ACC Committee does not enforce the Covenants

Ric,

Are you stating that you are deliberately not paying assessments because you are dissatisfied with your HOA? If so, this is extremely dangerous.

Most CC&R's create an obligation for the member homeowners to pay assessments without any strings attached. That is, the obligation is absolute and unavoidable. Your obligation to pay is not conditioned on whether you are satisfied or not. Having a lien recorded against your property is the first step in losing it to foreclosure.

Enforcement of the covenants is a matter that is usually left up to the board of directors or, in your case, the ACC. Under the Business Judgment Rule, such a body normally has a great deal of discretion as to which battles to fight and how to fight them. One of your remedies is to get yourself elected or appointed to the ACC.

Most CC&R's have a provision that allows a member to seek enforcement of the covenants through civil action. If one of your neighbors has violated the covenants you can take him to court and force him to clean up his act. This completely bypasses the ACC and puts you in the driver's seat.

My advice is, above all else, consult an attorney ASAP to learn your rights, risks, and obligations.

LarryB13:

Assessments (Liens) were filed (against the land which obviously we own), but, we were never informed of same, until a refinance and title work was done; we are not dissatisfied with the "Mother HOA" other than they have NOT enforced the Covenants themselves, or through their agents or ACC, wherein you have to file a written proposal for approval. Of the 82 residents, approximately 20% have just avoided any written application, as required, and the POA has done nothing and obviously breached their agreement and want their Liens satisfied.
Some of the "improvements" were done in the last few years, without any objection or notice of noncompliance to the owners, and some of the members have sold and moved on.
An attorney has been contacted and if you have any further advise, please advise.

Larry and Janet:
How about a "Class Action" as it appears we have quite a few neighborhoods under the "Mother POA" and their Covenants, By-Laws, and restrictions are the same???

JanetB2:

What is the confusion you seem to rely upon???
There is also no time Waiver (unless implied) in the Covenants and Restrictions of the "Mother POA" relative to the ACC, and, also no notice(s) from them to the several POA, under their umbrella, that they would have to follow the ACC rules... Also, it appears that the documents have not been changed since there inception in 1989 by the required 75%.
In my State, you have to follow your Contracts and you cannot create a Waiver to modify the Contract!!!
Annual dues would have to be paid, but, it seems that this is a clear "Class Action" event???

As for the assessments:

Pay them.

It doesn't matter that you were unaware of the assessments prior to the lien.
That may be a basis to ask that the late charges (if any) be waived. However, it is not an excuse that will play in court (if it goes there).

Ask for a meeting with the Board, explain the situation and ask that the late charges be waived (you can ask but it's doubtful that any legal fees or court costs will be waived). However, be ready with check book in hand to pay regardless of what they decide.

As for the failure to enforce (and please note that these are two separate issues):

Keep in mind that there is likely language within your covenants that authorizes both members and the Association to enforce the covenants.
You would enforce by taking the violators to court.
The Association would also enforce by taking the violators to court but may have additional leverage to force compliance without the courts.

Keeping in mind that this is two separate issues, bring the issue up to the Board AFTER you bring your assessments current.
It may be as simple as the Board doesn't have the volunteers to do enforcement.
If this is the case, perhaps you could offer to serve on the ACC.

I had a similar issue within my Association. I volunteered and was appointed to the ACC.
What I discovered was that the files of the ACC were lousy. The committee spent the first year organizing the files and searching all past minutes of the committee and the Board to see what was on record as being approved or not. We then did a full inspection of all properties to identify any changes that would have required prior approval. After comparing those changes to the records, we sent out letters identifying the issues discovered and asked for a copy of the approval from the member and, if they had no written approval, to remove the change or submit an application that would be considered for approval if it complied with existing covenants and guidelines. After we went through that stack of requests, we then started yearly inspections. What was discovered was that the volunteers which had been serving were not complying with established procedure and were not keeping records. What was needed was someone to start the work. I am no longer on the committee and I hope that they are keeping up what we setup. As a minimum we provided a good starting place for them and left the records in better shape then we found them.

To: MelissaP1 (Alabama)
TimB4 (Virginia)and
JohnC46 (South Carolina)

I may hereafter let you know how the "Class Action" lawsuit proceeds in Court... Also, as JohnC46 seems to say that anyone who has an "issue" is a "deadbeat" (LOL)...

I did not say those with issues are deadbeats. I did say that do not pay are deadbeats.

