Q: There has been confusion on my HOA board regarding when the association can record a lien against a delinquent owner. I thought we could lien after 45 days, but our manager says we must give a warning letter first. Is this correct? (G.M., via e-mail)
A: More or less.
First, the association needs to understand when an account becomes “delinquent.” This is not set by statute, but by your governing documents. 10 days, 15 days, and 30 days after the due date are the most common standards used to establish delinquency.
Once an account is delinquent, Section 720.3085(3)(b) of the Florida Homeowners’ Association Act requires that before the association allows the account to be subject to a lien or the accrual of attorneys’ fees on the account, a notice of late assessment must be sent. This notice must advise the owner of the amount of past due assessments, any applicable late fees and interest, and further advise them that if they do not pay within 30 days, the association may proceed with further collection activity against them. Some refer to this as the “free notice.”
If 30 days expires without payment, the association may then send a 45-day “notice of intent to lien.” This notice advises the owner of the amounts now outstanding, and that if they do not pay such amounts within 45 days, the association has the right to record a claim of lien against their property. Attorneys’ fees incurred in the collection process can be added to the account at this point.
If the owner does not pay within those 45 days, the association can then record the claim of lien. If the association wishes to file a foreclosure lawsuit, a third notice must then be given, allowing another 45 days to pay off the account with interest, late fees if appropriate, costs and attorneys’ fees.
So, there are several steps that must be taken before seeking a foreclosure, including the “30-day free notice.” This was added to the law due to allegations of sharp practices in the assessment collection industry.
Q: Our homeowners’ association board has not enforced a number of the provisions of our documents. Can the board be sued for not enforcing a covenant? (M.H., via e-mail)
A: Some documents are written in a manner which makes enforcement permissive, some can be construed as mandatory. There may be reasons why a board would not take action in a particular case, such as advice from legal counsel that the association is likely to lose the case.
An action to compel enforcement of the documents would not be brought against “the board,” it would be brought against the association. In general, directors are not personally liable for the action, inaction, errors, omissions, or contractual obligations of the association unless there is fraud, self-dealing, criminal conduct, or recklessness.
It is also relevant, and may be considered important by a court, that individual owners generally have the right to enforce the governing documents, including bringing claims against other owners.
Enforcement of rules and covenants is undoubtedly one of the most difficult aspects of board service. Contrary to popular media lore, the vast majority of people who volunteer their time to operate their community do not want to be the “HOA Police,” and generally find these matters unpleasant. Further, because our laws favor individual freedoms and property rights, enforcement actions are rarely a “slam dunk,” and when contested, are often expensive and time consuming.
My general advice is that communities should periodically go through their covenants and rules. If there are requirements that are not being enforced, and there is no desire to do so, they should be removed by the proper procedures.
Joseph E. Adams is a Board Certified Specialist in Condominium and Planned Development Law, and an Office Managing Shareholder with Becker & Poliakoff. Please send your community association legal questions to firstname.lastname@example.org. Past editions of the Q&A may be viewed at floridacondohoalawblog.com.