We are often asked what can be done when a homeowner is violating the governing documents. That answer depends on the language of the association’s declaration, and whether or not the association is subject to the North Carolina Planned Community Act or Condominium Act. Quite frequently, the answer results in a discussion on the association’s ability to issue fines to owners who are in violation. However, the same North Carolina statutes that grant the ability to issue fines also grant the association the ability to suspend community privileges or services.
As with issuing fines, an owner’s community privileges or services may not be suspended without following the proper statutory procedure. Essentially the statutes require that owners be provided with “due process” prior to issuing a fine and/or prior to suspending community privileges or services.
NCGS 47F-3-107.1 and 47C-3-107.1 state that: “Unless a specific procedure for the imposition of fines or suspension of planned community/condominium privileges or services is provided for in the declaration, a hearing shall be held before the executive board or an adjudicatory panel appointed by the executive board to determine if any lot/unit owner should be fined of if planned community/condominium privileges or services should be suspended…” Both statutes require that the owner receive notice of the charge, an opportunity to be heard and to present evidence, and notice of a decision regarding the alleged violation or delinquency. If the executive board or adjudicatory panel decides to suspend privileges or services, the suspension may be continued without further hearing until the violation or delinquency is cured.
This procedure is most often used when the association has an amenity available to the homeowner. For example a pool, tennis courts, or a clubhouse. Associations can suspend the right to use these community amenities until the owner cures the particular violation or delinquency. During the summer months we sometimes see associations suspend the ability to use the pool until the owner becomes current on their assessments.
Suspension of community privileges and services is seen less often than the issuance of fines. However, the same statutory process is to be followed for both. For associations with particularly attractive amenities, suspension of privileges or services may entice compliance faster than issuing fines. For advice on the process of issuing fines or suspending community privileges or services, please contact one of our community association attorneys in our Greensboro, Charlotte, Triangle, or Coastal offices. Note that the specific procedures outlined above pertain to North Carolina communities. For help with your community in South Carolina, please contact one of our South Carolina licensed attorneys.