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CCOC Decision Summary

# 141-O, Houston v. South Village Homes Corp. (June 16, 1994) (Axelson, Fox, Sullivan) 

The homeowner (HO) challenged the legal right of the homeowners association (HOA) to assess them for the costs of operating a water and sewer system that serves their home.

The facts produced at the hearing showed that the HO lived in a neighborhood association called Center State, which was served by its own water and sewer system.  Center Stage was merged into the HOA, which was much larger and had its own, different, water and sewer system.  In 1991 the HOA imposed a special assessment on the Center Stage homes of $60.00 per month for the maintenance of the Center Stage water and sewer system.  As a result of the merger, the Center Stage homes became subject to the HOA governing documents, and the Center Stage homes were charged $220 per home, to be paid to the HOA, for its assumption of the duty of maintaining the Center Stage water and sewer system.  The Center Stage system then became the community property of the HOA.  The HOA's Declaration stated that the HOA has the right to charge "reasonable admission and other fees for the use of the common community properties," and the definition of "community properties" included "all land improvements and other properties heretofore and hereafter owned [by the HOA]."  The HOA bylaws require the board of directors to maintain all community properties and facilities.

The hearing panel held that the HOA did not have the authority to charge the Center Stage homeowners, including the HO in this case, a special user fee for any portion of the community facilities which those homeowners are required to use.  The HOA was paid to own and maintain the Center Stage water and sewer system, and that system was now part of the HOA community property.  The HOA was only allowed to charge special fees for the use of those community properties that members used voluntarily, and not to those elements of community property that a member was required to use.  A special assessment imposed on selected homeowners for the use of community property which the homeowners must use is a violation of the HOA Declaration, Bylaws, and Articles of Merger.

The panel ordered the HOA to stop collecting the disputed special assessments ands to refund the sums already collected to the Center Stage homeowners.  The panel recommended that the HOA negotiate with the Washington Suburban Sanitary Commission to take over their water and sewer system.


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