What is a Road Maintenance Agreement?
A Road Maintenance Agreement (RMA) is an agreement between property owners within a development or neighborhood HOA that sets forth the maintenance responsibilities for the private roads within the community’s development. The purpose is to clearly define which parties are responsible for the upkeep of the road throughout its expected life, including repairs and repaving as needed. Some developments with private roads will dictate that all maintenance and repair costs – including paving – will be shared by all of the homes in the HOA. Others may allocate those costs differently . Sometimes the RMA caps the per-home responsibility for cost in any given year at a set dollar amount. The limit, like the allocation, varies based on each development’s RMA.
It is important for the RMA to require that the repair work is performed in a manner and standard acceptable to the applicable government agency that maintains the public roads nearby. This will enable the road to be taken over by the statutory "private road" process, which provides that after a certain number of years, the road is offered to the government entity to maintain. This standard is not well known and there is no published case law interpreting or applying the standard.
Elements of a Road Maintenance Agreement
Pursuant to these broad principles, here are some of the key components that might be included in a sample road maintenance agreement:
Parties to the Agreement
The parties to any Road Maintenance Agreement would normally include the owners of all serviced private roads and the several homeowners that utilize each of the maintained roads. In most cases the owners of the roads and the members of the homeowners association are the same group but sometimes the association is different than the owners of the roads. The owner or owners of each road would be the only parties obligated to maintain the road.
Scope of Maintenance Services
The Road Maintenance Agreement must clearly state what maintenance services are being provided under the Agreement. The party obligated to maintain the roads under the Agreement must provide all necessary services such as snow plowing, tree trimming, grading and any other maintenance tasks necessary to keep the roads in good condition.
Parties Responsible for Maintaining Roads
Each private road should be assigned to the home or homes located on it or should be assigned to a homeowners association if the road is not situated on or adjacent to a single family residence. When a road is owned by the homeowners association, it may be prudent to have contractual provisions in place allowing the homeowners association to collect road maintenance fees from the homeowners. If a single family residence is an owner, the owner will be responsible for paying its share of road maintenance costs regardless of whether it is also a member of the homeowners association.
Compliance with Ordinances and Municipal Laws
The parties to the Road Maintenance Agreement must agree among themselves that they will comply with all local ordinances and municipal laws affecting the roads and that they will not create any nuisances on the roads. This clause may arguably benefit either party but the main intention is to preserve the peace and tranquility of the residential community as a whole.
Allocation of Costs
Costs under the Road Maintenance Agreement may be allocated to one or more of the following categories:
Road maintenance costs should be assessed by the individual owners for purposes of billing and collection. Individual assessments will require pro rata allocation of costs based on the number of households using the roads.
Dispute Resolution
It is advisable for the parties to include a dispute resolution mechanism in the Road Maintenance Agreement. For instance, the parties could agree to have disputes between them settled by mediation, arbitration or some other means.
Legal Issues Surrounding Road Maintenance Agreements
The legal considerations when creating a road maintenance agreement are similar to those applicable to a general maintenance agreement. However, with a road maintenance agreement, there is no concept of equitable servitude. Any road maintenance agreement drafted for a road shared by several homeowners must be recorded in the public records of the county or counties where the roads are located to give it legal enforceability. The failure to do so could arguably render such an agreement unenforceable or unenforceable against a homeowner who did not consent to its terms. As a result, it would be prudent to provide the signatures of the homeowners to be bound by the terms of the agreement and the recording of the agreement to affect its enforceability. There is an added benefit to recording the agreement because not only can it bind the parties to it but any successors-in-interest.
Florida law does permit homeowners to sue for the enforcement of a road maintenance agreement and to compel the parties to perform according to the terms of the agreement. Florida Statute § OK 95.11(3)(a) grants a four-year period to bring a claim for enforcement. However, Florida Statute § 70.091(3)(b) grants a five-year period to record the road maintenance agreement in the county. Failure to record the agreement in the county within five years arguably tolls the period through which a lawsuit can be enforced to compel performance in accordance with the road maintenance agreement.
Common legal pitfalls to avoid when drafting a road maintenance agreement include the following:
Advantages of Establishing a Road Maintenance Agreement
A well-drafted road maintenance agreement provides numerous benefits to the property owners. A few of the main benefits are discussed below. One of the substantial benefits is that it clearly sets forth the responsibilities of all of the property owners. If a property owner is the only one responsible for a certain section of a road, that is clearly set forth. Further, the apportioning of expenses is clearly drafted to lay out each property owner’s percentage. This is essential in any type of agreement of this nature so that there are no disputes between the property owners. This type of agreement can also help to clear up what is expected of each property owner, thereby potentially eliminating disputes with regards to maintenance and other activities for the road. This provides adequate protection to all parties. Any issues can swiftly be resolved with less tension resulting from the clarity of the agreement. Another benefit in having a well-drafted road maintenance agreement is that it can help to protect the property values for everyone involved. For instance, should there a be a dispute about a particular road repair or refresh that costs the property owners money to perform, this may cause tension amongst the property owners that could have been easily resolved had the road maintenance agreement clearly laid out everyone’s responsibilities. Should expensive repairs be required, it will also assist in protecting against a single property owner encumbering the others with the responsibility for such expense as opposed to them sharing in the expense equally.
