Fining process for HOA in Missouri

Hello everyone, I put up a fence lakeside on my property. The cc&R's state a fence under 3ft is allowed and doesn't have to be approved by the board. There are set back requirements but I made sure to be well within those as well. Our current HOA is ignorant on the rules and basically they do what they want. My question is can the legally fine me? They sent a letter stating if it's not removed by aug 16th they'll fine $100 a month. Nowhere in our restrictions or amendments does it say anything about fines or the process to receiving a fine ect. They did create a summary of the restrictions a couple years ago. This 5 page document has never been filed with the county or state in any way and has rules that are inconsistent with the filed restrictions and amendments. I know for a fact my fence isn't against the cc&R's I even checked with an online legal service who said I was in the clear.
My question is what is the process for fining? What rights do I have to fight the fine? On another note non of the board members have been elected they've all just kind of taken over and the community has by in large allowed this. We have our annual meeting in September where elections are supposed to be held. I am not sure if there is a way to fight against all of this but I'd certainly like to. I appreciate all the help and input.

No..... I want to know specifically how I fight a fine. I don't need forgiveness I haven't done anything wrong. I just want to know how I fight a fine and appeal it and what not.

Honestly I didn't understand the initial reply. I thought my post made sense. But yeah..... different strokes for different folks I guess.

-- As I believe you are aware, Missouri does not have a (non-condo) HOA statute.

-- The Missouri statute with the most relevance is the Missouri Non-Profit Corporation statute. The Non-Profit Corporation statute is silent with regard to fines (as is common nationwide for state nonprofit corporation statutes).

-- The only legal authority that exists for fining would be in the CC&Rs. I googled and quickly found a few Missouri law firm sites indicating similar or saying that the CC&Rs and nonprofit corp act are the only non-case law authorities. E.g. see
https://clarksimsonmiller.com/missouri-hoa-laws-and-regulations/
https://www.stevemartinlaw.com/blog/2019/11/three-ways-to-enforce-hoa-rules-and-regulations/
https://www.nolo.com/legal-encyclopedia/missouri-hoa-coa-foreclosures.html

-- Around 2017, the legislature was considering some bills giving HOAs the right to fine. This seems to reinforce my contention that Missouri HOAs having CC&Rs silent about fining cannot fine.

-- You indicate the CC&Rs are also silent regarding fining.

-- Nationwide in circumstances like this, I understand the only lawful recourse a HOA has is to take you to court to seek an injunction such that the fence meets whatever required lawful standard exists in the covenants.

DakotaS, I think your options are as follows:

-- Ignore the fines. See if the HOA is stupid enough to lien your home for the fines. When you go to sell your home, this might lead to disputes.

-- Speak to a Missouri law firm (maybe one of those mentioned above?). See if they will write a letter on your behalf threatening legal action unless the HOA removes the assessment of fines. Estimated cost: $500 to $3000.

-- Regarding elections, I am pretty sure you have brought this up before in recent months. I think you should go back to these threads and take the advice there. Or you could ask the attorney to add this to his/her list of things to demand of the board. Of course, this will cost you more money.

First, it sounds like there is no violation so the issue of fines is moot.

Second, taking your money without authority is tantamount to theft. Even the government cannot take your money without a law allowing it. Unless there is a law where you live allowing fines or authority to fine in the CC&Rs, the HOA cannot fine you. That being said, if they do try to fine you, I would consult with an attorney to be certain.

So I reached out to his fight club and they pointed out that our HOA has filed the annual registration with the secretary of state since 2018. Because if this they apparently cannot conduct business. If this is accurate couldn't the community get together and file it as the acting HOA and basically create a new board? How would this work?

Dakota

Some parts of your posts make no sense. Examples:

So I reached out to his fight club...what is a fight club?

and they pointed out that our HOA has filed the annual registration with the secretary of state since 2018....are you saying the HOA HAS NOT filed the annual registration each year? By the way, no biggie. Easily back filed.

Because if this they apparently cannot conduct business....Are you saying they CANNOT conduct business because of this?...if so, this is your opinion only.

If this is accurate couldn't the community get together and file it as the acting HOA and basically create a new board? How would this work?....I have never heard of such and I can only assume it could get very expensive.

Commas, proof reading, etc can be your friend.

Just an observation here, If this HOA does not have the certificate form the MO SOS to operate, that to me means they cannot operate as an HOA i.e. sending violation letters etc. Fruit of the poisoned apple as they say in the legal world.

