Monday, May 4, 2009

Condominium Board Authority - Condo Antenna - Cell Tower Leases

At Cell Tower Attorney, we assist various types of landowners in connection with cell tower leases including private landowners and corporations, religious organizations, school districts, condominium and cooperative associations. A few months ago, the New York Law Journal reported a court decision involving a condominium association’s attempt to enter into a lease with a cell phone company. In the case of Kaung v. Board of Managers of the Biltmore Towers Condominium Association, the court determined that the Condominium Board violated its bylaws when it signed a cell tower lease with Metro PCS for the placement of its condo antena on the building’s rooftop.

Specifically, the judge ruled that the condominium board did not have the authority to enter into an agreement with Metro because the agreement violated a restrictive covenant in the condominium bylaws that limits the common elements, including the roof, to residential uses. Similar to many other condominium buildings, the bylaws required that “the common elements shall be used only for the furnishing of the services and facilities for which they are reasonably suited and which are incident to the use and occupancy of the units.” While Metro and the board argued that the cell phone antennas were incidental to the residential use of the units, similar to land lines, cable and internet services, the court disagreed, concluding that that the provision of wireless communications to the surrounding city was commercial in nature and not incidental to the residential use of the condominium units.

While the above decision may ultimately be appealed, it is instructive for a condominium board seeking to enter into a cell site lease for the placement of equipment or condo antenna on the rooftop or other common areas of the building. Before entering into a cell site lease, the condominium board should examine its existing bylaws to determine if, in fact, it has the right to lease the common elements of the building for telecommunications purposes. To avoid any potential dispute, the board may consider changing its rules or amending its bylaws. This typically requires a majority vote of the unit owners.

Recently, we advised two other condominium boards that were approached by cell phone companies. Ironically, the bylaws had similar restrictions on commercial uses of the common areas. In one of the matters, we assisted the board in amending its bylaws to specifically allow for the lease of the rooftop space to the carrier involved. While there was no opposition to the lease at that time, the board’s actions were an appropriate precautionary matter to avoid a problem in the future.

If you represent a condominium board and are considering a cell tower lease on your building, please feel free to contact us. At Cell Tower Attorney, we can review your condominium bylaws to determine the board’s authority to enter into such a lease. In addition, we can recommend an appropriate course of action to avoid a potential dispute from unit owners in the future. Finally, we can assist you in negotiating and drafting a cell tower lease that protects the board, its unit owners and the building while creating additional revenue on the property.

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