(A) A portion of the property for which insurance is required pursuant to Section 27-31-240 and which is damaged or destroyed must be repaired or replaced promptly by the council of co-owners unless:
(1) repair or replacement is illegal under a state statute or local health ordinance; or
(2) eighty percent of the co-owners, including the owner of an apartment which is not to be rebuilt, vote not to rebuild; except that the property bylaws may expressly require a percentage greater, but not less than, eighty percent of the co-owners.
(B) The cost of repair or replacement in excess of insurance proceeds and reserve must be considered a common expense.
(C) If the entire property is not repaired or replaced, the insurance proceeds:
(1) attributable to the damaged common elements must be used to restore the damaged area to a condition compatible with the remainder of the property;
(2) attributable to apartments and limited common elements that are not rebuilt must be distributed to the owners of those apartments and to the owners of those apartments to which limited common elements were allocated, or to the lienholders, as their interests may appear;
(3) remaining must be distributed to all of the co-owners or lienholders, as their interests may appear, in proportion to the percentage as described in Section 27-31-60.
(D) If the co-owners vote not to rebuild an apartment, that apartment's allocated interest must be reallocated automatically upon the vote and the council of co-owners promptly shall prepare, execute, and record an amendment to the master deed reflecting the reallocations.
HISTORY: 1962 Code Section 57-518; 1962 (52) 1866; 1967 (55) 449; 1984 Act No. 463, Section 5; 2006 Act No. 250, Section 1, eff March 24, 2006.
Editor's Note
2006 Act No. 250, Section 2, provides as follows:
"This act takes effect upon approval by the Governor and applies to all horizontal properties governed by the Horizontal Property Act, notwithstanding a provision in the master deed or bylaws to the contrary."
Effect of Amendment
The 2006 amendment rewrote this section.