Dakota, my first step is to make a copy of the violation letter and write a simple two paragraph complaint letter to the MO Secretary of State. In the meant time send a letter to your HOA board and property manager citing the specific covenant where you do not need board ARC approval for said fence. threaten legal action if they pursue the issue.

For all intensive purposes, this looks like an easy and inexpensive fix for you, you just need to supply the time and elbow grease.

I am still puzzled as why the OP can't simply "fight" the fine by going to board to present their evidence. I mean if it's true and written, then simply responding with the EXACT quote from the rules should suffice. How did it escalate to proving the HOA is not official or whatever? Simply prove what you say is true. Done.

This is flatly incorrect. An administratively dissolved corporation retains many rights that are relevant here. From Missouri statutes:

=== Start Missouri Statute Section 355.691 ===

"Effect of dissolution. — 1. A dissolved corporation continues its corporate existence but may not carry on any activities except those appropriate to wind up and liquidate its affairs, including:

  (1) Preserving and protecting its assets and minimizing its liabilities;

  (2) Discharging or making provision for discharging its liabilities and obligations;

  (3) Disposing of its properties that will not be distributed in kind;

  (4) Returning, transferring or conveying assets held by the corporation upon a condition requiring return, transfer or conveyance, which condition occurs by reason of the dissolution, in accordance with such condition;

  (5) Transferring, subject to any contractual or legal requirements, its assets as provided in or authorized by its articles of incorporation or bylaws;

  (6) If the corporation is a public benefit corporation, and no provision has been made in its articles or bylaws for distribution of assets on dissolution, transferring, subject to any contractual or legal requirement, its assets exclusively for one or more purposes described in section 501(c)(3) of the Internal Revenue Code; or if the dissolved corporation is not described in section 501(c)(3) of the Internal Revenue Code, to one or more public benefit corporations, including a foreign corporation that would qualify under this chapter as a public benefit corporation;

  (7) If the corporation is a mutual benefit corporation and no provision has been made in its articles or bylaws for distribution of assets on dissolution, transferring its assets to its members or, if it has no members those persons whom the corporation holds itself out as benefitting or serving; and

  (8) Doing every other act necessary to wind up and liquidate its assets and affairs.

  2. Dissolution of a corporation does not:

  (1) Transfer title to the corporation's property;

  (2) Subject its directors or officers to standards of conduct different from those prescribed in sections 355.316 to 355.501;

  (3) Change quorum or voting requirements for its board or members; change provisions for selection, resignation, or removal of its directors or officers or both; or change provisions for amending its bylaws;

  (4) Prevent commencement of a proceeding by or against the corporation in its corporate name;

  (5) Abate or suspend a proceeding pending by or against the corporation on the effective date of dissolution; or

  (6) Terminate the authority of the registered agent.

=== End Missouri Statute Section 355.691 ===

Missouri case law chatter on the above:

https://cases.justia.com/missouri/supreme-court/sc91138-45964.pdf?ts=1396129272

https://law.justia.com/cases/missouri/supreme-court/2015/sc94693.html
("Although the Original HOA sat dormant in a state of administrative dissolution, Missouri law allows for rescission of the administrative dissolution. Mo. Rev. Stat. §351.488. Only an actual dissolution of that entity or unanimous consent of all of the owners of property could have extinguished the authority of the Original HOA.")

Note how these cases speak of a dissolved corporation's exclusive right to assign control of the HOA to a new corporation. The OP here does not, on her own, have this right. Only the HOA's board of directors has this right, even (and pursuant to the case law above, especially) in a state of "administrative dissolution" of the HOA corporation.

Furthermore, as stated in the statute section above, and in order to deal with the HOA's liabilities, it appears to me that an administratively dissolved corporation may, pursuant to the covenants (a contract with the owners), continue to collect assessments.

The OP is barking up the wrong tree when she contends that the HOA corporation being "administratively dissolved" somehow means either the HOA or the corporation no longer exist. When a HOA corporation is "administratively dissolved," the courts say the HOA still exists; the corporation still exists; and the covenants continue.

Anyone thinking Missouri is weird this way: No. Statutes like Missouri's above are common nationwide.

"Dissolution" comes up from time to time here. I feel there is lots of misunderstanding about what it means. I know an attorney in my own town who thought the way many folks here are thinking, until he was sent to the statutes.

