As technology permits more individuals to work at home, the issue of in-home businesses in community associations continues to be debated. Most community association master deeds and declarations include a restrictive covenant that prohibits a residential unit from being used for anything other than a residential purpose. There is no question that business uses such as a doctor’s office or retail store are prohibited by such a use restriction. The debate gets interesting when businesses are run out of an in-home office and are otherwise undetectable. Are such in-home businesses considered a private residential use or are they a violation of the use restriction? As strong advocates for community associations we support broad enforcement powers for associations and their boards but understand that policing certain uses is impractical.
New Jersey case law requires that community association use restrictions be strictly construed. Despite this requirement, the obvious purpose of the restriction must be maintained. Thus, when interpreting a use restriction it must be given a rational meaning that is consistent with its express general purpose.
A restrictive covenant prohibiting a residential unit to be used for any purpose other than a private residence certainly exists to ensure that the community maintains its private residential nature. Any use which is inconsistent with this general purpose should not be permitted. Incidental in-home business uses that are limited to the interior of the residence, do not produce additional traffic or noise, and are otherwise undetectable may have no impact on the private residential nature of the community. It could be reasonably argued that if a use is undetectable and does not impact the residential nature of the community that it is in keeping with the general purpose of the use restriction.
If you want to know more about this issue and how it applies to your community, please contact us.