8. Common Areas

SECTION 8. COMMON AREAS

8.1 Common Areas. Common areas include all real property and any improvements or amenities on it identified as such in the Master Condominium Declaration or any Sub- Condominium Declaration, including all landscaping, infrastructure, machinery, equipment, common assets, and other items that are permanently attached to such common areas, in addition to personal property and services for the common use and enjoyment of the Owners and Occupants located thereon.

(a) Master Common Areas. The Master Common Areas include all real property and any improvements or amenities on it, including all landscaping, infrastructure, machinery, equipment, common assets, and other items that are permanently attached to such common areas, in addition to personal property and, services for the common use and enjoyment of the Owners or Occupants located thereon, within the Master Condominium and classified as Master Common Areas in the Master Condominium Declaration. Master Common Areas may include but are not limited to private roads, walkways, access control gates, community swimming pools, perimeter walls, and other amenities within the Master Condominium which are for the common use and enjoyment of the Owners and Occupants. The Master Common Areas are governed and administered pursuant to the Master Rules.

(b) Sub-Condominium Common Areas. The Sub-Condominium Common Areas include all

real property and any improvements or amenities on it, including all landscaping, infrastructure, machinery, equipment, common assets, and other items that are permanently attached to such common areas, in addition to personal property and services, for the common use and enjoyment of the Owners or Occupants located thereon, within a Sub-Condominium, which property and the maintenance thereof are exclusive to the Sub-Condominium and classified as Sub-Condominium Common Areas in its Sub-Condominium Declaration. The Sub-Condominium Common Areas are governed and administered pursuant to the Sub-Condominium Rules, and are also subject to the Master Rules, the Master Condominium Declarations, the Administrators Rules, the Design Guidelines, and all other applicable rules, regulations, standards, resolutions or guidelines issued by the Master Condominium Assembly.

8.2. Title To and Use of Master Common Areas.

(a) Ownership. Each Owner holds an Undivided Interest Percentage in the Master Common Areas in the percentage assigned to its Private Unit or Sub-Condominium Unit in the Master Condominium Declaration and Sub-Condominium Declaration, and such Undivided Interest Percentage does not constitute an individual direct interest in the Master Common Areas. Owners may not transfer, sell, encumber or otherwise dispose of their Undivided Interest Percentage in common areas separately from their Private Unit or Sub-Condominium Unit. Under no circumstances may an Owner perform any act that implies exclusive ownership of any portion the Master Common Areas.

(b) Rights of Use. Subject to use limitations established in applicable easements, covenants, conditions, or restrictions, the Master Rules, the Master Condominium Declarations, the Administrators Rules, the Design Guidelines, the Sub-Condominium Rules, any Sub- Condominium Administrators Rules, the Sub-Condominium Declarations, any other applicable rules, regulations, standards, resolutions, or guidelines issued by the Master Condominium Assembly or Sub-Condominium Assembly, and the Law, each Owner has the nonexclusive right to use the Master Common Areas, in common with all other Owners, and such right extends to each Owner and Occupant and their agents, employees, and Guests. The nonexclusive right to use and enjoy the Master Common Areas. according to their nature, must be exercised without restricting, disturbing, or interfering with any other Person’s use of the Master Common Areas.

(c) Authority Regarding Rights-of-Way and Easements. The Master Condominium Ordinary Assembly is authorized and empowered to grant rights-of-way and easements in common areas for sewer lines, water lines, underground conduits, storm drains, television cable, security lines, roadways, public access to beaches or for other purposes that may be reasonably necessary and appropriate for the orderly maintenance, preservation, and enjoyment of the common areas, for the preservation of the health, safety, convenience, and welfare of the Owners and for compliance with the Law, provided that any resulting damage to common areas or Sub- Condominium Units must be repaired by the Administrators as a Common Expense.

(d) Assignment of Interest. No Owner may assign or delegate the Owner's right to use and enjoy the Master Common Areas to any Person except as expressly permitted by the Master Condominium Rules and Regulation.

8.3. Waiver of Use. No Owner is exempt or may release any Private Unit or Sub

Condominium Unit from the application of the provisions of the Master Rules, the Master Condominium Declarations, the Administrators Rules, the Design Guidelines, or any other applicable rule, regulation, standard, resolution, or guideline issued by the Master Condominium Assembly, personal liability for Assessments, or any other liens, charges or liabilities by voluntary waiver or abandonment of the Owner's right to use and enjoy the Master Common Areas or the Owner's Private Unit or Sub-Condominium Unit.

