Homeowner Files Ch13 - Can you Still Fine? > HOA Forum

Unanswered

Active Topics

Forums

Forums > Homeowner Association > HOA Discussions

Subject: Homeowner Files Ch13 - Can you Still Fine?

Prev Next

You are not authorized to post a reply.

Author

Messages

CathyT3
(Washington)

Posts:2

08/03/2008 5:38 PM
We have a homeowner that we have learned that just filed for Chapter 13 Bankruptcy to stop foreclosure. Can the HOA still send him letters/fines for leaving his trash cans out? (homeowner leaves them in front of their garage doors). Thanks for any advice.

GlenL
(Ohio)

Posts:1362

08/03/2008 5:46 PM
Cathy I'm not an attorney and this is not legal advice but as I understand the new bankruptcy law anything that occurred prior to the filing will probably be discharged. You need to start a second file on this person for anything after his filing which would be fair game for enforcement action.

CharlesH9
(Michigan)

Posts:80

08/03/2008 6:24 PM
Couldn't you just give this person a break and maybe send a reminder letter. Not like they have anything else on their mind. I hardly think the trash cans are on the top of the list right now. I find the economy and these situations to be soooo sad for alot of people. Do they have chidren to worry about also? Like they say about Karma!!

BrianB
(California)

Posts:1732

08/03/2008 6:41 PM
absolutely, you can fine them. in fact, every debt they create AFTER they file, they won't be able to discharge or slip away from: they can't use the bankruptcy card twice until after 7 years or so. that's why credit card companies LOVE people who declared bankruptcy... because they can't walk away from all the debt anymore. And Charles, while i actually do understand the sentiment you express, and probably would do the same as you and be more lenient, i have to say, their bankruptcy is very very likely the result of their decisions through life. This isn't the first time those people probably ignored the rules, regulations, laws or suggestions of people around them, not the first time they broke promises, made commitments they had no intention of keeping, railed at the "system" and at others for not being fair, for not giving them what they want, etc.. I tend to believe the lack of following the rules of their contract with the HOA is a sign of the kind of people they are. I would say that the kind of person who puts their cans away every week, follows rules of the association, does what is expected of them by their neighbors, by society in general, and tends to the small details without being forced to by outside agencies are the least likely to be going bankrupt...

GeorgerwilliamsW
(Indiana)

Posts:705

08/04/2008 4:31 AM
Posted By CharlesH9 on 08/03/2008 6:24 PM Couldn't you just give this person a break and maybe send a reminder letter. Not like they have anything else on their mind. I hardly think the trash cans are on the top of the list right now. I find the economy and these situations to be soooo sad for alot of people. Do they have chidren to worry about also? Like they say about Karma!! Charles, I agree with you. We don't have all the information here, so forming conclusions can be a dangerous thing. There could be a long history here we don't know anything about. Nevertheless, cut the homeowner some slack. This may be kicking a guy while he is down. If this is all the information I had, I think I would be knocking on his door, offering to be of any help I could the neighbor faces foreclosure. We need to show some compassion; some humanity, and most of all, some restraint.

SusanW1
(Michigan)

Posts:2117

08/04/2008 5:44 AM
While you can have all the sympathy you want for this person, the Board's JOB is to protect the HOA. Therefore, treat this person's account like any other resident's. File all paperwork so the association has a paper trail, AS IF YOU KNEW NOTHING ABOUT THIS PERSON OR HIS/HER PERSONAL ISSUES. Sorry, the Board is not a group of social workers. Don't even try applying "special circumstances" to your resident's financial obligations. (Do you tnink the bank or the utility companies do?) To prevent being swayed, each case should be numbered and the name protected (taken off or not discused) when determining past due financial situations. Believe me, this will come back to bite you if you don't keep a business head about you. I've got the stories . . . .

SusanW1
(Michigan)

Posts:2117

08/04/2008 5:46 AM
P.S. there may be some charities in your area that help with past due bills, or social services may offer these kind of benefits. Your board should be publishng these phone numbers in the newsletter once in a while.

GeorgerwilliamsW
(Indiana)

Posts:705

08/04/2008 5:49 AM
Susan, Again, I have to disagree with you most adamantly and sincerely. The function of the board of directors is to serve residents, not "protect the HOA."

SusanW1
(Michigan)

Posts:2117

08/04/2008 5:55 AM
George - Google "function of Board of Directors" Ensuring continuity of the corporation is the FIRST job of the Board!!!

