HOAleader.com - Tip of the Week - March 1, 2019
Published: Fri, 03/01/19
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Arizona Court Throws Condo/HOA Fining Processes Into Doubt
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We report on a recent Arizona case that caused quite a stir among community association lawyers in the state in this week's tip.
You've probably never heard of Turtle Rock 3 v. Fisher. But it landed like a ton of bricks in the community association world in Arizona.
It involved a scenario common to HOAs—an alleged hoarder who didn't do proper home upkeep, which led to fines. Also fairly common: The owner fought back in court.
Here's what's not common: Arizona courts really clipped HOAs' wings when it comes to their fining authority.
Turtle Rock involved a dispute between the Turtle Rock III HOA and Lynne Fisher, an owner in the community. The HOA sought an injunction requiring Fisher to clean up and repair her property. The HOA said that Fisher was using the home as a storage facility and that she failed to maintain its exterior.
It also argued she had "excessive items within the home that can be viewed from neighboring property and/or constitute a health and safety hazard to the rest of the members in the community." It's probably fair to interpret that statement as an indication that Fisher was hoarding possessions on her property. The HOA began to fine her $25 per day.
Fisher argued that under Arizona case law, an HOA must have adopted a fee schedule for its fines to be considered reasonable.
The trial judge found in the HOA's favor, ordering Fisher to perform all the requested maintenance, to pay $10,839.70 in attorneys' fees, and to pay $3,850 in penalties and $474 in costs.
On appeal, however, the appellate court reversed the $3,850 award of fees to the HOA. It held that even when an HOA has the authority to levy fines, it must adopt and provide notice of a fine schedule before it can impose any fines. "The failure to prove promulgation is fatal," the court held.
It also added this devastating blow to HOAs:
"Although the HOA had the authority under state statutes and the CC&Rs to promulgate a fine schedule for monetary penalties, there is no competent evidence in the record before us that it did so. Without competent evidence of a fee schedule timely promulgated demonstrating the fine amounts and the appropriateness of such amounts, monetary penalties are per se unreasonable. Even if a fee schedule existed, the HOA had the burden to prove its damages."
Did you catch that? The court is saying that HOAs can't enforce fines for the sole purpose of gaining an owner's compliance; to collect fines, it must prove the homeowner has actually caused damage to the HOA.
"This case created quite the storm when it came down," according to Clint G. Goodman of the Goodman Law Group in Mesa, Ariz., who represented Turtle Rock, speaking to a group of community association lawyers. "When the opinion came down, it's not often when colleagues from competing law firms come together."
Read more, and get tips on how to strengthen your fining process, in our new article: https://www.hoaleader.com/members/3871.cfm
Best regards,
Matt Humphrey
President
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Recent articles posted at HOAleader.com:
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The Arizona Case on HOA Fining that Threw Community Association Lawyers for a Loop
You've probably never heard of Turtle Rock 3 v. Fisher. But it landed like a ton of bricks in the community association world in Arizona.
Click here to read full article:
https://www.hoaleader.com/members/Arizona-Case-on-HOA-Fining-that-Threw-Community-Association-Lawyers-for-Loop.cfm
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Is 2019 the Year Your Condo or HOA Does an Audit?
Audits are expensive! No argument from us. But they're also sometimes necessary. How often are they necessary? Here, our experts explain when they advise their clients to conduct an audit.
Click here to read full article:
https://www.hoaleader.com/members/2019-Year-Your-Condo-or-HOA-Does-Audit.cfm
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How to Handle the Growing Challenges of Service and Emotional Support Animals
Did you miss yesterday's webinar on service and emotional support animals? If you did, you missed a great, information packed session. But it's not too late! You and the rest of your board can watch this in-depth webinar led by two experts with extensive experience in fair housing issues and law will tell you how you should and probably shouldn't respond to owners' requests for accommodation for any animal.
Click here to read full article:
https://www.hoaleader.com/products/challenges-service-emotional-support-animals-b.cfm
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Reader Reports: There's a New California Law on Association Banking. We Can't Find It
An HOAleader.com reader recently gave us a heads up that a California law passed late in 2018 now requires that all HOA funds be maintained in California banks. But our reader asks: What qualifies as a California bank?
Click here to read full article:
https://www.hoaleader.com/members/Reader-Reports-Theres-New-California-Law-on-Association-Banking-We-Cant-Find-It.cfm
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How Much are You Texting Your Fellow Condo/HOA Board Members--and Is It Wise?
Fess up. You've probably texted with a fellow condo or HOA board member on something association related. Maybe it was just to discuss something fairly innocuous like the next meeting agenda. Odds are, however, that you're among the millions of people worldwide texting about matters important to your life—and that might include something like how to handle a complaint against a homeowner for a violation of your association's rules. Is that OK? Probably not.
Click here to read full article:
https://www.hoaleader.com/members/Reader-Reports-Theres-New-California-Law-on-Association-Banking-We-Cant-Find-It.cfm
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