Q. In the summer, we usually have social gatherings among the residents of our condo. Our board of directors has approved over $1,000 for the cost of our monthly community barbecues. I assume, rightly or wrongly, that using the monthly maintenance fees in this manner is inappropriate. However, the board insists on going ahead with the barbecues, which has caused dissent among residents who disagree with the expense Could you please advise a course of action?
—Fired Up in Freehold
A. “A condominium association stands in a fiduciary relationship to the unit owners, which requires that it act consistently with The Condominium Act N.J.S.A. 46:8B-1 et. seq., its own governing documents and that its actions be free of fraud, self-dealing, or unconscionability- Glen v. June, 344 N.J. Super. 371, 380, 782 A.2d 430 (App. Div. 2001),” says Nancy A. Cifalino, Esq., of the New Jersey-based law firm of Celentano, Stadtmauer & Walentowicz, LLP. “It is not entirely uncommon for an association to hold barbecues in an attempt to bring the community together. However, your question fails to indicate the number of units in your community and whether the “more than $1000" cost is a monthly or annual expense. You may want to review the association’s operating budget in the event you are unsure.”
“The actions of the governing body of a condominium must meet the test of reasonableness. Papalexiou v. Tower West Condominium 167 N.J. Super. 516, 525, 401 A. 2d 280 (Ch. Div. 1979). If the more than $1000 cost is an annual cost and there are 500 units, the barbecues may pass the reasonableness test because the proportionate cost would be $2.00 per each unit owner annually. However, if the approximate $1000 is being set aside each month for the barbecues at an annual expense of $12,000 per year and there are only 100 units, the proportionate cost of $120.00 per unit owner annually may be deemed unreasonable.”