Example of a Road Maintenance Agreement
The following is a sample outline for a road maintenance agreement. Editing, expansion and obviously legal advice will be required to create a usable road maintenance agreement.
Road Maintenance Agreement
This Road Maintenance Agreement (this "Agreement") is made as of this _____ day of _____, 20____, between _________ ("Owner") and _________ ("Owner 2").
The parties hereto, intending to be legally bound, agree as follows:
- Owner’s Agreement. Owner agrees to defend, indemnify and hold harmless all other Owners from and against all liabilities and damages of any kind whatsoever arising from or in any way related to the use of the road located on the property owned by Owner and _____ (the "Road"). The frequency and scope of all road maintenance activities shall be as approved in accordance with this Agreement.
- Owner 2’s Agreement. Owner 2 agrees to defend, indemnify and hold harmless all other Owners from and against all liabilities and damages of any kind whatsoever arising from or in any way related to the use of the Road. The frequency and scope of all road maintenance activities shall be as approved in accordance with this Agreement.
- Owner’s Right Of First Refusal. In the event of a sale, transfer or lease of any portion of ____________, then the remaining owners shall have a right of first refusal to purchase the property to be sold, transferred or leased to the extent the sale, transfer or lease involves the Road. This right shall only apply if the purchaser, transferee or lessee intends to build a dwelling or construct any other improvement in which vehicular traffic over the Road will increase substantially, such as, but not limited to, a fence, barn, detached garage and/or outbuilding, swimming pool, boat ramp, workshop, etc. Where a sale, transfer or lease of a part of _______ occurs without the right of first refusal being exercised, the Road shall be limited to the current level of occupancy, with neither existing higher nor increased density allowed. Prior to any sale, transfer or lease agreement for a partial sale, each Owner will be provided notice and an opportunity to participate in the sale, transfer or lease of said property.
- Other Notices of Proposed Sale , Transfer, Lease etc. With regard to any proposed sale or transfer of any part of ________, each owner shall be provided with written notice and an opportunity to be included in the proposed transaction to the extent that the purchaser or transferee intends to build a dwelling or construct any other improvement which will substantially increase any existing density as to vehicular traffic over the Road. Where a sale, transfer or lease of a part of __________ occurs in accordance with this section, the Road shall be limited to the current level of density, with no existing or increased density for traffic over the Road. Prior to any sale, transfer or lease agreement for a partial sale, each Owner will be provided notice and an opportunity to participate in the sale, transfer or lease of said property.
- Specific Number of Dwellings Limited. No owner shall construct more than ______ dwelling(s) on its property, notwithstanding any other provision in this Agreement, unless otherwise agreed to in writing by all Owners.
- Road Maintenance Activities. Subject to the rights of the parties with respect to a sale, transfer or lease of a part of ___________, Owner(s) shall have the right to from time to time conduct the following road maintenance activities (collectively, the "Road Maintenance Activities"): and Owner 2 shall have the same rights with respect to the Road. Notwithstanding the above, Owner(s) shall not conduct any Road Maintenance Activities which are not consistent with the frequency and scope of the Road Maintenance Activities provided by other Owners during the preceding ___________.
- Rights of Entry. Owner(s) shall have the right to enter the property at reasonable times to conduct Road Maintenance Activities, provided Owner(s) notify the other Owners _____ hours in advance prior to entering the property.
Although the basic obligations of Owners or Owner 2 under this agreement should be consistent with the provisions of Paragraphs 1 through 6, there should be a provision or provisions allowing the parties to expand or limit, by consent of the parties, the number of dwellings, activities or improvements by the various Owners and owners at some specified time in the future.
How to Create a Customized Road Maintenance Agreement
A well-tailored Road Maintenance Agreement will precisely meet the requirements of the specific private road, based upon its unique features and past experiences. This section will highlight a few issues associated with road maintenance agreements, along with a step-by-step outline of how to create a Road Maintenance Agreement, specific to your private road. This article does not address specifics relating to the drafting and negotiation of the Road Maintenance Assessment, which is equally as important as the Road Maintenance Agreement and will be the focus of a future article.
Step 1 – Assess the Current Physical Needs of the Road.
