Texas HOA ignoring State Statutes

I will try to make this short but detail oriented. Our HOA, Management Company and attorney seem to be running quite the scheme. Dozens of homeowners were sent to "collections" for not paying dues. Notices were NOT sent via Certified Mail per 209.0064 and homeowners are being assessed significant collection fees. They are also being told they MUST speak with the attorney once their account is in collections. If you have any significant dialogue with the attorney's office, you are then assessed additional attorney's fees for their time. Members are requesting documentation of the Certified Mail and the post office confirmations are being forged by the Managment company, the delivery confirmation numbers don't register in the USPS system.

Additionally, our HOA has forfeited their Charter with the Texas Comptroller.

Our Management Contract is with an LLC that has not registered with the state so technically, the entity doesn't exist.

It's just one big mess.

Any direction or help is greatly appreciated.

My first question would be, were you delinquent in paying assessments?

As it's normal for an Association to stay out of the discussion once a collection issue has been turned over to an attorney, you likely won't get any help from having a hearing in front of the Board.

If you did owe assessments and are simply complaining about the failure to follow procedures with the certified letter, you could take the issue before a judge. However, the judge will likely say you owe the assessments, late charges and reasonable attorney fees then read the riot act to the Association for failure to follow procedures (which could be a moral victory for you). However, this will likely cost you more then simply settling the issue now (but I understand fighting for principal alone, regardless the cost).

I know it's likely not what you want to hear.
I hope it helps.

Tim

Ricky,

It should piss you off when the Association doesn't follow the rules.

I haven't read the statutes but if it says that collection fees can't be recovered, it may be worth it to challenge the amount in court as that is where you will have to challenge the process your Association is using.

As for the $15 for a certified letter, if you add in 15 min it may take to prepare and mail the letter, $15 isn't unreasonable.

To get rid of the Board or the MC, you will need to gather support and either not reelect those currently serving or go through the process of recalling them.

$15.00 isn't unreasonable, but our HOA is paying her $15 for something she clearly did not do. Well, I guess we paid her $15 to forge a certified mail receipt. Considering it was a crap job, $15.00 is fair.

Report filed last week. From the looks of things on their site, they don't put much effort into one off situations. The report will be documented and if the Management Company name appears on numerous reports, it MAY start an investigation.

I also have a sworn affidavit from the attorney that she "had access to and had reviewed all documents" to support the claims and the validity of the total debt. I have filed a complaint with the Texas State BAR for that.

And I cant disagree with you. From the looks of things, it appears that laws may have been violated intentionally to their benefit. And I have spoken to several attorneys. All agree with my position. The catch is their retainers are all substantially more than what I would have to gain. So if I were to pursue, it would most likely be on my own accord. The HOA and their attorney know this and are using it to their advantage. To me, that's borderline extortion as the only legal process in Texas is to bring suit. They are not regulated in any manner otherwise.

That we did. No argument there. However, the first several years were smooth and easy until our board decided to hire a fly by night management company.

A 'fly by night' management company is not an issue if you had paid your assessment.

If you actually had payment receipts/cancelled checks you would win 'slam/dunk'.

However, by your own statement, you did NOT pay and are now contesting the costs of nonpayment.

Oh Boo Hoo Hoo .................................................

I think the important points from your query so far are:

1)
If a Texas HOA fails to sned a collection notice by certified mail, as I see 209.0064 does require, does the member still owe back assessments? My answer is that it's only a formality to send the collection notice by certified mail. I have some confidence that the HOA will then just send the notice by certified mail. Members should pay up if this is the only problem with the collection effort.

2)
But there are other problems. One of the attorneys at the following site says that a Texas HOA that has lost its charter no longer may enforce its Bylaws and Declaration: https://www.avvo.com/legal-answers/does-an-hoa--cease-to-exists--following-the-forfei-1800101.html . This court opinion seems to support your position as well: http://law.justia.com/cases/texas/fifth-court-of-appeals/2011/05-09-00788-cv-2.html . Also here is a court petition that claims charter revoked, so no HOA dues owed after revocation:
http://chamberslanding.org/Lawsuit.pdf . But this needs more research of course, by a well-qualified attorney.

3)
Regarding the requirement for unrepresented third persons (yourself, for one) to speak with the HOA attorney: If the attorney gives only legal information, and not legal advice (interpretations of statutes or court opinions), this is fine. The attorney is supposed to explain that the HOA, and not you, is his client under these circumstances, if he or she wants to cover his a--.

If you get more confirmation that you do not owe HOA dues on account of 2) above, then let them take you to court and argue thusly. Of course if this apparently non-existing corporation liens you or slanders your credit report or title to home, you may have to initiate a claim in court to stop this.

RickyM, I found a compelling rebuttal to the arguments I give in 2) above, in particular the lawsuit petition. First, from http://chamberslanding.org/Past.html:
~~~
Many HOAs choose to remain unincorporated and are subject to the provisions of the Uniform Unincorporated Nonprofit Association Act, Chapter 252 of the Texas Business Organizations Code (BOC). The BOC defines an unincorporated nonprofit association as an unincorporated organization consisting of three or more members joined by mutual consent for a common, nonprofit purpose.
...
The vast majority of Member responses were positive, offering their thanks, support and encouragement. However, two property owners denied the existence of our Declaration based on the grounds that our developer had fallen into bankruptcy. Every effort was made to explain the logistics of a common interest community and that the deed restrictions "run with the land", not the developer.
~~~

Second is this FAQ from a Texas Property Owners' Association Primer at http://www.rmwbhlaw.com/POA%20Primer.pdf:
~~~
Can the POA be "disbanded"?
Not easily. This question is usually asked by owners who are so angry with their POA that they want to make it go away. If the POA is incorporated, the State has procedures for dissolving the corporation. However, dissolving the corporate status of the POA does not - by itself - get rid of the POA, which may become an unincorporated nonprofit association under Chapter 252 of
the Tex. Bus. Orgs. Code. What this question overlooks is the fact that the obligations and duties under the POA's governing documents that are publicly recorded against the land are unaffected by a corporate dissolution through the Secretary of State. To get rid of functions like common area maintenance and the obligation for assessments would require procedures and
consents that are beyond the scope of these FAQs, and may require the involvement of platting authorities, city councils, special districts, and the owners' mortgage lenders, in addition to the owners themselves. Suffice to say that dissolving the corporation does not make the POA go away.
~~~

I think these docs are saying that, since the Declaration was recorded with the County, and the Declaration 'runs with the land,' this legally means the Declaration's requirements to pay one's assessments remain in effect even if the corporation ceases to exist.

I would pay up.

Many of us this chat are considered pro-HOA but yet if you hang around you will find most of us got involved as we had issues with our HOA's. That said the one thing many of usreccomend is pay the dues/assessment then fight the BOD. Most of those not paying are "deadbetas" and the mani reason many associations are in trouble.

Pay, then fight.