Legal Rights with Home Owner’s Associations.

A homeowners association (an “HOA”) can be your best friend or your worst
enemy, and it is good to work to make sure that they are your best friend.
Knowing your laws surrounding a HOA is one of the first steps.

Cole Cannon, of the Cannon Law Group, weighs in to ensure you are both
protected and treated fairly by your homeowner’s association.

1. Make sure you are the right fit. BEFORE purchasing or
renting a home or condo, review the Covenants, Conditions, and
Restrictions (CC&R) that are placed on the property. Even if the property
does not have an HOA in place, there still may be CC&R’s that exist.

a. The CC&R’s set the rules for the neighborhood, and for your property.
CC&R’s can restrict pets, vehicles, home styles, and other activities that you
may be accustomed to.

b. It is especially important to consult the CC&R’s before building a
home as they often contain many rules about the design of the home. You
will want to take a copy of the CC&R’s to your architect to make sure that
your home design complies with the rules.

c. You can ask your realtor for a copy of the CC&R’s, and you can also
find a copy filed with the county recorder’s office.

2. Following the Rules. CC&R’s establish rules for all in the
neighborhood to follow. They provide predictability and help to maintain
property values. If you live with CC&R’s in place and you decide to not
follow those rules, you will likely find that you are the subject of some type
of enforcement proceeding. Likewise, if you have a neighbor who does not
follow the rules, the CC&R’s provide ways for you to enforce the rules that
are in place.

a. The most likely method is to file a complaint with the HOA.

b. The HOA will then decide what the appropriate course of action is,
and such action may include initiating a lawsuit against the offending party.

c. Check the bylaws of the HOA to determine the actual method to
enforce the rules.

d. If you live with CC&R’s in place but do not have an HOA to enforce the
rules, you likely will have to employ an attorney and write a demand letter
or file a lawsuit to enforce the rules.

3. Proper Enforcement of the Rules. While an HOA is entitled to
enforce the rules set forth in the CC&R’s, there are restrictions on how the
HOA can enforce the rules.

a. The law prohibits an HOA from taking any enforcement action that is
considered to be “arbitrary, capricious, or against public policy.” This
usually means that the HOA cannot choose to enforce a rule against you
but not against a neighbor.

b. The HOA must enforce the rules (or choose to not enforce the rules)
on a uniform basis.

c. Once an HOA has not enforced a specific rule for a number of years, it
is possible that the HOA could lose the ability to enforce that rule if it
chose to try and enforce the rule at a later date.

d. Besides these few restrictions, however, the HOA is entitled to enforce
the rules, and the HOA can enforce the rules against you whether you agree
with the HOA or not.

4. Fees. An HOA can only operate if it collects fees from the
residents. If you don’t pay your fee, the HOA can take action against you to
collect on those past due fees.

a. The HOA can sue to collect amounts owing, require tenants to pay the
monthly rent to the HOA if the owner isn’t paying the dues, or foreclose on
the property.

b. The HOA can also assess fines for noncompliance. These fines cannot
exceed $500 per occurrence, or $500 per month for continuing violations.

5. An HOA is a democracy. Despite the above, an HOA is set
up as a democracy to make it so that the rules and actions of the HOA
reflect the will of the majority of the members of the community.

a. HOA’s have scheduled meetings, and each member of the community
is supposed to receive notice of these meetings. Depending on the HOA’s
bylaws, notice can be provided by written or electronic means, and may be
as simple as a posting on the HOA’s website.

b. Only owners of the property receive notice and only owners are
entitled to vote. Renters do not get to vote or have a say in the community,
so if you’re a renter and have a concern, you will have to take it to your
landlord to have the concern voiced at an HOA meeting.

c. While a board makes most decisions for the HOA, members can elect
the board and can vote to overturn a decision by the board. The specifics of
these processes will be found in the bylaws for each HOA.

d. The HOA can amend the CC&R’s if changes are desired. The members
of the community can vote to ratify amendments, and the percentage
required usually ranges from 51-67%. The law does not allow an HOA to
require more than 67% approval on amendments.

Cole Cannon, Esq. is a principal attorney at the Cannon Law Group, PLLC
, 801.363.2999 specializing in business
transactions in both Utah and California.

DISCLAIMER: The above represent only some of the legal implications of
associations and is not intended to create any form of professional
relationship between the Cannon Law Group, PLLC and the reader. For
more information please contact a licensed attorney.

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