unfair fines, liens, assement fees do I have a chance???

First of all let me apologize for being too lazy to browse the forum for threads relating to my situation with our hoa. I am sure others in this forum have been through a similar situation and I am very interested in the outcome.
My wife and I are the mortgage holders for a house located in Maricopa Arizona which we purchased in December of 2010. We are renting the property to our daughter with option to buy. Our daughter pays the monthly hoa fee and is responsible for making sure the property is maintained within the guidelines spelled out in the contract.
Last month we received a letter from a law firm representing the hoa that we were facing possible litigation for unpaid late fees from august of last year to now. I was shocked, why was I not contacted about this sooner? My daughter went to their office with all of her receipts to find out how this could have happened and why were we not notified of the situation. The operations manager pulled up our file and inside were six late notices mailed over a period of six months that were returned by the post office as undeliverable even though they were properly addressed.
Moving on to what generated the late fees. Our daughter forgot to make the monthly payment for July of last year. When she made the August payment it was applied to the July balance plus a 15.00 late fee. As she made progressive payments over the past year each payment was credited to the previous month along with a 15.00 late fee thus accruing a total of 165.00 in late fees. Also there have been numerous fines imposed plus legal fees totaling in excess of $1,200.00. I submitted an offer to pay the late fees for July and August of last year totaling $30.00. That offer was rejected. I also expressed my dissatisfaction on their follow up to the six returned as undeliverable late notices. How could you possibly expect someone to respond to a situation when they are completely unaware that one exists? We now find ourselves at the mercy of the board of directors in getting some of the fees and fines removed from this case.
Finally my question is this, What are my chances of prevailing in court should I decide to contest this

Were these notices sent certified with return receipt requested? Usually when it gets to this stage the PM's send the notices certified and we notice that no one bothers to go the post office in order to sign for the letter and pick it up?

You should immediately pay all of it. It was the mistake on your end. You skipped the one payment resulting in late fees. Now they have gone to an attorney for collections. You start bantering back and forth between your attorney and theirs and costs will escalate even more.

Pay your bills people. On time and you wont have these problems. I know I sound harsh but I have literally spent all my summer dealing with deadbeats... errr delinquencies.

Most management contracts call for them to collect late fees, sometimes the clause might read, "paid to them once received from the homeowner." I would suspect that the management company didn't consult the Board on this matter, either to take the settlement, which I would have done in a heartbeat, or proceed with legal action against the homeowner. I sometime wonder who they think they work for. The late fees, in almost all cases goers to the management companies, not the HOA's.

GnomeX, deadbeats are ones that don't attempt to communicate and reach any type of settlement or compromise. I think an apology from you might be in order.

Dennis, check all your statements from the past year. A full accounting of what transpired with your account should be listed on each of the statements.

Reply to Gnome:

First of all I resent being compared to a deadbeat. For the record we do pay our bills on time and have an excellent credit rating. I accept the fact that since we are the mortgage holders we are ultimately responsible for the late fees. My beef is with the extremely poor protocol this hoa uses in communicating with it's associates. Had we been notified that the account was behind it would have been delt with immediately.
Finally, if you have spent your whole summer dealing with deadbeats you should know by now that it is a road to nowhere. You need to take the next offramp and get on with your life.

No I'm not going to get on the next offramp as that is precisely what the deadbeats want. They want a free ride at the expense of everyone else in the community.

I as Treasurer am going to hold these people to their debt.

You are too stupid to realize you have just failed at your own attempt at intelligence. A person gave you a scenario with specific details on what transpired and YOU MAKE EVERY ASSUMPTION UNDER THE SUN in trying to "prove" they are wrong. Maybe you should stick to Harry potter type logic...

"In the scientific method, Occam's razor is not considered an irrefutable principle of logic or a scientific result"

Dennis

Just to keep the facts straight.

Were the letters mailed to you in CA, not to the unit/home in AZ?

Who was actually paying the dues?

Thanks

The letters were mailed to our home in calif and not to the unit address. Our daughter was paying the dues.

Out of curiosity, was the postage correct? Did the HOA use a forever stamp or an older stamp from prior rates?

Also, what are your governing documents regarding the accrual of late fees? When are late fees applied? What are the policies in regards to collection?

Dennis,

I hate to be the bearer of bad news but as near as I can tell, this is correct. There is no statutory requirement for an HOA to mail you a notice that your payment has not been received. So in this case, the fact that the letters were returned by the post office does not gain you any leverage.

I suggest that you examine those letters to see why the post office returned them. If they were addressed correctly you need to have a chat with your postmaster to find out what the problem is. You may be losing more mail than you know about.

It does happen and can go on for months or even years until the receiving party somehow learns that his mail has not been delivered.

I once rented a new home in a rural area. The house had a visible street number assigned by the county and all my neighbors had mailboxes. I installed a mailbox yet I received no mail. It turns out that there is a form that must be filled out and entered into the postal system database. Without that information in the USPS database, no mail will ever be delivered and they do not inform the intended recipient that his mail is being returned to the sender. I found out only when I went to the post office to inquire as to why I was not getting any mail.

Here we have another example of such unreasonableness! How frustrating.

This is how I see the situation.

- Homeowner bought the house.
- Homeowner trusted daughter to pay the HOA and never saw any mail from them, was never concerned about the HOA, and trusted she was taking care of everything. She wasn't.
- Homeowner or daughter did not take responsibility for payments or statements

So.... this goes to court, and the judge looks at this and it will award the HOA its attorney fees, late fees, back dues, and the homeowner will also owe its own lawyer fees, etc.

