#37-11, Hernandez v. Hadley Farms Community Association (July 17, 2012) (Panel: Alkon, Weinstein, Brandes)

The homeowner filed a complaint with the CCOC disputing an order from his HOA that he remove a fence and other improvements from the common areas.  The owner claimed that when he purchased the property in 2006, the rear yard already included the fence and several improvements such as a fish pond and a bird bath, and he added playground equipment and other items.  The HOA did not complain to him of any violations or encroachments until 2010.  He argued that removing the improvements would be a hardship for him.

The evidence at the hearing showed that the lot in question already had certain improvements installed on it when the homeowner purchased it.  The fence and several of the improvements were actually located on the common areas.  The homeowner' s title survey did say that the improvements might encroach on the common areas but the homeowner testified he was not aware of that warning, and the HOA did not disclose any violations at the time of the purchase.  The HOA was not aware of the problem until 2009, and it hired a surveyor who concluded that the improvements were in fact on the common areas.  The HOA's governing documents required it to make annual inspections, but for many years it did not perform them, and when it did, it only inspected the lots from the front yards and so could not see if there were problems in the rear yards of these town homes.

The hearing panel found that the improvements had been installed without the HOA's approval, in violation of the governing documents.  The improvements constituted a trespass on the HOA's property.  The HOA did not waive its rights because it was not aware of the encroachments and because the Declaration of Covenants clearly states that the HOA's failure to enforce the covenants in the past was not a waiver of its right to enforce them in the future.  Moreover, the homeowner took title subject to the HOA's governing documents, which regulated the use of the lots and prohibited storing private property on the common areas.

However, the panel also found that the HOA was partly at fault in the matter.  The HOA violated its own rules by failing to inspect the lots properly and annually.  If it had complied with its rules, it would probably have discovered the encroachments several years earlier and would have prevented the homeowner from investing more money in additional improvements.  Therefore, the panel held that the HOA should pay the costs of removing the encroachments