What Happens When a HOA Owner Dies?
What Happens When a HOA Owner Dies?
On a very sad note, home owner associations sometimes have to deal with the aftermath of the death of an owner. If an owner dies, leaving his unit empty until its fate is resolved through the legal process, what happens if the former owner's successors or executor fail to pay HOA dues? How can you handle that problem with respect? Here are some answers.
Lead with Compassion
Before you do anything, remember that someone has lost a loved one. "This is an area in which you want to tread lightly and respectfully," says Elizabeth White, a shareholder and head of the community associations practice at the law firm of LeClairRyan in Williamsburg, Va. "It's important that the association get paid. But remember that the people who are in charge of paying you may be going through an enormous grieving process."
Unfortunately, sometimes board members need to be reminded of that. "We had this situation in a high–end condo," explains White. "The day the obituary for one of the owners came out, I got a call at home from the board president wanting to know if I knew who the executor was because he wanted to make sure the bills got paid. In this case, the person who died was basically a public figure, and I happened to know who the executor was. It was an attorney, so it was a little less sensitive. I said to the board president, 'Let me help you draft a letter telling the executor you're going to direct correspondence to the executor unless the executor tells you to direct it to someone else.' But normally you want to give it time, and that sensitivity might go a long way."
You'll Get Paid—Really
The HOA nearly always gets paid after an owner dies because it has the same rights against the former owner's estate that it had when the owner was alive. "The rightful heirs or beneficiaries of the estate will take title through the will or by operation of law, but that doesn't change anything from the HOA's standpoint," says Andrew Lewis of Eisinger, Brown, Lewis, Frankel & Chaiet PA in Hollywood, Fla., who specializes in representing community associations. "The HOA can lien and foreclose pursuant to statutory procedures."
With the law on the HOA's side, how understanding should you be? "You should be compassionate and helpful because it's the right thing to do, and it will get you more than being in an adversarial position," says Robert Galvin, a partner at Davis, Malm & D'Agostine PC in Boston who specializes in representing condos and co–ops. "In the condo in which I live, everybody is asked to provide the name of an emergency contact. I've provided the names of my sons. You should try to get in touch with the emergency contacts that have been provided, offer condolences, and tell them you'll discuss HOA matters at a later time."
At some later date, make contact again to discuss HOA matters. "You can play it by ear," says Galvin. "I wouldn't call them up on the day of the funeral except to offer condolences. It may go a week or two, but not much longer. Certainly, you shouldn't wait longer than a month. But you do have to explain to the family at some point that you're required to collect expenses. You might tell them that in the interest of compassion, the HOA might let them slide for a couple of months. But you can't let them slide forever because all obligations of the unit owner pass to the estate when the owner dies—and you can't fulfill your responsibilities as a board owner if you don't collect."
Lewis agrees. "Under the circumstances, you may want to give more time than usual for payments," he says. "You might also want to make certain heirs and beneficiaries are aware that assessments exist and how much are due and not just assume they know this. They could be distant relatives. If you can get information on who's taking over, maybe you make a phone call to let them know assessments are due instead of sending a written demand letter to the property address."
Be Prepared for the Future
If you haven't run into this issue before, be prepared to do so in the future. Galvin thinks aging issues are going to become common for HOAs to address. "This is a big problem, and it's becoming more of a problem as people age," he says. "I've seen this a number of times. Someone bought a condo when he was in his 50s, and how he's in his 80s or older. He's no longer able to care for himself or may be doing something that might create a fire hazard. It's a real problem."
Resolving these problems isn't simple. "In my experience, boards have called family members," says Galvin. "But some don't seem to care about anything more than inheriting these valuable apartments when the relatives die. Boards have also called social services in their town. You can't kick these owners out because they own their units. So there's no easy answer. "