HOAs and condo associations are created when the property and community are first being developed. Before the developer sells the first property, documents are recorded with the local city or county creating obligations that attach to the property itself such that they are binding on anyone that subsequently purchases that property. For this reason, anyone that buys a property in such a community is automatically bound by all valid rules and regulations of the association.
The association’s “governing documents” (typically comprised of corporate bylaws, a declaration of covenants, and supplemental rules, regulations, and architectural guidelines) are treated as a legally binding contract between the association and its members. Those documents outline the scope of the association’s powers. In Virginia, the powers granted by the governing documents are strictly construed such that an association is not allowed to do anything that is not expressly allowed by the governing documents.
Community association law is rapidly evolving and there are game changing decisions issued every year. To ensure that their documents are compliant with the latest laws, community associations are encouraged to consult legal counsel for a document audit and appropriate revisions on a regular basis.
If assessments or other charges are not paid in a timely manner, a community association can elect to do several things. The association might file a collections lawsuit to collect the sums due. It can also impose late fees and other penalties allowable by law and the governing documents. Even if no formal collections action is taken, when the property is eventually sold, any unpaid assessments are typically paid at the closing.
An association’s enforcement powers are set forth in the governing documents and applicable state law. Typically, an association has the power to issue fines. However, Virginia law states that fines cannot exceed $50 for a single violation, or $10 per day for up to 90 days ($900 maximum) for an ongoing violation. An association can also file a lawsuit seeking an injunction—basically a court order forcing you to correct the violation. In addition, some governing documents empower the association to come onto your property and correct the violation for you, and then bill you for the work. Also, many governing documents allow the association to recover its legal fees if it ends up filing a lawsuit, which can be very costly.
Yes. Before any enforcement action is taken, the association must give the homeowner a reasonable opportunity to correct the alleged violation, after sending written notice to the homeowner. If the violation remains uncorrected, the association must hold a hearing on the matter before issuing any fines, and the homeowner is allowed to be represented by counsel at that hearing.
Under Virginia law, an HOA’s governing documents must require two things in order for it to be a valid HOA. First, the governing documents must require the HOA to collect assessments. And second, the governing documents must require the HOA to use the assessments to maintain some common areas or common elements. If the governing documents do not include both requirements, the association can be declared invalid.