A Court in Arizona recently provided one more reason for your association to have a fine schedule and late fee policy (Turtle Rock III Homeowners’ Association v. Fisher, 2017 WL4837821 and 2017 Ariz. App. LEXIS 187). This particular Homeowners’ Association (“HOA”) required their owners to maintain their property in various ways relative to cleanliness and attractiveness, via the HOA’s declaration. The declaration allowed the HOA to assess daily fines if the violations were not corrected. The HOA sent a particular owner 90 separate notices but started fining the owner less than 30 days from the relevant notice. A trial court enjoined the owner, requiring the owner to comply with the provisions in the declaration, and awarded the HOA thousands of dollars in fines and attorneys’ fees.

On appeal, the owner claimed the fines were unenforceable because he hadn’t been given proper notice or an opportunity to be heard, and the HOA had not adopted a written fine schedule as required by state law. The Appellate Court agreed with the owner, noting (1) the requirement for a fine schedule before fines could be assessed, and (2) that there was no indication that the fine the HOA had actually assessed was reasonable.

To save your association significant expenses, make sure that your association has adopted an enforceable collection policy.

If you have any questions, please feel free to contact us.