fines for violations

prior to levying fines for violations, must a community have an established fine structure that was forwarded to all homeowners?

Fines can not be excessive and need to fit into your state laws. This would be in the area of "Loan sharking" if you were to look this up. States don't allow for excessive fines levied or interest on loans. The HOA documents can't exceed this amount. If this went to court, they would reduce the fines/interest down to the legal amount anyways.

Fines can NOT be used for the basis of liens or foreclosures in most states. It is for unpaid assessments plus late fees that can be. So if someone doesn't pay their levied fines, then the HOA can't really put this in a lien form or foreclose. Fines work more like speeding tickets and are considered punitive measures. Thus the reason they can't be part of a lien or foreclosure proceedings. However, it tends to be people who refuse to pay their dues out of protest of the fines, that one then can indeed place a lien on the home for the unpaid dues. So it can be a catch 22 situation.

Just where do we come up with a requirment for "due process"?

This is not a criminal matter simply the enforcement of property rules.

We have never required the person reporting a violaton to appear and subject themselves to questioning by the person cited for violating the rules. As the Board or HOA is citing the offending party I would see no reason to produce or allow anyone else to be required to make the accusations against the offending party.

John,

I'm basing this on what our Association has and the advice from our attorney that said due process was required.

Perhaps our legal advice was based on VA law that specifies "Before any such charges or suspension may be imposed, the member shall be given an opportunity to be heard and to be represented by counsel before the board of directors or other tribunal specified in the documents."

As someone who has been at the other end of the fine process, we were denied due process and that meant that we weren't able to face the person making the accusations. Because it was stated who was making the accusations, that means that we could not ask for certain board directors to recuse themselves.

Further, due process, the right to face your accuser is the basis for civil and criminal law. If someone is making accusations, how can you in the best case scenario work it out?

For instance, there was a complaint that our dogs barked. But when we challenged, we were given no specifics and no one could prove or disprove that it was our dogs who did the barking. Further there was no way to improve the situation since the CC&R allow dogs, you have to expect some barking. The complaint didn't make it clear that the barking could be defined as nuisance barking.

That wasn't actually what our hearing was about and the small claims court judge overturned our kangaroo court board. We were threatened with fines a couple of times and the court case was based upon a hearing in which the board hoped to profit (meaning we would pay more than what the supposed damages cost to fix).

Arizona law requires the citation letter to specify who filed the complaint. There is no facing the accuser, but you do have a right to know who it was. Therefore our board requires all complaints to be in writing and signed. There must be a hearing before a fine can be assessed. An unpaid fine cannot be collected even at close of escrow unless it was first taken to Superior Court and a judge was convinced to direct a judgement. You can then use that judgement to file a lien (which can be collected at close of escrow) but a lien based on a fine cannot be used to foreclose. Of course you can use other legal means to collect on the judgment. The key is to convince a judge your fine is reasonable and justified.
Nor can you apply assessment dues when paid to any outstanding fine, or other charges. Any payments must first be applied to the current assessment. Otherwise, diverting assessment payments to fines, etc would make the assessment delinquent and liable to foreclosure.

Actually, quite a simple process. Someone reports a violation the Board or MC confirms the violation and then THEY submit the violation for action.

IMO that is part of the Board's duties to enforce rules and regs. And in many cases we have residents who report violations that would rather not be involved. Say the 80 year old who is worried about her tires being flat when the kids next door violate the rules.

IF the Baord or MC is unable to confirm the violation for themsleves then they should not issue a violation.

Larry - Isn't that basically what I said? To your requirements for the HOA to convince the judge, I would also add the need to prove they are enforcing ALL the "rules" unilaterally.

I assume you meant uniformly.

That might be a defense raised by the homeowner but would not normally be an element that the HOA would need to prove. It's like trying to defend yourself against a speeding ticket by claiming that others were going faster than you were.

Under the Business Judgment Rule, the HOA can decide which violations to pursue and which to ignore. Unless there is a clear abuse of discretion, the courts will not usually interfere in the association's decisions. There may be a point at which violations of a rule are so widespread that the rule is no longer enforceable, but I have yet to find a case that clearly defines when that occurs. I know of at least one Arizona case where the court ruled that 20% of the homes violating a rule was not a high enough percentage to be deemed a waiver of the rule.

BTW, the Superior Court would have original jurisdiction only if the amount of the fines exceeds ten thousand dollars. Anything under that amount would have to be pursued in the Justice Courts and an officer of the association could represent the HOA, instead of an attorney.

Our legal documents do not provide for fines to be collected for Restriction or Rules infractions. We developed complaint forms to be submitted to the ACC when someone has a complaint about a neighbor violating the Restrictions. The ACC hears and decides the case but there is an allowable appeal to the Board. The question of course is remedies. For instance, what if the homeowner refuses to move his boat from his driveway? Since we can't fine, we have to go to court, get an order or judgment and sue the violator. Thus far, most residents do not test the waters and we have managed to settle grievances peacefully. However, you can provide for a mediation/arbitration procedure in your bylaws to avoid court costs, etc.

Jean

While I say never say never, most Covenants do allow for fining but few spell the fine amounts out. Read the docs closer. I would be surprised if they did not allow for fines. Look closely at General Provisions and Enforcment.

It is a function of the BOD to set a fine schedule and procedure. It is critical they do so before fining anyone for anything.

Some states have usuary laws prohibiting charging more then a certian amount of interest but this usually applies for late charges on dues/assessments. Rarely applies to fine amounts.

Hope this helps.

Does the state of HI allow HOAs to fine? If so, it seems to me that you can amend your CC&Rs.

If you have any amenities worth suspending and ways to keep violators from using those amenities, that's another possibility.

Bab

Saying something is not allowed versus not referencing it are two very different issues. Unless your docs specifically say you cannot fine, I expect there could be an interpertation of them that says you can fine. If so do with Rules and Regulations, not document changes.

Hope this helps.