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Key: (1) language to be deleted (2) new language

                            CHAPTER 168-S.F.No. 1231 
                  An act relating to real property; regulating sign and 
                  flag display; amending Minnesota Statutes 2004, 
                  sections 515.07; 515B.2-103; 515B.3-102; proposing 
                  coding for new law in Minnesota Statutes, chapter 500. 
           Section 1.  [500.215] [LIMITS ON CERTAIN RESIDENTIAL 
           Subdivision 1.  [GENERAL RULE.] (a) Any provision of any 
        deed restriction, subdivision regulation, restrictive covenant, 
        local ordinance, contract, rental agreement or regulation, or 
        homeowners association document that limits the right of an 
        owner or tenant of residential property to display the flag of 
        the United States and the flag of the State of Minnesota is void 
        and unenforceable. 
           (b) "Homeowners association document" includes the 
        declaration, articles of incorporation, bylaws, and rules and 
        regulations of: 
           (1) a common interest community, as defined in section 
        515B.1-103(C)(10), regardless of whether the common interest 
        community is subject to chapter 515B; and 
           (2) a residential community that is not a common interest 
        community, as defined in section 515B.1-103(C)(10). 
           Subd. 2.  [EXCEPTIONS.] (a) This section does not prohibit 
        limitations narrowly tailored to protect health or safety. 
           (b) This section does not prohibit limitations that 
           (1) the size of the flag to be displayed to a size 
        customarily used on residential property; 
           (2) the installation and display of the flag to a portion 
        of the residential property to which the person who displays the 
        flag has exclusive use; or 
           (3) illuminating the flag. 
           (c) This section does not prohibit a requirement that the 
        flag be displayed in a legal manner under Minnesota law, that 
        the flag be in good condition and not altered or defaced, or 
        that the flag not be affixed in a permanent manner to that 
        portion of property to be maintained by others or in a way that 
        causes more than inconsequential damage to others' property.  A 
        person who causes damage is liable for the repair costs.  
           Subd. 3.  [APPLICABILITY.] This section applies to all 
        limitations described in subdivision 1 and not excepted in 
        subdivision 2, regardless of whether adopted before, on, or 
        after the effective date of this section.  
           Subd. 4.  [RECOVERY OF ATTORNEY FEES.] If an owner or 
        tenant of residential property is denied the right provided by 
        this section, the owner or tenant is entitled to recover, from 
        the party who denied the right, reasonable attorney fees and 
        expenses if the owner or tenant prevails in enforcing the 
        right.  If a flag is installed or displayed in violation of 
        enforceable restrictions or limitations, the party enforcing the 
        restrictions or limitations is entitled to recover, from the 
        party displaying the flag, reasonable attorney fees and expenses 
        if the enforcing party prevails in enforcing the restrictions or 
           Sec. 2.  Minnesota Statutes 2004, section 515.07, is 
        amended to read: 
           Each apartment owner shall comply strictly with the bylaws 
        and with the administrative rules adopted pursuant thereto, as 
        either of the same may be lawfully amended from time to time, 
        and with the covenants, conditions, and restrictions set forth 
        in the declaration or in the owner's deed to the apartment.  
        Failure to comply with any of the same shall be ground for an 
        action to recover sums due, for damages or injunctive relief or 
        both maintainable by the manager or board of directors on behalf 
        of the association of apartment owners or, in a proper case, by 
        an aggrieved apartment owner.  This chapter is subject to 
        section 500.215. 
           Sec. 3.  Minnesota Statutes 2004, section 515B.2-103, is 
        amended to read: 
           (a) All provisions of the declaration and bylaws are 
           (b) The rule against perpetuities may not be applied to 
        defeat any provision of the declaration or this chapter, or any 
        instrument executed pursuant to the declaration or this chapter. 
           (c) In the event of a conflict between the provisions of 
        the declaration and the bylaws, the declaration prevails except 
        to the extent that the declaration is inconsistent with this 
           (d) The declaration and bylaws must comply with section 
           Sec. 4.  Minnesota Statutes 2004, section 515B.3-102, is 
        amended to read: 
           515B.3-102 [POWERS OF UNIT OWNERS' ASSOCIATION.] 
