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Commercial Property held hostage by HOA

Started by JenniferC14 ā€¢ 10 replies ā€¢ 847 views

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JenniferC14 (Arizona)
Posts: 2
Posted:
We purchased a commercial building located outside the gates of HOA GOLF Course community. When we purchased it 3 years ago there was no HOA per the owner at the time and the title officer. The previous owner states he has never paid a dime for HOA but now they are trying to collect 2,000 a month for HOA dues. The HOA has no part in our property and we donā€™t utilize any part of their common areas. We donā€™t even enter their community. The original builder at one time owned all the property but went to jail for eunethical practices. Apparently he used to launder money from our property to the golf course and HOA. How can we be removed from their HOA and highway robbery fees. This all came about because we tried to buy the building next door and the title officer wonā€™t allow it to close until 30,000 of HOA fees are paid?!? Why would a vacant commercial building be held hostage by HOA? We are a church so itā€™s not as if we are making a lot of money. Any ideas on how to divorce ourselves from this HOA?
RichardP13 (California)
Posts: 3,868
Posted:
You need to get a corporate attorney well versed in real estate litigation, ASAP.
RoyalpitA
Posts: 195
Posted:
DITTO
DouglasK1 (Florida)
Posts: 2,046
Posted:
I agree with the previous posters, but will add a question. Have you researched your property deed to see what might be attached to it?

If the deed has the HOA covenants (AKA Deed restrictions or CCRs) attached, then the property is subject to the requirements therein. In that case, the title company should have brought that to somebody's attention when the property was purchased and it's possible that there would be a valid claim against the title insurance, assuming a policy was purchased.

If there are no HOA covenants attached to the deed, hopefully a strongly worded letter from a lawyer will get the HOA to reconsider, otherwise it could require suing.
Escaped former treasurer and director of a self managed association.
GenoS (Florida)
Posts: 4,276
Posted:
The previous owner and the title officer told you there was no HOA? Talk to the title company. Obtain the plat for the property and see what it says. Obtain the HOA's CC&Rs and see what that says. You'll probably want an attorney. What about the party who owns the lot you tried to buy? He should hire an attorney too because he might have his own claims against the HOA, for slader of title, restraint on alienation and/or tortious interference in his contract with you for sale and purchase (depends on how far along in the process you were). I'm not an attorney but I think you'll definitely want to talk to one.
JenniferC14 (Arizona)
Posts: 2
Posted:
Thank you....our deed has no mention of HOA or CCR...but it was previously subdivided from the one we want to buy now. That dead says ā€œeasement is subject to HOAā€. Regardless they are billing us 2,000 a month for nothing. Will be hiring an attorney. Thank you for your help!
TimB4 (Tennessee)
Posts: 21,059
Posted:
As others have said, this is going to have to go to someone who knows how to research property records and research them well.

If the records state that the property is subject to covenants controlled by the HOA, then you will likely never "divorce" yourself without buying your way out.

SteveM9 (Massachusetts)
Posts: 3,699
Posted:
Quote:
Posted By JenniferC14 on 09/28/2018 3:04 PM
Thank you....our deed has no mention of HOA or CCR...but it was previously subdivided from the one we want to buy now. That dead says ā€œeasement is subject to HOAā€. Regardless they are billing us 2,000 a month for nothing. Will be hiring an attorney. Thank you for your help!

If it was on a previous deed........ and not legally removed from the HOA, its still part of the HOA. Doesn't matter if its not on the new deed. You will need to research previous deeds and follow the trail.

For example, I cant simply write myself a new deed without the hoa, file it and remove myself from the HOA. Same thing. Doesn't matter who wrote the deed.

My guess..... your still part of the HOA. Its extremely rare to remove a property from a HOA.
SteveM9 (Massachusetts)
Posts: 3,699
Posted:
Think of it this way.....

If you had a huge house lot in an HOA.
You divided that property in 2.
Now both properties are in the HOA and both properties are paying dues.
FredS7 (Arizona)
Posts: 927
Posted:
Seems to me...if the title company did not include the HOA as an exception...they are on the hook.
SteveM9 (Massachusetts)
Posts: 3,699
Posted:
They may or may not be on the hook. Read the fine print.

Just just be warned..... filing a claim with a title company isn't so easy. Many will simply ignore legitimate claims unless you file a lawsuit against them. So be prepared...... settling all this out could take many years and quite a bit of money spent on lawyers.

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