Substantive Changes to DUCIOA Could Have Significant Impacts on Common Interest Communities

September 27, 2021

Publication| Real Estate Services

On September 15, 2021, Governor John Carney signed into law House Bill 112, as amended, which amends the Delaware Uniform Common Interest Ownership Act (DUCIOA).  While many of these amendments are technical in nature, the legislation includes two important, substantive changes to DUCIOA that could have significant impacts on developers of common interest communities and the associations governing those communities. 

First, this legislation adds to the sections of DUCIOA that apply to pre-existing common interest communities, including the minimum requirements for already existing community bylaws that DUCIOA currently only imposes on new communities, which could force existing communities to amend their bylaws and other governing documents to ensure they comply with DUCIOA.  Second, sellers will have to provide a public offering statement to purchasers of a unit in any common interest community—not only in condominiums and cooperatives, as is now the law—prior to the execution of any contract of sale. Moreover, a purchaser may cancel its purchase contract if that purchaser has not received the public offering statement more than five days before execution of the contract.  This represents a fundamental policy change for communities that are not condominiums or cooperatives. 

The legislation’s more technical amendments include clarifying that nonresidential common interest communities are exempt from DUCIOA and not required to maintain a repair and replacement reserve; permitting a declarant to amend the declaration, bylaws, or plat plan to correct typographical and other errors; expanding the options and methods for property owner voting permitted under DUCIOA; and authorizing communities to charge a reasonable fee to provide required certifications.  The legislation will become effective on October 15, 2021.

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