HOA litigation might not be as common as other types of business litigation, but claims against a homeowners association or planned community can be expensive and prolonged. They can become a central focus for the board of directors and divisive for the community. Our firm has represented hundreds of associations and planned communities in Arizona since our founding. We put together an article on the most common issues that lead to HOA litigation in Arizona and what your association can do to avoid them.
Failure to Pay Assessments
The most common type of litigation is the collection of delinquent assessments. When an owner purchases a property within an Arizona HOA, that owner becomes contractually obligated to pay the assessments when due. The assessments are also a lien on the property. Each HOA should adopt a collections policy. If the owner does not pay, an association will usually send the case to a law firm like BLG to collect the unpaid assessments, and if necessary, file a lawsuit.
The board of directors for an HOA is tasked with enforcing the association rules. This generally includes the covenants, conditions and restrictions (CC&Rs) and bylaws. Naturally, enforcing the rules with penalties and fines for violations can lead to disputes with members. HOA litigation can arise from members that fail to accept penalties from the board and disputes about the validity of certain penalties.
Failure to Maintain Common Areas
There are many legitimate reasons that common areas in an association can create maintenance issues. From a natural disaster to unexpected breakdowns, the board of directors can be caught off guard by serious maintenance challenges and these issues can quickly become a source of heated disputes with members in the community. These maintenance issues can rise to HOA litigation if they are not resolved quickly and effectively.
Denying Member Requests
Denying member requests for their desired plans for their home and property creates the potential for legal disputes and HOA litigation. It is also a necessary part of being on the board of directors for the association. It is common for emotions to be heightened when a member feels their denied request was unjustified. It is important for board members to understand this potential when reviewing member requests and be cognizant of this potential when crafting a denial for requests that violate governing rules.
Litigation related to discrimination is also common for HOAs and condo associations in Arizona. All board members should be familiar with federal HOA laws that apply to their operations, like the and Fair Housing Act. It is important to make sure your association has appropriate accommodations for any people with disabilities and stays vigilant against any discriminatory practices in leases, sales, and application of governing rules for the community.
Disputes Over Actions by Board of Directors
It is normal for members to take issue with some decision by the HOA board. When these disputes over increased expenses or controversial decisions become contentious, they can lead to members suing the association to prevent these actions. Many of these issues can be avoided by reviewing potentially controversial decisions with an Arizona HOA attorney. They can make sure your actions are within the rights of the board of directors and follow state and federal laws. This will not prevent every lawsuit, but it helps your board know they are following the appropriate process to make difficult decisions for the association.
HOA Election Issues
Close elections for the board of directors always have the potential for disputes. Whether there are complaints about the election process or concerns from members about board members ability to do the job, these disputes can quickly escalate into time-consuming legal matters that are costly for the association. Routine review of your association election process can give all members confidence in the process and discourage potential litigation.
HOA Pet Policies and Issues
Most people think of their pets as members of their family so it should not be a surprise that disputes with members over association pet policies can escalate into HOA litigation. Many associations and planned communities assume their pet policy will be fine and they fail to make proactive efforts to get feedback from members on any potential issues or needs. We put together an article on crafting an effective HOA pet policy in Arizona and how to make sure your association accommodates any support or service animals.
Tips to Avoid HOA Litigation in Arizona
Anyone can file a complaint in court against their association or planned community, but that does not mean it will be successful. All HOAs need to have a plan in place to deal with contentious members and potential legal issues that arise. While you cannot avoid all potential litigation, your association can take many proactive steps to protect the association as much as possible in the long term. The simplest way to protect the association is routine review of your CC&Rs and bylaws with an experienced HOA law firm to make sure the governing rules are valid and enforceable. As state and federal laws get updated, the governing rules might need changes. Having experienced attorneys that specialize in representing associations also means you can leverage their expertise when potential problems arise. Many common issues that lead to HOA litigation can be resolved appropriately before a lawsuit is filed. Ignoring member issues or attempting to always squash small violations with excessive fines or penalties can cause the matter to escalate to litigation when it is not necessary.
Get an Experienced HOA Attorney
Some associations and board members might feel that HOA litigation is something they will deal with when needed. Proper planning and experienced legal representation can help your association avoid many matters rising to that level. The Brown Law Group only represents Arizona homeowners associations and planned communities. Our firm helps our clients keep their governing rules updated and enforceable. We help associations keep operations as smooth and effective as possible, while addressing most potential legal matters before they become HOA litigation. Contact our firm today at 602-952-6925 to schedule an initial consultation to review your HOA representation needs or make an appointment on our contact us page.
The Brown Law Group shares this article for informational purposes only, and it does not create an attorney-client relationship.