In the state of New Jersey if any board members decide to start proceedings that entails lawyer's fees when possibly the problem could be handled with a letter from the management people or the association themself, then the association should not even pay the lawyer's fees but the people on the board themself should pay for it out of their pocket and earning that they make and not use other's condo owners money because they jumped the gun and then everything was dismissed. Let the board members who made the decisions to use the lawyer pay for him. How dare they think it is ethical and correct to charge you for lawyer fees? What happened in the United States with power hungry people who want others to pay for their mistakes. I would read your bylaws and take them to small claims court. I live in a condo with a lot of corrupt people and I always blame it on Columbus who had to empty the jails to get enough people to take the trip with him when he discovered America.
I would say that HOA must already have collections procedures adopted for non-payment of HOA dues and assessments by delinquent homeowners.
Before an attorney proceeds to file a complaint or collections action against a homeowner that may result in a foreclosure action, the attorney MUST send out a warning letter, certified, notifying the homeowner of what is about to take place, if payment is not made for the past HOA dues. This is standard legal procedure for such matters, to give the homeowner a chance to pay their back dues and avoid getting an attorney to lien to foreclose, which is at great expense to the HOA.
HOA's do not desire to hire lawyers frivolously for collections, for the HOA has to cough up the money and usually these costs are never collected or reimbursed; If the delinquent homeowner happens to be behind on their mortgage payments. The government and the bank are in first position to collect from any proceeds at a foreclosure and the HOA comes in 3rd position for any remaining funds to get the past due arrearages and attorney's fees reimbursed to them. In Alaska, this applies even if the HOA filed a lien to foreclose before the mortgage lender did.
In other words, the HOA is typically not reimbursed for attorney's fees by the homeowner, although it is permitted. I would recheck your bylaws and CCR's, because all the HOA's I have managed for the last 30 years, stipulate that the homeowner is responsible to pay back the HOA all legal fees incurred to collect a debt owing to the HOA. This CLAUSE MUST be in there somewhere, so keep looking or call and ask the property manager or your board president where in the CCR's/bylaws, collection policies et al it states that the homeowner is responsible for all legal fees?
Plus, complaints are not customarily dismissed, unless they have been paid in full or the debtor has signed a 'confession of judgement' or has made payment arrangements.
ALL the HOA CCR's and bylaws I have read in the last 30 years, all state that the HOA is entitled to recover attorney's fees for collection of a debt, dismissed, settled or unsettled. If not for this provision, more HOAs would be filing bankruptcy as a result of legal fees not being reimbursed and paid back to the HOA by the delinquent homeowner who failed to pay their monthly HOA dues on time.
It sounds as though the HOA was dragtged into a legal action. The Judge might assign fees to the party in error. Sometimes, those involved in suits have to pay whether they are at fault or not. What is your degree of fault?
John, You seem to be the only one who understands that the homeowner in this case was not faced with a foreclosure action by the HOA for failure to pay assessment fees. Rather, the Plaintiff was a New York Trustee who decided to dismiss the case voluntarily. I will, within 30 days persuant to the Florida Rules of Civil Procedure and Florida Statutes, file a Motion for Taxation of Costs to recover those costs that I incurred in an effort to defend myself against the Sham Pleading. I believe that the proper course of action by the HOA (through their attorney) would be to simply do the same instead of applying (I believe unlawfully) their attorney fees to my account without identifying those fees as a special assessment. I can find nothing in the Florida Statutes, nor in the Association's CC&R's or By-Laws, which would allow them to apply fees to an individual homeowner at any time, let alone whenever they seem to feel like it. They certainly cannot do this without at least first notifying the homeowner in advance. My question is: Outside of the HOA controlling documents, is there anything in the Florida Statutes that gives them the legal right to apply these fees to the homeowner, especially in face of the fact that, by Rule and Statute, the homeowner is, after Plaintiff's voluntary dismissal, the prevailing party?
Section 720.3085, Florida Statutes, and probably the community's Declaration, provides that an Owner is liability for attorneys fees and costs of collection when those costs are incurred in the collection of delinquent assessments from the Owner. When a mortgage lender files suit against an Owner and names the Association as a defendant in the action, the Association has two choices: 1) ignore the complaint and waive any right the Association may have to a distribution of any surplus proceeds that they may be entitled to after the foreclosure sale in hope that the Owner continues to pay his or her assessments after going into mortgage foreclosure, or 2) refer the matter to counsel so that counsel can determine whether the mortgage has priority over the Association's interest in the property (and whether there are any other defenses to the foreclosure action), and file an Answer to the complaint and preserve their right to any surplus proceeds from the sale.
The advisable course of action is to refer the matter to counsel and Answer the complaint. Now, the question is: were those costs incurred in attempting to collect delinquent assessments? There is no easy answer to this question. If the Owner was not past due at the time the mortgage complaint was filed, there is an argument that the funds were not expended in the collection of delinquent assessments. However, the Association also has an argument that it has one chance to answer the complaint and it is not reasonble to expect the Association not to do so in hopes that the owner will continue to pay the Association in order to keep the property when the owner has apparently not paid the lender in order to keep the property. While the judge could see it either way, I would pay the attorneys fees if they are reasonable.
I am in a similar situation in Ohio. I received a bill for attorney fees for the HOA to file a response regarding our foreclosure proceedings. I am current on my HOA fees.
The Ohio Planned Community Law states "5312.10 [Effective 9/10/2010] Common expense liability.
(A)(1) In accordance with its declaration, all costs the owners association incurs in the administration, governance, and maintenance of a planned community are common expenses." This would seem to indicate the association would be responsible for the filing costs. Do I have legal ground to contest the bill I have received?