Due process on fines?

Just looking for thoughts-

40 home community- 6 board members.

A homeowner gets a violation notice and the board has decided to levy a fine. Per the rules the homeowner gets the opportunity to address the board and make a case for not being fined or fight it out right. The board then meets in private and decides if a fine is warranted.

So far so good.

Here is the case: The people that initiated and witnessed the violations (parking) are board members. In fact, this homeowner is accused of his guests parking overnight (a no-no) on three occasions over a three month time frame. The homeowner denies the allegation for what it is worth. However, the witnesses to the violations are board members that live next door to him. Each of the three violation were initiated by a different board member. The only proof is the written violation form signed by the board members. (Not witnessed together, separate violations witnessed by different board members on three occasions)

Shouldn’t they recluse themselves when voting on guilt or innocence and if a fine is to be levied? Isn't that like the accuser going from the witness stand into the jury box? They all three voted and had input on the fine.

Is the way all HOA's are doing it?

As a second issue- the board incurred $1500 by bringing an attorney to the meeting to listen to the homeowner make their case- fined him $250 and $1500 in attorney fees. Seems unreasonable.

This is a small community with 40 homes and only 7k in reserves so it appears more personal than due process.

Any thoughts?

http://www.azleg.gov/ArizonaRevisedStatutes.asp?Title=33

arizona state stattutes only requires that the board member announce to the board that they are in a conflict of interest prior to voting. and really that is only if it benifits them. really if there are 6 people on the board (an even number, weird) then the remaining 3 should be unbiased. Really if you think about it any violation comes from the board. a member of the association cannot send out a notice of violation (to my understanding) it must come from the board (or from the management company which represents the board).

I too find it unnecessary for a lawyer to be present at that meeting. 41-2198 of the AZ statute allows for an administrative law judge to hear cases on compliance of planned communities, i'm not sure what the filing fee is, but i'm sure it's less than $1500. however, the association may bring their lawyer to that meeting as well and if the violator loses there too he may be hit with double to cost.

finally you may want to seek help here:
http://phoenix.gov/NSD/index.html
it's the city of phoenix neighborhood services department (i'm assuming you live in phoenix, but if not maybe your city has a similar program). I believe if you file a complaint they may offer mediation to come to a resolution.

good luck, once the housing market rebounds i will be the first to sell and get out of my HOA! i can't stand it

RZ,

State law says that the member must have the opportunity to be heard before a fine can be levied. It also says: "A member who receives a written notice that the condition of the property owned by the member is i violation of the community documents without regard to whether a monetary penalty is imposed by the notice may provide the assn with a witten response by sending the response by certified mail w/i 10 business days after the date of the notice. Within 10 business days after receipt of the certified mail containing the response from the member, the assn shall respond to the member with a written explanation regarding the notice tht shall provide at least the following info unless previously provided in the notice of vioation:
1) the proviison of the comm. docs that has alledgedly been violated
2) the date of the violation or the date the violation was observed
3) the first and last name of the person or persons who observed the violation
4) the process the member must follow to contest the notice"

So, you see, it is state law that the accusers must be named. The fact that the accusers are board members does not equate to a conflict of interest. Those board members still have a right to vote on whether or not a fine should be levied. I'm wondering why the attorney was called in on this and I certainly do NOT feel his fee should be passed on to the member. Is a $250 fine normal for a first warning of a violation? Frankly, this seems quite excessive to me. In my assn the PM doesn't send an overnight parking violation unless the overnight parking is ongoing -- several days in a row. In a community of only 40 homes I believe your board could lighten up a bit. I'm not saying violations shouldn't be noticed, but sending a violation for overnight parking for one night that occured 3 times in a 3-mo period is a bit excessive. Not to mention calling in an attorney and passing on his excessive fee to the member. And speaking of excessive fees -- the $250 fine also meets this definition.

As a side note, the BOD needs to find a different attorney. Charging $1,500 to sit in on a member's hearing is quite excessive. I wonder what he charges for other services!

I served as a board member in a 49-member HOA so I know what it's like serving a small community. Even if the BOD doesn't act like "little Hitlers" it's hard not to have your friends and neighbors mad at you for just doing your job.

Thanks all-

Mary- do you have the particular ARS statute with that info? I would like to print it out.

Another sub issue with this board is stacking fines. I would be interested in feed back on this too.

