Punitive Fining is Outside Board's Authority
Fairfax Co. Redevel. and Housing Auth. v. Shadowood Condo. Ass'n,
No. CL-2010-13282, Va. Cir. Ct., May 12, 2011.
In this case, a condo association levied more than $20,000 in fines against a housing authority, which owned several units to rent to low income families. The fines were related to rules violations by the authority's tenants and failure to provide the association with paperwork relating to the units.
The court held that the fine amount was unreasonable and punitive in nature. After analyzing the association's governing documents, the court determined that the board's authority to fine was limited to maintenance of common area property and association operations. The board lacked authority to issue fines as a penalty.
Before levying fines, a board of directors must ensure that the association's governing documents permit monetary fines. The board should also draft a policy outlining fine procedures and provide notice of the policy to association members.
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