Monday, May 19, 2014

Covenant Violations and the Fining Process - What Your Rights Are as a Homeowner

This is the time of year where our firm gets a lot of calls about covenant violations, mostly lawns that took a beating during the winter months.  The Florida climate, which goes from almost freezing to tropical in a 24-hour period, tends to be harsh on lawns, but I digress.  That's a blog about Florida-Friendly Landscaping.

There are several things the homeowner should know about the fining process because if you know what the law provides, it is less likely you will be taken advantage of by your HOA.  Remember -- knowledge is power.

A board of directors cannot impose a fine against a homeowner.  The HOA is required to have a committee of at least three (3) members, who are independent and are no relation to the board of directors, the property manager, officers, agents or employees of the HOA.  The committee should be comprised of an odd number to avoid a tie vote.  The odd number of members is industry standard and not part of the statute.  The committee has to agree by a majority vote to impose a fine, which cannot be retroactive, and the board of directors cannot override the vote to impose a fine, but can override the vote to withhold a fine being imposed.

The HOA is required to give the homeowner notice of a hearing to be held to vote on the fines.  The HOA is required to give the owner at least 14 days notice. Now here's where many HOAs get it wrong.  The statute, Fla. Stat. 720.305(2)(b) states "A fine or suspension may not be imposed without at least 14 days’ notice to the person sought to be fined or suspended...."  The statute does not say mailed at least 14 days in advance, IT REQUIRES THE NOTICE TO BE GIVEN TO THE OWNER AT LEAST 14 DAYS IN ADVANCE.

The statute also provides this is a hearing, not a meeting.  The HOA should not be noticing the hearing to the membership to attend as a lynch mob.  Hearings do not require notice.  The only people that should be present are the homeowners, the committee and if the HOA is going to present the case to the committee, a representative of the HOA.  This is usually the property manager or a board member.  The representative of the HOA should not be sitting in on deliberations and voting by the committee.  This would prevent the committee from making an independent decision.

If you find yourself in front of the committee, bring a recorder.  You have the right to do so, although the committee will probably say you don't.  Even board meetings are cut short and adjourned because board members tend to think you have no statutory right to record meetings.

You are entitled to obtain a copy of the minutes from the hearing.  The committee should create minutes and record the vote, listing the vote of each committee member.

If a fine is imposed, you should pay it and then challenge the decision.   Never risk your home.  If you pay the fine, the risk to your home is removed and you can challenge the decision without worrying about losing your home to a foreclosure.  Unpaid fines in excess of $1,000 can be the source of a lien and foreclosure.

Now, off topic, if you have one of those troublesome lawns that doesn't thrive no matter what you try to do to save it (you know, those St. Augustine lawns), then look into Florida-Friendly Landscaping (FFL).  You still have to submit an application to the ARC or ACC or whatever your HOA calls it, but by law the HOA cannot prohibit you from implementing FFL.  Check out the website by the University of Florida's IFAS extension at

As far as other violations go, please do not make improvements to your home without filing the ARC/ACC application and please do not store boats, trailers, RVs, 4-wheelers, jet skis and other recreational items on your property.  These are the biggest sources of fines in HOAs.

Tuesday, May 6, 2014

Buyer Beware - You Are About To Be A HOA Victim

NOTICE:  New out-of-state home buyers -- welcome to Florida and please turn over your new home to the HOA.

This has been going on for a while, but the number of owners contacting me because they have been victimized is increasing at a steady pace

Here's the scenario:

-  You sign a purchase agreement to buy a home in a HOA
-  Your closing documents have charges to pre-pay the HOA; sometimes for a couple of months,
    sometimes til the end of the year
-  You expect to get a coupon book to pay your assessments; sometimes you do, sometimes you don't
-  You receive an intent to lien notice for past due assessments despite not getting a coupon book or even
    paying your assessments
- You call the property management firm who tells you a) the bookkeeping hasn't posted all the payments
   b) it's not a mistake on their part and just send the money and they will fix it or c) they didn't receive your
   payment but send it in and they will take care of it
-  The property management firm doesn't tell you that you have incurred interest and late fees and maybe
   even attorneys' fees and any payment goes to the fees first and assessments last so you will continue to
   be past due
- The issue then snowballs into a dispute that involves the HOA attorney, who liens your house and then
   sends a notice to foreclose
-  Every phone call, email or letter to the HOA attorney generates more legal fees

What's really going on:

-  Unscrupulous property managers and attorneys work together to generate billable hours for both
-  You may have pre-paid assessments but the management company did not properly credit them
-  You were given an incorrect amount
-  Your payment was "lost" because there is no way to prove you did send it and a payment dispute
    means more money for the HOA manager and attorney
-  You are told they will fix the problem while they are really preparing a lawsuit to foreclose

The problem:

There is no defense to non-payment of assessments unless you can prove you did actually pay them and the HOA made a mistake, which is rare to have the proof necessary for this defense.

How to avoid the problem:

Ask you real estate agent or title company the name and address to send payments.  The title company should get this from the estoppel request they are required to send to the HOA.  Pay your assessments in advance at least until the first of the new year so you can be certain you get a coupon book.  Use a bill pay service so you have proof of processing and delivery of the payment.

Of course the best solution is to not buy a home with a HOA.