Reimbursement assessments (aka “compliance assessments”) refer to special assessments levied against an individual owner’s separate interest to reimburse the association for its costs incurred in repairing damage to the common area caused by that owner, his guest or tenant. Reimbursement assessments are distinct from fines (monetary penalties), as the imposition of a fine is not necessarily tied to any costs incurred by the association as a result of an owner’s violation. (See “Fines (Monetary Penalties).”)
Where an association’s CC&Rs do not contain provisions directly allowing for the imposition of reimbursement assessments, many HOA attorneys take the position that Civil Code Section 5725(a) impliedly allows the board to impose them in the form of monetary charges. However, the degree to which such a reimbursement assessment may then become a lien against the owner’s separate interest and enforced through foreclosure will be dictated by the governing documents. (See Civ. Code § 5725(a).) When foreclosure is not authorized, collecting an unpaid reimbursement assessment may require the association to file a lawsuit against the owner in order to obtain a money judgment.
Civil Code Section 5855 contains procedural requirements that must be satisfied before a reimbursement assessment imposed upon a member becomes effective. Those requirements include:
- Notice and Meeting (Hearing). The board must provide the member with individual notice of the meeting (hearing) where the board is to consider imposing the reimbursement assessment, at least ten (10) days prior to the meeting. (Civ. Code § 5855(a).) The notice must contain, “at a minimum, the date, time and place of the meeting…the nature of the damage to the common area and facilities for which the [reimbursement assessment] may be imposed, and a statement that the member has a right to attend and may address the board at the meeting.” (Civ. Code § 5855(b).) The board must meet with the member in executive session if requested by the member. (Civ. Code § 5855(b).)
- Notice of Decision. If the board imposes the reimbursement assessment, the board must, within fifteen (15) days following the action, “provide the member with a written notification of the decision, by either personal delivery or individual delivery pursuant to Section 4040.” (Civ. Code § 5855(c).)
**For more information on these procedural requirements, see “Notice & Hearing Requirements.”