8.4. Changes to Use of Common Areas. The Extraordinary Master Condominium Assembly may change the intended use and characteristics of Master Common Areas, with the approval of 75% of the Undivided Interest Percentage of the Master Condominium with rights to vote. A Sub-Condominium may change the intended use and characteristics of any Sub-Condominium Common Areas at a Sub-Condominium Assembly, with the approval of 75% of the Undivided Interest Percentage of the corresponding Sub-Condominium Owners with rights to vote.

8.5. Maintenance of Common Areas. The Administrators, or their representatives, must maintain and manage all Master Common Areas on behalf of the Master Condominium, including but not limited to any landscaping, walkways, riding paths, parking areas, drives, roofs, interiors and exteriors of buildings, structures, and improvements located upon the Master Common Areas that are the responsibility of the Master Condominium. The responsibility of the Master Condominium for maintenance of all walkways and related landscaping within Master Common Area is limited to a gravel standard. Any Sub-Condominium may construct and maintain any such areas within their overall boundaries to a higher standard. The only exception to this rule is the beach access pathway in Sub-Condominium F (not including related landscaping) which the Master Condominium will maintain to a paved pathway standard due to its high use for public beach access. For clarity this rule does not include buildings, structures or related improvements in Master Common Areas, such as swimming pools, the Sub- Condominium A palapa, or fountains, which will be maintained by the Master Condominium at a high standard for the benefit of all. The maintenance and management of all Sub-Condominium Common Areas or any areas of free access in Private Units not subject to a sub-condominium regime are not the responsibility of the Master Condominium unless they are assumed common areas or unless the Master Condominium is otherwise specifically required to manage or maintain them, whether on a temporary or permanent basis, by the rules and regulations of the Master Condominium or the Law.

8.6. Assumed Common Areas. In order to preserve a consistent and uniform appearance and a more efficient administration and operation of the Master Condominium, Administrators have the right but not the obligation to assume, whether on a temporary or on a permanent basis, the maintenance, operation and management of any Sub-Condominium Common Areas or areas of free access within a Private Unit not subject to a Sub-Condominium regime. This right must be exercised by the Administrators through delivery of written notice to the appropriate Sub- Condominium Administrators or Owners of the Private Unit not subject to a Sub-Condominium regime. Such an assumption by Administrators does not affect the title to such assumed common areas, which will continue to be held by the Owners pursuant to their Undivided Interest Percentages as set forth the in corresponding Sub-Condominium Declaration or, in the case of a Private Unit not subject to a Sub-Condominium regime, the relevant title documents. Administrators must apply to the assumed common areas the same standard of care in the

performance of its duties as those mandated under these Master Rules in connection with the Master Common Areas.

(a) Total Assumption. If Administrators choose to assume the maintenance, operation and management of all the Sub-Condominium Common Areas and of all areas of free access of all Private Units not subject to a Sub-Condominium regime within the Master Condominium then the costs and expenses relating thereto must be treated as Master Common Expenses, billable to all Sub-Condominium Units and all Private Units not subject to a Sub-Condominium regime of the Master Condominium in accordance with their respective Undivided Interest Percentages.

(b) Partial Assumption. If Administrators choose to assume the maintenance, operation and management of some portion of the Sub-Condominium Common Areas or area of free access within a Private Unit not subject to a Sub-Condominium regime within the Master Condominium then the costs and expenses relating thereto become an expense of the affected Sub- Condominium or Private Unit benefited by such assumption, billable exclusively to the affected Sub-Condominium or Private Unit as a Benefited Assessment.

8.7. Standard of Care. Administrators, subject to the supervision of the Master Surveillance Committee, have discretion regarding the appropriate maintenance of all Master Common Areas. Administrators must use a reasonable standard of care in providing for the repair, management, and maintenance of Master Common Areas and assumed common areas and may, subject to any applicable provisions relating to capital improvement assessments, perform any of the following within the Master Common Areas or assumed common areas:

(a) Construct, reconstruct, repair, replace or refinish any improvement or portion thereof;

(b) Replace injured and diseased trees and other vegetation, and plant trees, shrubs and ground cover to the extent that Administrators deem necessary for the conservation of water and soil and for aesthetic purposes;

(c) Place and maintain such signs as are appropriate for the proper identification, use, and regulation of these areas, subject to the approval of the Design Review Committee;

(d) Do all such other and further acts as are necessary or appropriate to preserve and protect these areas and the beauty thereof in accordance with the general purposes specified in these Master Rules.

