Articles

When trying to collect assessment arrears owed by delinquent members, don’t file a lien against the member yourself. Instead, refer the matter to your association’s attorney. Managers should avoid filing liens because of the increase in potential liability under the federal Fair Debt Collections Practices Act (FDCPA) when the number of letters or phone calls to a member is increased.

It may seem like tax season—and the paperwork that accompanies it—has just passed, but remember that as you manage your community year-round, you need to be aware of tax issues that could arise in the future. A common issue to keep your eye on is the use of outside, third-party workers to perform jobs, such as cleaning, in your community. If you don’t handle paying these workers properly throughout the year, you could get into tax trouble with the IRS or state and local tax agencies later.

Q: As the manager of a condominium building, I recently discovered that one of the members who lives in the building has been operating a day care for profit in her unit. There have been a few complaints from other members about noise and an increased number of visitors to the building—mostly from pick-ups and drop-offs of children. I checked our governing documents and home businesses are banned.

If you’re threatened with a lawsuit by a member who claims that her consumer protection rights under the federal Fair Debt Collections Practices Act (FDCPA) have been violated by you or your staff, your association's master policy carrier may consider settling the case rather than face the enormous burdens of time and costs required to defend a lawsuit—even if it’s frivolous.

Facts: A disabled homeowner sued her community association over the right to bring her service animal, a Chihuahua, into the community’s clubhouse. On three occasions, the homeowner was asked when she entered the clubhouse to produce documentation that she is disabled and that the dog is a service animal. She was also asked why the dog was necessary for her to be able to use the clubhouse. When the manager wasn’t satisfied with her responses, she ordered the homeowner to leave.

Facts: Two homeowners who owned a single lot purchased the lot next to theirs for the purpose of expanding their home. After they had purchased the second lot, they asked their community association to approve their plans to expand their home by converting their existing garage into livable space and building a new garage onto the house. To do this, they would annex a portion of the second lot into their lot, construct the new garage over the original property line and onto the annexed portion, and then sell the remainder of the second lot as a separate home site.

An alleged homeowner’s association election-rigging plot has been uncovered in Nevada, leaving those living in community associations across the Las Vegas Valley feeling vulnerable after being tricked into hiring a certain construction company.

The scheme involved a former construction company boss using his associates to stuff ballots, steal ballots, and steam open ballots to win HOA elections so that the construction company could obtain lucrative construction contracts from “friendly” board members.

Inevitably, for one reason or another, a community association board member gives up his position. When this happens, the association has the sometimes difficult task of replacing the outgoing member. But the challenging part of replacing a member comes after the new member is found and elected to the board. That's because, depending upon the new member's experience with your association, or associations generally, there may be a lot of information for him to quickly get up to speed on—especially if big decisions are in the process of being made.

From time to time, members of the association you manage may have financial trouble and get behind on their assessments or other amounts that are owed, such as costs for things like a storage area or parking. And that can be compounded when fees, fines, and interest are added due to delinquency. Sometimes, late payments aren’t because of financial hardship—a member may be upset about something in the community and feel that he’s “taking a stand” by not paying what he owes.

Q: My association publishes a community newsletter and hosts a community website. I’m worried that at some point there will be a situation in which a disgruntled member or someone outside the community falsely accuses the board of defamation for something that may be published in the newsletter or on the website. What are the defenses against defamation lawsuits?