#578-O, Williams v. Oak Springs Townhouse Association, Inc. (May 15, 2003) (Panel: Reilly, Bruce, Cihak).

The homeowner (HO) disputed a charge of $56.25 imposed on her by her homeowner association (HOA) for the cost of collecting her trash which she put outside her home a day before the scheduled trash pickup in violation of an HOA rule.

The facts produced at the hearing showed that the HOA had suffered problems with garbage and trash littering the neighborhood, so it sent a notice to all the residents warning them that they should not put trash out for collection before sunset of the evening before the regular trash collection pickup day.The warning also stated that anyone who did so would be charged for the cost of having a contractor remove their trash.Because the HO was leaving for a trip, she placed her trash out at noon of the day before the regular pickup.Later that afternoon, the HOA's contractor who was touring the area saw her trash and collected it.The contractor opened the trash bag to find out whose trash it was and identified the HO as the violator.Altogether, there were 4 violators that day.The contractor divided its total charge of $225 among the 4 violators and billed each of them $56.25.The HOA later reduced the charge to $30 because the HO was a first offender.

The HO claimed that the HOA violated her Constitutional rights against unreasonable searches by opening the trash bag and inspecting its contents.She also claimed that the HOA did not have the authority to adopt any rule imposing a penalty for placing her trash out early, and requested $10,000 in damages from the HOA.

The hearing panel ruled that even if the U.S. Constitution applied to a private organization – an issue it explicitly did not rule on – the U.S. Supreme Court had already ruled that a search of trash bags left out for pickup was not an unreasonable search.Further, the panel denied the HO's request for $10,000 because it felt that the HO's comments at the hearing demonstrated a cavalier attitude concerning compliance with the HOA's attempts to control trash in the area.

However, the hearing panel struck down the HOA policy on imposing fines for leaving trash out early.Although the panel firmly believed that the HOA had the authority to impose fines for the violation of its trash pickup rules, it concluded that the warning letter, in which residents were notified of the new policy on fines, was an improper exercise of authority.The panel said that while such a letter could be used to remind the residents of an existing, properly-adopted policy, the letter used here stated a policy that had not been properly adopted.The panel said that the HOA should have first adopted a written policy on imposing fines according to the rules specified in its governing documents, and that policy should state the reasons for its adoption and specify when the fine would be imposed, how the fine would be calculated, and how the fine could be appealed.The panel ruled that policy as stated in the warning letter was unenforceable and therefore the HO did not owe the fine.