsible manner.

"The board of directors is supposed to establish the reserves," Ratner said. "Buyers can be harmed if the board of directors isn't following the by-laws. It can affect your ability to get a mortgage."

Ratner said she went 10 months without hot water in 2007, so she withheld her condo fees in protest.

"What other recourse do homeowners have?" she asked. "I felt it was a meritorious reason."

Ratner is not the only dissatisfied owner. Bob Merrama said he believes the condo fees, which he said are in excess of $500 a month, are too high.

In particular, he'd like to see the heating in common areas made more efficient.

"It costs $60,000 to heat the building and the common area," he said. "The heat comes out of the ceiling."

What Merrama, a property manager himself, said he'd like to see is a small, glassed-in waiting area in front of the door, so that heat wouldn't escape into the atmosphere when someone opens it. There are other improvements he'd like to see: centralized trash collection, key-card access to the building, and to replace the carpeting and wallpaper, which he said dates back to building's opening in 1986. He said the improvements would drastically reduce the current condo fees.

"They aren't following their own by-laws," Merrama said. "I've filed a complaint with the attorney general."

Some of the numerous claims Ratner made in her initial filing included that the condo association did not keep enough money in the capital reserve fund to keep up with maintenance, that the association ignored the advice of the auditors, and that they kept fees artificially low to the detriment of the owners.

However, many of the allegations Ratner made date back more than 10 years. In her findings, Judge Mary Miles Teachout ruled that Ratner had no standing to sue, and even if she had, she waited too long to file.

"The best interest of the corporation may not always by synonymous with the best interest of all the shareholders," she wrote.

"When these interests conflict, it is clear that a director owes the fiduciary duty to the corporation as a whole and not the individual shareholder."

As to the timing, Teachout wrote that the statute of limitations started running in December 2004, when the association made a special assessment which Ratner disputed.

"Although Ms. Ratner could now know the full extent of all future special assessments at this time (December 2004), the inability to calculate all damages does not stop the statute of limitations from running," Teachout wrote. "Even if Ms. Ratner had standing to bring this direct action against Defendants, her suit is time barred because it was not filed within six years of December 2004, when, at the latest, her claims accrued."

Bob Harvey, the condo association's current president, said he couldn't comment on litigation still wending its way through court. He said he believes Merrama's claims are somewhat overblown.

"I don't know about the other things," Harvey said. "He hasn't said a word. One thing he's harped on is the common area. The only heat in the common area is over the top of two doors. We're talking about an area that's only 5 or 6 percent of the building."

Harvey said the association had hired an engineer to come to the complex to inspect the boilers. He also said they'd discuss the possibility of an energy audit at that time.

Merrama said if his complaint and a number of others he's made aren't taken care of, he's considering moving.
"I like it here," he said. "My daughter's of age to start skiing. But if things don't get corrected, I'm out of here."