Assessments Expired along with Covenants?

Cross-post from AnonNews

September 2, 2013

Since we know our rules are expired, in all actuality, we don't have to pay fees if we don't want to; does any one know if all unencumbered properties could also stop paying the fee on the loan that was taken out several years ago to pay for repairs from the hurricanes?
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To Anon. above:

that's a very good question; and got me to thinking that I don't recall signing any kind of document binding me to paying the loan amount of $25/quarter or $100/yr.
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What about the renters and guests, who, come down here and enjoy our resort without the fees that the rest of us have to pay to keep our amenities operational like the pool, Jacuzzi, pool tables, shuffleboard courts, horseshoe pits, and all the maintenance that goes along with them, as well as keeping the bathhouses stocked with paper and soap, etc. etc., isn't it high time they also paid their fair share?
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$Anon$

Lissen Up Anons!

Membership in the HOA BINDS you to its contracts; you "presigned" everything the HOA agrees to when you accepted the Deed to your property. You became a member of a private government--SLohA. (Many of you didn't vote for the president either and you still have to follow legislation adopted by his administration. Because you are a citizen of the US government.)

Stop paying fees at your own risk! Until the covenants issue is settled, the HOA will assume the authority to execute its duty to collect fees and will legally pursue nonpays to the limit of its legal power.

I continue to voluntarily pay contributions--they are no longer "assessments"--so as not to muddy the waters with a second issue (based on the underlying important issue). I will do this until my attorney advises me to do otherwise.

If you intend to stop paying fees for any reason, I would suggest that you get the counsel and protection of an attorney.

S u e Tg
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Whoa, there, never said anything about stopping paying our fees; it's just that we use none of the amenities, and will pay for what we use: water, sewer, garbage pick-up and road maintenance, since we do use those items, however, when a resident whose lot is expired, is expected to pay the way too high fee of $475/qtr., which includes the loan re-payment fee of $25/qtr., it seems ridiculous that we can't just pay for what we use, especially since when we bought in here, (in 2008) the covenants on our lot were already expired, therefore, was there really an HOA legally in existence to pay these fees to since the first quarter we were in here?

Perhaps this is a legal question.
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@above Anon: Yes, I believe you should consider your proposition with an attorney before any action is taken. You incorporate two important thoughts in your post--the non-existence of the HOA at the time you bought your property and the equitable assessment of amenity fees.

If your lot expired prior to buying in 2008, you can do what my attorney recommended as a first step; put the BOD on formal written notice of that fact. This action closes off certain typical defenses and forces the HOA into a more uncertain defense posture should it attempt to pursue for non-payment.

Fraud would be the most obvious tort which you suggest due to misrepresentation of the legal status of the HOA, but it will be cH allenging to prove. You might have to prove that your Seller/Realtor defrauded you by intentionally withholding material information about the property you bought and you suffered damages as a result. The sued previous owner might S u e the HOA, Management company and individual directors for withholding material information about the lapsed authority of the HOA. You might also have to prove that the HOA/ knew about the expired covenants and misrepresented its authority to owners, resulting in damages.

You noticed that my reaction was brisk! Payment of assessments is the heartbeat of the HOA and when it is threatened, the HOA will go into death throes as revenue dries up. They will protect the money flow and spend many times the amount owed to collect. When the money stops, eventually the HOA dies because there is no money to pay anyone to go out and pursue collections against owners who no longer care to participate in an HOA that has violated their trust. Inability to pay legal fees to lawyers to write threatening letters, file liens and foreclosure suits will result in zero collections.

Not paying will provoke a earth-shuddering protective response by HOA and where a contract exists, the nonpayer will likely lose. Where a contract no longer exists due to covenant expiration, HOA is behind the 8 ball. This is why the HOA is fighting--the contract has expired for the vast majority of properties in SLR and if it acknowledges that fact, it runs the risk of having no authority to enforce collection of fees. My attorney characterized this as revealing that "the emperor has no clothes".

It is frightening when I think that owners who are questioning this issue might consider not paying assessments. It is commendable and responsible to learn about the covenants expiration issue and place it in the context one's own situation. In the future, the nature of payments to the Association may change drastically and you are peeking into the future with the kinds of observations and propositions that should be made. Wish more folks would do as you are doing. I thank you for your post so I am able to pass along some information that has been given to me by my attorney. Tg
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September 3, 2013

thank you so much for your post above, and the full knowledge with which you exhibit in your posts. when we purchased in here in '08, I seriously doubt the seller, whose husband was seriously ill at the time, and the reason they were selling the place, knew anything at all about the covenants being expired on the lot she sold to us.

Legally, it does all seem to boil down to one thing and that is proving that the HOA knew the CC & R's were expired and when they knew it, and that would be a hard nut to crack, so to speak, in prevailing in any law suit that we could bring regarding the fact that we purchased into an HOA w/expired CC & R's.
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