I am posting to try to get some facts out about what "dissolution" does and does not mean. "[C]an't do business as a corporation" is not how I would explain what "dissolution" means. The powers of a "dissolved" corporation are extensive. These powers revolve around "winding up" (a statutory term used also in case law) the affairs of the corporation. The period of "winding up" is either frequently not defined or is a very long time. In Ohio, statute section 1701.88 and a few other statute sections talk about what "dissolved" corporations can do. For example:

-- Start excerpt from Ohio statute section 1701.88 --
The directors of the corporation and their successors shall act as a board of directors in accordance with the articles and regulations until the affairs of the corporation are completely wound up. Subject to the orders of courts of this state having jurisdiction over the corporation acting pursuant to section 1701.89 of the Revised Code, the directors shall proceed as speedily as is practicable to a complete winding up of the affairs of the corporation. For that purpose, the directors may exercise all the authority of the corporation. Without limiting the generality of such authority, they may do all of the following:

(1) Fill vacancies;

(2) Elect officers;

(3) Appoint agents, liquidators, or other entities or persons to carry out the winding up of the corporation's business;

(4) Carry out contracts of the corporation;

(5) Make new contracts;

(6) Borrow money;

(7) Mortgage or pledge the property of the corporation as security;

(8) Sell its assets at public or private sale;

(9) Make conveyances in the corporate name;

(10) Lease real estate for any term, including ninety-nine years renewable forever;

(11) Settle or compromise claims in favor of or against the corporation;

(12) Employ one or more persons as liquidators to wind up the affairs of the corporation with such authority as the directors see fit to grant;

(13) Cause the title to any of the assets of the corporation to be conveyed to such liquidators for that purpose;

(14) Apply assets to the payment of obligations;

(15) Distribute the remainder of the assets either in cash or in kind among the shareholders according to their respective rights and interests after paying or adequately providing for the payment of all known obligations of the corporation under section 1701.882 of the Revised Code and for claims that have not been made known to the corporation or that have not arisen but that, based on facts known to the corporation, are likely to arise or to become known to the corporation within five years after the date of dissolution or such longer period of time as the directors or a court acting under section 1701.89 of the Revised Code may determine, not to exceed ten years after the date of dissolution;

(16) Perform all other acts necessary or expedient to the winding up of the affairs of the corporation.
=== End Excerpt ===

In 2019 a developer where I am needed to purchase a "ransom strip" of land, about 300 feet x 10 feet, from a corporation that had dissolved over 30 years ago. The developer needed this land for purposes of constructing a city-required drainage ditch. (he city also initially messed up about who owned this strip of land. When some 'interested neighbors' pointed it out, the city attorney went ballistic on the developer. The plats properly recorded the strip of land and that the dissolved corporation still owned it. In fact the dissolved corporation owns a number of such strips all over my town. Only one of the dissolved corporation's three directors remained alive, and then there were several heirs to the other two directors. The sole living director is an attorney; informed the developer to quit trespassing; and negotiated sale of the strip of land, with the proceeds going to himself and the heirs. Hence my education on the subject of the rights of a "dissolved" corporation.

The issue of property taxes came up. I am not sure how this resolved.

This is largely about property rights. The state does not just take away a dissolved corporation's property rights. Much more has to happen before a dissolved corporation loses title to property.

Some of us were those little kids who took stuff apart to see how it worked. :-)

Anyway, most OPs probably want a basic answer to "what should I do" and won't be interested in theory unless their situations are more complicated than they look on the surface. Theory is interesting for those who like to understand principles and to see whether or not the answer to the OP's question can be applied to similar situations.

I'll try to remember to label my theoretical posts "Down the Rabbit Hole" so people can skip them if they're not interested.

Wrong.

Are you stupid because you sound stupid?
This post is much bigger than a damn fence. I did ask how to fight the fine because I've already pointed out in the restrictions and amendments what it says about offenses and I'm not breaking any fence rules. They say I am how do you fight that if I literally tell you the sky is blue and you say no it's not it's green and we have documentation that says it's blue and you continually say it's green anyway how do you fight that that's the question?
The other issue is the fact that the board has not been elected the community has not elected board members in over a decade. If they're not elected they should be removed and an election should be held in a proper fashion. If you can't understand that as an HOA president you're obviously part of the problem that so many HOAs have issues with.
The other thing I said was that our annual registration is not even current it has not been filed since 2018 according to this non-profit I'm working with regarding this issue they cannot conduct legal business without this being current. Now instead of thinking you know things that you clearly do not and making crazy ass assumptions based on nonsense why don't you first read and get the facts. This forum has some good people on it but it also has some very ignorant arrogant people that just need to find another home

Hardly I've seen you on here several times you always make backhanded snarky comments and you offer little insight. I have to imagine that dealing with people like you is why most people don't like being in an HOA. I just tell it how I see it if you don't like honesty then that's on you. Now since you haven't offered anything of substance to this conversation why don't you run along and allow the others to converse and offer insight. Thank you

One thing all of the legal citations do is help show why getting courts involved can have unpredictable results, in addition to costing an arm and a leg. This means it's usually in a person's best interest to solve their problem without going that route, if at all possible.

