Abstract of Judgment (Legal Terms) [ + ]
An abstract of judgment is a document provided by the cleark of the court which summarizes the key elements of a judgment (plantiff, defendant, court, case number, judgment date, brief terms of judgment). It is used to prove that a judgment has been rendered. It can be filed in the real property records of the county where the property is located, as well as any other jurisdiction, where it constitutes notice of a "judgment lien" on the debtor’s real property. The Abstract prevents the transfer of that property until the judgment has been paid.
Accounting Basis - Accrual (Financial Terms) [ + ]
In accrual accounting, revenues are shown on financial statements at the time they are earned. For an association with annual assessments due on January 1st, all invoiced assessments are shown as a revenue on January 1st independent of when they are actually collected. If a property is subsequently foreclosed, they revenue that will never be collected, but was already show as a revenue in January, is recorded as a Bad Debt.
For expenses, the expense shows on the financial statements in the month the expense is incurred. So if a $500 project is approved in March but not paid until June, the $500 shows on the March financial statements. At the same time, an Accounts Payable (A/P) entry is made showing $500 is owed to a contractor. Once the check is written to the contractor in June, the A/P entry is removed.
Accounting Basis - Cash (Financial Terms) [ + ]
In cash accounting, revenues are shown on financial statements at the time they are receivedearned. For an association with annual assessments due on January 1st, revenues are shown throughout the year (including prepayments received before January 1st. Bad Debt is not used in cash accounting.
For expenses, the expense shows on the financial statements in the month the expense is paid. So if a $500 project is approved in March but not paid until June, the $500 shows on the June financial statements. An Accounts Payable (A/P) is not used in cash accounting.
Accounting Basis - Modified Cash (Financial Terms) [ + ]
This is the accounting method used on financial reports produced by C.I.A. Services. Modified cash combines the benfits of accrual and cash accounting to provide financial reports which are easily understood by board members.
As with cash accounting revenues are shown in the month they are received and expenses are shown in the month they are paid. The "modified" part occurs at the beginning and end of the budget year.
When next year’s assessment is invoiced in October or November, all prepayments are held in a "Paid in Advance" account and moved to revenues on January 1st. This aligns the revenues with the budget. For expenses incurred in one year but not paid until the next, Accounts payable (A/P) entries are made as of December 31st to shown the expense in the right budget year. Once the check is written to the contractor in the next budget year, the A/P entry is removed.
Accounts Payable (Financial Terms) [ + ]
Accounts payable (A/P) is list of amounts that an association owes to others but has not yet paid. In accrual accounting, when an invoice is received, it is added to the file, and then removed when it is paid. Thus, the A/P is a form of credit that suppliers offer to their customers by allowing them to pay for a product or service after it has already been received.
Accounts Receivable (Financial Terms) [ + ]
Accounts receivable (A/R) represents money owed to the association by its members. The A/R ledger is typically broken down by the type of invoice: assessment, interest, legal fees, fines, etc.
Ad Hoc Committee (HOA Jargon) [ + ]
Ad hoc is a Latin phrase meaning "for this". An ad hoc committee exists to address a specific purpose or task. The committee typically disbands once the task is complete.
ADA (HOA Jargon) [ + ]
The Americans With Disabilities Act (ADA) was signed into law under President Bush in 1990. It applies to all private and state-run businesses, employment agencies and unions with more than fifteen employees. The goal of the ADA is to make sure that no qualified person with any kind of disability is turned down for a job or promotion, or refused entry to a public-access area.
For a community association, the ADA requires that reasonable accommodations be made to the common areas and facilities to allow access to all persons whether or not they are members of the association.
Aeration (Landscaping) [ + ]
Aeration refers to the process of using mechanized equipment to either puncture the soil with spikes (spike aeration) or remove approximately 1"X2" cores of soil from the ground (core aeration). Aeration may be overlooked when trying to restore a lawn but is vital to bring it back to health. It improves drainage and reduces puddles formation.
