Mandatory Food & Beverage with home ownership

Started by JudyM9 • 24 replies • 1969 views

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JudyM9 (Arizona)
Posts: 46

Posted:

I live in a mandatory membership community. There is a mandatory HOA (reasonable and well run) plus a second, mandatory Country Club (no nice adjectives). The Club is now considering a Food & Beverage minimum to help offset a very expensive restaurant remodel.

I fully understand F&B minimums but haven't heard of one in a mandatory club. This amounts to forced food purchases. Buy a home here and you are required to buy food. Can this even be legal? Anyone else out there with mandatory food in an HOA or other mandatory club?

Since this would be mandatory food AND beverage, the bulk of the revenue comes from alcohol sales, so mandatory alcohol? Wouldn't they have to exclude alcohol?

Your comments and experiences are welcome.

PaininyourA
Posts: 215

Posted:

To paraphrase Judge Judy:

If you don't like where you live MOVE.

You bought in - You live with the contract.

TimB4 (Tennessee)
Posts: 21,062

Posted:

Judy,

If you belong to the country club, you should have some say in how it's ran.
Gather support from your neighbors and make your voices heard.

CarolF (Florida)
Posts: 435

Posted:

Judy - does this Country Club also have a golf course, or other amenities that would require some sort of dining facilities? Minimums are common in full service Golf Clubs. However, many clubs of this type are experiencing financial problems these days, and are being forced to come up with new ideas to keep them going.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Judy

This is not uncommon. You knew going in there was a mandatory club membership.

JudyM9 (Arizona)
Posts: 46

Posted:

Actually, we bought here before the club was built.

PaininyourA
Posts: 215

Posted:

Evidently w/o reading the Covenants and Restrictions referenced within the deed (which you DID sign for).

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By JudyM9 on 12/02/2017 2:26 PM
Actually, we bought here before the club was built.

Were you told it was coming and it would be mandatory?>

PaininyourA
Posts: 215

Posted:

John,

our posts crossed

JudyM9 (Arizona)
Posts: 46

Posted:

I think it is very uncommon. There aren't many mandatory Country Clubs in the country. We are the only one in Arizona - a place filled with Country Clubs.

There is a big difference between a club you voluntarily joined and pay for where there is a food and beverage minimum. It is quite another thing to have the purchase of food and alcohol required because you own a house.

If you keep Kosher should you be required to buy food. If you are Mormon, should you be required to buy alcohol and coffee or just eat more?

JudyM9 (Arizona)
Posts: 46

Posted:

CC&Rs do not apply. This is a 25-year-old mandatory social club where they are considering changing bylaws to create a F&B minimum.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Judy

All you what ifs aside, did you know about it being mandatory? Yes or No.

If no, how did it become mandatory.

If yes, live with it.

JudyM9 (Arizona)
Posts: 46

Posted:

This club has no financial issues whatsoever. They charge a very large transfer fee to new homeowners. It is not a full-service country club. It has a restaurant and other amenities which are supported through mandatory dues by homeowners, but are not part of the HOA.

JudyM9 (Arizona)
Posts: 46

Posted:

The minimum is being considered and hasn't been enacted.

My question was whether anyone else had experience with this scenario and/or it's legality.

Sounds like you have no idea

DouglasK1 (Florida)
Posts: 2,046

Posted:

Quote:

Posted By JudyM9 on 12/02/2017 9:24 AM

I fully understand F&B minimums but haven't heard of one in a mandatory club. This amounts to forced food purchases. Buy a home here and you are required to buy food. Can this even be legal? Anyone else out there with mandatory food in an HOA or other mandatory club?

I don't have first hand experience with your situation, but am interested to know what document makes it mandatory. If not CCRs, I assume there is some kind of document attached to your deed that requires membership, is that correct? I would expect that this document forms some kind of contract, and what is or is not allowed should be defined by that contract.

Most likely this is not illegal, as in against any law, but may or may not be beyond the scope of what is allowed by whatever agreement is in place. If this is a substantial amount of money, you (possibly together with like-minded neighbors) should consider getting a lawyer's opinion. Just remember that it is only an opinion, the final determination in a civil dispute would be rendered by a judge.

Escaped former treasurer and director of a self managed association.