           (a) Except as provided in subsection subsections (b) and 
        (c), and subject to the provisions of the declaration or bylaws, 
        the association shall have the power to: 
           (1) adopt, amend and revoke rules and regulations not 
        inconsistent with the articles of incorporation, bylaws and 
        declaration, as follows:  (i) regulating the use of the common 
        elements; (ii) regulating the use of the units, and conduct of 
        unit occupants, which may jeopardize the health, safety or 
        welfare of other occupants, which involves noise or other 
        disturbing activity, or which may damage the common elements or 
        other units; (iii) regulating or prohibiting animals; (iv) 
        regulating changes in the appearance of the common elements and 
        conduct which may damage the common interest community; (v) 
        regulating the exterior appearance of the common interest 
        community, including, for example, balconies and patios, window 
        treatments, and signs and other displays, regardless of whether 
        inside a unit; (vi) implementing the articles of incorporation, 
        declaration and bylaws, and exercising the powers granted by 
        this section; and (vii) otherwise facilitating the operation of 
        the common interest community; 
           (2) adopt and amend budgets for revenues, expenditures and 
        reserves, and levy and collect assessments for common expenses 
        from unit owners; 
           (3) hire and discharge managing agents and other employees, 
        agents, and independent contractors; 
           (4) institute, defend, or intervene in litigation or 
        administrative proceedings (i) in its own name on behalf of 
        itself or two or more unit owners on matters affecting the 
        common elements or other matters affecting the common interest 
        community or, (ii) with the consent of the owners of the 
        affected units on matters affecting only those units; 
           (5) make contracts and incur liabilities; 
           (6) regulate the use, maintenance, repair, replacement and 
        modification of the common elements and the units; 
           (7) cause improvements to be made as a part of the common 
        elements, and, in the case of a cooperative, the units; 
           (8) acquire, hold, encumber, and convey in its own name any 
        right, title, or interest to real estate or personal property, 
        but (i) common elements in a condominium or planned community 
        may be conveyed or subjected to a security interest only 
        pursuant to section 515B.3-112, or (ii) part of a cooperative 
        may be conveyed, or all or part of a cooperative may be 
        subjected to a security interest, only pursuant to section 
           (9) grant public utility easements through, over or under 
        the common elements, and, subject to approval by resolution of 
        unit owners other than declarant or its affiliates at a meeting 
        duly called, grant other public or private easements, leases and 
        licenses through, over or under the common elements; 
           (10) impose and receive any payments, fees, or charges for 
        the use, rental, or operation of the common elements, other than 
        limited common elements, and for services provided to unit 
           (11) impose charges for late payment of assessments and, 
        after notice and an opportunity to be heard, levy reasonable 
        fines for violations of the declaration, bylaws, and rules and 
        regulations of the association; 
           (12) impose reasonable charges for the review, preparation 
        and recordation of amendments to the declaration, resale 
        certificates required by section 515B.4-107, statements of 
        unpaid assessments, or furnishing copies of association records; 
           (13) provide for the indemnification of its officers and 
        directors, and maintain directors' and officers' liability 
           (14) provide for reasonable procedures governing the 
        conduct of meetings and election of directors; 
           (15) exercise any other powers conferred by law, or by the 
        declaration, articles of incorporation or bylaws; and 
           (16) exercise any other powers necessary and proper for the 
        governance and operation of the association. 
           (b) Notwithstanding subsection (a) the declaration or 
        bylaws may not impose limitations on the power of the 
        association to deal with the declarant which are more 
        restrictive than the limitations imposed on the power of the 
        association to deal with other persons. 
           (c) Notwithstanding subsection (a), powers exercised under 
        this section must comply with section 500.215. 
           Presented to the governor May 31, 2005 
           Signed by the governor June 2, 2005, 4:55 p.m.

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Revisor of Statutes