Homeowner association Boards are presented from time to time with a conundrum...a puzzling question that must be solved. These are situations that require the wisdom of Solomon because ramifications are far reaching and complex. In other words, a simple answer just won’t do. Take this real life scenario:

A condo owner had a roof leak several years ago and notified the Board President who, in turn, called the manager who, in turn, contacted a roofer who, in turn, contacted the condo owner to arrange a repair. Are you with me so far? While all seemed to have been handled correctly, the roofer never actually did the work, so the condo owner stopped paying the monthly assessment several months later when the rains returned and the roof started leaking again.

Late notices were sent by the management and eventually the HOA attorney stepped in. The owner made a few payments then stopped, claiming the leak still wasn’t fixed and moreover, the lawyer had treated her rudely. (How cheeky!) Since it was now summer and the rains had passed, trying to repair a leaky roof was problematic. The owner was told it would be handled when the rains started again.

A new Board was elected later that year and soon became aware of the conundrum, now over a year old. The Board made a personal visit to inspect the leak which was in a bedroom closet. A fish tank was catching the rain water, the ceiling was covered in mold and falling apart. A roofer immediately remedied the problem and the owner was charged for drywall repair.

By now, the condo owner owed $1200 in monthly assessments, $405 in late fees and $870 in legal fees. The owner made partial payment but refused to pay any legal or late fees. The Board agreed to waive late fees but wants legal costs reimbursed which were already paid by the HOA. The Board is in a conundrum: go to court or compromise?

Withholding assessments is a common, but illegal, tactic some members use to make a point with their HOA. It's easy to see how quickly things would get out of hand if every member stopped paying because things weren't going his or her way. But in this situation, there seems to be a huge disconnect between the owner, Board and management. The manager clearly failed to see that the repair was completed. Now, the owner could make a good case that all interior damage should be paid by the association due to failure to repair the roof in a timely manner. Further, the mold issue could escalate into a legitimate health issue. Mold litigation is a growing cottage industry for lawyers.

While this owner's methods aren’t exactly kosher, under the circumstances, the Board should compromise by waiving late charges and attorney fees if the owner brings the delinquency current immediately. The chances are pretty good a judge (if it got that far) would slap the Board and management for how this situation was handled and might even grant the owner punitive damages.

This is a case when the Board needs to settle the matter amicably before it goes any further (read “lawyers”). While the Board should never back off too quickly, there are cases, and this is one of them, where the association has clear liability in the events. When that’s the case, swallow your pride, cut your losses and review the maintenance procedures to make sure it doesn't happen again.

Oh, that all problems put before the Board were cut and dried. But, now and again, a conundrum will present itself. Conundrum solving requires thinking “outside the box” so the HOA doesn’t get itself boxed in.

For more on HOA management techniques, see http://www.Regenesis.net

Published: December 4, 2002

Use of this article without permission is a violation of federal copyright laws.

Richard Thompson owns Regenesis, a management consulting company that specializes in condominium and homeowner associations. He is a nationally recognized expert on HOA management issues. Regenesis publishes The Regenesis Report, a monthly newsletter for HOA boards, developers and managers. To subscribe, go to Regenesis.net. He can be contacted by email at .