Summary

Even where homeowners characterize their claims against an Association as civil rights violations, the claims involved in the parties’ rights under the declaration, and the declaration’s attorney’s fees provisions applied.

Facts

In 2011, David Merritt, a former HOA board member, and his wife, Salma, sued their Sunnyvale HOA, Classics at Fair Oaks (Classics), as well as three of its board members. The dispute centered on the Association’s covenants, conditions, and restrictions (“CC&Rs”) involving parking restrictions at the Classics. The HOA’s parking policy requires residents to pay for and obtain a permit for each vehicle parked on the street versus in the garage of each residence. The Merritts had a two-car garage, but only parked one car inside it. They argued that they can only park one car in the garage, because Salma is disabled, and needs additional space to enter and exit the vehicle when it is parked inside the garage.
Continue Reading

Summary

If your Association excessively fines an owner, expect a court to find a way to penalize the association.

The Facts

In 2004 Mr. and Mrs. Mills (“Mills”) bought a home in the subdivision called Galyn Manor.  In 2007 Galyn Manor began fining Mills for a commercial work vehicle parked in their driveway in violation of the association rules.  Galyn Manor advised Mills that the fines would be $50 for each day that the commercial vehicle was parked on their property.  By the end of 2007, the fines amounted to $645.  In January of 2008, the association hired the Andrews Law Firm (“Law Firm”) to collect the fines.  Between 2008 and May of 2015 many demands for payment were made, and many payments were made.
Continue Reading

Summary

A single warranty date applies to each condominium building in a development.  Meaning that each unit does not have its own warranty date, and units in different buildings will likely have different warranty dates, unless they happen to be completed on the same date

The Facts

Village Lofts Condominium Association consisted of two buildings: A and B.  Building A was substantially completed in 2003 and Building B was substantially completed in November of 2004.  In 2014 the Association discovered various water leaks in Building A.  In June of 2015 they had also found similar leaks in Building B.  The Association repaired the leaks throughout both buildings.  In August 2015 the Association sued the developers and contractors for breach of warranty, breach of contract and negligence.  The defendants brought motions for summary judgment arguing that that the Association couldn’t bring a suit after 10 years based on the statute of repose (similar to a statute of limitations).
Continue Reading

Summary

Not following ALL of the required procedures when preparing amendments to your association governing documents can be VERY expensive.  Take the time, money and effort to do it right.

The Facts

In 2015 the board for Forest Lakes Master Association distributed notice that it would be holding a vote to amend its voting procedure at its annual meeting.  The board and property manager alleged that they had received the required votes for the amendment.  Because of some interesting counting techniques, the number of votes in favor of the amendment kept rising.  One owner, Johnson, emailed the board and stated that he believed the board failed to follow proper voting procedures and that the amendment did not pass.  After counting the votes, Johnson confirmed his belief that the board had violated the voting procedures in their documents.  Johnson demanded that the Board find the voting procedure void.  When the board refused Johnson filed suit.  Both parties moved for summary judgment and the association also asked for attorney fees.
Continue Reading

Summary

If smoking is otherwise allowed in your association, you do not need to ban it as a reasonable accommodation for a person with asthma.

The Facts

Phyllis Davis suffers from asthma but lives in a condominium complex that allows residents to smoke in their units.  Davis claimed that the smoke from a neighboring unit aggravated her asthma.  Davis is a cancer survivor with “a history of asthma and multiple chemical sensitivity disorder.”  When the association didn’t ban smoking in her building she sued alleging that the association had discriminated against her by not granting her reasonable accommodation request to ban smoking in her building thereby violating the Fair Housing Act because of her disability.  Davis also alleged a nuisance claim under the bylaws.
Continue Reading

Declarant/Developers of Community Associations love to reserve themselves rights within the Declaration that extend far beyond their Declarant control powers.  This is nothing new.  But when a Homeowners Association puts it foot down, who will end up on top?  It depends on how all the sections in the Declaration read together, and as this case shows, ambiguity does not favor the Declarant.

Facts

In a 2019 case, a court had to interpret the Declaration governing an HOA (subdivision) and determine who was right.  The Developer, after turning over control to the homeowners, sold the final lot to a buyer with a planned home that did not fit the specifications of the Declaration.
Continue Reading

Summary

Each owner of a lot in a planned community with multiple subdivisions was required to be a member of the master association – Holly Lake Ranch Association (HLRA).  Some of the owners voted to amend their particular subdivision’s respective deed restrictions.  The effect of which was to add a voting requirement for assessments, mandatory waiver of duplicate fees for additional lots, and restricted HLRA’s lien rights.  In this particular Texas case, Roddy v. Holly Lake Ranch Association, Inc., __ S.E.2d __ (2019), the court found that the amendments were “illegal” and therefore void.  In addition, the court remanded the case to the trial court to determine the reasonableness and necessity of the attorney fees it awarded to HILRA.
Continue Reading

Summary

Declarant owned nine of 10 units, controlled the board and association, failed to have an association bank account, intermingled the assessments that were paid into his business account, never held elections or annual meetings and kept no separate corporate records.  Yet, the Court held that these failures could not be used as an excuse for not paying assessments that were due under the condominium documents.  In other words, you bought into an association, pay your assessments.
Continue Reading

Summary

An entity that ultimately bought the prior interests of the declarant learned the hard and expensive way that not perfectly following the documents can be very costly.

The Facts

Property owners brought action against declarant and their associations seeking a declaratory judgment that declarant was not a proper successor declarant and requiring the alleged declarant to pay assessments they otherwise would have been exempt from paying.  The property owners claimed that the defendant had not validly obtained declarant rights and therefore had wrongfully claimed the unilateral right to appoint the directors of the homeowners’ associations.  The property owners also claimed that they did not owe the assessments because: the right to levy assessments was vested in the associations’ boards of directors; the boards were never duly elected or were otherwise illegally constituted; and in the absence of properly constituted boards, the associations lacked authority to impose the assessments and record the liens at issue.  At the heart of the issue was a foreclosure on a couple of loans against the original declarant followed by a number of subsequent transfers of the declarant rights and the property.  Both parties moved for summary judgment.
Continue Reading

Summary

When faced with the question of how much is too much for a “reasonable fee” the US Court of Appeals for the 7th Circuit held that it could not answer the question because the right parties were not before the court.

The Facts

Keith Horist owned a condominium in downtown Chicago building’s condominium association. Joshua and Lori Eyman also owned a condominium in Chicago, but at a difference association. Both associations hired Sudler Property Management to manage their day-to-day operations.

In 2017 Horist and the Eymans put their units up for sale and found buyers.
Continue Reading