Core aeration reduces turf compaction, reduces thatch buildup, and improving the infiltration of water/nutrients into the root zone of grasses.
Photo "Core Aeration" by http://fertplus.com/core-aeration/
Agreed Judgment (Legal Terms) [ + ]
If the parties agree to terms on settling a lawsuit, an "Agreed Judgment" is submitted to the Court for the judge’s signature to conclude the lawsuit. Once signed, it has the same legal effect as a judgment rendered by the court.
AMS (HOA Jargon) [ + ]
Association Management Specialist. The AMS® designation is awarded by the Community Associations Institute to managers that have pursued advanced training and education. The designation indicates the manager has the knowledge, experience, and integrity to provide the best possible service to associations. AMS® designees have made a commitment to continuing education and must adhere to a professional code of ethics.
Articles of Incorporation (HOA Jargon) [ + ]
Articles of Incorporation are filed with the Texas Secretary of State’s Office to create a corporation. This document defines the overall purpose of the entity and name the registered agent (the official contact person for the corporation).
Articles of Incorporation are no longer used to create corporations in Texas. Beginning 01/01/2006, the document is called a "Certificate of Formation" and contains the same information.
Association (HOA Jargon) [ + ]
A non-profit corporation or unincorporated association created for the purpose of managing a common interest development.
Astragal (Homes & Other Structures) [ + ]
An astragal is a moulding profile composed of a half-round surface surrounded by two flat planes (fillets). It can be an architectural element used at the top or base of a column, but is also employed as a framing device on furniture and woodwork.
An astragal is commonly used to seal between a pair of doors. The astragal closes the clearance gap. The vertical member (molding) attaches to a stile on one of a pair of doors (either sliding or swinging) against which the other door strikes against or closes to.
Also known as “meeting stile seals,” the term can refer to the raised half-round overlap where pairs of doors meet, such as is the case with French doors. An astragal is designed to be applied to one or both doors of a pair at their meeting edges (meeting stiles). The astragal closes the clearance gap for the purpose of either providing a weather seal, ensuring privacy, preventing sound from leaking in or out of a room, minimizing the passage of light between the doors, or retarding the passage of smoke or flame during a fire.
Doors are typically the weakest link in any partition that is designed to block sound. This is often due to poor sealing around the perimeter of the door. Astragals, perimeter gasketing, drop seals and door sweeps can all be used to prevent sound from leaking through cracks around the door perimeter.
Awning (Homes & Other Structures) [ + ]
An awning or overhang is a secondary covering attached to the exterior wall of a building. It is typically composed of canvas woven of acrylic, cotton or polyester yarn, or vinyl laminated to polyester fabric that is stretched tightly over a light structure of aluminium, iron or steel, possibly wood or transparent material (used to cover solar thermal panels in the summer, but that must allow as much light as possible in the winter).
The location of an awning on a building may be above a window, a door, or above the area along a sidewalk. With the addition of columns an awning becomes a canopy, which is able to extend further from a building, as in the case of an entrance to a hotel. Restaurants often use awnings broad enough to cover substantial outdoor area for outdoor dining, parties, or reception. In commercial buildings, an awning is often painted with information as to the name, business, and address, thus acting as a sign or billboard as well as providing shade, breaking steep winds, and protecting from rain or snow. In areas with wintry weather, most awnings do not have to be taken down at the end of the summer - they can remain retracted against the building all winter long, or be designed and built for those conditions.
Backflow Prevention Device (Landscaping) [ + ]
A backflow prevention device (BFPD) is used to protect public water supplies from contamination or pollution. In the case of an irrigation system, a BFPD is located adjacent to the water meter. It prevents standing water over an irrigation head from flowing back into the public water supply during a water plant outage or severe weather situation. BFPD should be tested on an annual basis to make sure they will function properly if needed.
Bandit Signs (HOA Jargon) [ + ]
Bandit signs are an advertising tactic mostly used by small businesses promoting services or items for sale. Often referred to as Flyposting which is the act of placing advertising posters, signs or flyers in illegal places.
