Habitually Delinquent Homeowner Does Not Have to Pay Annual Dues

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Posted By TimB4 on 05/21/2016 12:21 AM
The bigger question is, if you have zero common areas, why do you still have an Association?

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Posted By LaurieK1 on 05/20/2016 8:38 PM
Newbie here, former Secretary for three long years. Ours is a small community - an HOA with only 18 homes, 22 lots - our annual dues is a mere $40.00. The main reason for this is we no longer own any common areas (eminent domain situation), consequently there are no expenses other than liability insurance, post office box rental, state filing fee. That's a bit of our background.

Since inception we have had a lot owner who habitually does not pay his annual dues - not at the once $350.00 per year nor at the now measly $40.00 per year. Because our bank balance was bursting, a proposal was made to reduce this by making a distribution to all lots who were up-to-date with their annual dues by a prescribed, voted upon date (several months after invoices were sent out.) This same lot owner, as per his usual M.O., did not pay and therefore did not receive the distribution ($40.00 payment for a $500.00 distribution!) By the way, the year prior he did pay but only after the HOA's attorney got involved and a letter was sent threatening a lien.

The Board decided to take this lot owner's 2015 annual dues from his unclaimed distribution and all subsequent annual payments unless he starts paying his dues, which as described above has not happened for 23 years! When questioned about this, the HOA Treasurer threw a fit, said something about his time being wasted on letters, attorney contact, and announced to the meeting attendees, "I'm ready to quit right now. You do it!" Something does not sit right about how this was handled - several other homeowners have expressed the same fuzzy, confused feeling as I, and I'm wondering if this issue is (perhaps) a bit bigger than what it appears. Obviously, right? In a nutshell: was this a valid/legal/appropriate way to handle the matter? And, if not, what should have happened? Thanks.

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Posted By LaurieK1 on 05/21/2016 11:00 AM
Allison, of course:

Annual Meeting was held February 2015. A proposal was made, seconded, no objections to a distribution of excess funds in our account. $500.00 to each lot owner who, as of a predetermined date (thinking we said July 1,2015), was NOT in arrears as to the dues. Again, our dues is only $40.00 per year (since we don't own any common areas, our expenses are low and $40.00 per lot covers those annual expenses.) This one lot owner who never pays (clarification: who never pays - sometimes years in arrears - but eventually will with much exhaustive hunt & peck and subsequent attorney intervention) was sent the same minutes that clearly stated that a distribution would be made and the details of receiving this distribution. Checks were sent out after the July 1 deadline.

Fast forward to this past February, 2016. The membership learned at the meeting that this particular lot owner did not pay his annual dues, and thereby did not receive the $500.00. The BoD had decided that instead of going through the process - getting the attorney involved like they did in 2014 (that was the part about a threatening letter which did procure the desired result, by the way), this lot owner's 2015 annual dues would be deducted from the distribution. His current 2016 dues has been deducted and the association membership will see this next year at our annual meeting when the Treasurer's Report is announced. All subsequent annual dues, according to the BoD, will be handled in the same manner BECAUSE "we don't want to deal with this guy anymore."

When asked for further explanation (after reviewing the Treasurer's Report), a few of us questioned the validity of how this was handled, and were answered with the statement from the Treasurer wanting to quit on the spot. Eventually the President also offered to quit right then and there (a different matter). I'm sure it was because they felt their authority was challenged - well...I know it was because the President said so. Since I am deeply aware that I don't know everything, and am not fleet of mind, I could not/did not make a reply about the Treasurer's decision. That's a lie. I did say, out loud, "Wow! Just wow!" Then again, no one else did either (say anything, that is)but that would be another story all together.

I am sorry. I reread my original post and although I did not mean to, made it sound like he's never-ever paid annual dues. He has, but always makes getting it a supreme difficulty. He sometimes has gone years without paying - 2014 got the attorney involved because he was more than a year in arrears. I am thinking that the Treasurer simply had enough and took the easy way out, deducting the dues from the distribution.

I have had some time to muse about the actual distribution and see now that it may have opened a kind of Pandora's Box. It is water under the bridge, however. Since non-payment of dues has an impact on voting rights, I am wondering now if that opens up another situation. Wish we could have a do-over. ((sigh))