JohnO6
(Georgia)

Posts:122

08/04/2008 6:15 AM
Susan & George - I think you're both right, but in a sequential way. The Board Members (at least some of them) are officers of a legal entity, ergo the HOA. As such their primary responsibility is to the corporation. However the primary purpose of the corporation is to serve it's members ergo, the homeowners. So the officers must first serve the best interests of the corporate entity, in order for that entity to fulfill its purpose and mission to its members.

GeorgerwilliamsW
(Indiana)

Posts:705

08/04/2008 6:25 AM
Posted By SusanW1 on 08/04/2008 5:55 AM George - Google "function of Board of Directors" Ensuring continuity of the corporation is the FIRST job of the Board!!! Susan, I am not going to debate this. Obviously you have very strongly held opinions on the matter. I don't know your qualifications to speak on the subject, nor do you know mine. Let's leave it at that. I did take your advice, and right at the top of the Google list I got is: Board of Directors FUNCTIONS AND RESPONSIBILITIES OF THE BOARD. The Board of Directors is responsible for setting the strategic direction of the Company and for overseeing and ... www.boral.com.au/corporate_governance/board.asp - 172k -\ Further, from the web page cited: FUNCTIONS AND RESPONSIBILITIES OF THE BOARD The Board of Directors is responsible for setting the strategic direction of the Company and for overseeing and monitoring its businesses and affairs. Directors are accountable to the shareholders for the Company’s performance. Adapted for the homeowner's association, "Directors are accountable to the members for the association's performance." And from the second Google reference that came up: Serving on a Nonprofit Board of Directors Serving as a member of a Board of Directors of a nonprofit organization can be one ... The first function of the board is to protect the public’s interest. ... www.scoreknox.org/library/serving.htm - 16k In this case, the "public's interests" are the homeowner's interests. 'Nuff said.

GeorgerwilliamsW
(Indiana)

Posts:705

08/04/2008 6:56 AM
Posted By JohnO6 on 08/04/2008 6:15 AM Susan & George - I think you're both right, but in a sequential way. The Board Members (at least some of them) are officers of a legal entity, ergo the HOA. As such their primary responsibility is to the corporation. However the primary purpose of the corporation is to serve it's members ergo, the homeowners. So the officers must first serve the best interests of the corporate entity, in order for that entity to fulfill its purpose and mission to its members. John, while I sincerely respect your approach, I must disagree that the primary responsibility is to the corporation. That simply is not the case in the law or theory of corporate organizations (whether profit or not-for-profit). The primary responsibility of the board in a membership corporation is to the members. The corporation exists to serve its members. Members do not exist to serve the corporation. Based on all that I have discovered here,this confusion is the very root of the problems that exist within the governance of homeowners associations. Those that function well, those that have few contentious issues, are led by individuals who see their role as serving the members by whom they were elected. Those that seem to have the most problems, are ones in which the corporation is viewed incorrectly as more important than the members. Let me describe it this way: There are two questions that can be asked in making any decision. "What is in the best interest of the association?" "What is in the best interest of the homeowners?" In some cases, both questions lead to the same answer. Thus, it is the source of much confusion. People assume, wrongly, that the association is somehow more important than the people it was designed to serve. But far, far too frequently, the answers to the two questions lead to divergent answers. And in such cases, the answer to the second question must always take precedence. Sometimes the best interests of the homeowners is strong enforcement of covenants. Sometimes the best interests of the homeowners is deliberately not taking action. Sometimes the best interests of the homeowners is filing a lien for non-payment of dues. Sometimes the best interests of the homeowners is not filing that lien. In neither case, should the best interests of the association even be considered. It is not a distinction without a difference. It is at the very heart of the theory of association.

JohnO6
(Georgia)

Posts:122

08/04/2008 7:39 AM
Geroge - with all due respect to your position, similarly I'll not debate you, because it has disintegrated into a semantical issue. However, I would point out that most HOAs are incorporated under various state laws, that place legal requirements upon the officers of the corporation TO THE CORPORATION, not directly to either the stockholders (profit corps) or members (non-profit corps). As such, the first priority of the officers is clear, since their very existence as officers of a state registered corporation is beholden by the very same law that allowed the creation of the legal entity.

