Association Self Help Remedies: Assessing Fines

Association Self Help Remedies:  Assessing Fines
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 Often Homeowner or Property Owner Associations (HOA/POAs) find themselves at a loss when it comes to enforcing the associations Declaration of Covenants, Conditions or Restrictions (CCRs). One option for enforcement is the application of fines against homeowners.  And while Texas law does allow for fines against homeowners for failing to adhere to the association’s CCRs, it is not as easy as some associations think.  If a Board of Directors isn’t careful they can find themselves in legal hot water.  

Let’s take a look at some of the laws in place for the State of Texas and also some of the requirements applicable to associations.  

First, it is important to understand the hierarchy of rules.  Federal law is at the top of the “legal pyramid”.  Two Federal laws that are of particular importance when it comes to enforcing an association’s CCRs are

  • Title VIII of the Civil Rights Act of 1968 otherwise known as the Fair Housing Act, and
  •  The Americans with Disabilities Act of 1990

Of particular note are laws protecting service animals and persons with mental disabilities (who may be seen as disruptive or threatening).  It would be wise for your Board of Directors to consult with an attorney prior to taking any enforcement action related to service animals or disruptive owners.  Being on the wrong side of the Fair Housing Act can have devastating results to include substantial penalties, damages and attorney fees…all against the association. 

After Federal regulations comes state statutes.  Associations in Texas do not automatically have the authority to enforce fines against homeowners.  These powers must first be granted in the association’s CCRs.  Title 11, Chapter 202 Construction and Enforcement of Restrictive Covenants and Chapter 209 Texas Residential Property Owners Protection Act are a “must read.”

Title 11, Chapter 202 sets forth guidelines with regards to what an association may or may not prohibit.  

For example, Section 202.012 states that an association may not prohibit homeowners from displaying the American flag, the Texas state flag or an official or replica flag depicting a branch of the U.S. armed services.  Section 202.012 does however allow an association to regulate HOW flags are flown, the size and location of flagpoles and other such details.  

Additionally, Section 202.020 prohibits associations from disallowing children (under the age of 18) from operating the occasional lemonade stand.  At the same time this section protects the association from being liable for any injuries suffered while running said lemonade stand.  

 It is important to note that if an association is lax in enforcing a particular rule then the courts can make a determination that the restriction or requirement has been “abandoned.” The homeowner can then use “abandonment and waiver”  as a defense for not adhering to a rule.  

For example, your association has a rule regarding the number of pets you are allowed to have on your property; however,  the unwritten policy has been to turn a blind eye as long as pets are well behaved and not deemed a nuisance.  Now one of the homeowners has more pets than “allowed” and one of the pets is considered a nuisance because this pet barks all the time.  The association decides to enforce the rule limiting the number of pets as a means of addressing the noise problem associated with this extra pet.  The homeowner may have a legal defense and the association may  lose the battle in court. 

When an association’s CCRs give the association the authority to take action(s) in order to enforce rules, regulations or bylaws this is known as a “self-help remedy.” Chapter 209 outlines requirements an association may be obligated to follow as part of an overall enforcement policy or resolution.  

Section 209.006 requires the association to notify the homeowner in writing of any enforcement action being considered and this “209  Notice” must be sent certified mail.  Unless otherwise specified in Section 209.006, the homeowner must be given an opportunity to fix or “cure” the issue or incident of non-compliance. Some instances, such as shooting fireworks or holding a garage sale when garage sales are not allowed are considered “uncurable.”  Examples of “curable” acts might include barking dogs, not mowing your grass or parking violations.  

Regardless, under Section 209.007 Texas homeowners have the right to a hearing within 30 days of the “209 Notice” being sent.  Additionally, Texas homeowners may have additional rights under Federal law (remember the Fair Housing Act and other federal laws) that supersede Texas statutes and the associations CCRs.  

And finally, there are the associations CCRs (sometimes referred to as restrictive covenants) which must contain language giving the association the right to take “self-help remedies”, to include authority to impose fines.  If your association’s CCRs do not give the association this authority, then the association will likely need to amend their CCRs and this of course takes the approval of homeowners.   Whenever an association is amending their governing documents, legal assistance is highly recommended.  

If your association’s CCRs do give authority for “self help remedies” then it is advisable to have the policy spelled out in a resolution.  A resolution give specifics with regards to the process or procedures for implementing a rule already in the association’s CCRs.  If your association’s CCRs state a fine may be imposed for non-compliance with a rule, then the resolution would outline the process for imposing a fine and the rights of the homeowner for appealing the fine.  

While writing a resolution is not overly difficult, it can be tricky.  This is where a really good management team, such as PMI Bluebonnet Realty, can be especially helpful.  When writing a resolution, PMI Bluebonnet Realty ensures that the resolution conforms with laws and governing documents.  We work to include input from the entire Board of Directors as well as feedback from homeowners.  Once a resolution has been drafted, the Board of Directors will vote to pass the resolution and then homeowners are notified.  PMI Bluebonnet Realty then ensures that the resolution is enforced without bias or prejudice. 

Bottom line, rules go both ways and it is incumbent on the association’s Board of Directors to know and work within the rules.  PMI Bluebonnet Realty works with your association to help ensure the Board is making sound and legal decisions regarding enforcement of CCRs.