Wilmington Attorneys Represent Homeowners’ & Condominium Associations
Rhine Law Firm, P.C., continues to maintain a truly comprehensive scope of legal practice for our many clients. We are able to assist in matters including business and civil litigation; car, truck, construction and workers’ compensation accidents; as well as cases involving medical malpractice, product liability, social security disability and more. We have over 27 years of experience in delivering results for North Carolina individuals, families, military members, students, vacationers, and those in our thriving business community.
One area of specialized practice is representing homeowners’ associations (HOAs) and condominium associations (COAs). We handle these cases on an hourly basis. Attorney Chris Barbour has recently joined Rhine Law Firm, P.C.’s team of highly qualified attorneys. A North Carolina native, Mr. Barbour understands how to navigate the many potential challenges that HOAs may encounter. He has experience as a licensed general contractor, forensic construction consultant, and has had tremendous success in key areas such as construction defects, and repair and maintenance-related litigation.
What Is an HOA?
A homeowner’s association (or condominium association) is made up of two or more property owners who are members in an organization responsible for maintenance of common areas, property improvements, and regulation of member-owned properties. Community developments are usually required to form a nonprofit entity that manages the properties. HOAs have a duty to manage their communities in the best interests of the members and in accordance with related state statutes including the North Carolina Planned Community Act, the North Carolina Condominium Act, and in many cases, the North Carolina Nonprofit Act. These "planned communities" may feature various types and styles such as single-family units, townhouses, etc.
Current HOA Data
According to the Community Associations Institute (CAI), a nonprofit organization and leader in advocacy and education, total home value within current community associations exceeds $5.5 trillion. In the U.S in 2016, there were approximately 342,000 community associations in existence. North Carolina has roughly 13,900 associations, which ranks 5th highest in the nation.
Administration & Development of HOA Board & Meetings
While for-profit corporations have shareholders, nonprofit organizations have members. HOAs have meetings which are conducted at least once per year and members elect a leadership board. Members are required to be given adequate notice of upcoming meetings. When votes on key issues are conducted, generally a quorum (minimum required percentage of members) must be present.
Drafting Key Documents: Declarations, Bylaws, Covenants, and Restrictions
An HOA establishes a variety of key documents. The bylaws are essentially "ground rules" or the organization’s "constitution" typically associated with governance and procedures for voting. The bylaws are likely to be referenced for information regarding elections. The declaration of covenants, conditions, and restrictions or "CCRs" typically explain what may or may not be done within the properties and outline general HOA operation. When referring to the bylaws and CCRs together, the commonly used term is governing documents. Examples of restrictions include where you can park, provisions about displaying flags or political signs, and landscaping guidelines.
Collection of Dues & Enforcement of Liens
The declaration also explains the obligation of the HOA to collect dues or "assessments" from the owners, including the amount and frequency of payment. Assessment amounts are based on a budgeted projection of the financial needs for the year. North Carolina law has specific processes in place regarding collection of unpaid dues, which includes placing a lien against the delinquent owner’s property and a potential subsequent foreclosure on the property.
The HOA is responsible for maintaining property insurance coverage for all common areas for risks such as fire. Liability insurance is required for risks such as incidents resulting in injury, death, or property loss. Similarly to a company, HOAs may be responsible for board member actions performed in the course of their duties.
Contracts, Disputes, and Defect Litigation Involving Developers & Contractors
Developers may control the board while they still own the majority of unsold units; however, they will eventually relinquish this to the HOA. HOAs routinely enter agreements with contractors. In the mid-2000s there was rapid building of planned communities. This led to a shortage of quality subcontractors, which coincided with manufacturers hastily producing new products to satisfy market demand, many of which had unique installation requirements. This combination led to a spike in "condo defects" such as those associated with water entry, including mold and structural failures. Defects are also common in swimming pools, walkways, and drainage systems. HOAs and their attorneys often must litigate these claims against developers and contractors, otherwise they risk having to absorb the costs of repair.
HOA Rule Compliance and Local & State Agency Representation
During the initial development stages, planned communities must obtain approval from the local zoning agency. In addition, they are tasked with adherence to ordinances and established building codes. The local health department may routinely inspect structures such as swimming pools. Property taxes are an unavoidable expense.
Rhine Law Firm, P.C., is experienced in providing a full offering of legal services for homeowners’ and condominium associations including:
- Creation of key HOA governing documents: bylaws, covenants, declarations, and restrictions.
- Providing transitional support between developers and establishing a board and meeting structure.
- Protecting the HOA by resolving disputes and litigation against contractors for faulty work or material defects.
- Assisting with collection of assessments (dues) and implementing property liens and foreclosures as needed.
- Maintaining compliance with ordinances, the N.C. Nonprofit Corporation Act, and providing representation before local and state agencies.
- Evaluation of insurance, protection of assets, and limiting risk and potentially costly liabilities.
The Rhine Law Firm, P.C., is available for experienced legal representation of homeowners’ associations and condominium associations in North Carolina. We work these cases on an hourly basis. For a consultation, contact our office at (866) 772-9960 today. We offer evening and weekend availability.
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