Member Right to Dispute Charges

Each member of an association has a duty to pay assessments levied by the association. A member may not refuse to pay assessments because the member vacates possession of his property, does not use the association’s common areas, and/or has a dispute with the association. (Cerro del Alcala Homeowners Assn. v. Burns (1985) 169 Cal.App.3d Supp. 1, Supp. 4-5; Park Place Estates Homeowners Assn. v. Naber (1994) 29 Cal.App.4th 427, 432; See also “Duty to Pay Assessments.”) However, a member does have the right to dispute any assessment, fine, penalty, late charge, or collection cost by paying the disputed amount under protest. (Civ. Code § 5658.)

Notice of Right to Dispute Charges
Associations must provide annual notice to each member of the procedure for disputing any charge. (Civ. Code § 5730(a).) That notice must be contained in the association’s annual policy statement prepared pursuant to Civil Code Section 5310 that is sent to each member by individual delivery.

Pay Disputed Sums Under Protest
A member may dispute any charge by paying the disputed sums under protest and (1) commencing an action against the association in small claims court (provided that the amount is less than $10,000 (see Code of Civ. Proc. § 116.221.)), or (2) pursuing alternative dispute resolution (ADR) as defined under Civil Code Section 5925. (Civ. Code § 5658(a).) A member may also utilize any internal dispute resolution (IDR) mechanisms employed by the association. (See Civ. Code § 5900 et. seq.)

Interest, Collection Costs, and Other Costs Incurred
A member is “not liable for charges, interest and costs of collection, if it is established that [a disputed assessment] was paid properly on time.” (Civ. Code § 5730(a).) If an assessment was paid properly on time, the association must promptly reverse all late charges, fees, interest, attorney’s fees, costs of collection, and lien recording/release fees, as well as pay all costs related to any IDR or ADR utilized in connection with the disputed assessment. (Civ. Code § 5685(c).)

Share:

Related Topics

Related Statutes

Related Case Law

  • Brown v. Professional Community Management, Inc.
    (2005) 127 Cal.App.4th 532

    [Assessments & Collection; Collection Fees] An association’s vendors are permitted to earn a profit on the fees it charges in connection with collecting delinquent assessments owed to the association.

  • Cerro De Alcala Homeowners Assn. v. Burns
    (1985) 169 Cal.App.3d Supp. 1

    [Assessments & Collection; Duty to Pay] A homeowner may not avoid his/her obligation to pay assessments levied by a HOA merely because the homeowner abandons possession of the property.

  • Park Place Estates Homeowners Association v. Naber
    (1994) 29 Cal.App.4th 427

    [Assessments & Collection; Duty to Pay Assessments] An association member may not assert the homeowners association’s (HOA’s) conduct as a defense or “setoff” to an action brought by the HOA against the member for the member’s failure to pay assessments.