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Colorado Court of Appeals Expands CCIOA Sec. 317

  • December 28, 2023
  • Miles Buckingham
  • Comments Off on Colorado Court of Appeals Expands CCIOA Sec. 317

In a new decision from the Colorado Court of Appeals, the Judges have ruled that bank statements for accounts held by Colorado homeowners associations “may” be included in the category of materials which must be kept by the community, and made available to owners who make a request under the law. CRS sec. 38-33.3-317 gives owners the right to demand access to categories of information and materials held by the Association. The new case, Seaman v. Heather Gardens, holds that even though bank records are generated by third-parties (that is, the bank, and not the association), such records “may be” nonetheless of a sort which associations must (a) keep and maintain, and (b) make available on demand.

While asking owners’ associations to maintain bank records is likely not a controversial decision, the ruling is silent as to how many years’ worth of records must be maintained, how associations should protect banking information when materials are demanded, and whether the decision applies to investment accounts, CDs, reserve accounts, and sums held in trust pending completion of construction or litigation. Moreover, as communities are shifting where they bank based on who their community manager is, we are going to see a need for association to take special care to download and preserve as many bank records as they can before any change in institutions occurs.

Finally, the Court of Appeals’ decision looked to the Colorado Open Record Act for guidance as to whether an entity which has a duty to make a production of demanded records must share materials generated by third-parties. As the Courts increase the frequency of references of owners’ associations as quasi-governmental entities, dovetailing CORA with CCIOA (if only to provide additional authority for the decision) hints at greater and greater demands from, and impositions on, HOAs in Colorado in the coming years.

HOA litigation in Colorado is complicated. If your community is being threatened with suit, make sure that your attorneys know their way around the complicated and nuanced legal world that is the Colorado Common Interest Ownership Act.