Home Owners Associations

With all of the new residential subdivisions being built in Hampstead, the number of Homeowners Associations (HOA’s) has also grown. Typically, builders set up the HOA as a non-profit corporation before selling the lots by filing a document with the Register of Deeds called the Restrictive Covenants. This document contains the rules of the community. The builder (also called ‘Declarant’) often maintains control of the HOA until he has sold off all of the lots. Once all lots have been sold to new owners, the control of the HOA is then transferred to the community. The HOA is then managed by an elected board. The method of electing the board is set up in the Bylaws. The board members are volunteer homeowners. The HOA’s will often afford homeowners the use of leisure amenities such as pools, tennis courts, fitness centers and docks, as well as necessary common areas such as roads, sewer and water utilities.

In addition to maintaining these common areas and amenities, the HOA also has the power to establish and enforce certain restrictions, as well as collection of assessments and fees. The Restrictive Covenants are intended to maintain the standards of the community, to ensure the safety of all residents and to help guarantee maintenance and repairs.An example of restrictions would be architectural requirements and landscape maintenance. The HOA Board can also establish reasonable rules for the use of certain amenities such as hours of use for the pool and fitness center or speed limits on roads within the community. It is the interpretation and enforcement by the HOA of these restrictions that causes confusion and creates difficulty for many of the clients that I have helped.

One common thread that seems to run through many of the problems that I have seen between homeowners and the HOA is in communication or lack thereof. It is the responsibility of the HOA Board to act on behalf of allof the homeowners. The Board must communicate with transparency and regularity with the community it governs, and enforce the RC’s equally. However, the homeowners also have a responsibility to pay assessments timely and to abide by the restrictions contained in the Restrictive Covenants.

Most problems do not arise as a result of either party intending to violate obligations. Time and again I have seen problems arise as a direct result of homeowners not being aware of requirements set forth in the Restrictive Covenants or because the HOA has failed to communicate a change or otherwise give homeowners adequate notice of a violation. Each and every subdivision governed by an HOA has its own set of restrictions that are unique to that community. I always recommend to my homebuyer clients that they read the Restrictive Covenants before purchasing in a community to learn about not only what the community has to offer, but also to see if they are comfortable with the restrictions. One example would be to consult the Restrictive Covenants before hiring contractors and embarking on home improvement projects that may violate restrictions. It is also important to read the By-laws, even for long-standing community members, to learn about how the HOA is governed.

Like any other corporation, the HOA will be as successful as the people who are a part of it take an active role in its success. It is beneficial for homeowners to attend monthly meetings and voice concerns early before the problem becomes bigger. If you are disputing assessments, I do not advise my clients to stop payments as there can be additional fines added on. Approaching your volunteer board members/neighbors with professionalism and kind words can go a long way toward amicable resolutions. Petitioning the board for change along with other like-minded neighbors may also help get the problem resolved not just for yourself, but for many others in the community.

If you have tried to approach the HOA Board to settle differences and have been unable to resolve the issue, that may be the time to seek the advice of an attorney who specializes in these types of cases. Bringing a copy of the Bylaws and Restrictive Covenants to your appointment, as well as any other documents that might pertain to the issue, is a good way to prepare for the meeting.

Kenneth Ording, Esq, Managing Partner
Blackburn & Ording, PLLC
712 Country Club Drive
Hampstead, NC 28443