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Four Tips for Peacefully Co-Existing with Your HOA’s Mixed-Use Neighbors

Four Tips for Peacefully Co-Existing with Your HOA’s Mixed-Use Neighbors

The growth of mixed-use condo facilities that include condos, retail, and entertainment venues has triggered nasty disputes, and condo owners and associations have been accused of making false complaints and harassment in their attempts to get businesses shut down.

Here our experts reveal whether they’ve seen an increase in disputes in mixed-use communities and offer four tips for ensuring that residents can peacefully co-exist with businesses.


Bar Fights Back, Sues HOA

Frustrated with noise, traffic, or odors coming from another occupant in your association’s mixed-use facility? Think twice about waging war before checking whether you actually have the right to do so.

That’s the lesson of a dispute currently brewing in Sarasota, Fla., according to the city’s Herald-Tribune. In the brouhaha, a bar owner, Ambrish Piare of the Ivory Lounge, has had enough. He’s sued the Plaza at Five Points Condo Association, whose units sit atop his bar, contending its efforts to have his business shut down have involved filing false complaints about noise and allegedly adult-themed events.

According to the Herald-Tribune, in January, the association urged the city to revoke the bar’s business permit because it alleged the bar was operating as an “adult business” by hosting “drag queen” pillow fighting and gelatin wrestling events. The association’s complaint with the city also asserted the bar’s customers weren’t “mature or educated,” as indicated in the business description in its use permit. The city dismissed the complaint. Condo owners have also reportedly pressured the property’s owner to terminate the bar’s lease.

The lawsuit seeks to make the condo association responsible for monetary damages for its alleged actions or to be banned from bringing similarly unfounded complaints.

The case isn’t so different from a 2010 situation in Houston, where the owner of Hans’ Bier Haus fought a condo association, several residents, and its management. In that dispute, condo residents sprayed water and threw ice blocks and raw meat onto the open-air beer garden’s bar and patrons. The bar owner won a lawsuit against the condo association, according to the Herald-Tribune.


More Mixed-Use Means More Complaints

The growth of mixed-use developments is undoubtedly prompting a growth in tensions between residents and businesses. “That’s exactly what I’m seeing,” saysRobert Galvin, a partner at Davis, Malm & D’Agostine PC in Boston who specializes in representing condos and co-ops. “We have a lot of mixed-use condos. They’re very popular, and I really think they’re going to continue to be. But there’s always this tension between commercial condos, particularly restaurants, and the residential owners. Even in a really well run restaurant, you have lots of problems. You have vermin. You have odors. I’ve seen some pretty bitter litigation.”

That’s true in California, too. “We have do have mixed-use clients,” says James R. McCormick Jr., a partner at Peters & Freedman LLP in Encinitas, Calif., who represents associations. “In the associations we’re involved in, we have seen the issues, and we’ve been involved in litigation over some of the issues, unfortunately.”

Here’s the challenge for many association owners and boards. You don’t have a whole lot of room to complain, argues Christopher J. Shields, a partner at Pavese Law Firm in Ft. Myers, Fla., who’s represented associations for decades. “I think, like it or not, to have commercial activity, especially a restaurant, you’ll have kitchen smells,” he says. “And to have a bar, you’ll have music. People like living in those communities because of the proximity to activities. But they don’t want the noise and smells.

“Occasionally, there’s a question of compliance with county or city noise abatement rules that have to be enforced,” says Shields. “But I think that’s people coming into the nuisance. Residential owners are aware the surrounding building may have different uses other than residential. And if you’re coming into the nuisance, you’re not necessarily protected from it. Say I move next to a cement plant or O’Hare airport, I’m not protected.”

You may also not have a lot of room to complain because the rules may have been stacked against you. “Here’s what happens,” explains Galvin. “The developer sells the residential units and hangs onto the commercial units and writes the governing documents so the residential units essentially have no rights. That becomes a real problem, and if that’s the issue, there’s no real way to solve it. If a restaurant is running in accordance with the governing documents, there’s little you can do. The problem should really be addressed when the lawyer for the developer is writing the governing documents. A lot of care should be taken so they actually work in practice. I really spend time trying to work out these details when I draft them.”


Four Tips To Avoid Disputes

All hope is not lost. Here are several ways to ease tensions:

  • Educate yourself, and stay within the authority your documents provide. “Residents have to keep in mind that the residential community has control only over what’s in the residential portion of the development,” says Shields. “You can file a complaint, but the key is what the covenants for the mixed use provide. The governing documents may be controlled or weighted in favor of the commercial users. Read your governing documents.
  • It’s also people coming to grips with the fact that this business was probably there to be seen at the time you purchased,” adds Shields. “If they buy during preconstruction, they need to see all the documents and all the adjoining units and what they could be used for. And they have to keep in mind that people will push the envelope. If a business can stay open until 10, it may not be until 11 that it actually closes.”
  •  Work together to resolve touchy issues. “I’ve occasionally created ausage committee with representatives of both commercial and residential units,” says Galvin. “It’s been charged with providing guidance on deliveries, pest contracts, exterminators, signs, and things like that. That sometimes works out.”
  •  Get the businesses involved in the residential. “A good approach is working together with the restaurants, and the only way to do that is through communication and social events,” says McCormick. “When the residential association has its annual meeting, one of the restaurants in commercial portion supplies food. And throughout the year, the restaurant sends around discounts for residents. That creates goodwill so that if the restaurant’s a little loud, owners might think, ‘Well, they’re giving us a little discount.’ Trying to create that goodwill ahead of time goes a long way toward resolving those disputes later.”
  •  If all else fails, consider your nuisance provisions. “There’s usually a provision in the governing document that there can be no nuisances,” says Galvin. “That’s the general catchall, but you can seize on it, and it usually results in litigation. It’s not the best way to resolve these disputes. It’s very expensive and time consuming. But that’s often what happens.”