In most areas, it is illegal to place such posters on private property without the consent of the property owner, or to post on public property without a sign permit from the local government. Flyposting is commonly seen as a nuisance due to issues with property rights, visual appearance and littering and is a misdemeanor in many locals.
Bankruptcy Discharge (Bankruptcy) [ + ]
When a bankruptcy matter is "Discharged" means that the debtor (the homeowner/property owner) has successfully completed the bankruptcy which they filed whether it be a chapter 13 or a chapter 7 filing.
Bankruptcy Dismissal (Bankruptcy) [ + ]
When a bankruptcy matter is "Dismissed" means that the debtor (the homeowner/property owner) has not completed the bankruptcy which they filed. The Bankruptcy Court may dismiss a bankruptcy at the recommendation of the Bankruptcy Trustee generally for failure to present a repayment plan or to make required payments.
Bay Window (Homes & Other Structures) [ + ]
A bay window is a window space projecting outward from the main walls of a building and forming a bay in a room, either square or polygonal in plan. The angles most commonly used on the inside corners of the bay are 90, 135 and 150 degrees.
The windows are commonly used to provide the illusion of a larger room. They are used to increase the flow of natural light into a building as well as provide views of the outside that would be unavailable with an ordinary window.
Board Meeting (HOA Jargon) [ + ]
Board Meeting includes any congregation of a majority of the board members at the same time and place to hear, discuss or deliberate upon any item of business scheduled to be heard by the board, except those matters that may be discussed in executive session.
Building Line (Homes & Other Structures) [ + ]
The lines on a platted lot beyond which no structure can extend. The front building line is typically shown on the community plat or lot survey. The side building lines are typically specified in the CC&Rs and shown on a lot survey. If a lot also has a rear building line, it may be specified in the CC&Rs or community plat and would also be shown on a lot survey.
The purpose of a building line to to provide a uniform setback from the street and to provide spacing between structures on adjacent lots. Building lines apply to structures so sidewalks and driveways, for example, can be built beyond a front building line.
CC&Rs (HOA Jargon) [ + ]
Each community association has a document created and filed by the developer to regulate the use of the land being developed. CC&Rs refers to the Declaration of Covenants, Conditions and Restrictions which is a common name for that document. It is also common to refer to that document as the "Deed Restrictions".
Certificate of Formation (HOA Jargon) [ + ]
Certificate of Formation is filed with the Texas Secretary of State’s Office to create a corporation. This document defines the overall purpose of the entity and name the registered agent (the official contact person for the corporation).
Prior to 01/01/2006, this document was called the Articles of Incorporation.
Chapter 11 (reorganization) (Bankruptcy) [ + ]
Chapter 11 is a chapter of the United States Bankruptcy Code which permits reorganization under the bankruptcy laws of the United States. Chapter 11 bankruptcy is available to every business, whether organized as a corporation or sole proprietorship, and to individuals, although it is most prominently used by corporate entities.
Chapter 13 (repayment) (Bankruptcy) [ + ]
Chapter 13 of the United States Bankruptcy Code governs the form of bankruptcy which allows individuals to undergo a financial reorganization supervised by a federal bankruptcy court. The Bankruptcy Code anticipates the goal of Chapter 13 as enabling income-receiving debtors a debtor rehabilitation provided they fulfill a court-approved plan. It is a form of debt consolidation. Repayment of debts under chapter 13 are paid out monthly by a Trustee appointed by the court over a period of up to 5 years.
Chapter 7 (liquidation) (Bankruptcy) [ + ]
Chapter 7 of the United States Bankruptcy Code governs the process of liquidation under the bankruptcy laws of the United States.
For an individual, the debtor is allows to retain certain exempt assets. Certain types of debts are discharged and the individual no longer has an obligation to pay them.
CMCA (HOA Jargon) [ + ]
Certified Manager of Community Associations. The CMCA designation is awarded by the National Board of Certification for Community Association Managers. It recognizes individuals who have demonstrated the fundamental knowledge required to manage community associations.
