Q: In the state of Maryland do existing covenants (came attached to the land plat) require the formation of an HOA?
Our community (13 houses on 75 acres) was established ca 1985 and the developer established and controlled the covenants, this until January 1, 2010. After that, these covenants revert to the lot holders (13 homeowners). As the document reads, these are currently enforceable by each lot owner BUT a couple of homeowners think we need to, by law, form an HOA to continue and enforce the covenants. I not only disagree but of course this adds a cumbersome wrinkle to the equation, odds then being nothing will happen. Net: Does Maryland require an HOA for enforcement of covenants?
A: If the covenants cover aesthetic issues like the type and color of roofs, whether windows are allowed on car garage doors, the type, location and set-back requirements (or prohibition) of sheds, sunrooms, fencing (including limits on type of fencing materials), location and type of shrubs, parking of RVs or trailers, driveway location, among any number of other things designed to maintain a certain appearance in the neighborhood, then failure over time to enforce the covenants as they are breached by first one owner then another, will often result in their becoming unenforceable against any other owner. Inconsistent, non-uniform, seletive or non-existent enforcement of such use restrictions can result in abandonment of them. Covenants like these are designed to maintain property values, upholding a certain higher-end appearance (and to avoid a trashy, messy look, like a free spirit painting their home in bright rainbow colors and erecting tents and outbuildings all over the yard). It is impossible for a single homeowner to enforce all these covenants against every other homeowner in the development, unless they are suing everyone all the time. An HOA typically is formed, a board of owners voted in, and they issue letters of non-compliance with a demand for correction of the violation if any is found. Of course, in order for an HOA to afford the cost of a lawyer to sue to enforce the recalcitrant owner to comply, the HOA needs money. That money comes in the form of monthly or annual dues. The money is maintained in an HOA account and each owner is provided with an annual accounting of how the money is spent. Typically a board member is appointed treasurer to manage the account. In larger HOAs with more common area maintenance issues or a large number of dues-paying homeowners, the board will often hire a management company to handle all the HOA affairs, including collection and enforcement of dues, hiring contractors, common area landscaping, repairs to community buildings, etc. Failure to pay dues is often an issue, which deprives the HOA of funds necessary to cover the budget for common expenses. They can accumulate and require a judgment lien be placed against the property of the non-paying homeowner. The HOA can choose to adopt all the existing covenants or select those it wants to maintain and enforce, but it must be consistent in its enforcement or risk the ability to enforce them. It is not so much a matter of whether the law compels your community to form an HOA, but of practicality if you expect covenants to be observed and followed and to maintain the ability to compel non-compliant homeowners to adhere to them. No HOA is more likely to result in non-enforcement and abandonment of the covenants over time.
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