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Subject: How far will a court go? (Tennessee)
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SmithT
(Tennessee)

Posts:5


07/20/2021 2:44 PM  
We have a homeowner who flagrantly violated our DCCR and changed the brickwork and windows on her house from those approved by our ACC. She sought approval AFTERWARDS, and in so doing acknowledged that she knew she had not complied with the approved plans for her new build.

She claims that to undo her “decisions” will cost $100k. We got our lawyer to sue her and he thinks we have a pretty good case. Just wondering whether it is realistic that a court is going to order someone to spend that much money to take parts of their house apart.
MelissaP1
(Alabama)

Posts:10534


07/20/2021 3:01 PM  
That is an easy answer. The court can ONLY make one "Whole". There is no "profit" in a lawsuit. Whatever you spent to correct the issue is how much you get back on the issue. Now there is the occasional "punitive" awards. Those are for teaching a lesson to discourage acting in a grievance way again. However, that is extremely unusual to be awarded and not in small claims courts typically.

Now your HOA does have the right to pay someone to correct the owner's work and send them the bill. This would be considered the HOA's "damages". Of which the court could award the owner to pay the HOA for it. This is something the HOA could lien for instead of sue for. ONLY if the owner refuses to pay the bill. A lien is a form of judgement that has a bit stronger teeth than a lawsuit judgement. A lien they can't sell till the lien is paid off. A lawsuit doesn't hold them to the ground as much. Plus the HOA has no right to one's social security # which makes some collection options difficult.

So the HOA should discuss with the lawyer the option of a lien versus a lawsuit. It may be something the lawyer has not mentioned as an option. It is cheaper to do...

Former HOA President
SheilaJ1
(South Carolina)

Posts:274


07/20/2021 3:43 PM  
You cannot put a lien for unpaid judgements, or a lien for the cost of restoring the property, you can only put a lien for unpaid assessments and late charges and cost recovery fees related to collection of assessments, most docs say this clearly.

As for this owner, the owner can admit whatever they want, if the docs have a restriction for the modification made then the HOA has a case however if the docs are vague, and they usually are, then the modification made favors the owner and the HOA will have a hard time proving otherwise. This is regardless of if the owner got approval or not, the owner could counter sue to ask the court to approve since the CCR’s don’t strictly forbid the modification made.

This is my take on it and others may have more experience with actual scenarios.


LetA
(Nevada)

Posts:1429


07/20/2021 4:22 PM  
The real question is would the HOA approved the changes if the owner submitted the ARC prior to the changes? If the answer is yes, then there are no damages except for butthurt and there is no pain and suffering for butthurt.
MelissaP1
(Alabama)

Posts:10534


07/20/2021 4:22 PM  
Actually most HOA's have this written into their documents. That a HOA can pay to correct a violation and if owner does not pay, they can lien for that. It's the ONLY other way to place a lien outside of assessments.

Former HOA President
SheilaJ1
(South Carolina)

Posts:274


07/20/2021 5:10 PM  
Posted By MelissaP1 on 07/20/2021 4:22 PM
Actually most HOA's have this written into their documents. That a HOA can pay to correct a violation and if owner does not pay, they can lien for that. It's the ONLY other way to place a lien outside of assessments.



I have seen restoration assessments and those can be used to place a lien if unpaid. It would be best to write this in during court proceedings.
AugustinD


Posts:1695


07/20/2021 5:18 PM  
Posted By SmithT on 07/20/2021 2:44 PM
We have a homeowner who flagrantly violated our DCCR and changed the brickwork and windows on her house from those approved by our ACC. She sought approval AFTERWARDS, and in so doing acknowledged that she knew she had not complied with the approved plans for her new build.

She claims that to undo her “decisions” will cost $100k. We got our lawyer to sue her and he thinks we have a pretty good case. Just wondering whether it is realistic that a court is going to order someone to spend that much money to take parts of their house apart.
Depending on the details, a court may or may not rule for the plaintiff HOA and enforce the covenants. Then there is the question of whether the court will award attorney fees to the HOA. This will depend on what Tennessee HOA statutes say and what the HOA covenants say. It is possible the HOA could win on the enforcement of covenants claim but then lose on the attorney fees claim. In which case practically speaking, both sides lost.

In the case law, one of the biggest questions that arises is whether the HOA had the discretionary authority to set xyz standard for architectural changes. If this discretionary authority is not exercised reasonably, then the court will rule against the HOA.

If I were on your Board, I would weigh suing vs. fining (until the ARC violation was corrected) and liening, if possible, for the fines.

If you want better opinions here, you are going to have to provide more information. E.g. what covenant is the person accused of violating? What Rule or Regulation was the person accused of violating? Is the Rule created by the Board reasonable?

Not all attorneys are going to talk with you about these things. Plus some attorneys will get the law wrong.
JackJ9


Posts:0


07/21/2021 8:32 AM  
Posted By SmithT on 07/20/2021 2:44 PM
We have a homeowner who flagrantly violated our DCCR and changed the brickwork and windows on her house from those approved by our ACC. She sought approval AFTERWARDS, and in so doing acknowledged that she knew she had not complied with the approved plans for her new build.

She claims that to undo her “decisions” will cost $100k. We got our lawyer to sue her and he thinks we have a pretty good case. Just wondering whether it is realistic that a court is going to order someone to spend that much money to take parts of their house apart.




I am curious if the board of directors voted to approve you discussing a legal case on a public forum such as hoatalk.com?
SheliaH
(Indiana)

Posts:4239


07/21/2021 9:46 AM  
The OP didn't name names which would have been against the posting rules anyway. That said, lawsuits are public records, so anyone could do a search of the court records and find the case, and see for themselves who's involved.

As for this case, it's hard to say what a judge will or won't do - all you can do is pursue the matter, document the hell out of everything you did (which you should have already done) and put forth your best argument. If the judge decides in your favor, hooray. If not, you'll have to decide if it's worth appealing. The judge may also require you and the homeowner to try and negotiate a settlement first - perhaps you might consider in advance what you're willing to accept. If the lady was flagrant about not applying for an exterior change request, you could stick to your guns and insist she bring the house in compliance or require certain things to be done and allow the others, depending on what it is. That may cost her, say $50K, which isn't anything to sneeze at. I wouldn't feel sorry for her - sometimes it takes a smackdown in the wallet before people behave - I bet she doesn't try this stunt again.
JohnC46
(South Carolina)

Posts:11539


07/21/2021 11:12 AM  
SmithT

Aside from the fact that the owner did not seek permission, based on what has been done, would the ACC have approved the changes? If yes, drop it. If maybe, drop it. If no, proceed.
SmithT
(Tennessee)

Posts:5


07/21/2021 3:17 PM  
This is super helpful. Thanks everyone.
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