We purchased our home because we knew that our mandatory HOA would keep up home values. The amenities in our sub division include: front brick signage entrance with a medium that included schrubs and flower beds. A community park and a 400 ft dock to the lake. Fast forward to today. About a year ago i found out that one of the original homeowners was suing the validity of the HOA, since it’s establishment in 1998. Under the decree that the developer did not set up the HOA correctly with the county. Since 1998 this community has been collecting dues, has a management company, and running for all legal terms as a legit HOA. Well today the judge has just ruled in favor of this neighbor. States declarations are binding, but now we must run as a voluntary association. We board membership and rest of our community are extremely upset. Do we have any recourse, can we appeal? Can we sue stating the only reason we purchased our home was because we knew that by having a legal mandatory HOA, they would protect our home value and if so who would we sue? The title company, the developer which is no longer in business? Thank you for your advice
Whether you can appeal or not (now, at least) will depend on the type of order or judgment the judge issued, but generally yes, of course you can appeal, and probably should. You should get a few members together, and retain a good local real estate litigator with substantial appellate experience.
Your lawyer will explain what you can do - to not only determine if the ruling is properly appealable, but also help determine the current enforceability of the CCRs. It is the CCR that really count. And if the association actually owns and manages common property, I find it difficult to believe the judge rule that way, and leave that property unmanaged (i.e., w/o at least establishing a trust, etc.).
Make SURE you retain an EXPERIENCED HOA lawyer. Some (many) lawyers and judges do not even LIKE real estate law, and worse, have no clue about HOA law (which is primarily statutory); this can result in serious mistakes (and appealable orders).
Hope this helps.
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I agree you need a HOA lawyer to review the ruling immediately. You only have 30 days to file an appeal. It's confusing as to why the judge states the HOA was not set up correctly with the county and is voluntary, but yet the declarations are binding. Just guessing, but it seems maybe they are land use restrictions with no intent in the original documents to create a HOA. At least get an opinion to see if the documents are expired and revitalization is an option or if they were not good from the beginning.
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