Default Judgment (Legal Terms) [ + ]
A default judgment is typically in favor of a plaintiff when the defendant has not filed an answer with the court after being served or has failed to appear in court as directed. The default judgment granted is for the relief requested in the plaintiff’s original petition.
Discovery (Legal Terms) [ + ]
Once a lawsuit is filed, each party to the lawsuit is entitled to gather evidence from the other party. Various discovery tools include depositions, interrogatories, requests for production and requests for admissions.
Interogatories are written questions provided by one side for the other to answer truthfully. These questions help establish basic facts and provide information to explore further.
In requests for production, one party request the other to turn over documents such as copies of letters, emails, minutes, photographs or recordings. This step exposes the trail of documentation in the dispute.
Requests for admissions are a useful tool for streamlining an eventual trial. Here the party is asked to "admit" or "deny" a written statement. This allows the parties to agree to to certain facts that will then not need to be proved at trial. An admission might be "Admit or deny that you purchased the property at 123 Main Street on June 1, 2011".
In a deposition, the attorney for one party questions a potential witness under oath in front of a court reporter but outside of court. The questions can be free-ranging and depositions are frequently held after the discovery steps described above to further pursue topics.
Dormer (HOA Jargon) [ + ]
A dormer is a structural element of a building that protrudes from the plane of a sloping roof surface. Dormers are used, either in original construction or as later additions, to create usable space in the attic of a building by adding headroom and usually also by enabling addition of windows. Like skylights, dormer windows are a source of light and ventilation for top floors, but unlike skylights (which are flush with the roof surface) they also increase the amount of headroom in the room and allow for more usable space.
Downspout (Homes & Other Structures) [ + ]
A downspout, downpipe or roof drain pipe is a vertical pipe for carrying rainwater from a rain gutter to ground level. The bottom of the downspout often has an elbow which directs the water away from the building. This is to protect a building’s foundation from water damage. The water is directed away to a sewer, to seem into the ground or to be collected for rainwater harvesting.
Driveway Apron (Homes & Other Structures) [ + ]
The driveway apron is the portion of the driveway that runs from the street to the sidewalk. In a typical configuration, it slopes downward to the street and flairs outward on the sides where it intersects the street and the curbs. If the streets and curbs are already in place when the driveway is installed, the street and curbs are typically saw-cut to make a clean interface between the old and new concrete. Note that the driveway apron is typically installed outside of the owner’s property within the road right-of-way.
Fascia (Homes & Other Structures) [ + ]
Fascia is the term used to describe the horizontal boards which cap the end of rafters outside a building. Rain gutters are attached to the fascia boards.
Funds - Capital (Financial Terms) [ + ]
The purpose of the Capital Fund is to pay for new community assets. The ideal fund balance is based on the capital project plan - i.e. how many years do we have to accumulate how many dollars.
Funds - Operating (Financial Terms) [ + ]
The purpose of the Operating Fund is to protect against fluctuations in budgeted revenues or expenses. It is used to cover lower than expected revenues or higher than expected expenses. The fund grows if performance is better than expected. The ideal fund balance is typically 25% to 75% of the annual operating expenses depending on the type and size of the community.
Funds - Replacement (Financial Terms) [ + ]
The purpose of the Replacement Fund is to pay for the predictable costs of maintaining and replacing major assets of the community. The ideal fund balance is calculated through a "reserve analysis".
Funds - Special Purpose (Financial Terms) [ + ]
Special Purpose Funds are accumulated and used for a specifically defined purpose. For example, an association might levy a special assessment for the purpose of replacing roofs. All amounts collected are placed in this special purpose fund and used to pay for the work. If more is collected than is needed for the project, the excess cannot be used for other association purposes.
Injunction (Legal Terms) [ + ]
This is a court order directing someone to do something or refrain from doing something. This term is used in deed restriction cases, where for example, a judge may order a defendat to paint his home or may order a defendant to discontinue repairing vehicles at his property.
