HOAleader.com - Tip of the Week - March 4, 2011
Published: Fri, 03/04/11
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HOA Litigation: How to Avoid It
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Litigation gobbles up time and money, and your home owners
association should do all it can to avoid becoming embroiled in
it. In a new HOAleader.com article, we provide seven rules your
HOA should follow to limit its risk of ending up in court. In
this week's tip, we offer two of those rules:
1. Don't accept contracts without negotiation or review. "When
you have a vendor, remember the importance of good contract
negotiation and review before you sign them," advises Jed L.
Frankel, a partner at Eisinger, Brown, Lewis, Frankel & Chaiet PA
in Hollywood, Fla., who advises community associations. "When you
run into trouble, if you have a fair contract, there's probably
not going to be litigation."
Frankel offers a typical example. "If you have a contract that
expires on Dec. 31 on its own, you're not going to get involved
in litigation if you don't renew it," he explains. "But if it
automatically renews for three years, the president who
negotiated the contract has moved to a new association and nobody
else knows about that provision, and then you try to cancel,
guess who's going to be sued?"
2. Know your contractual duties, and document problems. "Keep
track of your contractual obligations, like when contracts expire
and what you must do to terminate them properly," says Frankel. "
If you have problems, document them and notify the vendor in
writing so that if you get to the point of sending a termination
letter, you've got documentation to back up your termination. All
too often, a client will say, 'This garbage company was horrible.'
I'll say, 'Did anybody ever document it or call the company?'
The answer will be, 'Maybe we had someone call in once, but we
can't remember who we talked to and didn't follow up with letters.'
"I've also seen situations where associations sent notice of
termination to the wrong person or did not send it by certified
mail, and the vendor says, 'Guess what? We think you breached,
and you owe us liquidated damages and attorneys' fees,'" says
Frankel. "That puts the association in a bad position because it'
ll be paying some damages, and there's not much I can do to
mitigate them."
To learn about all Seven Rules for Avoiding HOA Litigation, see
our new article: http://www.hoaleader.com/members/549.cfm
Best regards,
Matt Humphrey
President
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Recent articles posted at HOAleader.com:
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Reverse Mortgages: What HOAs Should Know
When seniors turn to reverse mortgages as a way to finance their
retirement, should you be concerned? Here, we explain what HOA
boards should know about reverse mortgages and discuss whether
you can--and should--place restrictions on owners' use of them.
Click here to read full article:
< http://www.hoaleader.com/members/543.cfm >
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Owners Nitpicking Your HOA's Spending? Try These Responses
In this week's tip, we offer you a life line if you're at your
wits end over owners constantly nagging and challenging your HOA
spending.
Click here to read full article:
< http://www.hoaleader.com/public/547.cfm >
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Discussion Forum Follow-Up: Can Your HOA Restrict Animals from
Common Areas?
A reader asks: "Is it permissible for HOAs to restrict the common
areas where dogs are allowed? I've seen some case law about this,
which tends to allow owners access to all common areas, but what
about dogs? Wouldn't it be unreasonable to permit dogs, but then
not allow them in common access paths, so that they're
effectively not allowed?"
Click here to read full article:
< http://www.hoaleader.com/members/546.cfm >
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Should Your HOA Require Owners to be Photographed?
An HOAleader.com reader says her HOA requires that every dog in
the association must be photographed and is wondering if the HOA
can extend that requirement to residents and renters. Can it? Why
would that be necessary? When might it invite problems? And which
HOA residents get photographed--even babies? Here's a snapshot.
Click here to read full article:
< http://www.hoaleader.com/members/545.cfm >
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5 Steps to an HOA Security Inspection
Someone at your association should be performing a security
inspection regularly. But who should do it, what should that
person be looking for, and how often should the inspection be
performed? Here's a five-step plan.
Click here to read full article:
< http://www.hoaleader.com/members/544.cfm >
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