Homeowners seeking to bring an enforcement action against their HOA or seeking to make a claim for damages against their HOA, must bring their civil action while they are homeowners. A 2006 California Court of Appeal case essentially held that a homeowner’s claim is extinguished upon sale. Thus, if you have a claim against your HOA but prior to filing your claim, sell your property, your claim would be extinguished by operation of law since you would no longer have standing to bring suit.
In Farber v. Bay View Terrace Homeowners Ass’n, (2006) 141 Cal. App. 4th 1007, a homeowner who sold his unit was sued by the buyer for nondisclosure related damages relating to common area repairs that the buyer claims the homeowner who sold, failed to disclose during escrow. Homeowner cross-claimed against the HOA as the repairs were common area repairs, claiming the HOA was responsible for the repairs. The trial court sustained the HOA’s demurrer to the cross-complaint on the ground that the homeowner, upon closing the sale, no longer had standing to bring an enforcement action against the HOA. The Court of Appeal agreed with the trial court and affirmed the ruling. The Farber Court held that “One who no longer owns land in a development subject to reciprocal restrictions cannot enforce them, absent showing the original covenanting parties intended to allow enforcement by one who is not a landowner.” Id at 1011.
Thus, a homeowner who is contemplating bringing an enforcement action against the HOA pursuant to Cal. Civ. Code § 5975, must do so prior to selling or conveying his/her interest in the property that is subject to the CC&Rs.
If you have an HOA dispute, contact one of our HOA Dispute Attorneys today for a free consultation and case evaluation.