RicO

Your state is a Horizontal Property regulated state and here is an example of the POA Statues:

http://jasonbolden.com/practice-areas/real-estate-law/property-owners-associations/poa-statutes/

Keep in mind we do not know what is exactly stated in your documents and you keep ranting with statements that do not make sense such as:



And yet your State law states:

18-13-107. Waiver and reestablishment of regimes.

(a)All of the co-owners or the sole owner of a building or property constituted into a horizontal property regime may waive this regime and regroup or merge the records of the individual apartments, or anticipated apartments, with the principal property if the individual apartments are unencumbered or, if encumbered, if the creditors in whose behalf the encumbrances are recorded agree to accept as such security the undivided portions of the property owned by the debtors.

(b)The merger provided for in subsection (a) of this section shall in no way bar the subsequent constitution of the property into another horizontal property regime whenever so desired and upon observance of the provisions of this chapter.

You have stated that you are a Sub-POA of a "Mother POA". Another person a number of years ago who had an umbrella type situation like you are describing their Sub-POA was the entity who was responsible for their own ACC approvals and upkeep for their area. You have not answered by question regarding that issue ... Again, most of your question is in your CCR's which we cannot read.

Hi Tim:

The OP is from AK not Alabama.

TO WHOM IT MAY CONCERN:

It is a "Umbrella AR POA" with many separate and incorporated neighborhoods, all under the "Umbrella POA", who pay dues, and, all with the same and/or similar documents...
A "Class Action" suit seems to be the proper remedy with the number of non offending owners involved AND the failures of the "Umbrella POA ACC" to observe the covenants, restrictions, and/or bylaws of the "Umbrella AR POA"... it is clearly a "Breach of Contract" case... Thanks

MelissaP1 (Alabama):

Well, damages and fees assessed against the "Umbrella POA" for their breach on contractual duties through their ACC and/or breach of their fiduciary duties would seem to be the relief don't you think???

MelissaP1 (Alabama):

I think there would be no problem at all with a "Bill of Assurance" I have from the Owner who set this matter up... Think about it!!!

RicO

MelissaP1 (Alabama):

I think there would be no problem at all with a "Bill of Assurance" I have from the Owner who set this matter up... Think about it!!!

MelissaP1
(Alabama):

Whatever you think???

we will have to agree to disagree.
As you said, sometimes attorneys get things wrong.

Per that act:

Whenever a sole owner or the co-owners of a building already constructed or the owners of property upon which a building is to be constructed expressly declare, through the recordation of a master deed setting forth the particulars enumerated in § 18-13-104, their desire to submit their property to the regime established by this chapter, there shall be established a horizontal property regime.

Sounds like a statute for condominiums to me.

TimB4
(Virginia):

It appears that the ACC has done nothing for a long, long time... In AR, we would consider this action to be a "Breach of Contract" or a "Breach of Fiduciary Duty" and a possible "Class Action" would be in order against the Developer and/or the "Mother POA"... the Developer has thousands of acres to guarantee, or pay, any possible Settlement or Judgment for allowing the neighbor to "transform"... Thanks for your wisdom and insight...

RicO
(Arkansas)

Ric,

Thank you for that clarification.

Although I believe court should be a last resort, I do understand the need to utilize the courts for some situations.

Realistically, I only see that your end goal in taking your Association to court for the ACC failing to do it's job, would be a lot of money and energy spent with a possible court order to start doing their job. Worst, the potential for receivership to ensure that this job gets done.

I doubt there will be any monetary award to the individuals who brought the legal action.
The court may (and may not) award reasonable attorney fees and court costs.

You, and others who signed on may be responsible for any additional costs your attorney incurred beyond the courts award.
You and others of your Association will most definitely be responsible for your share of the Associations legal costs (as these will be paid by the membership). If you are able to prove intentional breach of fiduciary duty, I doubt if the Association insurance will cover any costs of the legal action (hence a large bill for the membership to pay).

The unintended consequences of such legal action may include a slowdown in the sale of homes/properties within the development. If this lasts long enough, property values may actually decrease (as sellers may have to reduce asking price to entice buyers) until everything is sorted out. The additional unintended consequences, once the special assessments start to pay the legal bills, will be loss of friends and potential vilification to those who brought the action (not saying the vilification would be warranted - as it would not be, just pointing out it will likely happen).

Since you mentioned the developer, I suspect that the Association is still under declarant control (vs. membership control).

If this is the case, it makes it difficult to make any changes until the members have control.

