Trouble Magnet

A property owner’s liability for guests’ injuries may be impacted by something known as the “attractive nuisance doctrine.” Examples of items that might be considered an attractive nuisance are: A piece of equipment, a wood pile, pile of sand, and a swimming pool.  

In these instances, the owner is required to take additional steps to protect children who naturally gravitate to these items.  On the other hand, a natural lake would not be considered an attractive nuisance. Georgia courts have stated that lakes are open and obvious hazards. Because of this, a person (including children) is considered to have actual knowledge of the dangerous condition and can avoid it by exercising ordinary care.

Specific circumstances create exceptions to natural hazards.  If a person is injured due to improper maintenance, the property owner could be held liable.  Example: A lake pier is in poor condition, and someone walking on it falls through and drowns.   The person’s injuries were caused by the failure to maintain the deck, which creates a distinct hazardous condition from the lake’s inherent hazards. 

Under Georgia law, an owner of land is liable if: 

1. the place where the condition exists is one upon which the owner knows or has reason to know that children are likely to trespass, and 
2. the condition is one of which the owner knows or has reason to know and which he realizes or should realize will involve an unreasonable risk of death or serious bodily injury to such children, and 
3. the children because of their youth do not discover the condition or realize the risk involved in intermeddling with it or in coming within the area made dangerous by it, and 
4. the utility to the owner of maintaining the condition and the burden of eliminating the danger are slight as compared with the risk to children involved, and 
5. the owner fails to exercise reasonable care to eliminate the danger or otherwise to protect the children. 

There must be evidence to support all five of these conditions.

When in doubt, the best policy is to take additional steps beyond the basic requirements in order to secure spaces in your community that may result in injury.  Besides regular inspections by the management company, you should have an insurance agent tour the neighborhood to identify needs.   Any life saved is worth your vigilance.

You've Been Served

On occasion, we get questions from clients about denying entry to a person serving legal notice to a resident. This post will hopefully provide you with a little information, as well as some ideas to ponder and take back to your community. 

Whether the community is a high rise or a gated suburban association, the State of Georgia requires that access be granted, per the following

Georgia Statute section 9-11-4(f) (4) Service upon persons residing in gated and secured communities.

      (A) As used in this paragraph, the term "gated and secured communities" means multiple residential or commercial properties, such as houses, condominiums, offices, or apartments, where access to the multiple residential or commercial properties is restricted by a gate, security device, or security attendant that restricts public entrance onto the property; provided, however, that a single residence, farm, or commercial property with its own fence or gate shall not be included in this definition.
   

   (B) Any person authorized to serve process shall be granted access to gated and secured communities for a reasonable period of time during reasonable hours for the purpose of performing lawful service of process upon:
         (i) Identifying to the guard or managing agent the person, persons, entity, or entities to be served;          (ii) Displaying a current driver's license or other government issued identification which contains a photograph; and          (iii) Displaying evidence of current appointment as a process server pursuant to this Code section.
      (C) Any person authorized to serve process shall promptly leave gated and secured communities upon perfecting service of process or upon a determination that process cannot be effected at that time.

In instances where the gated community is not being monitored, the process server may consult the Association’s annual listing with the Georgia Secretary of State to determine who to contact for entry.  If you are the person being contacted, be mindful of the following: 

• You are not required to permit entry to a limited common element, such as allowing use of a private elevator leading into a home. 
• If the community policy is to normally announce the arrival of guests to homeowners, doing so in this instance may be considered an obstruction of justice.The Federal penalty for obstructing entry is $300 and up to a year imprisonment.  In some states (not Georgia), this is instead classified as a misdemeanor even with private process servers. 
• Obstructing a law enforcement officer attempting service in Georgia may lead up to a $1,000 fine plus a year imprisonment.  

It is always a good idea for the Board to establish and post a formal resolution detailing procedures for handling entries such as process servers, federal agents, and emergency responders.

Is Your Community On Board?

Earlier this year, the Georgia Court of Appeals issued a decision for a community where the declarant had not appointed a Board of Directors.  Unfortunately, this situation is more common because of the impact of the recent recession.  Many developments that were started several years ago ground to a halt, with some developers going out of business, and declarant rights turned over to bank control.  In such instances, many banks found themselves both unprepared and unwilling to address homeowner association needs.

What is the difference between a declarant and a developer?  Often these are one and the same, but a developer could choose to deed its powers as declarant to another party (i.e. another developer, a bank, or even an individual).  The power of the declarant is immense, able to set up and remove rules in a community development as it sees fit, with only government zoning as a restriction.  The length of time these declarant powers remain in effect is governed by state law, and varies based on the type of development being overseen:  5 or 10 years is not uncommon.

