This week's tip is a cautionary tale for homeowners associations

considering making club memberships mandatory in an effort to

generate additional funding.

Cash-strapped HOAs in Florida, Oregon, and Washington have

been testing a new plan to generate income for their

communities—making membership in association clubs mandatory

for all homeowners. Angry homeowners have been fighting back by

challenging those efforts in court, and they're starting to

have some success. A growing number of Florida courts have held

such amendments invalid because they substantially change the

scheme of the community from homeowners' expectations when they

moved in.

After losing in the lower courts, a few associations have

settled with the homeowners who sued. "With all the cases I'm

aware of," explains Lisa A. Magill, a shareholder and

association attorney at Becker & Poliakoff PA in Fort

Lauderdale, Fla., "they settled because the association couldn't

take the risk that the amendment requiring the masses to

participate in the expenses would be in jeopardy [if a decision

by an appellate court upheld the trial court's invalidation of

the amendment]."

Still pending is the appellate court's decision in a case

against The Aberdeen Golf & Country Club near Boynton

Beach, Fla. "Aberdeen amended its documents to say all new

buyers have to become members of the club and are responsible

for club-related expenses, including purchases at the restaurant

and the annual fee," says Magill. "Everyone's waiting with bated

breath for the decision in that case. That's really going to

change what has transpired with respect to a number of country

club associations that have done this over the last several

years."

But those are just the first steps in the battle over mandatory

memberships. If the challenges to the rules are upheld in

appellate courts, what about homeowners who were forced to join

because of the new rules?

To learn more, see our new article:

Can Your HOA Make Club Membership Mandatory?

Best regards,

Matt Humphrey

President