Legal Fees - Board solicit, homeowner pays??

What is the typical protocol for charging homeowners with legal fees? We have a situation where a homeowner challenged the board and ARB over solar panels. The board felt it best to respond to the homeowner via the HOA attorney. For this the HOA has charged the homeowner $570 in legal fees. It doesn't make sense to me.

Who did you expect them to charge? A HOA is ONLY funded BY it's owners FOR it's owners. The HOA can recoup the legal fees they had to front to hire an attorney onto the homeowner. It's similar to if the HOA had to remove a violation such as a unapproved/unsafe fence. The HOA can collect the costs they incurred.

The best way is to LIEN the homeowner for the amount owed them. This will keep them from selling and moving from the HOA without paying. A lawsuit will just cost money, gets into a vicious circle, and doesn't guarantee money to be paid back.

Yes, people get sick of me posting this but suing a HOA is suing yourself and your neighbors...

By challenge, do you mean the homeowner is talking legal actions, they already installed them, or just questioning a decision the board made?

Fees usually can't be passed on unless a legal judgement was made in the board's favor.

Thank you all for your inquiry. I realize now that I was vague.

I am not the person in the situation. I am a new board member who is taking up for the homeowner.

It seems that the previous board leadership would take all issues in question to the HOA lawyer for review.

So a homeowner wanted to put solar panels on his roof and the ARB said no for aesthetic reasons. The homeowner resubmitted the request again suggesting that it is likely going to become law as in other states, that you cannot prevent solar panels from going up.

This comment created a question in the ARB and BOD which they took to the lawyer who charge $570 for his research. The BOD then charged the homeowner the attorney fees.

The problem that I am having with this I think is evident. The homeowner did not solicit the advise of the attorney nor was he notified that the board was going to take this action on his behalf with option to back off.

This charge was approved by the management company which indicated that it was standard practice.

This same situation has been repeated a few other times in this neighborhood and we need a policy change. The Covenants do require the homeowner to repay legal cost but I think that this is a stretch.. Please advise

Your problem lies deeper than this. The problem is within 95% of the HOA's out there. It lies in your documentation. The CC&R's, by-laws, Incorporation, or ACC documents most likely haven't been updated in years. Technology has changed since then and will continue to. Usually the technology mentioned in the documents refer to the old satellite dishes that were HUGE eye sores. However, this can be expanded to solar panels.

I would address this issue by asking about updating the documentation instead of continously denying new upgraded technology designed to be less eye sores. Solar panels or satellite dishes of today are more stylish and provide cost savings. Plus they may benefit the common areas by saving money in those areas as well with new technologies. (Tankless water heaters, solar light systems, or other new systems)

As for paying the legal fees, I can see how that was intrepreted to make the owner pay. HOA's are created by volunteers and most volunteers are NOT comfortable with dealing with legal matters. It's much easier and effective for them to keep a lawyer on hand for issues. However, this also creates a cost for them to incur. The logic is that since they had to incur an expense on the behalf of an owner possibly suing them, that the cost should be incurred by that owner. It's kind of a deterrent from having an owner sue. It makes sense to a Board member but to the general membership it is kind of stinks. That process may also want to be reviewed as to see IF things can improve in communications without a need to run to a lawyer for every question.

Hi William:

For anyone to help regarding your covenants you would need to post the exact verbiage from your covenants regarding legal costs.

RogerB is probably correct regarding the legal fees. Laws vary by state and unfortunately South Carolina does not appear to have really good statutes for HOA’s. In my state we can collect “reasonable” attorney fees for items such as failure to pay assessments, failure to comply with covenants, civil actions to enforce, etc. However, most all cases where attorney fees can be charged to an owner is when the owner fails to comply or meet their obligations, and generally under court order.

If I was the homeowner and did not solicit the advice of the attorney and the HOA did so without my knowledge or consent and charged to my property, I could fight the charge and probably win. As Roger stated the HOA incurred the fees.

With regards to allowing solar panels, many states have statutes such as the following for my state, and could be a matter of time that your state makes similar provisions:

A covenant, restriction, or condition contained in any deed, contract, security instrument, or other instrument affecting the transfer or sale of, or any interest in, real property that effectively prohibits or restricts the installation or use of a renewable energy generation device is void and unenforceable.

I've seen boards do some strange and shady things, this ranks pretty high on the list. You can't pass on costs to a homeowner for a service they didn't request. The homeowner simply asked the board to reconsider.

Plus, banning solar panels is a VERY bad idea, environmetnally, politically, property value wise, and just plain logic...