8.8. Master Common Services. Administrators may contract with others for the performance of the maintenance and management of Master Common Areas, the provision of Master Common Services, and other obligations of Administrators under these Master Rules, and any expenses incurred by Administrators in connection therewith must be billed to the Owners as Master Common Expenses or as otherwise permitted by these Master Rules.

(a) Utility Services in Master Common Areas. The costs and expenses incurred by Administrators in providing the utility services to the Master Common Areas constitute a Master Common Expense that must be paid by the Owners in proportion to their Undivided Interest Percentage as part of their Assessments, except that the costs and expenses incurred by

Administrators to provide services to assumed common areas in case of partial assumption constitute an expense of the Sub-Condominium Owners or Private Units not subject to a Sub- Condominium regime that are benefited by such provision.

(b) Ownership of Utility Infrastructure. The Master Condominium may own Utility Infrastructure. Administrators have no liability for the interruption of utility services due to causes beyond the reasonable control of Administrators. Administrators do not guarantee that utility services provided by Administrators will never be interrupted or faulty; however, Administrators must maintain, repair, service, and correct utility services interruptions due to Utility Infrastructure malfunction or wear and tear of any portion of the Utility Infrastructure that is the responsibility of the Master Condominium. Repair or replacement of Utility Infrastructure that has been damaged or destroyed by or through the fault of an Owner must be made at the expense of such Owner.

(c) Services to Exempt Property. Administrators may contract to maintain or manage Exempt Property by voluntary agreement with the parties responsible for maintenance and management of that property, and any expenses incurred by Administrators in connection therewith must be billed to the Owners as Master Common Expenses or as otherwise permitted by these Master Rules.

(d) Owner Contracts. Owners may not individually contract for the provision of Master Common Services, and under no circumstances may an Owner disturb, disrupt or otherwise interfere with the provision of Master Common Services contracted for by Administrators. An Owner may contract with a common services provider for additional or different services to their Private Unit or Sub-Condominium Unit, which are not common services provided to the Master Condominium and may not be performed on or provided to Master Common Areas and which may not disrupt or interfere with the provision of any common services. Such contracts are negotiated and agreed upon between the Owner and common service provider individually, and the cost of such services must be paid separately by the relevant Owner and is not a Master Common Expense.

(e) Rights of Way. Any service provider under contract to and designated by Administrators has a right of way over the Master Common Areas, assumed common areas, or any areas of free access in any Private Unit not subject to a Sub-Condominium regime to the extent necessary or convenient for the efficient delivery of the designated service.

8.9. Rights of Access.

(a) General Access. The Master Condominium is private property. Owners enjoy the right to use the common areas pursuant to these Master Rules. In addition, Owners, through the Ordinary Master Assembly, determine any restrictions on the access of non-owners to common areas throughout the Master Condominium; provided, however, that the Ordinary Master Condominium Assembly may not restrict any right of access that is protected by the Law.

(b) Access Control Systems. Administrators may create and operate access control systems for the Master Condominium or any part thereof, other than the interior of a Private Unit or Sub- Condominium Unit, with the prior approval of the Master Condominium Assembly and subject to

the Master Rules, the Master Condominium Declarations, the Administrators Rules, the Design Guidelines, and all other applicable rules, regulations, standards, resolutions, or guidelines issued by the Master Condominium Assembly, and the Law; however, Administrators are not guarantors or insurers of security. Neither Administrators nor any of their committees, officers, directors or agents are liable to any Owner, Occupant, or other Person if any patrol or access control system is ineffective to prevent or detect any risk for which it is intended, and neither the Design Review Committee nor Administrators, nor any member or agent of either, have any liability by reason of any approval given if any security system fails to prevent or detect the risk for which it is intended.

(c) Administrators Rights of Access. Subject to all powers and limitations established by these Master Rules, Administrators have rights of access over the entire Master Condominium for the purpose of enabling Administrators and their contractors, representatives, and agents to implement the provisions of these Master Rules. Such rights of access must be exercised so as to reasonably minimize interference with the quiet enjoyment of Private Units or Sub- Condominiums Units by their Owners or Occupants.

