HOAleader.com - Tip of the Week - November 3, 2017
Published: Fri, 11/03/17
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How a Simple Email Might Have Saved an HOA Hundreds of Thousands of Dollars
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In this week’s tip, we explain how a recent North Carolina case might affect your delinquency and foreclosure operations.
The case involved an HOA’s foreclosure action against an owner for failure to pay assessments. It cost the HOA a lot of money because the it failed to simply email the owner of a foreclosure action.
The case involves Gina A. Ackah, an owner in Addison Reserve at the Park at Perry Creek, a North Carolina HOA. She bought her home in 2005 but returned to Africa in 2012, renting out her home during her absence. She didn’t notify the HOA of her move, but she did have her mail forwarded to her uncle in South Carolina.
In 2014, Ackah became delinquent to the HOA for association dues. The HOA filed a lien on her property for failure to pay assessments, and Ackah never appeared during the court proceedings foreclosing on the lien. The testimony during the trial indicated that the HOA’s notices were sent by certified mail to Ackah’s mother and uncle, but they didn’t forward them to her.
The HOA also posted notice on Ackah’s door. But while it had her email address, the HOA never sent her an email about the foreclosure. She learned of the proceeding only after she lost title to her home to investors, when her tenant received notice to vacate, which she provided to Ackah.
The appellate court noted that there was no evidence that Ackah had actually received notice of the foreclosure proceedings. And when she did learn of the foreclosure, Ackah filed documents to undo the foreclosure, alleging she never received notice, which she asserted made the process fatally flawed.
The HOA didn’t use due diligence to provide notice of the lawsuit to Ackah as required by North Carolina statutes, the appellate court held, and that entitled Ackah to relief. Specifically, the HOA had Ms. Ackah’s email address, according to the court, and the HOA knew she wasn’t residing at the property since it sent the notices to her mother and uncle.
Those notices, the HOA also knew, went unclaimed. The court held that when that happened, the state’s statute required that “the HOA at least attempt to notify Ms. Ackah directly through the email address it had for her rather than simply resorting to posting a notice on the property.”
However, since Ackah came forward only after bona fide purchasers took title to the property, she wasn’t entitled to undo the foreclosure sale. She was, however, entitled to relief from the HOA. The appellate court sent the case back to the trial court to determine the amount of money the HOA would be forced to provide Ackah for its faulty process.
HOAs in North Carolina now know the rules they have to follow. What if you’re not in North Carolina?
Find out in our new article: https://www.hoaleader.com/members/3630.cfm
Best regards,
Matt Humphrey
President
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Click here to read full article:
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