Every community will encounter HOA disputes at one point or another. Disputes are normal, but what is important is that boards know how to handle them when they arise. This is not always easy, especially for inexperienced leaders.
What are HOA Disputes?
Disputes are disagreements that occur among those living in and running the association. With diverse demographics and different viewpoints, it is normal for disputes to arise in a community.
Sometimes, these disputes resolve on their own, with little to no interference from the association board. At other times, they can escalate, necessitating intervention. In more extreme cases, disputes can even reach the courts.
While HOAs and condo associations are no strangers to lawsuits, it is better to prevent them by resolving disputes internally first. Lawsuits can be costly and time-consuming, so they shouldn’t be the go-to option. Instead, associations should practice proper HOA conflict resolution.
Types of Homeowners Association Disputes
There are three main types of disputes in an HOA: resident-to-HOA disputes, board member disputes, and neighbor-to-neighbor disputes. Let’s break them down below.
Resident-to-HOA Disputes
These disputes happen between the association or its board and one or more homeowners. Common HOA dispute issues under this category include:
- Architectural Rules. This could be a denied application, a violation of architectural standards, or other architecture-related disagreements.
- Rule Enforcement. This could stem from unpaid fines, different interpretations of the rules, and claims of inconsistent enforcement.
- Maintenance Duties. This could be due to a homeowner’s failure to maintain their property or the association’s failure to maintain common areas.
- Financial Obligations. This could arise from disagreements over dues, increases, special assessments, late fees, fines, reserve contributions, and the like.
Board Member Disputes
These disputes happen between members of the association board. Common HOA dispute issues under this category include:
- Resolutions and Amendments. Board members may disagree on what rules and covenants to change.
- Financial Management. This could arise from budgeting, expense allocation, and fee increases.
- Conflicts of Interest. Board members may argue over actual or perceived conflicts of interest.
- Communication Breakdown. Board members may become frustrated due to a lack of transparent communication from other board members.
The HOA board needs to present a united front, as a warring board can foster distrust and doubts within the community. Board members may argue over decisions, but if a particular decision wins the vote, all board members should stand behind it even if they didn’t vote for it.
Neighbor-to-Neighbor Disputes
These are disputes that happen between neighbors or residents of the association. Common HOA disputes between neighbors include:
- Property Boundaries. This includes disagreements about property lines, fencing, and encroachments.
- Property Maintenance. A resident may complain about the state of their neighbor’s property exterior, lawn, or driveway.
- Noise. Neighbors may make noise beyond the acceptable level and during quiet hours.
- Nuisance. This includes foul odors, light pollution, and other nuisances that interfere with someone’s quiet enjoyment.
- Pets. This could stem from barking dogs, defecating on the laws, and other pet-related complaints.
- Parking. This includes cars parked in a neighbor’s driveway or blocking access to a common area.
Strategies for HOA Internal Dispute Resolution
Board members should attempt to resolve disputes internally. Of course, application is not always as easy as theory. Here are some strategies to adopt for proper HOA dispute resolution.
1. Check Governing Documents
Every association should have an HOA dispute resolution policy. This policy should be outlined in the governing documents, particularly the CC&Rs. It should outline the types of disputes that fall under the policy and those that are not covered.
Additionally, the governing documents outline the rights and responsibilities of both the association and its members. Sometimes, resolving a dispute is as simple as checking whether a particular activity or behavior is acceptable under the association’s covenants and rules.
For example, if a resident complains about their neighbor’s noise during quiet hours, the neighbor may violate the HOA’s noise rules. In that case, the board should enforce the rules and follow the violation procedures.
2. Communicate Openly and Clearly
Many disputes escalate out of control due to a communication breakdown. The association board should encourage the disputing parties to discuss their differences with a clear and open mind. Of course, board members should also practice what they preach when there is a board dispute.
When communicating, it is essential to use a calm and respectful tone of voice. This will help maintain a civil tone and prevent escalation.
3. Document Everything
Documentation plays a vital role in resolving disputes and follow-through. The association board should take notes on the actions taken and the agreements reached by the parties. This way, the board can track decisions and refer to these notes should the case escalate.
4. Seek Legal Counsel
It is always a good idea to ask for legal advice from an attorney. Attorneys can help associations navigate disputes and guide them on the proper way to handle them.
Alternative HOA Dispute Resolution
If internal processes are not working, the association can turn to Alternative Dispute Resolution (ADR). These methods encompass mediation and arbitration, both of which are viable options for resolving HOA disputes.
In Texas, many organizations provide ADR services.
Mediation
Mediation refers to a process in which a mediator sits down with the disputing parties and helps them reach a compromise. The objective is to get a middle ground with all parties in agreement.
Mediation is a voluntary procedure, which means parties can’t be forced to enter it. It is also non-binding, so parties are not necessarily obligated to follow through on the agreement.
Arbitration
Arbitration refers to a process wherein an arbitrator sits down with the disputing parties, reviews the evidence, and decides for them. Unlike mediation, arbitration is binding and final. The parties must follow through with the decision of the arbitrator.
Litigation as a Last Resort
When disagreements arise, most people’s first instinct is to take legal action. Lawsuits are both lengthy and costly for the association and the homeowner. It is best to take other measures, such as internal dispute resolution and ADR, before jumping to a lawsuit.
In the event of litigation, associations should hire an experienced HOA dispute attorney. Documentation is key, so boards should always ensure that they communicate using email or other written correspondence.
Insurance will also play a critical role here. While general liability insurance and the master policy should contain some coverage, having a separate Directors and Officers (D&O) policy is ideal.
The Bottom Line
HOA disputes can disrupt community peace and sow discord among members. Although smaller disputes can sort themselves out, association boards should keep an eye out for more significant ones and attempt to resolve them either internally or through ADR.
Preferred Association Management Company offers exceptional HOA management services to communities in Central Texas. Call us today at 512-918-8100 or contact us online to learn more!
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