8.10. Insurance.

(a) Administrators Responsibilities. Administrators have the power and authority to purchase such public liability, casualty, workmen's compensation, and other insurance or fidelity bonds as Administrators deem necessary or appropriate with respect to the Master Common Areas or any activities or potential hazards of any kind relating to same, subject to approval in the budget by the Ordinary Master Assembly; however, neither Administrators, nor any of their staff members, officers, or agents, are liable to any Owner or any other Person for any risks or hazards not covered by insurance or if the amount of coverage is not adequate.

(b) Premiums. Premiums for insurance policies purchased by Administrators must be paid by Administrators as a Common Expense, except that the amount of increase over any annual or other premium occasioned by the use, misuse, occupancy or abandonment of a particular Private Unit or Sub-Condominium Unit or of the Master Common Areas by an Owner or Occupant, or their agent, employee or invitee, may be assessed against the relevant Owner as a Benefited Assessment.

(c) Insurance Claims. Administrators must make, handle, and respond to all claims arising under insurance policies purchased by Administrators and must execute and deliver releases upon the payment of claims and do all other acts reasonably necessary to accomplish any of the foregoing. Administrators may appoint representatives to assist in this process and to negotiate claims under any policy purchased by Administrators.

(d) Benefits. Except as otherwise provided herein, all insurance policies purchased by Administrators must be for the benefit of the Master Condominium and any proceeds of insurance received by Administrators must be held or disposed of by Administrators for the benefit of the Master Condominium and the Owners and other Persons according to their interests.

8.11. Damage and Destruction to Master Common Areas.

(a) Duties of Administrators. Pursuant to the direction of the Ordinary Master Condominium Assembly, Administrators must restore and repair any partially or totally destroyed Master Common Areas and assumed common areas.

(b) Application of Insurance Proceeds. If the amount available from the proceeds of any insurance policy for restoration and repair, together with any uncommitted or unreserved capital, is sufficient to cover the estimated cost of restoration and repair, Administrators must perform such restoration and repair. If the insurance proceeds, together with any uncommitted or unreserved capital, are less than the estimated cost of restoration and repair, the Master Common Areas and assumed common areas in case of Total Assumption may be replaced or restored, if so approved by Owners representing a majority at an Urgent Master Condominium Assembly specially convened for the purpose of approving the replacement or restoration. Extraordinary Assessments must cover the shortfall to perform the works necessary to restore or repair the affected areas. With respect to the restoration and repair of a particular assumed common area in case of a Partial Assumption, only the vote of the relevant Urgent Sub-Condominium Assembly will be considered in determining whether to replace or restore the damaged areas, and any Extraordinary Assessment with respect to reconstruction of such assumed common areas must be assessed only against the corresponding Private Units or Sub-Condominium Units. If the Owners do not approve repair or restoration of the damaged or destroyed areas, within 3 months following the first call for an Urgent Master Condominium or Urgent Sub-Condominium Assembly for such purpose, the areas so damaged or destroyed may be cleared and landscaped for common use or other use determined by Administrators and the costs of clearing and landscaping must be paid from insurance proceeds to the extent available.

(c) Excess Insurance Proceeds. If any excess insurance proceeds remain after any reconstruction, replacement, clearing, or landscaping by Administrators, Administrators may retain the excess sums in the general funds of the Master Condominium.

(d) Use of Extraordinary Assessments for Reconstruction. All amounts collected as Extraordinary Assessments for reconstruction, replacement, clearing or landscaping must be used only for such purposes, unless expenditure for another purpose is approved by the Master Condominium Assembly, and such funds must be accounted for separately by Administrators.

8.12. Eminent Domain.

(a) Condemnation and Expropriation Proceedings. Administrators, or their designated representatives, must represent all of the Owners in connection with any threatened condemnation of Master Common Areas or assumed common areas pursuant to a special power of attorney for ownership acts limited to acts in connection with Master Common Areas or assumed common areas, and such powers must be granted by the affected Owners immediately, if condemnation proceedings are initiated, upon Administrators’ requests.

(b) Awards. Any awards received on account of such proceedings must be paid to Administrators. Administrators may, expend the funds for maintenance, restoration, and repair of Master Common Areas or assumed common areas as applicable, retain any award in the general funds of the Master Condominium, or distribute all or any portion thereof to the Owners through credit against payments due on future Assessments in accordance with their Undivided Interest Percentage under these Master Rules or as their interests may otherwise dictate.