Written By: Joseph J. Nardulli
Buying a condo, townhouse or single family home can present many challenges and rewards, but buying real estate in a development governed by a homeowners association (HOA) can be a serious trap for the unwary. Not only is the property subject to the laws, codes and ordinances affecting all other residential properties in the same geographical area; it is also governed by the covenants, conditions and restrictions of the development, and the bylaws, and rules and regulations of the association.
In California, in connection with sale of property governed by a homeowners association, the seller of the property is required to provide the buyer with, among other things, copies of the covenants, conditions and restrictions (“CC&Rs”), bylaws and any other rules and regulations of the association. These documents are referred to as “governing documents” of the association. They are, for the most part, the rules of the road for the association and the homeowners, and the terms of these documents can seriously affect your use and enjoyment of the property. It is also important to know that, in general, California courts will enforce them if they are fair and reasonable as to the homeowners in the association as a whole, regardless of whether they create a hardship or are unfair to a particular owner based on his or her individual circumstances.
Frequently, when disputes arise between property owners and their homeowners association, the answer regarding the disputes can be found in the governing documents, and if the dispute ripens into a lawsuit, the courts will usually look first to these documents to determine if they cover the subject matter of the dispute. If they do apply, and the court decides that the homeowner has violated them, the homeowner may be left with not only having to pay for any damages awarded to the association or comply with the terms of an injunction concerning the use of the property, but also having to pay the association’s court costs and attorneys’ fees.
However, if a lawsuit is brought to enforce a governing document (regardless of whether it is brought by the association or the homeowner), and the Court determines that the association has acted in excess of its power, the action taken by the association may be unenforceable, and courts have granted injunctive relief against associations where it is shown that the association exceeded the scope of its authority. In particular, California courts have held that when an association exceeds its scope of authority, decisions or rules of the association resulting from its unauthorized actions are invalid and not enforceable against the homeowner. Furthermore, if a lawsuit is filed to enforce one or more of the associations’ governing documents, and the Court finds that the decision of the association or rule is invalid or unenforceable, by statute, the association may be required to pay the homeowner’s attorneys’ fees and court costs.
So carefully read the CC&Rs, bylaws and rules and regulations of the homeowners association, and be sure you can follow them and still live happily in the development. These “private laws” will affect you if you choose to live in a development governed by a homeowners association.
Furthermore, if you do own property in such a development, and you believe that the association is taking inappropriate action, one of the best ways to protect your rights is to review these documents thoroughly. By informally pointing out to the association why its action is unauthorized, you may be able to stop the association in its tracks without filing a lawsuit. Thereafter, if the association refuses to follow its own governing documents and evidence is presented to the Court of the association’s violations, the Court will likely require the association to cease or correct its unauthorized actions.
When dealing with homeowners associations, knowing the terms of the association’s governing documents is truly power.