For example, there are two cars that park overnight- car number 1 gets fined $50, then car #2 is $100, so the total fine levied is $150 for the night. The next night, two more cars are parked (maybe the same cars)- the fine is $150 and $200- making the total weekend parking violations add up to $450. 40 days later, another vehicle is parked overnight- the next fine would be $250.

In this homeowner’s case, the actual fine was $500, but the board forgave 1/2 of the fine, for a total of $250 plus the $1500 lawyer fee. On a lighter note, the attorney that attended the meeting and racked up $1500 has a published article from 2005 where he states that stacking of these fines are wrong. Here is an excerpt from his newspaper article:

"Additionally, escalating fines may not be considered reasonable. An example of an escalating fine may be found in a fine policy that increases the amount as the violation is repeated.

For example, let us say the first violation of a restrictive covenant carried a $10 fine. Let us say further that the second violation carried a $50 fine. Finally, let us say that the third violation carried a $100 fine. In this example, a $50 or $100 fine may appear to be unreasonable because the initial fine was $10.

Moreover, HOAs run into trouble when they feel that they are entitled to receive fines for violations. HOAs must keep in mind that fines are a means to an end, meaning that fines are solely for the purpose of gaining enforcement, not for gaining additional income for the HOA.

Many HOAs mistakenly impose fines for violation of the restrictions without providing the violating owner an opportunity to be heard before the HOA's board of directors. This problem may be corrected by informing the owner, in the fine notification, that if the owner wishes to discuss the fine with the HOA's board of directors, he or she may do so."

RZ,

Sorry, I really should have posted the statute number(s), here they are:

ARS33-1242 for condos and ARS33-1803 for planned communities.

The method of charging for repeat violations that your assn is using may not be against the law, but it certainly appears to be unethical. The purpose of a fine, as stated in the article you posted, is to gain compliance and hopefully prevent repeat occurrances, NOT to add money to the HOAs coffers. My HOA has escalating fines for violations that continue and remain uncured. We start with a friendly reminder w/10 days to cure, then a $50 fine on the 2nd reminder with 10 days to cure, $100 on the 3d reminder with 10 days to cure. Then the final notice advises the member their account may be turned over for legal action which will cost them $250 and they are given an additional 7 days to cure. The 2nd, and subsequent notices are not sent after the 10 day cure period but usually a month later. Also, the first notice is only sent if a parking violation is noticed for several days running. We try to be as fair as possible and, depending upon the circumstances, will waive the fines after a hearing.

BTW, we don't like to mention names here, but does the attorney's last name start with an "E"??? And, in what part of the Valley are you located? I'm in N. Glendale.

RZ,

Depending upon how many board members are included in the emails and whether business is being conducted, i.e. votes taken, email communications certainly can be a violation of the open meeting law. The problem is that email communications are not specifically stated in the statute so some board members are of the opinion that if something isn't specifically stated then it doesn't apply.

I believe I mentioned in an earlier response that I thought your BOD is being quite excessive in their fines. I also think they should not send a violation notice for the overnight parking if the car is only there one night. The problem is that in a small community it's alot easier to spot these violations immediately. I lived in a 49-member HOA community (only 2 streets) so I know exactly what goes on. I was glad to hear the $1500 attorney fee was waived.

BTW, if you replaced attorney E with attorney AS, IMO you went from the frying pan to the fire. You can read about a high-profile court case in which the judge admonished him for his behavior. Go to: www.ccfj.net/CAIattorneychast.html The transcript of the court case is also posted there.

Incredible. He apparently was not listening because he is at it again...

Thanks Mary- you're great.

This six member board is way over the top. First an even #. The six members? Three is plenty and they should be working to make a community where they don't go out and hire a $1500 lawyer and fine a neighbor $250 for park on the street overnight. Something wrong here. Certainly 15% of the community serving on the Board is a place to look. The elections must be a trip. You all need to spend your time bringing your community together and start acting like neighbors, instead of all this lawyer stuff. What do you hope to build with that.
Have a big open board meeting for a re-organization of your community. You need to build, not tear down the fabric with $1500 lawyers and $250 fines for parking violation.

IMHO

Brian,
You seem to have had a fair and equitable way to handle these day to day violations and you laid it out pretty well. However I am willing to bet things did not lend themselves to a rational solution at times. Anything you would do different now, after the fact? Another point might be how did you handle violations that presented a need to get resolution immediately or there abouts?