M-100: Essentials of Community Association
Management Exam
120 Multiple-Choice Questions with Answers & Rationales
1. Which type of community association is characterized by individual
ownership of a unit combined with common ownership (as tenants in common)
of the common elements?
A. Homeowners association (planned community)
B. Condominium association
C. Housing cooperative
D. Municipal utility district
Correct Answer: B
Rationale: In a condominium, each owner holds fee-simple title to their individual unit
and, as a tenant in common with all other owners, an undivided interest in the common
elements, as defined by the condominium's declaration.
2. In a housing cooperative, what does a resident typically own?
A. Fee-simple title to a physical unit
B. Shares of stock in the cooperative corporation plus a proprietary lease
C. An undivided interest in common elements only
D. A leasehold interest from a municipality
Correct Answer: B
Rationale: Cooperative residents do not own real property directly; instead, they own
shares of stock in the corporation that owns the entire property, along with a
proprietary lease granting the right to occupy a specific unit.
,3. Which governing document is generally considered the 'constitution' of a
community association, containing the most fundamental and difficult-to-amend
provisions?
A. Rules and regulations
B. Declaration of covenants, conditions, and restrictions (CC&Rs;)
C. Meeting minutes
D. Reserve study
Correct Answer: B
Rationale: The declaration (CC&Rs;) is recorded against the property and establishes
the association's fundamental framework, including use restrictions, assessment
obligations, and easements; it typically requires a supermajority owner vote to amend.
4. Which governing document establishes the internal procedures for how the
association is operated, such as board elections, officer duties, and meeting
procedures?
A. Articles of incorporation
B. Bylaws
C. Plat/plan
D. Rules and regulations
Correct Answer: B
Rationale: Bylaws set forth the operational and procedural rules of the association,
including board and officer structure, meeting notice requirements, quorum, and voting
procedures.
5. Which document creates the association as a legal corporate entity under
state law?
A. Declaration
B. Bylaws
C. Articles of incorporation
D. Rules and regulations
Correct Answer: C
Rationale: Articles of incorporation are filed with the state to formally create the
association as a nonprofit (typically) corporation, giving it legal standing to hold
contracts, sue, and be sued.
,6. Rules and regulations adopted by the board of directors, compared to the
declaration, are generally:
A. More difficult to amend than the declaration
B. Easier to adopt and amend, since they typically only require board approval and
must be consistent with the declaration and bylaws
C. Recorded in the same manner as the declaration
D. Superior in authority to the declaration
Correct Answer: B
Rationale: Rules and regulations are usually adopted by simple board resolution rather
than owner vote, making them easier to create or change, but they must remain
consistent with and subordinate to the declaration and bylaws.
7. If a provision in the association's rules and regulations directly conflicts with
the declaration, which document generally controls?
A. The rules and regulations, because they are more recent
B. The declaration, because it is the highest-ranking governing document
C. Neither; the conflict is resolved by a court automatically voiding both
D. The bylaws
Correct Answer: B
Rationale: Governing documents generally follow a hierarchy with the declaration
(recorded against the land) at the top, followed by articles of incorporation, then
bylaws, then rules and regulations; lower documents cannot override the declaration.
8. A 'planned community' or homeowners association, as compared to a
condominium, is typically characterized by:
A. Owners holding fee-simple title to a lot/home and separately owning or having a
shared interest in common areas
B. Owners holding stock shares rather than real property
C. No individually owned real property
D. Common elements owned entirely by a municipality
Correct Answer: A
Rationale: In a planned community, owners hold fee-simple title to their individual lot or
home; common areas may be owned by the association itself or held via easements,
distinguishing it from the tenancy-in-common structure of condominiums.
, 9. What is the primary legal mechanism that allows covenants in a declaration to
bind not only the original parties but also all future purchasers of property within
the community?
A. A verbal agreement at closing
B. Covenants running with the land, recorded in the public land records
C. A separate contract signed annually by each owner
D. State licensing law
Correct Answer: B
Rationale: Recorded covenants 'run with the land,' meaning they automatically bind all
subsequent owners of the property regardless of whether those owners individually
signed the declaration, as long as proper recording and notice requirements are met.
10. Which entity is generally responsible for enforcing the governing documents
on a day-to-day basis, subject to the oversight of the board of directors?
A. Individual owners acting independently
B. The community association manager, under the board's direction
C. The state real estate commission
D. The original developer indefinitely
Correct Answer: B
Rationale: While the board of directors holds ultimate authority and fiduciary
responsibility, the community association manager typically handles day-to-day
enforcement of rules and administration of the governing documents under board
direction.
