Why Do HOAs Have So Much Power?

Why do HOAs have so much power?

Q: What does the law say about an HOA rule that has not been enforced for years? What are the procedures the HOA board must take before they enforce the rule? Can a management company fine a homeowner $100 per day for not following rules? Or does it have to be a law firm that steps in to assess the fine? And, why do HOAs have so much power?

A: You raise an interesting question. Let’s start with the obvious: HOAs (homeowners associations) and condominium associations should enforce their rules consistently and in a uniform manner.

HOAs have power because the association grants them rights and privileges

An HOA’s power comes from the documents that created the association. It gives the HOA the ability to set rules and regulations for the building or community. The documents also give the HOA the ability to enforce those rules. Or, not enforce them.

When an association elects not to enforce a rule over many years and then decides to start enforcing it, it can be jarring to residents. We’d expect the board to give everyone in the association fair notice that enforcement is beginning.

There are a wide variety of rules homeowner and condo associations enact. Some rules relate to the payment of assessments, noise issues and other matters that are within the control of the unit owners. For these types of rules, the association should provide notice, detailed explanations, and even provide owners grace periods, to make sure everyone understands and can abide by the rule.

Some HOA Rules are Complicated and Unenforceable

Other rules are more complicated. And, enforcing them suddenly can be challenging. We can envision a situation where a board has long standing rules regarding pets. The rules may limit the number or size of specific types of pets. Or, they may prohibit them. But over the years, the board never enforced the rule. Owners moved in with their pets or bought new pets. In this situation, it would be unfair to require homeowners with pets to get rid of them just because the board decided to begin enforcing a “no pet” rule.

Powerful HOAs Must Make Rules Fair for Everyone

So, how do you make rule enforcement fair for everyone? The board may decide that existing pets can stay but not allow any new pets in the building, whether for existing or new residents.The board can exempt existing owners, deny new owners the right to break the rule, and over time make sure everyone follows all rules.

We can see a similar arrangement with other rules that may not have been enforced. However, say the board never enforced a late payment fee on assessments and now wants to start charging a late fee. The board should notify all of the unit owners that the board will start collecting a late fee with the next assessment that comes due.

As that first date passes, the association might give warnings to unit owners that pay late and then start charging late fees going forward. Again, the circumstances depend on the facts and how long it has been since the last enforcement and how it affects the association as a whole.

For example, we think it’s unfair and wrong to start fining homeowners for the prior installation of roof tiles that don’t meet the rules of the association if the association has allowed other homeowners to install non-conforming roof tiles over the years.

HOA Rules Can Be Enforced After Notice Has Been Given

Having said all that, once the association has given notice of the rules and has circulated a fine schedule for violations, the association usually has the right to enforce those rules and fine homeowners that violate the rules. Sometimes associations have a mechanism to appeal fines or allow a homeowner to contest the fine, but that’s not always the case. Homeowner associations are not governmental entities bound by the same rules that give citizens the right to contest and claim that their rights have been violated.

You need to remember that a homeowners association board is made up of owners of the complex. These people are your neighbors, for better or for worse. If the managers are not doing a good job, it is up to the unit owners to vote in better managers. Frequently, the board of directors or managers hire third party outside companies to manage the association.

Outside management companies support HOA power

Outside management companies have their own way of doing business. Often, they enforce rules. They back up the power of the HOA. They’ll usually recommend the attorneys that the association should use on the association’s behalf. In so doing, these outside management companies also bring in their own recommendations for rules, fees and fines. More often than not, the board of directors or managers will accept these recommendations.

It is here that your question becomes critical. A change in property managers could bring a change in rule enforcement, and in the structure of fines. If an owner isn’t paying attention, those fines can accumulate quickly.

HOAs are powerful and can cause problems for owners

An outside law firm can’t fine you. But, the outside law firm can bill the association fees for their services. And, because the rules and regulations may place the costs of rule and regulation enforcement on the violating unit owner, that unit owner might be stuck having to pay the fees billed by the law firm.

The fines will be billed or structured by the association board. The legal fees will be set by the law firm. Ultimately, violators of the rules will end up having to pay both the fines and the attorney’s fees.

If this is what you’re facing, talk to the HOA board members and plead your case. Read the rules and regulations and compare them to the process that was followed (and note what wasn’t followed). Talk to your neighbors and work with them and the members of the board to find a solution if the manager of the building is trying to enforce a rule that has not been enforced for many years.

You can also consult with an attorney that has experience in community associations and get some advice on any specifics to your situation. Good luck.