Holding: The Supreme Court of Vermont held that a homeowners association, as assignee from the developer, could charge lot owners for its reasonable costs to maintain the subdivision private roads and water system, including litigation and other overhead costs.
The Facts: A 92 lot subdivision in Vermont was developed in the 1960s. The subdivision contained private roads and a private water system that was to be maintained by the developer. Owners/Purchasers of the lots were granted the right to use the private roads and water system, and a service fee for said use was imposed.
In 1998, maintenance of the private roads, streetlights, water system, and recreational facilities was turned over from the developer to a homeowners association (the “Association”). The Association continued to charge the homeowners a service fee to maintain these parts of the subdivision per the relevant subdivision deed, which included litigation and overhead costs.
In 2009, a Homeowner Plaintiff alleged that the service fee was unreasonable and refused to continue paying.