- use ordinary care and prudence in managing the property and financial affairs of the community that are subject to its control;
- treat members fairly;
- act reasonably in the exercise of its discretionary powers, including rulemaking, enforcement, and design-control powers; and
- provide members reasonable access to information about the association, the common property, and the financial affairs of the association.
Friday, August 23, 2013
What Duties Does Your HOA Owe You?
To many homeowners, it may seem as though your homeowners’ association (HOA) governs your community essentially without any rules. While it is true many HOA’s have a lot of discretionary authority, their authority is not without checks and balances. The HOA’s powers are limited in four primary ways: the Arizona statutes; the governing documents (i.e. the bylaws and the Covenants, Conditions and Restrictions (“CC&Rs”); Arizona common law; and your ability to vote those in control out of office.
The Arizona statutory sections governing HOAs are primarily found in A.R.S. §§ 33-1801 -1814. Those provisions regulate such subjects as what a homeowner can be fined for late payments; requirements for responding to challenges for alleged violations of the community documents; the need for certain HOA meetings to be open to the community and requirements for providing notice of when those meetings will take place; the availability of the associations financial records for inspection; and when an association lien on your property can be foreclosed upon. The statutes also address subjects as a homeowners’ right to display flags and political signs, as well as when parking on the street cannot be restricted by the HOA. Finally, the statutes address such subjects as voting rights and when a board member can be removed. If you have a disagreement with the HOA, your first step should be to familiarize yourself with these statutory provisions.
While the statutes often trump the bylaws and CC&Rs, there are many subjects and details that the statutes do not address. Thus, in determining the scope of the HOA’s authority, as well as the obligations of you as a homeowner, it is important to also review those documents. The bylaws and CC&Rs should have been provided to you upon your purchase of your home, and are often posted on HOA websites.
The Arizona Courts have indicated that, in addition to the duties imposed by statute and the governing documents, the association has the following duties to the members of the common-interest community:
However, if you, as a homeowner, contend an action of the association has violated one of the foregoing duties, the burden of proving such a breach of duty falls on you. It will also be your burden to prove that the HOA’s actions have caused, or threatened to cause, you or the interest of the community some harm.
Finally, as with any governing body, if you do not like the way the HOA is operating, you have the power to cast your vote at the next election to put someone else on the board.
*Garrett Olexa is a Member with the law firm of Jennings, Strouss & Salmon, PLC and works in its real estate and commercial litigation practice group. He can be contacted at firstname.lastname@example.org or 623.878.2222.http://www.jsslaw.com/professional_bios/Garrett_J_Olexa