If your community is under developer or bank control without the existence of a Board, had a Board appointed years ago which no longer exists, or the authority has disappeared completely - your Association is in dire straits.

In the case of Hall v. Town Creek Neighborhood Association, the court determined that an assessment levied by a declarant, not a Board of Directors, was unenforceable.  The homeowners were not required to make payments in this situation.  Just because a declarant has the ability to appoint a Board, it does not automatically have the powers a Board would have.  In Georgia, a community’s Declaration is handled as a contract. If an item isn’t in writing, it doesn’t exist for this contract.   Normally a Declaration does not explicitly assign Board powers to the declarant.  Because of this, the court determined that it was intended that a Board had to be appointed.

The impact of this court decision extends to any decisions rendered by a Board of Directors.  Any rule or regulation issued, any vendor service hired, is invalid without a Board.  What should you do if your community finds itself in this situation?  If the declarant (determined by what is filed in the courthouse records) exists, a letter should be sent to it, asking for the immediate appointment of a Board.  If the declarant refuses, or a declarant no longer exists, the homeowners (with legal counsel) should conduct an election to bring the community in compliance:  The Association is a corporation, and under state law must have a Board.  Once this Board is installed, it has the option of retroactively affirming past decisions/actions taken.  More importantly, it needs to establish good governance to carry the community to a positive place.

For fledgling Board members, obtaining training and counseling are a must.  Whether this is obtained through a community association management company or an attorney versed in homeowner association law, the Board should be patient with itself during the initial years, recognizing the time and money is a good investment that will benefit the community in the long run.

Age of Vicarious

The hardest question raised by Board members is, “How do we get people involved in our community?”  Requests for volunteers often fall on deaf ears:  a scary and frustrating experience for the same few stepping up for the community.

One defining aspect of humanity is its need for connections.  Whether with tales told around the campfire or epitaphs carved in stone, people link themselves with events outside the space they inhabit.  Electronic communication and social media accentuate this immersion, ranging from “reality” TV shows, political radio, sports events, to any number of educational programs.  Vicarious living can consume a person’s time and alienate others, crowding out personal and regular interactions with one’s neighbors.

Breaching this barrier is a must for creating healthy community associations.  While written communications are a great tool, the Board of Directors must guard against a “means” becoming an “end”.  A Board can issue newsletters and emails detailing plans and goals, but sharing the same information at a personal level in an informal setting is far more effective in making it “real”, fostering a positive environment for neighbors to adjust their views.

The only step to growing healthy volunteerism is frequent social gatherings.  More meals together create space to form common goals with your neighbors.  Communities hosting events every two or three months for two or three years see higher committee involvement rates and lower levels of animosity:  Trust comes with time.

The key is persistence.  A Board that humanizes itself to the membership, creating a compelling narrative for connection, will see community involvement flourish.

We Second That Emotion

Think about this actual situation - A grocery store customer decided to abandon her shopping cart in the middle of a handicap parking space, walking down to the other end of the parking lot with groceries in hand.  She did this despite the fact that she had to pass a cart corral on the way to her car.  To make it even worse, she didn't even prop the cart up against the curb or concrete parking bumper, as some of us have done on occasion.

The parking lot is on an incline.  With a gust of wind, the cart began rolling downhill, toward the far end of the lot. After several hundred feet at considerable speed, it unerringly struck the side of this same lady’s car.  Everything happened to be witnessed by the store manager, along with several employees of the grocery store who were outside assisting other shoppers.

Refusing to acknowledge karma, the negligent shopper sued the grocery store and shopping center, stating the cart was defective and the parking lot should never have been sloped.  The claim was turned over to the insurance carriers, who promptly wrote a sizeable check to the customer.

Although it was the customer’s actions that resulted in the damage, and there was nothing wrong with the cart or condition of the parking lot, the insurance carriers knew the cost (in time, effort, and money) involved in going to court.  It was cheaper to write the customer a check.  Had it been up to the store manager, the customer would have never received a dime.

This is a hard lesson for Board members to learn.  Whether it's homeowner negligence or a collections case, the inclination is to have the wayward individual suffer the full consequences of his/her actions.  An example, a homeowner chooses to lease out his home, despite clearly understanding that this is prohibited by his community's covenants. The homeowner is sent multiple violation letters and incurs many fines for doing this. A year later, the matter is sent to court in order to get it resolved.  On the eve of the court hearing, the Association’s attorney comes to the Board with a recommended settlement that waives all or most of the fines incurred. The attorney's fees and court costs have already begun to mount. 