Although Texas law allows Justice of the Peace courts to hear deed restrictions issues, those courts do not have injunctive authority - they may only award monetary relief but not issue an injunction. This is the primary reason that deed restriction cases are almost always filed in state District Court.
Insurance - Directors & Officers Liability (HOA Jargon) [ + ]
Directors & Officers (D&O) policies covers claims made against individual directors, officers, volunteers and management staff. It provides the defense and typically has a fixed deductible (e.g. $1,000). This policy is needed by every association.
Insurance - Fidelity Policy (HOA Jargon) [ + ]
This type of policy is referred to as a Crime Policy or a Fidelity Policy. It protect the association against the dishonest acts of its directors, volunteers and employees who have access to association funds. It is optional but not too expensive. A better option is to have good procedures & controls in place.
Insurance - General Liability (HOA Jargon) [ + ]
General liability insurance covers damage to the property of others and bodily injury On a covered loss, this insurance pays for the legal defense to the claim and typically has no deductible. This coverage is recommended for all associations even if the association has no facilities or common areas.
Insurance - Non-Owned Automobile (HOA Jargon) [ + ]
A Non-Owned Auto Policy provides coverage for directors, officers & community volunteers when using their own vehicles for association business. This coverage is secondary to the individual’s personal policy - i.e. it only pays if the limits of the underlying policy are exhausted. This is optional coverage for an association but is inexpensive. Sometimes it is "packaged" with other policies.
Insurance - Property Coverage (HOA Jargon) [ + ]
Property insurance covers the loss of any physical assets own by the association. This is needed if an association owns or maintains any assets (clubhouse, playground, monuments, gates, etc.). There is typically a fixed deductible on a loss ($5000) or a percentage (5%) depending on the type of policy.
Insurance - Umbrella Liability (HOA Jargon) [ + ]
An Umbrella or Excess Liability policy provides a good way to increase the limits on one or more underlying policies. For example, if an association had a $1M general liability policy, a $5M umbrella policy could be used to increase an association’s general liability protection from $1M to $6M. Since it is unlikely that the underlying policy’s limits will ever be exceeded, umbrella policies are a less expensive way to increase limits than increased the limits on the underlying policy. An association only needs this coverage if they want to increase their liability limits.
Insurance - Workers Compensation (HOA Jargon) [ + ]
This insurance provides an association with statutory protection under workers compensation laws. It is optional if the association does not have any employees. A better option is to require evidence of this coverage, plus general liability and automobile liability, for any independent contractor the association hires.
Service (Legal Terms) [ + ]
When a lawsuit is filed, each defendant in the lawsuit must be "served" with a copy of the lawsuit petition before the lawsuit can proceed. Service can be done by the court through a Constable or by a private process server. Once a defendant is served, they must file an answer with the court by the 3rd Monday following the day of service.
If the process server is not able to serve a defendant and several attempts, the court may approve "substitute service" which is soemtimes referred to as "rule 106 service". With substitute service, the citation can be left with anyone over 16 at the defendant’s home or attached to the door among other options.
Shingles - Laminated (Homes & Other Structures) [ + ]
An asphalt roofing shingle created with multiple layers laminated together to provide a dimensional, shadowed appearance. Once installed, the shingles have an attractive appearance with a texture emulating wood shake shingles. Laminated shingles typically have limited warranties from 25 years to 50 years. Some communities require laminated shinges and three tab shingles are not allowed.
Shingles - Three Tab (Homes & Other Structures) [ + ]
An asphalt roofing shingle with decorative slots cut up from the bottom to provide "three tabs" when looking at an individual shingle. Once installed, the shingles have a regularly spaced appearance. Three tab shingles typically have limited warranties.
Soffit (Homes & Other Structures) [ + ]
The exposed undersurface of an overhanging section of the roof. Soffits normally have vent holes or openings that allow air to enter the attic and flow out roof vents.
Solar Screens (Homes & Other Structures) [ + ]
The term solar screen generally refers to fixed framed panels of dense mesh which are mounted to the exterior of a commercial or residential window. These may also be installed over skylights, doors, and other fenestrations of a building.