Can HOA’s Fine Owners?

Street of residential housesDo Homeowner Associations have the right to fine owners who do not comply with their rules?  In Virginia, this very question was put before a judge to decide.  A dispute arising between Maria and Sam Farran and their HOA at the Olde Bellhaven in Fairfax, VA over a political sign stirred a four year costly legal battle that ended with the HOA declaring bankruptcy.  The dispute all began when the couple put out a sign campaigning for Obama during the 2008 election year.  Their homeowner’s association has strict rules on how large signs can be when being displayed on lawns.  Their political sign violated this HOA rule by being too large.  The board came down hard on the Farrans demanding they remove the sign.  The Farrans reacted by cleverly cutting the sign in half, displaying the smaller signs side by side on their yard.  The two signs then met the HOA rule requirements for sign size. 

Unfortunately, the board was not amused with their sense of humor and decided to fine the Farrans $900.  The board also later rejected proposed home improvement projects the Farrans had planned for their home.  This is when the Farrans decided to sue the HOA for abusing their use of power by fining owners.

In the end, the Judge ruled in favor of the Farrans.  The Judge ruled that fining could not be enforced if the fining process was not specifically laid out in the HOA’s covenants.  In this case, the Olde Bellhaven HOA did not clearly state their fining process in their covenants.  They therefore lost this case.  This case set the standard for settling HOA related cases in the state of Virginia.

Here in the state of Florida, the laws are different.  The HOA can impose fines on homeowners who disobey covenants, but there are laws governing this process.  In order to impose fines on owners, the HOA must provide at least 14 days written notice to the owner of violation.  The owner then has the right to a hearing in front of a volunteer fining committee.  The committee must consist of three or more owners who have no relations with board members or management office.  The committee then based on hearing, presents their verdict on whether to fine or not fine to the board.   If committee decides fines are in order, then the association can impose fines.

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