A Florida homeowners association recently decided to waive $20,000 in fines accumulated by a homeowner who abandoned her property to her lender. It appears that owner Linda Conti overestimated her ability to purchase the home, and planned to turn the property over to the bank with a deed in lieu of foreclosure. She moved out before the bank took title, and as a result the property’s front lamp was left unlit for over a year. This violated the association’s covenants, and the association levied a $50.00 fine every day, resulting in $20,000 in fines and several thousand dollars in attorneys’ fees.
The article doesn’t go into details about the association’s enforcement policy, but it is pretty clear that somehow communication between the association and the owner failed. In Colorado, an association must adopt (and follow) a written policy regarding fines, and this policy must provide a fair and impartial fact-finding process to determine whether the owner should be responsible for the violation, if one actually occurred.
If the Florida association has a policy like this, the impartial fact-finder could find Linda’s absence a mitigating factor for the violation. They could have contacted her to work to find solutions to the problem.
It is possible the association failed to contact Linda at all. Her address with the association may have been her old address – the home she abandoned to the bank. Even if she failed to register her new address with the association, members of the association’s board almost absolutely had to know she wasn’t living there.
This makes an association lawyer wonder – what was the Board thinking? Any Board would know that imposing a daily $50.00 fine on a $134,000 home, and then trying to recover that fine at the close of the owner’s deed in lieu of foreclosure to the bank, is completely irrational. This fine takes a home that could be used and taken care of by a new (dues paying and lamp lighting!) owner, and renders it practically unsellable. Everyone suffers when a home is left vacant, and the association’s actions in trying to force the payment of a $20,000 fine, which could jeopardize the sale, call into question whether the Board members are really acting in the association’s best interests.
Fines should be reasonable, and related to the seriousness of the offense. In Colorado, the association’s policy regarding the imposition of fines must set forth a fine schedule. Associations and hearing committees should clarify when a violation may be a "continuing violation" justifying regular fines, so that an owner who takes three days to remedy a violation is not subjected to fines for three separate violations.
Associations have a hard enough time in the press without imposing ludicrous fines like this, and need to consider how the fines will impact the individual as well as the community.