Te words “penalties” and “sanctions” suggest this is a form of punishment in response to a wrong.
It is a price to be paid, or time to be
served. However, community associations are designed to enforce restrictions to gain compli- ance, and not enforce restrictions to penalize. Tis is not only a philosophical perspective, but one that is rewarded in court. Numerous ap- pellate cases have ended in an association being awarded its attorneys’ fees because it achieved the goal of obtaining compliance, even if it took a curvy road, with a few losses, to get there.
In
fact, in the recent case of Almanor Lakeside Vil- las Owners Association v. Carson (2016) 246 Cal. App.4th 761, an association had a majority of its fines overturned, but the association was still declared the prevailing party because it met its objectives in the litigation of enforcing the gov- erning documents. Te fines were a big part of bringing that case, and the owner beat most of them, but they were ultimately treated like back- ground noise when the court focused on the big picture of enforcement and compliance. A great deal of arguments in that case were spent on the fines, but ultimately the court did not give them much weight in ruling in favor of the association.
With that background in mind, fines are a useful if given the right perspective. Fines are a tool to gain compliance.
When to fine?
Fines are the first line of defense. Tey are low- cost, gain the attention of the compliant who have made an error, and involve multiple com- munications and a meeting before the Board where there are many opportunities to gain the owner’s compliance. Courtesy notices will cor- rect many issues, but when they fail, the fines should commence. Te hearing notice is the
prelude to the fines, and that notice itself will cause some to pay attention and take action. Te hearing follows, which again is another opportu- nity for voluntary compliance. When that fails, it is time for fines in accordance with the associa- tion’s reasonable schedule of fines.
How much to fine?
Not all violations are equal, and should be re- sponded to in kind. In that regard, the Board must consider whether a house painted without approval warrants the same fine as the dog off- leash in the common area. A schedule of fines can be detailed or broad, but thoughtful consid- eration should be given to the amount of each fine. Te Board must also act uniformly and consistently when imposing fines so that one owner’s barking dog leads to the same fine as an- other.
If a lawsuit ever occurs over a violation, an association does not want to be in a position of having to turn over stacks of hearing results notices, and the owner’s attorney seeing the same violations but with different amounts fines. Te initial assumption will be those owners were treated differently because of some nefarious rea- son, such as a personal issue with a director, or their protected class status.
Daily fines are a possibility as well for a stagnant, ongoing violation, such as an unapproved paint color. Daily fines are not appropriate for repeat- ed but distinct events that have different facts, such as a dog barking on Monday, and then again on Tuesday. Tat scenario would require a hearing before new fines are imposed.
Daily fines also have the tendency of being put in motion with a single letter, and then start to accumulate while no one is closely monitoring. Six months go by before another inspection con- firms the violation remains, and the owner gets a
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FINED!
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