Ruling Illustrates Potential Costs of HOA Disputes for Owners

The firm’s latest Miami Herald “Real Estate Counselor” column was authored by Christyne D. Santisteban and appeared in Sunday’s edition of the newspaper. The article, which is titled “Ruling Illustrates Potential Costs of HOA Disputes for Owners,” focuses on the potential pitfalls for owners who flout community association rules in hopes they will ultimately be allowed to do as they wish and avoid strict compliance. Her column reads:

. . . A recent ruling by the state’s Fourth District Court of Appeal illustrates how disregarding  clear and reasonable association restrictions can lead to costly outcomes for owners. They could ultimately be forced to comply via a court-ordered injunction, and they may also be saddled with having to pay the association’s attorney fees and legal costs in addition to their own.

The case of Justin Mooney and Katarina A. Korray v. Color Le Palais of Boynton Beach Homeowners Association stemmed from a dispute over Mooney and Korray’s replacing of most of the lawn from their front yard with mulch. The Color Le Palais HOA responded by sending them numerous notices indicating they were required to replace the mulch with sod, as the community’s recorded declaration states that owners must maintain lawns that are “uniform in texture and appearance with surrounding lawns.”

The governing declaration goes on to state that for those who fail to comply, the association may proceed in court to demand compliance, and it will also have the right to take action to correct such failures and impose the associated costs on the owners.

After the owners refused to participate in the association’s requested mediation over the matter unless the HOA agreed to pay all the costs for the proceeding, the association filed suit against them for breach of contract and injunctive relief. The lawsuit alleged that they failed to receive the association’s prior approval for their landscaping alterations, their mulch was being blown and strewn around neighboring properties and common areas, and it was blocking storm drains and causing flooding. It asked the court to issue an injunction to order the owners to replace “their unsightly mulch lawn with healthy grass/sod.”

The case went to trial before the Palm Beach County Circuit Court, and the pleadings revealed that the owners had voluntarily complied with the HOA’s demands to replace the mulch with acceptable sod after the litigation commenced. The association contended this compliance was the functional equivalent of a judgment in its favor, and as the prevailing party it was thereby entitled to having its attorney’s fees and costs paid by the defendants.

The owners acknowledged that their compliance with the landscaping demands had rendered the case moot, so they asked that it be dismissed. They also contended that the association could not be the prevailing party due to its failure to state a claim for the injunction it sought, as its own declaration provided it with an adequate remedy at law by granting it the right to self-help in the form of taking action to replace the noncompliant mulch and billing the owners for the costs.

The circuit court granted the association’s motion for summary judgment. It found that in accordance with the community’s governing declaration, it had the option to either seek injunctive relief or to remedy the violation at its own expense and then impose those costs on the owners. The ruling also determined that the HOA was the prevailing party and would be awarded its attorney’s fees and costs in the agreed amount of approximately $40,000.

In the owners’ ensuing appeal, the appellate panel concluded that the circuit court’s ruling was supported by longstanding decisional law. It found that the HOA’s governing declaration provided for self-help as an alternative in addition to the exercise of all other reasonable remedies.

The appellate ruling cites Florida’s HOA statutes and numerous prior court decisions in support of its opinion that the right to self-help did not preclude the association from seeking an injunction. It also concludes that self-help was not an adequate remedy because it required the HOA to embark on a substantial horticultural project that would have been against the owners’ wishes and could have degenerated into a breach of the peace. The property could have been damaged, the parties could have ended up un litigation over the costs, and the failure to reimburse the HOA could then have allowed it to foreclose on its lien. The Fourth DCA concluded that all these potential complications rendered the self-help remedy inadequate, and the injunction was the more efficient and complete remedy.

The appellate panel also certified its ruling as being in direct conflict with two prior cases holding that an HOA declaration’s self-help provision constituted an adequate remedy at law and thus precluded it from obtaining injunctive relief for an owner’s failure to comply with maintenance or lawn requirements. Such a certification of conflict serves a request to the Florida Supreme Court that it consider taking up this case in order to render a decision over this question that would hold precedence throughout the state.

The appellate court also upheld the lower court’s decision that the association was the prevailing party in the matter, so the end result is that the owners will now be on the hook for their own attorney’s fees as well as those of the HOA. . .

Christyne concludes her column by noting that as this decision illustrates, needless disputes resulting from owners’ refusal to comply with clear and reasonable provisions in governing declarations can lead to costly outcomes. She writes that such clashes and potential litigation should be avoided by gaining a clear understanding of the requirements for compliance, and seeking prior approvals before taking any actions that could run afoul of a community’s edicts.

Our firm salutes Christyne for sharing her insights into the takeaways from this recent appellate ruling with the readers of the Miami Herald.

Our South Florida community association attorneys write about important matters for associations in this blog and our Miami Herald column, which appears every two weeks on Sundays, and we encourage association directors, members and property managers to click here and subscribe to our newsletter to receive our future articles.