JudyM9 (Arizona)
Posts: 46

Posted:

There is a "membership agreement" which goes with your deed, and bylaws. What they are considering would involve a change to the bylaws. I am in the information gathering mode.

I'm having a hard time believing that a community can write bylaws which force a homeowner to buy food and alcohol as a condition of owning a home.

We have just gone through attorney hell with this club when they decided to take out a huge loan without a vote, so no one is in the mood to hire attorneys again.

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By TimB4 on 12/02/2017 12:38 PM
Judy,

If you belong to the country club, you should have some say in how it's ran.
Gather support from your neighbors and make your voices heard.

Ever belong to a private country club?

PaininyourA
Posts: 215

Posted:

She does, in fact.

CONTRACTURALLY

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By JudyM9 on 12/02/2017 5:08 PM
There is a "membership agreement" which goes with your deed, and bylaws. What they are considering would involve a change to the bylaws. I am in the information gathering mode.

I'm having a hard time believing that a community can write bylaws which force a homeowner to buy food and alcohol as a condition of owning a home.

We have just gone through attorney hell with this club when they decided to take out a huge loan without a vote, so no one is in the mood to hire attorneys again.

Who is they? Who owns the club?

JudyM9 (Arizona)
Posts: 46

Posted:

The non-profit corporation owns the club.

Please don't lecture me on our bylaws and what I should and should not have known. I am well versed in planned communities and what I am subject to. I am looking for anyone who either has the same situation and can comment from experience or has some legal basis for understanding how an organization can force you to buy their food and alcohol.

DouglasK1 (Florida)
Posts: 2,046

Posted:

Quote:

Posted By JudyM9 on 12/03/2017 6:09 PM
The non-profit corporation owns the club.

Please don't lecture me on our bylaws and what I should and should not have known. I am well versed in planned communities and what I am subject to. I am looking for anyone who either has the same situation and can comment from experience or has some legal basis for understanding how an organization can force you to buy their food and alcohol.

Unless there is something in AZ state law addressing this (unlikely, I would think), this is a contractual issue. If the bylaw changes are not in conflict with the membership agreement contract, then the changes might be permissible. What are the requirements to change the bylaws? Can the directors do this on their own or does it require a membership vote?

Escaped former treasurer and director of a self managed association.

JudyM9 (Arizona)
Posts: 46

Posted:

There will be a membership vote to change the bylaws. I am attempting to do some homework ahead of time.

Again - I'm having a hard time with the concept of owning a home for 23 years, then being required to buy food to stay in my home. We aren't talking about what kinds of plants go in the yard or what color to paint the house, we are talking about food and beverage. Those are things which have religious and health ramifications. For example, if someone owns a home here already and they have food allergies, can they be suddenly required to pay $600 a year for food they cannot eat? Lots of alcohol flows through a country club restaurant. Will recovering alcohols be required to have a meal in the middle of that?

In the Willoughby case, where the club was trying to change from an optional club to a mandatory one, the club already had a F&B minimum. When the judge ruled the club could make that change, the club was required to pay back those who paid the F&B minimum. Our case would be similar, not identical.

DouglasK1 (Florida)
Posts: 2,046

Posted:

My first plan of action in your case would be to campaign hard against this. Knock on doors, talk to owners, make up your own flyer and put on doors or mail, etc.

If this passes, then your recourse would be through the courts, and it is difficult to predict how any given judge would decide. A lawyer could give an opinion based on reading your membership agreement and considering potential precedents and case law, but that would just be an opinion. The opinion could be helpful in deciding whether to challenge the change and how likely you would be to prevail.

There is probably no law in your state forbidding this change, but again, a lawyer could help there. Most likely the people pushing for this change won't stop when presented with precedents and case law, but might if you can find an actual federal, state, or local law that applies.

Escaped former treasurer and director of a self managed association.

JudyM9 (Arizona)
Posts: 46

Posted:

DouglasK1 - thanks. We just went through a 6-month fight with our Board, including a recall attempt with attorney assist.

PaininyourA
Posts: 215

Posted:

..... understanding how an organization can force you to buy their food and alcohol. .....

By virtue of the contract YOU have with the organization.

a/k/a Covenants and Restrictions which are BINDING

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