Does the Board really have the authority?

In a seminar given by our HOA lawyers, the comment was made that a recent opinion by the VA court indicates that governing documents need to be specific on what is and isn't allowed. As it was explained to me, if the documents don't specify you may impose fines for violations then, per the courts opinion, you may not.

The old method of thinking was if it didn't deny the board doing something then they may start doing it. Now we are being advised, unless the governing documents say you can do something then you can not.

Here's a link to the case.

Tim,

Many people are of the opinion that if it doesn't say we can't do it then we can. I have an article from the Parliamentary Internet Newsletter, Volume 8, Issue 1, June 2002, titled "It Doesn't Say We Can't Do It". The bottom line in this article is: "So, what is your response when someone says, "It doesn't say that we can't do it."? The reply is "where does it say that we can do it?"

In reading the court case what I found interesting was the fact that the BOD passed a resolution about a topic that is not addressed in the gov docs. The CCRs do not talk about fines so the board has no authority to pass a resolution about fines. IMO, that is why the court ruled as it did.

wow this is a very interesting topic. I guess I should be glad that my declaration and bylaws are very very specific saying we can fine for just about anything!

ps: sorry to have hijacked your thread Tim. I should have started a new one...

Tom,

Following is the definition of "equitable relief". From what I gather, equitable relief does not involve any monetary payment.

Equitable Relief
Equitable relief comes in many forms. It may be a Restraining Order or an Injunction, which are court orders directing a party to do or not do something. An accounting may be requested by a plaintiff who seeks to know how his or her money is being handled. A trust or Constructive Trust can be ordered by a judge to place the care and management of property with one person for the benefit of another. A partition is an order dividing property held between two or more persons. Declaratory relief is granted when a judge declares the rights of certain parties. The effect of a Declaratory Judgment is to set future obligations between the parties.

Under the remedy of Specific Performance, a judge may order one party to perform a specific act. This type of relief is often used to resolve contractual disputes involving unique property. For example, the purchaser of a house may not wish to obtain money damages if the seller breaks a contract for sale of the house. This may be so because a house is considered unique and thus the damage is irreparable—that is, it cannot be fully redressed by mere money damages. If the court agrees that money damages would be inadequate redress for the buyer, the judge may order a completion of the sale to the buyer, instead of money damages, for the seller's breach of contract.

Equitable contract remedies offer a judge an array of choices. Rescission discharges all parties to a contract from the obligations of the contract. The remedy of rescission restores the parties to the positions they held before the formation of the contract. Restitution is an order directing one party to give back something she or he should not be allowed to keep. These two remedies may be sought together. For example, if a buyer purchases an antique piano on credit and later discovers it is a fake, the buyer may sue for rescission and restitution. Under such a dual remedy, the buyer would return the piano to the seller, and the seller would return any payments made by the buyer.

Reformation is an equitable way to remedy a contractual mistake. Suppose, for example, that a buyer agrees to order 5,000 units of a product but mistakenly signs a contract ordering the shipment of 50,000 units. If the seller refuses to provide fewer than 50,000 units and demands payment for 50,000, the buyer may sue the seller for reformation of the contract. In such a case, the court may change the terms of the contract to reflect the amount of product actually agreed upon.

Equitable relief has long been considered an extraordinary remedy, an exception to the general rule of money damages. Modern courts still invoke the rule that equitable relief is available only where money damages are inappropriate; in practice, however, courts rarely insist on monetary relief when equitable relief is requested by a plaintiff.