As I said, I understand the need for court action in certain circumstances.
I simply think that the financial penalties you think may come your way simply won't occur.
You won't dismantle the covenants and you won't dissolve the Association.
You will simply, in my opinion, spend a lot of money having an outside entity force compliance with the contract. Something I know can be done by working within the Association (because I and many others have done just that) vs. seeking assistance from the courts.

Either path won't have changes occur overnight.
Either path will require time, energy and financial input.
I simply think you will obtain better results quicker by working from within.

However, I do wish you luck and ask that you keep us updated.

Tim

RicO ... I understand your anger and frustration. I have walked in your shoes dealing with a developer controlled HOA and the transition.

The developer was able to choose pretty much anything he wanted to put into the CCR's prior to building and selling homes. Therefore, he should make sure what he has stated and sold to others is abided by and followed. A lawsuit has many various consequences and many which Tim pointed out above.

Before you file a lawsuit my question would be: Have you sent a letter to your HOA Board, Management Company and the Developer via "Certified Return Receipt" stating your concerns?

Before you file a lawsuit you need to make sure you have tried many other avenues and proof of having tried to work things out prior to filing; otherwise, the Court might throw out and send you back to square one.

I am surprised the developer is not making everyone abide by the CCR's and keep the subdivision looking nice as it is in his best interest to do so when trying to sell more homes at top dollar.

LOL ... Many on here can attest that I do not favor Developers. I favor what is morally and ethically right and agree the documents should be followed. However, there are other avenues I would pursue before filing an expensive lawsuit.

Just exactly how many members have signed up with you on your class action lawsuit AND contributed money? Just curious as you keep saying your going to file a "class action" lawsuit. Just how many are with you in this suit? You do understand a "Class action" lawsuit means multiple litigants filing together and not just one person against a large number?

Also, you may want to ask "JanetB2(Colorado)" who seems to have helped all of here!!!

Personally, I think that a neighbor of Rics put up a fence or outbuilding that he doesn't like.
He doesn't want to approach the neighbor about it directly.
He doesn't want to serve on the Board or serve on an enforcement committee.
He wants those who have volunteered to serve to do the job as he interprets the governing documents require.
He wants someone else to force those volunteers to do that (i.e. the courts).
He doesn't want to absorb the cost himself (10s of thousands based on recent news articles).
He may hope that there will be a financial gain (damages) and using that enticement, gain support with a class action.

OR

He is simply mad because the Association is taking collection actions on him for unpaid assessments and instead of simply admitting he made a mistake wants to find something to complain about that the Association has made a mistake on (i.e. the response of some, "Oh yea, well you did this or didn't do that" thinking it negates what they did or did not do)

I also suspect that he hasn't actually talked to an attorney yet about a class action suit.

TimB4
(Virginia): Are you related to JanetB2?

TimB4
(Virginia):

What have you been drinking to come up with all these "wild" scenarios and/or questions?
Maybe you can make a movie with them and earn more $$$ than you do as a volunteer for a POA or HOA?

CIAO!!!

Ric,

I'd also like to add that I'm not saying that your observation of the lack of enforcement isn't valid.
I'm taking your posting at face value and going with the expectation that it is valid and the Master Association isn't enforcing the covenants.

I'm simply making an observation about what I perceive as the motivation behind your actions.

Rather then enforce the covenants yourself, by taking legal action against a violator directly, you want to take legal action action against the Association. Therefore, you aren't concerned about the cost, time or energy any legal action requires. However, it's not typical to want to jump to class action status.

Wanting someone else to enforce vs. you enforcing is also typical (be it the Association or the courts). However, it's not typical to go after the whole community vs. a specific violator.

You don't clarify if the violations you specify are actual violations (as in not authorized by the covenants or guidelines). Yet you claim that many didn't get approval. If that number is accurate, you would have only found this out by talking to your neighbors. Therefore, you are not afraid to talk to your neighbors about the policies and required procedures. However, you seem to not want to serve on the Board or ACC to enforce those policies and required procedures.

If the violations exist, you claim that there is no enforcement. Yet, you haven't described a single issue where you filed a specific complaint of a violation to see if the Board will enforce if the violation is reported. Nor do you give any anecdotal information if enforcement is in progress or that you even brought the issue to the Board to see how they responded to the question if enforcement is happening.

Again, I am expecting that what you have posted is accurate and the Association has not enforced. It simply seems to me that you are willing to try and jump the cliff (take legal action) rather then walk around the bend to see if there is a bridge (actually talk to the Board about your concerns on enforcement) or consider felling a tree to bridge the gap (volunteer to serve on the Board or committee to correct the issues you see).

To me, it seems a little out of place to want to attempt the leap before you have checked out other options.