DwightT
(Idaho)

Posts:443

08/04/2008 8:03 AM
George - I'm going to agree with John and Susan. I'll give you that the Board should ultimately do what is best for the homeowners, but that is for ALL the homeowners collectively, not individually. I think it's a stretch to say that "in the best interest of the homeowners" means not following established enforcement procedures for one individual homeowner just because that one homeowner got themselves in a bind. If the board starts doing that then everyone who doesn't want to follow the CC&Rs will want the same "special" treatment. Now that isn't saying that the Board should be hard-assed about it. If the homeowner wants to appeal to the Board the Board should be willing to listen and work with the homeowner to get the problems fixed. Ultimately that will be more "in the best interest of the homeowners" (all of them) than just letting the issues go with no response. But the homeowner has to be willing to work with the Board also. Cathy stated that the homeowner in question is leaving garbage cans out. I would really be hard pressed to see why being in a financial bind means that you can't put your trash cans away.

KirkW1
(Texas)

Posts:1110

08/04/2008 8:17 AM
Just one question: How many board directors have seen legal trouble for failing to further fine a person in bankruptcy? Some of you really need to get a grip on life. Now consider how this will help the corporation: Channel 12 News "On Your Side" shows how your HOA is fining a person who is in bankruptcy and you can not legally point out that they have been told 20,000 times. I am sure this will help the neighborhood. (Oh, forgot, you don't care about the neighborhood, you care about the corporation.)

GlenL
(Ohio)

Posts:1362

08/04/2008 8:45 AM
Unfortunately some BOD's and evidently some people here equate non-profit to charitable. We had a poor unfortunate soul here that ultimately leached over $6,000.00 from everyone else here while her bankruptcy wound its way through the courts and we were finally able to get rid of her, all the while she had a live-in who made good money. As Spock said: "The needs of the many outweigh the needs of the few." If you want to be charitable, God bless you but use your own money not the money of your fellow H/O's.

JohnO6
(Georgia)

Posts:122

08/04/2008 9:11 AM
Kirk - good of you to bring this thread back to the situation at hand. I jumped into the conversation after George (in post #8) elevated, I believe, the conversation from what to do about the original owner to a more isolated, perhaps philsosophical, question about where the Board's first priorities lie. Since I disagreed with him, I posted in that vein. I believe my position is still valid, in that the officers' first priority is to the corporate entity; BUT when applying it to the case at hand, their actions SHOULD consider ALL the potential ramifications of their actions on the corporate entity (e.g. financial, public reputation, setting of precedent, legal, etc, etc, etc).

CathyT3
(Washington)

Posts:2

08/04/2008 9:43 AM
Charles, Here's the background: This homeowner was a past board member. This homeowner has never paid their 2007 or 2008 annual dues. This HO kept saying the check is in the mail. Our gut instincts told us something was wrong - so the Board approached this HO to work out a payment plan. To date, we still have not rec'd payment - only continued excuses. While this HO was on the board - he never showed up for board/homeowners meetings/or helped period. We believe he used this avenue (being on the board) as a way to "skate by" for a bit. Finally, we had to let this homeowner off the board and protected this reputation. Even as a board member, he has left his trash cans out and just in general set a bad example in the neighborhood. The Board has helped & protected him as much as we could (personally & professionally). This HO still does to this day - leave his trash cans out on a daily basis for the past two years. This homeowner and the board were actually friends and socialized. We have not directly set out to hurt or punish this homeowner - this HO does it on it's own. With more foreclosures affecting our community - we still need to keep up our property values by taking care of our lawns, trash cans, etc. if we want homeowners to obtain the best value for selling their homes. But this HO is still refuses to work with us and "fights the system" - since I've know them. My question still remains - can we still send him letters and fine him? His lawn is in need of care, his trash cans are always out, and he has not finished his fence in over a year. What else can we do for him?

KirkW1
(Texas)

Posts:1110

08/04/2008 10:04 AM
There comes a time when you must in fact send a fine notice or there is no point. And that you let it go two years is part of the reason things are looking bad. (That coupled with his lack of financial stability.) In the meantime you need to have your association represented in the proceedings so you can get your share. You also need to make sure that you have two policies in place. The first is the collection policy and the second is enforcement. They should be followed because anything else leaves you vulnerable when another resident says you played favorites (which you did). All the same, I would highly recommend you speak with your attorney to ensure that the HOA is in the proceedings. And also speak with him about the enforcement issue and listen to the expensive advice you get.

You are not authorized to post a reply.

Forums > Homeowner Association > HOA Discussions > Homeowner Files Ch13 - Can you Still Fine?