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HOA Horror Stories: The Shocking Truth Behind HOA Lawsuits

HOA lawsuits

Homeowners associations can provide a great opportunity to collaborate with neighbors to ensure your neighborhood or building is well-maintained. However, if the wrong people are serving in leadership positions, an HOA can cause a living nightmare.

Truth can be stranger than fiction when it comes to HOA lawsuits. From outrageous fines and fees to bizarre rules, it’s almost too unbelievable to be true.

Read on to learn more about the horror stories that can lurk within the shadows of homeowners associations across the country and how you can get help.

Getting to Know Homeowner Associations: What They Are and What They Do

Living in a residential community is like being part of a family.

Like every family, some rules and guidelines must be followed for the household to run smoothly. Homeowners associations (HOAs) provide this structure, ensuring that all members adhere to certain standards.

An HOA is a non-profit organization established by the real estate developer or owners of homes in a community, with rules that are required for ownership of a property. The board of directors of the organization enforces these covenants through assessments or fines, depending on the severity of the violation. They also have the right to demand assessments from all of the property owners in the association.

HOAs also:

  • Manage budgets
  • Collect dues and assessments from homeowners
  • Maintain common areas such as parks and swimming pools
  • Address any disputes between neighbors regarding maintenance issues.

While HOAs can help keep neighborhoods looking neat and orderly, they have been known to cause headaches for residents who stray outside their boundaries.

Common Causes of HOA Disputes 

HOA disputes and litigation can be costly and time-consuming for all parties involved. Disputes can result in years of legal battles, costing both sides hundreds of thousands of dollars. This is just one example of how serious these disagreements can become.

Generally speaking, common causes of HOA disputes include:

  • Unlawful rules or regulations set forth by the HOA
  • Mismanaging funds
  • Failure to pay dues or assessments on time
  • Disagreements related to policies, such as noise complaints, pet policies, parking restrictions, etc.
  • Conflicting interpretations of governing documents
  • Disputes over maintenance issues such as landscaping, property damage repairs, etc.

These conflicts often arise due to misunderstandings between homeowners and HOAs regarding their rights and obligations under established laws and contracts.

While it may not always be possible to avoid disagreements entirely, understanding each party’s responsibilities upfront can help reduce the chances of conflict down the line.

A Nightmare on HOA Street: 3 Tales of Horror

#1 Inflated Repair Bills

Miami condo owners are facing a nightmarish situation as they are being told to cough up a whopping $175,000 each for their 40-year recertification, adding up to a staggering $46 million for repairs according to the property manager’s engineer.

But the shocking twist came when residents hired their own engineer, who gave an estimate of only $23 million, leading them to suspect the property manager was inflating the numbers and wanted to hire their own sister company for repairs.

Homeowners are afraid they may lose their homes due to these exorbitant fees and have retained our attorneys at J. Muir & Associates to handle their case.

#2 Major HOA Fraud

This is a shocking news story from South Florida where five former and current board members of the Hammocks Homeowners Association (HOA) have been arrested for stealing over $2 million of residents’ money.

This came to light after residents raised concerns about the association’s reserve funds being depleted during the tenure of former board president Marglli Gallego in 2017. It’s a disturbing reminder of how easily people’s hard-earned money can be stolen in seemingly safe communities.

#3 Threats of Foreclosure

This HOA horror story begins with a Central Florida couple being threatened with foreclosure for a debt they didn’t owe.

Cindy Decker, who at the time had lived in her home for 26 years, had not paid her association’s annual dues on time. She delivered a check for $892 to Lake Harney Woods Property Owners Association to cover everything she owed, including late fees.

One month after Decker paid, the association filed a lien against her home to collect a debt that had already been paid, leading to the threat of foreclosure and a two-year battle. Despite having a receipt for full payment, the association insisted Decker owed $1,300.

Decker ultimately hired an attorney and settled with the association for $33,000.

How an HOA Can Avoid Lawsuits

Like a ticking time bomb, lawsuits are often the result of an HOA not taking proactive steps to avoid them.

An ounce of prevention is worth a pound of cure when it comes to HOAs and litigation – but how can they do this?

Here’s a list of how to avoid potential legal disputes:

  • Have clear rules and regulations that all members must follow
  • Monitor compliance with these rules regularly
  • Ensure proper communication between all stakeholders in the association

It’s also important for HOAs to create policies that allow for the quick resolution of minor issues before they become major problems. In addition, associations should look into setting up alternative dispute resolution procedures, such as mediation or arbitration, if disagreements arise among owners.

Many common HOA disputes can be avoided by implementing preventative measures like these.

When to Seek Professional Assistance With HOA Disputes

Still, professional assistance may be needed even after taking all the right precautions to avoid disputes.

This is especially true when the dispute involves legal action or has been going on for an extended period. It’s important to understand the consequences and responsibilities of pursuing litigation against an HOA before taking the next steps.

Seeking out experienced legal counsel can help ensure that all parties involved are protected throughout the process.

Furthermore, resolving conflicts through mediation or arbitration may be more appropriate than immediately filing a lawsuit. Professional mediators and arbitrators can provide valuable insight into potential solutions and often facilitate better communication between conflicting sides. With their knowledge and expertise, these professionals will ensure that each party’s interests are taken into account—helping avoid costly lawsuits down the road.

Navigating an HOA Dispute? Call J.Muir & Associates Today.

It’s no surprise that homeowners’ associations (HOAs) are often fraught with disputes and litigation. The financial and emotional costs of these lawsuits can be staggering, leaving many members feeling powerless and frustrated. But there is hope.

No matter what side of the fence you’re on, an experienced attorney can help. An attorney or mediator can help all parties come together amicably, reducing the chances of a lawsuit ever having to be filed. And while courts do play a role in solving some disputes, they should only be used as a last resort when other methods have failed.

Get help today. Call J. Muir & Associates to book a consultation today.

Author Bio

Jane Muir is a Shareholder and Managing Partner of J. Muir & Associates, a Miami business law firm she founded in 2018. With more than 13 years of experience in business, she is dedicated to representing clients in a wide range of legal areas, including business litigation, contracts, corporate formation, insolvency, nonprofits, partnership disputes, and other business law matters.

Jane received her Juris Doctor from the University of Miami School of Law and is a member of the Dade County Bar Association and Coral Gables Bar Association. She has received numerous accolades for her work, including being named among the “20 Under 40” in 2016 by Brickell Magazine. Super Lawyers named her a Rising Star from 2014–2019 and selected her for the Super Lawyers status.

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