I agree that the fence issue sounds easy if the CC&Rs don't say anything about fences or fines. Put it in letter stating exactly that and that you will go to court if the board persists, send certified return receipt, and with luck that will be the end of it.

Resolving the other stuff means legal action for sure, and hopefully DakotaS has a competent and honest lawyer who can assess the situation and explain what fighting it will mean (time, money, stress, increased assessments, ticked off neighbors, unpredictable outcome, etc.). The reality is that legal action is expensive, can drag on for years, and a plaintiff won't necessarily get the outcome they want. Anyone considering this route needs to be very sure that they're up for whatever is coming their way - it's not a decision to make lightly.

Which part is nonsense? We have a board that hasn't been elected they are paying the treasurer which is a volunteer position they are fining people for things that are not against the rules and the president the treasurer carry around cash that is subdivision property and use it whenever they feel like. I and a few others have seen this take place. They also don't maintain the common areas and they silence anybody who doesn't agree with them.
I think these things are legitimate reasons to fight back

It's "They/Them" quandry. It's never "What can I do?" conversation is it? A HOA is ONLY YOU and your neighbors. There are no "They or Them". So if you don't like what is going on then get in and DO THE WORK! Stop wanting to take your HOA to court or hire a bunch of lawyers.

If you have problems with your HOA, then you take the steps that are defined in your CC&R's, by-law, or Article of Incorporation. I find it funny that people want their HOA's to "Follow the rules" except not once have those people tried to do that themselves.

For the record my HOA sucked when I moved in and became a member. What did I do? Ran for Vice-President then got elected as President the next year. I went back to following the rules. Even so much as bringing them to each and every meeting. You asked me a question I could quote those rules backwards and forward. Any written response included references to them.

So if you thought the HOA wasn't applying the rules, simply come to the OPEN meeting and express the FACTS. Don't go to a website to complain about your HOA or find ways to surprise attack it with legal woes. Your just setting yourself up for failure and egg on your face...

Number 1. Most HOA's a general membership can NOT remove a board member. It is the board that has to do that. The general memberships votes in the board members. The board members then decide amongst themselves to elect to officer positions. Some HOA's the board can replace an empty position amongst the membership. The membership can recall a board or directors. The board members remove the officers.

It sounds like a misinterpretation here on the fence allowance. Are fences allowed in the area of the lakeside? Many HOA's with lake access do not allow fences on that side or within a certain egress. So I can see how the fence is being considered a violation after all. What you seem to be describing is a fence location issue than an existance issue.

If you want to find out about how to run a HOA you go to your documents good or bad. If they are bad, then you find out what it takes to make the changes you all want to make. Once you get those votes and changes documented, then go to the courthouse and file them. They are not legal till officially filed. Which does cost money. Plus a lawyer should be involved with making sure it is legal what is written. Plus they help with the filing process.

So no I am not the "idiot crazy" person you think I am. I've been down this road before and wearing the T-shirt. Many others here are as well. Sometimes you need to slow your roll and listen...

"Number 1. Most HOA's a general membership can NOT remove a board member."

Wrong.

Our fence guidelines do not say no lake side fences. It says a fence 3ft or shorter is allowed and if someone wants a taller fence they have to get approval from the board. It also says in set back rules that it has to be 5ft off the property line on the sides and 15 ft behind your front line and cannot be built in front of your building line. That's literally all it says. If you'd like I could probably upload the page so you can see exactly what it says word for word.

If it's not allowed doesn't it have to say it's not allowed otherwise it's just making stuff up? No not all houses are on the lake but a good majority of them are. But there's no separate rules for where a house is located we have a one size fits all restrictions and amendment page. If it doesn't in some fashion say no lakeside fences how can they be not allowed? That doesn't make sense. The restrictions do not stipulate where a fence can and cannot be except to say they can't be in front of the building line and they have to be 15 ft behind the front line and 5 ft off either side of property line that is the only stipulations it gives for where they can and cannot go.
It's also worth mentioning that an attorney got back to me and agreed with me that lakeside fences are permitted