Management Exam
120 Multiple-Choice Questions with Answers & Rationales
1. Which type of community association is characterized by individual
ownership of a unit combined with common ownership (as tenants in common)
of the common elements?
A. Homeowners association (planned community)
B. Condominium association
C. Housing cooperative
D. Municipal utility district
Correct Answer: B
Rationale: In a condominium, each owner holds fee-simple title to their individual unit
and, as a tenant in common with all other owners, an undivided interest in the common
elements, as defined by the condominium's declaration.
2. In a housing cooperative, what does a resident typically own?
A. Fee-simple title to a physical unit
B. Shares of stock in the cooperative corporation plus a proprietary lease
C. An undivided interest in common elements only
D. A leasehold interest from a municipality
Correct Answer: B
Rationale: Cooperative residents do not own real property directly; instead, they own
shares of stock in the corporation that owns the entire property, along with a
proprietary lease granting the right to occupy a specific unit.
,3. Which governing document is generally considered the 'constitution' of a
community association, containing the most fundamental and difficult-to-amend
provisions?
A. Rules and regulations
B. Declaration of covenants, conditions, and restrictions (CC&Rs;)
C. Meeting minutes
D. Reserve study
Correct Answer: B
Rationale: The declaration (CC&Rs;) is recorded against the property and establishes
the association's fundamental framework, including use restrictions, assessment
obligations, and easements; it typically requires a supermajority owner vote to amend.
4. Which governing document establishes the internal procedures for how the
association is operated, such as board elections, officer duties, and meeting
procedures?
A. Articles of incorporation
B. Bylaws
C. Plat/plan
D. Rules and regulations
Correct Answer: B
Rationale: Bylaws set forth the operational and procedural rules of the association,
including board and officer structure, meeting notice requirements, quorum, and voting
procedures.
5. Which document creates the association as a legal corporate entity under
state law?
A. Declaration
B. Bylaws
C. Articles of incorporation
D. Rules and regulations
Correct Answer: C
Rationale: Articles of incorporation are filed with the state to formally create the
association as a nonprofit (typically) corporation, giving it legal standing to hold
contracts, sue, and be sued.
,6. Rules and regulations adopted by the board of directors, compared to the
declaration, are generally:
A. More difficult to amend than the declaration
B. Easier to adopt and amend, since they typically only require board approval and
must be consistent with the declaration and bylaws
C. Recorded in the same manner as the declaration
D. Superior in authority to the declaration
Correct Answer: B
Rationale: Rules and regulations are usually adopted by simple board resolution rather
than owner vote, making them easier to create or change, but they must remain
consistent with and subordinate to the declaration and bylaws.
7. If a provision in the association's rules and regulations directly conflicts with
the declaration, which document generally controls?
A. The rules and regulations, because they are more recent
B. The declaration, because it is the highest-ranking governing document
C. Neither; the conflict is resolved by a court automatically voiding both
D. The bylaws
Correct Answer: B
Rationale: Governing documents generally follow a hierarchy with the declaration
(recorded against the land) at the top, followed by articles of incorporation, then
bylaws, then rules and regulations; lower documents cannot override the declaration.
8. A 'planned community' or homeowners association, as compared to a
condominium, is typically characterized by:
A. Owners holding fee-simple title to a lot/home and separately owning or having a
shared interest in common areas
B. Owners holding stock shares rather than real property
C. No individually owned real property
D. Common elements owned entirely by a municipality
Correct Answer: A
Rationale: In a planned community, owners hold fee-simple title to their individual lot or
home; common areas may be owned by the association itself or held via easements,
distinguishing it from the tenancy-in-common structure of condominiums.
, 9. What is the primary legal mechanism that allows covenants in a declaration to
bind not only the original parties but also all future purchasers of property within
the community?
A. A verbal agreement at closing
B. Covenants running with the land, recorded in the public land records
C. A separate contract signed annually by each owner
D. State licensing law
Correct Answer: B
Rationale: Recorded covenants 'run with the land,' meaning they automatically bind all
subsequent owners of the property regardless of whether those owners individually
signed the declaration, as long as proper recording and notice requirements are met.
10. Which entity is generally responsible for enforcing the governing documents
on a day-to-day basis, subject to the oversight of the board of directors?
A. Individual owners acting independently
B. The community association manager, under the board's direction
C. The state real estate commission
D. The original developer indefinitely
Correct Answer: B
Rationale: While the board of directors holds ultimate authority and fiduciary
responsibility, the community association manager typically handles day-to-day
enforcement of rules and administration of the governing documents under board
direction.
