People often think of HOAs as mundane organizations whose biggest concern is making sure everyone mows their lawns. However, HOAs are responsible for maintaining peace and order within a community, and HOA rules carry legal weight. In case of disputes or other legal issues, the HOA should contact a lawyer.
HOAs need an attorney before the HOA is even legally established. A lawyer can help a new community draft founding documents, file articles of incorporation with the state, and draft appropriate covenants, conditions, and restrictions (CC&Rs). If a community member violates the rules or challenges the HOA’s authority, a lawyer may represent the HOA and work to resolve the issue.
Contact our HOA lawyers for boards and communities for a confidential legal evaluation by calling Halk, Oetinger, and Brown at (602) 759-9205.
How Can a Lawyer Help Establish a New HOA Board in a Community?
Establishing a new HOA can be a difficult process, and community members should get a lawyer to help them navigate the legal procedures needed to create the HOA.
Drafting Founding Documents
A lawyer should help the proposed HOA draft appropriate covenants, conditions, and restrictions. These CC&Rs must be reasonable and proportionate to the needs and goals of the community. They must also comply with relevant state and federal law.
The HOA also requires bylaws to govern how the association operates and the duties of board members. Again, bylaws must comply with state and federal law to be legally binding and enforceable.
Founding documents should also include fine and fee schedules. Before an HOA may enforce fines or impose fees, fine and fee schedules must be made publicly available. The schedules should also be reasonable and not overly costly.
Filing Articles of Incorporation
To make an HOA a legal entity, our HOA lawyers for boards and communities must file articles of incorporation with the Arizona Corporation Commission. Without articles of incorporation, the HOA does not legally exist, and community members are not obligated to follow rules established by the HOA.
Filing CC&Rs with the County Recorder
By filing the CC&Rs with the county recorder, the community and the land it is attached to are bound to the HOA. This means all homes currently within the community and those that may be built in the community later are all under the HOA.
What Happens if an HOA Has a Legal Dispute with a Homeowner?
Legal disputes are common in HOAs, and the board should always have a lawyer to call when disputes arise.
Imposing Fines and Penalties
When a homeowner violates the HOA’s CC&Rs, the association cannot immediately demand payment. First, the HOA must send a notice of the violation to the homeowner, including details about the violation and evidence, such as photos.
Before paying a fine, homeowners have the right to challenge the allegations against them in a hearing before the HOA board. If the homeowner demands a hearing, the board must arrange one.
Remember, fine schedules must be made publicly available in advance. If the fine schedule is unavailable to homeowners, they cannot be fined. If fine schedules are updated, the community must be immediately informed.
Alternative Dispute Resolution
Many HOA CC&Rs and bylaws require that homeowners who want to challenge an HOA’s authority must first go through mediation or arbitration. These alternative dispute resolution methods can help the parties resolve the issue while avoiding more costly, formal legal actions, like lawsuits.
If you are interested in including arbitration or mediation clauses in your association’s CC&Rs, the HOA’s lawyer can help.
More Formal Legal Action
If alternative dispute resolution methods are ineffective, an attorney can help your HOA with more formal legal action.
If the homeowner owes significant HOA fees or assessments, the board may move to place a lien on the homeowner’s property, giving the HOA a legal claim to the property if the debt remains unpaid. Eventually, the HOA may initiate foreclosure of the property to collect payment.
It may also be possible to file a lawsuit against the homeowner for unpaid fines or damage caused to community amenities.
Making Sure CC&Rs and Bylaws are Up to Date and Enforceable
You cannot include just anything in your HOA’s CC&Rs. These rules must be legally valid to be enforceable, and you should review any proposed rules or modifications with a lawyer.
Checking for Compliance
HOA rules must comply with state and federal laws. If any rules are in violation, they may be unenforceable.
It is important to note that many CC&Rs and bylaws were compliant with state and federal law when they were first established, but over time the laws may have changed. HOA rules must be updated over time to remain enforceable.
Modifying the Rules
If rules must change, a lawyer should assist. Changing HOA rules requires following proper legal procedures.
Many changes require a vote, and the HOA bylaws should explain the voting percentage required to pass new rules. Community members need to be notified before a vote is held. If the change is significant, it may need to be filed with the county recorder.
Are HOA Boards Required to Have a Lawyer?
No, but it would be unwise to handle all the HOA’s needs without a lawyer’s help. Board members can draft foundational documents, revise CC&Rs, and address legal disputes, but doing so can be incredibly difficult without legal guidance.
Do HOA’s Need a Lawyer for Everything They Do?
Remember, an HOA is a legal entity, and its rules carry legal weight. While a lawyer may not be necessary for day-to-day operations, a lawyer should at least review the rules to make sure they are enforceable and handle legal disputes as they arise.
Can a Lawyer Help an HOA Collect Fines and Fees?
Yes. While collecting fines and fees is a routine function of the HOA, it can be legally tricky if homeowners refuse to pay. Collecting payment may involve legal action, and you should review the situation with a lawyer before taking any action.
Speak to Our Glendale, AZ HOA Attorneys for Boards and Communities
Contact our HOA lawyers for boards and communities for a confidential legal evaluation by calling Halk, Oetinger, and Brown at (602) 759-9205.