Although the Board wants to take this homeowner “to the mat”, they must weigh the very real possibility that the homeowner will prevail at the trial level. This result would require further legal action for the Association to appeal to reverse the decision.  It is about a 50-50 chance that a judge/jury will side with the homeowner against the Association “bully”.  Also as expenses pile up, the likelihood increases for foreclosure and bankruptcy of the homeowner, in the end, leaving the Association with a large, uncollectible legal bill.

That is not to say the Board of Directors should always compromise.  Consider this:  For years a homeowner has refused to pay his assessments, and knows how to game the system to make it an arduous process.  He has outlived the turnover of many Boards through the years.   He is great at avoiding service processors, and once a judgment finally occurs after 18 months, the Association is unable to locate assets or wages to garnish.   The Board announces its decision to pursue foreclose.  At this point the homeowner finally comes forward with a settlement offer. 

However, he is a symbol to others in the community, both nonpaying homeowners and those who are tired of paying more than their fair share.  To send a clear message to the community, the Board decides to incur another $7,000 to force the sale of his home on the courthouse steps.  Although expensive in the short-term, it drives the other delinquent homeowners to settle their obligations, and encourages the rest to continue paying.

The difference between the two above situations is the role emotion plays in the process.  A Board member must weigh his wish for a "pound of flesh" against short and long term costs.  Always be mindful of the impact emotion plays for all the parties involved when reaching a decision. 

Voluntary Payments

In the past, a community charged an initiation or capital contribution fee each time a home was sold.  A newly appointed Board of Directors discovers that this charge was not specifically authorized in the governing documents, and decides to end the practice.  Perhaps tens or hundreds of thousands of dollars were collected through the years.  Although the Board may wish to refund the homeowners, the reality is that the money has already been spent addressing critical maintenance issues.

The question arises:  Is there some type of statute of limitations on how far back reimbursements would have to be provided?  A quick call to the Association’s legal counsel reveals that no money will have to be refunded, due to something known as the “voluntary payment doctrine”.

This legal defense states that a payment voluntarily made cannot be recovered by claiming there never was an obligation to make the payment in the first place.  While controversial, and treated very differently in other parts of the U.S. (it is actually banned in Florida), in Georgia it has been codified as a defense to repayment.  The Georgia state statute (section 13-1-13) says “Payments of claims made through ignorance of the law or where all the facts are known and there is no misplaced confidence and no artifice, deception, or fraudulent practice used by the other party are deemed voluntary and cannot be recovered unless made under an urgent and immediate necessity therefore or to release person or property from detention or to prevent an immediate seizure of person or property. Filing a protest at the time of payment does not change the rule prescribed in this Code section.”

If your Association finds itself in a similar situation, be sure to consult legal counsel to determine if this defense may apply to you.

Pool Party Foul

Everyone enjoys splashing in the pool during our hot Georgia summers.  All too often, one of two events occurs that require the pool to be shut down for a span of days:  1. Fecal contamination and 2. glass bottles.

While a small child, a special needs person, or an elderly individual may wear swim diapers, these are not proof against fecal contamination.  Frequent (every 30 to 60 minute) bathroom breaks and diaper changes, followed by thorough cleaning of the backside, are the best proof against contamination.  When a bowel movement does occur, the pool must go through a round of chemical treatment before it is safe for use.  It is not unusual for the pool area to be closed several days to avoid chemical burns.  If the person causing the closure can be identified, an Association may choose to charge back all related costs to the individual.

Too often, glass beer bottles are found disposed of in trash cans located within the fenced area of the pool.  County regulations prohibit the presence of all glass containers, because a broken piece of glass is difficult to detect in the water, and easily injures a swimmer (think severed digits!)

Whenever glass does make it in to the pool, the County requires that the entire basin be drained to confirm that no glass is still present.  This is expensive, as it is not a service covered in standard pool contracts and there is also the cost of pumping in and treating new water.  It is also frustrating for everyone else in the community who has to wait several days before being allowed to use this wonderful amenity during PEAK season.

If you spot anyone using any type of glass container within the fenced area of the pool, immediately share the above reason to this person and make sure the glass is removed ASAP.  If the person refuses to comply, you should send your Board of Directors or management team photographic proof and any details that will help them identify the individual who is exposing everyone else to possible injury.

Turning a blind eye to these situations is not an option:  The safety of you and your neighbors is too important for this to be ignored.