A fundamental component of living in a common interest community that is governed by a homeowners association is the need for rules, regulations and/or policies (hereinafter collectively referred to as rules) that all members of the homeowners association and their tenants and guests are required to comply with. As such, it follows that those who live within common interest communities must be familiar with the associations rules and should have a basic understanding of the process of enforcing HOA rules and adopting them. It is also critical for those who are involved in the management of a homeowners association, whether as an officer, volunteer director or as a retained property manager, be knowledgeable about the process of adopting and enforcing the associations rules.
Associations Must Have the Authority to Adopt Rules.
A homeowners association cannot adopt rules that are enforceable against its members and their tenants/guests unless the association has the authority to adopt the rules. A homeowners associations authority for adopting rules comes from the associations governing documents (i. e. Articles of Incorporation, Bylaws, CC&Rs) and/or state and federal laws that apply to homeowners associations. With the required authority, the associations board of directors can formulate and formally adopt rules for the association. Absent provisions in the associations governing documents that empower the associations directors to adopt rules, there must be authority granted to the association in applicable statutes for the association to properly adopt and enforce rules.
Proper Procedures Must be Followed to Adopt Rules.
In addition to having the proper authority to adopt rules, an associations board of directors must also follow specific mandated procedures for the adoption of enforcing HOA rules. Such procedures are set forth in the associations governing documents and/or state statutes. Associations that have governing documents which lack proper provisions concerning the adoption and enforcement of rules should invest in the process of amending their governing documents to add the appropriate language.
Rules Must be Consistent with Provisions Contained in the Associations Governing Documents.
A fundamental requirement of enforcing HOA rules that are adopted by an associations board of directors is that the rules be consistent with, and not in conflict with, the provisions contained in the associations governing documents, which by law have priority over the rules. Thus, something that is permitted by the associations governing documents cannot be prohibited by the adoption of a rule containing the prohibition.
Rules Must be Adopted in Good Faith and Must be Reasonable.
In addition to being consistent with provisions contained in the associations governing documents, the rules that are adopted by an associations board of directors must be reasonable and adopted in good faith. Whether or not a rule is reasonable is determined by reference to the common interest development as a whole, and not by reference to any facts that are specific to any particular homeowner that is challenging a rule. Case decisions have held that rules are reasonable and should be enforced unless they are wholly arbitrary, violate a fundamental public policy, or impose a burden on an owners use of land that far outweighs any benefit.
Homeowners association members, officers, directors, and management personnel should be familiar with the content of their associations governing documents and state and federal laws that must be complied with when dealing with issues relating to the adoption and enforcement of rules. All rules that are adopted by a homeowners association should be reasonable and consistent with the provisions in the associations governing documents and the law, and they should be enforced fairly and consistently. Having this basic understanding will enable those dealing with issues pertaining to homeowners association rules to more effectively address those issues.