CondoTalk: Limits on late fee charges
Q. Our condominium association imposes a $25 late charge every month that an owner’s account has an open balance. I seem to recall reading that this is not permitted. Am I correct?
A. Yes, you are. The board may impose charges for late payment of a unit owner’s proportionate share of the common expenses. Recent case law states that condominium associations may charge a late fee only for the month that an assessment is not paid, or not paid on time. So, charging a late fee whenever there is an open balance on an owner’s account at the end of a month, if the assessment for that month was paid on time, would violate case law.
Q. I live next door to an empty lot that is always filled with over grown weeds. Are these empty lots held to the same association bylaws that I am? Can the association force this lot owner to cut their grass and maintain the property?
A. All of the lots in your association should be subject to the same covenants and restrictions and rules. If there is a restriction that requires owners to maintain their lots and keep grass mowed and free of weeds, then it would apply equally to a developed lot or a vacant lot. The association can enforce the restriction through fines. If fines don’t persuade the owner to comply, legal proceedings could be initiated to force the owner to maintain his lot. Some association governing documents permit the association to perform the work and charge the cost back to the offending owner. This usually requires the board to first give written notice to the owner and a deadline for compliance.
Q. I was recently assessed a fine for my grass being too long. I emailed my property management company asking when our next board meeting would be held, so I can appeal this fine. I also asked for the names of our association board members. I was advised that our association does not have board meetings and that they are not allowed to give me the names and contact information of our board members. Management also said I have a right to appeal the fine, but that would have to be done via email and I could send that email to them. Is this the correct way appeals should be done? How do I find out whom is on our board?
A. The fine was not properly levied here. A fine can be levied only after providing written notice of the violation to you and after providing an opportunity for a hearing. Levying a fine and requiring an owner to appeal the fine violates the required due process. Most associations are required to hold at least four board meetings a year. Board members not meeting as required by law could be exposed to liability for breach of fiduciary duty. An owner should be provided the names and contact information for members of the board. If the association is incorporated, you can obtain the names and addresses of the officers from the secretary of state website. Boards of associations are not “Star Chambers.” They are generally required to meet and conduct association business in open meetings. The political solution, elect new board members at the next annual meeting, may be the most efficient way to correct these problems.
Q. Our association has a unit in foreclosure with more than a year’s fees unpaid. The accountant for our condominium association has advised the board that the association can only place a lien for six months of monthly dues in arrears. Is the accountant correct?
A. No. The association is not limited to a lien for only six months’ of assessments. The amount of unpaid common expenses or the amount of any unpaid fine when due, with any interest, late charges, reasonable attorney fees incurred enforcing the covenants of the condominium instruments, rules and regulations of the board of managers, or any applicable statute or ordinance, and costs of collection constitute a lien on the interest of the unit owner. However, the accountant may be referring to the amount that a purchaser at the foreclosure sale is obligated to pay the association with respect to assessments owed by the foreclosed unit owner. I will address this issue, and foreclosures generally, in a future column.
Ÿ David M. Bendoff is an attorney with Kovitz Shifrin Nesbit in Buffalo Grove. Send questions for the column to him at CondoTalk@ksnlaw.com. The firm provides legal service to homeowner associations. This column is not a substitute for consultation with legal counsel.