HOA street ownership

Started by SteveW9 • 9 replies • 1214 views

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SteveW9 (New Mexico)
Posts: 37

Posted:

The HOA in which I live is located in New Mexico. Last year, the bankruptcy court awarded ownership of our streets to the HOA via a quitclaim deed plus 50K to be used for maintenance of the streets. However, the Board of Directors does not want to file the quitclaim deed in the local county seat. The reason: The HOA would then be liable and responsible for the streets. Any comments from anyone?

SusanW1 (Michigan)
Posts: 5,202

Posted:

Will the county take them over?

ChuckR (Texas)
Posts: 8

Posted:

By not filing them, the HOA is not disclosing to potential purchasers of real property. The HOA should be dissolved by your State's Attorney General in my humble opinion, and the officers of the HOA made personally liable for any and all financial damages their actions cause.

This is one more reason I will NEVER again purchase real property in any subdivision having an HOA. They always want the homeowner to play fair, and disclose and play by the rules. But they want to make the rules up as they go along, ex post facto.

Not filing those dedicatory instruments is appalling at best.

SteveW9 (New Mexico)
Posts: 37

Posted:

Thanks for the question. No, the county will not take over ownership. sdw

KirkW1 (Texas)
Posts: 1,665

Posted:

Your BOD really doesn't have a choice on maintenance of the streets. A judge decided that the HOA now owns the streets and awarded some money to start the repair fund.

I would recommend you start a petition for recall. You need people who will take a look at the situation and take actions needed. The money needs to be put into an account and more added to it on a regular basis. The BOD should also jump into find out what they can regarding any ways to minimize the costs.

As a note, they do open the association (and possibly themselves) up to a suit by not doing their fiduciary duty.

SteveW9 (New Mexico)
Posts: 37

Posted:

Thanks for the reply. We do have the money in a savings account.

A local title company gave me this scenario: If someone sold a vehicle or property to me and gave me a quitclaim deed; if I did not file this quitclaim deed, then the name of the property owner never gets changed. She also stated that once I started making use of this property, I accepted liability and responsibility regardless of the fact that the quitclaim deed was not filed. We have already begun patching our streets, installing road signs and are talking about installing speed bumps.

Of course, I am sure that I can find another title company or an attorney who can provide me with a different opinion.

RogerB (Colorado)
Posts: 5,067

Posted:

Steve, you may want to seek out the services of a good attorney to see if they can help get the streets dedicated to an appropriate governmental agency or otherwise give you a written opinion on what to do.

SusanW1 (Michigan)
Posts: 5,202

Posted:

I would not spend any of the 50K if you haven't filed the proper documents so that you won the property you are repairing.

SteveW9 (New Mexico)
Posts: 37

Posted:

Last year I obtained an opinion from an attorney about another issue and it cost me $2,000.00. Unfortunately, the board’s attorney presented an opposing view.

KirkW1 (Texas)
Posts: 1,665

Posted:

So let us do a quick analysis of the situation. You were presented with a quit claim deed (presumably from an entity that had a legitimate claim). But this is all over ownership of a street.

So let us examine what there is here. A person can't come back and decide that they will sell the streets to someone else. They can't come and place a house in the middle of the street. The streets are what they are: streets. They will be streets forever unless the houses go away.

At the end of the day there is only one issue: who will repair/maintain the streets?

You already know that the government will not take that issue on. So if you don't file the clam, then does anyone really think the previous owner will pay for this?

And who will suffer a loss if the street is not maintained? The answer seems glaringly obvious. You and the other neighbors.

So then I wonder, what is the point? You may as well file the papers now. I just can not fathom any situation where good can come from failure to file. But perhaps some major problems could come from not filing it. At some point you may need something done and have a refusal to undertake the work because they believe you are not the rightful owner. Or that they have no recourse should you fail to pay. It could cause you to have to wait while papers are filed.

I think you should push to get people who will think things through.

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