As a starting point, initially assess the current condition of the road. Specific observations related to the intersection of Chippewa and Wexford could include issues at the beach access road (further defined below).
Step 2 – Review any existing Road Maintenance Agreements and/or Historic Practices.
It is important to have a Firms man or woman on the ground to review any existing Road Maintenance Agreements, existing Road Maintenance Assessment and associated practices relating to the maintenance thereof. A Road Maintenance Agreement should be approved by the members of the neighborhood, which includes a simple vote of all members, where a 60% majority prevails.
Step 3 – Review any applicable Declarations and Bylaws.
Ensure compliance with all Declarations and Bylaws for the Private Road and/or Neighborhood.
Step 4 – Collaborate with all Stakeholders.
Engage with the attorneys representing the applicable Neighbors in Chippewa Shores. It is important to understand that all members of a specific private road will have their own attorney. Seeking advice from an attorney through a personal phone call will assist in reporting to your neighbors that the specific needs of the Private Road have been addressed.
Challenges with Road Maintenance Agreements
Common challenges
The agreement should help avoid future disputes or misunderstandings. It needs to be flexible enough to allow for changes, especially as new parties to the agreement come into the picture, without having to amend the agreement each time.
The most common challenges I have seen are road maintenance agreement disputes, which are typically due to:
Exclusivity / No formalities
Most agreements I see are not "exclusive," which means that the owner of the affected property can not use the same road under formal conditions, such as weight limits, time limits, or other conditions that they must also adhere to. This type of exclusivity is beneficial because it guarantees the owners that the road will only be used by certain vehicles at certain times, which is important for a variety of reasons.
For example, if the property owner only owns an industrial property, a Road Maintenance Agreement would be considered a nuisance if it contains unreasonable restrictions to the property owner’s use. A solution for property owners is to specifically limit their Agreement to apply under certain conditions, such as weight or location.
It would also make sense to require the parties to notify their tenants about the Road Maintenance Agreement.
Flexibility
Constructing a Road Maintenance Agreement with ample flexibility helps avoid future disputes.
Some important things to keep in mind when drafting are:
Lastly, be sure to remember that parties may enter this Agreement for a variety of reasons, so the Agreement should take all of these into consideration.
Inadequate insurance coverage
This is another reason why the above suggested flexibility is so important when drafting the Agreement, because of the high standards required for professional engineers and contractors.
Also, the right insurance for a Road Maintenance Agreement usually advises that parties carry general liability and automobile liability. Depending on the location, businesses may be required to carry additional insurance, such as pollution liability.
Case Studies on Road Maintenance Agreements
To better illustrate how the above provisions have been effectively utilized, the following will explore real-life situations where road maintenance agreements have proven successful:
Governor’s Avenue, Newport, RI
Governor’s Avenue in Newport, Rhode Island is a long private road with four town-owned side roads. The Governor’s Avenue Association was formed to enforce easements and provide for road maintenance and collection of fees. The Association owns the roads and has had attorneys draft all appropriate documentation. The Town of Newport has accepted the roads for tax purposes only, acknowledging that they are owned by the Association. The Town has no responsibility for repairs or any activities relating to the maintenance of the roads, other than to bill residents for emergency response to incidents occurring on the roads.
The Association assesses for maintenance based on usage. The Association has spent $20,000 improving the roads over the past twenty years using these assessments on a pay-go basis. The Association has contracted with a snowplow contractor, but the roads were plowed by each individual resident during the day until the contractor was employed. The Association has a snow policy that specifies the amount of snow that must be on the ground before the contractors begin plowing and salting, which is two inches of fresh snow. Residents are responsible for the snow removal on their own property , but the contractor plows and salts the end of each drive that touches the road. Residents shovel their own sidewalks, but residents with a physical impairment can make arrangements with the contractor to have their sidewalks plowed. There is a snow policy that limits the height of snow banks on the roads, which is necessary for visibility and safety. The Association was diligent in removing the path cuts that the Town made when it plowed the roads before the Association hired its own contractor. Today, the residents on Governor’s Avenue are very satisfied with the services of the snow contractor and the maintenance of the roads.
Doane Way, Pocasset, MA
Doane Way is a very low traffic area that has been in existence since the 1930s, and the residents have taken steps to maintain and improve the road since at least that time. In 1979, the Town of Bourne took responsibility for maintaining the road; however, the road is still considered private because the Town cannot accept the road as a public way. The homeowners participate in all maintenance of the roadway and the costs to maintain the road are assessed on the basis of frontage. Each abutter has an individual responsibility to maintain the right-of-way in front of their own property. The Town accepted a deed to Doane Way from the private owners in 1979, but the homeowners have a right of reverter if the road is ever abandoned or discontinued by the Town. To this date, the road has remained in good shape and appears to be well maintained by the residents.