Homeowner will loose. The mail issue is not significant.

If it was me, I'd plead for the hoa to remove as many fees as possible. But if they don't budge, I'd pay it anyway. You are at their mercy. They are right, you are not.

We have an individual several years in arrears (one of many) that is claiming we never sent him any notice. Claimed we have the wrong address. We sent letters to what the county tax records show.

But get this. He is also up for county tax foreclosure in November and is alleging the same thing with the county. IE that the county never sent him a tax bill. The county isn't buying it either. Now he has back taxes and foreclosure costs and if he doesn't pay, his property is forfeit in November.

I just don't buy this whole, "we were not contacted" excuse. Nor do I buy this whole lack of communication on the part of the HoA. People need to take responsibility and stop blaming others. Call me stupid all you want. But I'm not one those paying legal fees because I am not paying my HoA dues.

You know you owe dues. If you are not receiving statements, then it isn't really an excuse. Pick up the phone and call your HoA if you are not receiving statements before you find yourself in a similar pickle.

The legal process of late fees, foreclosure, etc will take place even if they can't find you or you choose not to respond.

If I didnt get a credit card bill one month, you can be sure I would call them to see what is going on. I wouldnt assume they must not want the money. LOL.

It wasn't a matter of not receiving statements. It was a matter of a payment was admittedly missed and the HOA applied each subsequent payment to the prior month while charging late fees. Then somewhere down the line they decided to collect said late fees but their requests were returned undeliverable for some reason.

Did the HOA mail monthly statements? And if so did they ever state late fees? Or were the late fees only learned about in those undelivered notices?

That is correct.

I am glad Mathew posted on this one as he is familiar with Arizona laws. I had a feeling that Arizona was one of those states that did have the old "Apply the new funds to the old funds owed" policy. Which is not something that I personally agree with. However, that is what the people in that state living in HOA's legislated for.

In the end, you still owe the late fees and the accumulation. You may try to negotiate the fines added. However, you are most likely responsible for the late fee, interest, attorney fees, and other associated costs. Fines are not costs, so they should be negotiable.

Notice I said YOU and NOT your daughter. Sorry folks but your name is on that mortgage and that means YOU as the owner are responsible. The bank nor HOA cares who pays their bill. They just want who ever signed that dotted line to be responsible. Consider this like you being a co-signer on a loan and that person did NOT pay their loan. The bank would come after you would they not? Same here.

Sorry but in the end, you all are going to have to pay. It's just try to limit your damages at this point....

I don't think it was a matter of not paying for six months and waiting to contact the HOA. As stated in the first post they were unaware of a missed payment and continued to pay until they received a notice and upon investigating by going to the HOA's office they discovered a missed payment.

And considering some of the reasons posted above it doesn't seem that odd at all. I had an issue where the HOA never updated their information despite me changing my contact info countless times. They always sent it to the wrong address and would call the wrong numbers.

You have grossly underestimated the stupidity of the average minimum-wage office worker.

Hi,

I live in California and used to work as a copy editor.

Ask your daughter to send a photo of each envelope to you via email. Make sure the photo is detailed/sharp enough that you can read the address. Then read the address BACKWARDS a letter/number at a time. Also check the stamp. See what kind of letter it was. Did it require a signature? If so then I would check back with your daughter or the postal records. I lived at a gated community where notifications for Fedex were left on the moving gate. This meant the notice usually was ripped off when the gate opened and closed.

So basically, you want to find out why the envelopes were not delivered.

Usually, the HOA is required to send a letter to the address is has on record for the owners. You can also see if the state requires that they notify you by email for certain things if you make the request.

You can also help your daughter if you have a copy of the CC&R.

See how the CC&R require the delivery of notifications.
See the CC&R requirements of fines/penalties/assessments.
See what the CC&R say about Alternative Dispute Resolution.

Here's what I understand. A penalty was assessed because the monthly assessment was not paid. Your daughter completely forgot to pay one month. It was understood that the penalty was assessment notification was NOT received for six months. There was no other method attempted to inform the owner of the penalty for six months even though it was known that the owner did NOT receive the notification. It should be obvious that if your daughter has been otherwise paying on time, that it was not an intentional omission and that this could have been settled early on by making in inquiry in a different form.

I also used to work medical billing and if we had received a returned letter, we had a protocol for the next step. This is just common sense and good business practice. We would look into other means of notification. We would not have waited for six returned letters. If you and your daughter were being taken to court, this (the six returned letters) would not be acceptable notification.

Generally, in a court of law, the judge is not only looking at the law, but what is fair. Could something have been done in order to prevent the penalty from accruing? The answer is yes.

However, I'm also guessing that your daughter was not attending any of the association board meetings. This would be an important part of ownership of a common interest development.

I would request an alternative dispute resolution. From my perspective both sides were at fault. If you go through mediation (in some counties such as Los Angeles, this is available for free), I would attend with the concept of preventing future problems and correcting the response of both parties.

A HOA should be run as a non-profit business and that should be the approach of both parties. Since both parties will continue to be in business together, they need to resolve the problems in order to create a better business relationship.

I hope this helps.

I just wanted to update my situation for everyone who is following our situation. The HOA considered the problem we had with the mail service in Maricopa and offered to cut the fees in half to settle. We accepted the offer. Upon our next trip out to Arizona we will be taking the 6 returned letters to the post office and asking some questions. Finally I want to thank all of the posters who contributed advice on our behalf, you are a true asset to this forum. I gave my daughter the link to the forum and encouraged her to visit because there is a lot that can be learned here.

Thanks again/ Dennis E