The Virginia Verdict Review

Comprehensive and Informative Commentary on State and Federal Legal Matters

Important Notice for Homeowners: Va. court bolsters defenses against unreasonable HOAs/COAs

While the last year has been rough on homeowners state-wide, the last few months have been great for Virginians battling their Homeowners Association (HOA) or Condominium Owners Association (COA).  Since July, Virginia courts have handed down not 1 but 2 rulings that limit the power of HOAs an COAs in the Commonwealth.  In the first of these decisions, the court found that a COA (and, by inference, a HOA) “does not have authority under [any measure]” to assess more than $20,000 in fines against someone who fails to properly submit required paperwork.  While this small stipulation may seem irrelevant or futile to many, I found it noteworthy for one major reason: the court’s decision strikes at the fundamental principles that control HOAs and COAS.  Through its ruling, the court reminds HOAs and COAs that their powers are expressly limited by statute and then can do nothing more than what has been granted to them by such statutes.  In a world where many HOAs  and COAs lose sight of their founding purpose, blatantly overstepping their bounds by trying to enforce outrageous rules, it is incumbent upon homeowners to remember that they hold the rights, not the associations.

Perhaps more importantly though, the Circuit Court continued its defense of homeowners with a ruling reported this past week.  As was reported by The Virginia Lawyer’s Weekly, a circuit court judge recently ruled that homeowners can to seek reimbursement for attorney’s fees if they are successful in suing their HOA.  Given how many people have  expressed discontent with the actions (or non-actions) of their HOA these days, this ruling stands as a solid victory for disgruntled homeowners in the Commonwealth.

In this particular case, Farran  Olde Belhaven Towne Owner’s Ass’n, the homeowners pursued a suit against their HOA for a number of grievances, the list of which included allegations that the HOA mismanaged the finances set aside for community betterment and that it arbitrarily denied homeowner’s request to build a deck.  In the end, the court agreed with the owners and found in their favor.  In response, the HOA argued that, though it had lost the suit, it was not required to reimburse the owners for the legal fees they incurred in defending their rights in court.  In fact, the HOA asserted that Virginia Code § 55-515 protected it from that responsibility because it was not the HOA, but rather the owners, that brought the suit to begin with.  Ultimately, it was this assertion that the Circuit Court found issue with.  Stating that its decision was supported by the Supreme Court case of White v. Boundary Ass’n 271 Va. 50 (624 S.E.2d 5), the court upheld the homeowners right to recover the money spent in their suit against the HOA.

To anyone that has dealt with a power-hungry HOA or COA that routinely oversteps its bounds, the court’s recent rulings should serve as a reminder that you have an outlet to hem these actions in.  One should remember that, despite their best efforts, HOAs and COAs have limited power and must act strictly in accordance with the code sections establishing them.  These entities are constantly overstepping their bounds and these cases serve as a reminder that, when push comes to shove, courts are clear in enforcing these limited powers.

Do you have a legitamate grieveance against your Home Owners Association or Condominium Owners Association? If so, feel free to contact Westlake Legal to schedule a consultation.


2 responses to “Important Notice for Homeowners: Va. court bolsters defenses against unreasonable HOAs/COAs

  1. John Wilson September 24, 2011 at 6:17 pm

    Let’s be fair to the HOAs that try to maintain some degree of community standards. There are some homeowners that go out of their way to challenge any Covenant rule that they don’t like and put impediments to enforcement of rules that a majority of homeowners agreed to. Homeowners who signed a statement agreeing to live by the Covenants of their Association should not expect to have no action brought against them when the violate Covenant rules.

  2. Jason R. Collins October 20, 2011 at 4:33 pm

    Very valid point. I will not argue with you that the successful management of a neighborhood or community is a two-way street, requiring equally responsible participation from both the homeowners and the HOA. In a perfect world, the homeowner/HOA relationship would work as intended, with the HOA establishing and maintaining reasonable, easily-enforceable regulations and with homeowners readily complying with them for the betterment of the community. Unfortunately, as I think we can both agree, this does not always happen and the relationship often degrades as the result of either (and sometimes both) parties’ actions. What I sought to address in this post is what I perceive to be a growing number of instances where homeowners are becoming entrenched in legal battles with their HOA as the result of the HOA trying to enforce a rule, regulation or design standard that they have no legal right to install in the first place. I will also admit that good HOA/Homeowner relationships rarely make it to my desk!

    That being said, I whole heartedly support HOA’s enforcing properly adopted rules and regulations. I agree with you that we choose to live in these communities and be governed by their rules for a certain quality of life and with that comes a responsibility to abide by them. When there are appropriate violations, an association should take steps to enforce its rights. However, it is becoming increasingly alarming that many associations seem to think that their role is to create and enforce the rules and regulations with a “what we say goes” mindset and they lose sight of the fact that their reach, influence, and regulatory ability is significantly limited by the very documents that established them, as well as the code of Virginia. When this occurs, litigation often results that is seemingly David v. Goliath. On more than one occasion, I have been told by opposing counsel that, although a position is not supported by the law or the association’s own regulations, “this is how the board handles these matters.” Often there is little recourse because the cost of litigation is not coming out of the Board’s pocket but instead is borne by every member of the community, whether they agree with the litigation (or even know of it) or not.

    The above goes to the heart of my blog. These cases serve as a reminder to these associations that their powers truly are limited and that there can be a significant cost to the association for willfully ignoring what it can and cannot do in favor of simply choosing its own path. Hopefully, cases like these will make these associations and boards rethink some of their actions and bring them more in line with the majority of associations that handle these situations appropriately and have members who are ready and willing to comply with their appropriate regulations. The problem today is that the outliers’ positions are often so extreme and the financial consequences to homeowners wrongfully targeted are so significant that, as the saying goes, one bad apple spoils the bunch!

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