Hearings may or may not be required to levy fines for covenant violations. The HOA’s governing documents may require hearings for this purpose. Or state statutes may require a hearing to levy fines, for example, North Carolina statutes require hearings. In South Carolina which has no specific state statutes, the HOA’s governing documents may require hearings.
If state statutes or the HOA’s governing documents do not specify a minimum notification period, the board of directors should be reasonable in this determination. A minimum of ten days notification would generally be considered customary. However, if feasible, fifteen to thirty days notification maybe deemed more reasonable if this notification time frame is challenged in court.
This notification should state the hearing is being called to discuss a “possible covenant violation.” Possible being the optimal word, because the hearing is being called to determine if a violation has actually occurred. This notification should be mailed First Class US Mail. This hearing notification letter does not have to be sent registered mail unless required by state statute or the governing documents.
The Hearing Process: At the beginning of the Hearing the member who has been called to the hearing should be shown the Hearing Notification Letter and told of the possible violation as noted in the governing documents of the HOA.
1) The homeowner should be asked for their input. We recommend and it is customary for a time limit of 3 to 5 minutes maximum.
2) The Board should avoid being confrontational with the member and only ask questions for clarification. Arguing or pointing out the weakness of the member’s defense of a violation is better done via a written Hearing Results Letter that is sent after the hearing.
3) When the member is finished, the Board should be advised that the board will notify them of their decision or ruling.
4) The Board is then free to determine the need for fines or sanctions and the amount of the fine. Some fines will be on an as occurred, such as a dog running loose. Other fines may be daily fines, such as for unauthorized homeowner construction, and levied daily until the construction is removed. State statutes or governing documents may go into specific detail on how fines are to be structured or limited.
5) Whatever fining parameters are to be used, it is advisable that all fines be reasonable and uniform in nature. For example not removing an item from their front yard would be a fine of $5 or $10 per day until removed. Not picking up after a dog would be a fine of $25. A judge may consider a fine of $100 for not picking up after a dog excessive in relation to the nature of the violation. The possible consequences of a judge deeming a fine unreasonable is the judge not honoring the fines accessed or possibly dismissing the case altogether.
Hearing Fine Points
– Minutes must be taken at the hearing.
– There must be a quorum of the board at the hearing.
– Hearing notifications do not have to be sent certified mail.
– Generally speaking a hearing does not have to be called every time there is another violation of covenant once a hearing and an initial violation has been adjudicated. State statute and the HOA’s governing documents need to be reviewed in this regard.
– If the member misbehaves at any point during the hearing, the member should be dismissed from the hearing; the hearing can continue without their input.
– If the member was properly notified and given the opportunity to appear, the member does not have to be present for the hearing to proceed. You generally do not have to reschedule a hearing to meet the needs of the party called to a hearing. State statutes and governing documents need to be reviewed in this regard.
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