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Mandatory HOA in TN?

Started by RayD5 • 11 replies • 1610 views

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RayD5 (Tennessee)
Posts: 2
Posted:
Many of my neighbors were told by the builder/seller of their new homes that there was no HOA and no dues appeared on the closing settlement. Later, they learned that the warranty deed included the mention of the HOA. The HOA includes 3 sections, but it was discovered that the formation was not done correctly and that their section had never been legally a part of the existing one. A meeting/vote was held for owners to choose whether to dissolve the HOA, join with another association or create their own. They tried to attend the meeting, but were told they could not attend unless they paid "delinquent dues" amounting to over $500 with penalties and late fees. The meeting resulted in the selection of a separate board and association for their section. The board's attorney sent out letters to delinquent owners with the threat of lawsuit if they did not pay. It also stated that owners could respond if they did not agree within 30 days. They wrote an appeal letter which was never answered. Now they are being sued- unpaid dues, interest, penalties and lawyer's fees. They were told by the process server to call the HOA attorney to ask about it and now another almost $300 has been added to the other fees. (The attorney did not tell them they would be charged; he asked what questions they had.) Is there anything they can do?
LarryB13 (Arizona)
Posts: 4,099
Posted:
Absolutely yes! They should find a phone book, open the Yellow Pages to the listings for attorneys, choose one, and make an appointment. Pretty much the same thing they should have done when their warranty deeds did not match what they had been told they were buying.
JohnB26 (South Carolina)
Posts: 1,569
Posted:
assuming this is not the 'troll' at work:

they should contact whatever attorney represented them at closing

also possibly the state bar association

the complaint would be: improper/sub standard representation

where was the title search? was the deed read/explained before signature?

if not, why not?
SteveM9 (Massachusetts)
Posts: 3,699
Posted:
Quote:
Many of my neighbors were told by the builder/seller of their new homes that there was no HOA and no dues appeared on the closing settlement. Later, they learned that the warranty deed included the mention of the HOA.


They should have dealt with this before they built and definitely before they closed on the property. If they didn't want to live in an HOA they should have had legal text giving them an out. Sounds like they didnt have an attorney representing them in the buying process and made a huge mistake, and now they are stuck with it.

Hard lesson to learn. They will pay the HOA dues, just like everyone else.
SteveM9 (Massachusetts)
Posts: 3,699
Posted:
Quote:
They tried to attend the meeting, but were told they could not attend unless they paid "delinquent dues" amounting to over $500 with penalties and late fees.


Yes delinquent members can be excluded if it is written into the CCR/Bylaws legally. I know this isn't what you want to hear, but its true.
TimB4 (Tennessee)
Posts: 21,059
Posted:
The members on this forum can often help others prior to an issue having attorney's involved. Your issue already has attorneys involved and, as you're finding out, the Association attorney does not represent your interests.

As others have said, contact a local attorney. I'd suggest one that is versed in property and contract law to see what your options are.
CarolR11 (Colorado)
Posts: 2,563
Posted:
So, I'm waiting for RayDS's evidence of life before I think about this one.
LarryB13 (Arizona)
Posts: 4,099
Posted:
Quote:
Posted By CarolR11 on 03/26/2014 1:15 AM
So, I'm waiting for RayDS's evidence of life before I think about this one.

Not a bad idea. This is not unlike another post the troll made awhile back claiming to be from Tennessee and forced into an HOA. The situation he described was not believable and he tried to write like a hillbilly talks. This post is not quite as ridiculous but seems a little suspicious.

There is another thread posted in the past day from a different first-time poster where the OP claims that her HOA has been operating as an S corporation since the developer set it up that way 20 years ago. Really?

RayD5 (Tennessee)
Posts: 2
Posted:
Real person, real problem. Appreciate all the advice so far. Don't know who the "troll" is. How to prove "life"? Just found your site yesterday when searching for TN laws relating to HOAs for friend.
JohnB26 (South Carolina)
Posts: 1,569
Posted:
to repeat:

they should contact whatever attorney represented them at closing

also possibly the state bar association

the complaint would be: improper/sub standard representation

where was the title search? was the deed read/explained before signature?

if not, why not?
JanetB2 (Colorado)
Posts: 4,219
Posted:
Hi Ray:

Have the owner's look at their Title Insurance Policy issued when they purchased. The title company prior to their purchase would have checked through the County Records and list if property is encumbered. See if any HOA information is listed in the policy documents. If not listed then they should contact their Title Insurance Company and ask about the situation.
TimB4 (Tennessee)
Posts: 21,059
Posted:
Ray,

The forum over the past several months had been hit hard by individuals posting spam or unrealistic posts (ie: being a troll). This has caused many to trust but be suspicious when the issue posted about is something that is a little outside the norm.

Out of curiosity, because your initial posting never said, are you:

1) a member of the group who are having the problems
2) a member of the Board who is dealing with that group
3) a concerned friend of a member of the group having the problems

Either way, the advice from everyone seems to be the same. An attorney needs to be consulted to see what your legal options are and, based on those options, consider the next course of action.

On a side note, we have often heard that "nobody said we were part of an HOA" when we closed on the house. Often, there is a one or two page document in the stack of papers informing the buyer that there are deed restrictions and/or an Association. Often these papers are signed and not read or remembered.
If there is no such paperwork in the closing papers, the individual may or may not have a case against the closing company and/or the seller for failure to disclose. Additionally, a complaint could be made to the licensing agency against the Realtor. However, if you like the property and would have purchased it anyway, it's likely that those cases wouldn't be worth the expense, time or effort. Again, an attorney who has access to all the closing paperwork, the actual title, the governing documents and knowledge of TN property laws and contract law will be the best person to seek advice from.

As another note: Check to see if a lien has been placed on the property. Sometimes there is a time frame that this lien can be contested. The clock may or may not have run out.

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