Charles County, MD Homeowners' Associations

The provision of a forum for alternative dispute resolution in disputes between homeowners' associations and homeowners involving recorded covenants or restrictions of the homeowners' association would be beneficial to all parties. Section 11B-104(c) of the Annotated Code of Maryland[1] empowers the County to establish a homeowners' association commission to hear and resolve such disputes, and the Homeowners' Association Dispute Review Board established pursuant to this article shall serve as said commission.

[1]

Editor's Note: See § 11B-104(c) of the Real Property Article of the Annotated Code of Maryland.

§ 247-2 Definitions.

In this article, the following terms have the following meanings:

ASSOCIATION DOCUMENT

The master deeds, declaration, incorporation documents, bylaws, and rules of any homeowners' association;

Any written private agreement between any parties concerning the operation of the community or maintenance or control of common or limited common property; and

Any similar document concerning the operation or governance of a homeowners' association.

BOARD

The Homeowners' Association Dispute Review Board.

COMMON OWNERSHIP COMMUNITY

A development subject to a declaration enforced by a homeowners' association, as those terms are used in state law.

DISPUTE

Any disagreement between two or more parties that involves:

(1)

The authority of a governing body, under any law or association document, to:

(a)

Require any person to take any action, or not to take any action, involving a unit or property;

(b)

Require any person to pay a fee, fine, or assessment; or

(c)

Alter or add to a common area or element.

(2)

The failure of a governing body, when required by law or an association document, to:

(a)

Properly conduct an election;

(b)

Give adequate notice of a meeting or other action;

(c)

Properly conduct a meeting;

(d)

Properly adopt a budget or rules;

(e)

Maintain or audit books and records; or

(f)

Allow inspection of books and records.

"Dispute" does not include any disagreement that only involves:

(1)

Title to any unit or any common area or element;

(2)

The percentage interest or vote allocatable to a unit;

(3)

The interpretation or enforcement of any warranty;

(4)

The collection of an assessment validly levied against a party; or

(5)

The judgment or discretion of a governing body in taking or deciding not to take any legally authorized action;

(6)

An allegation of a public nuisance which is the subject of a complaint filed with the Charles County Nuisance Board.

GOVERNING BODY OF A HOMEOWNERS' ASSOCIATION

The council of unit owners, board of directors, or any other body authorized by an association document to adopt binding rules or regulations.

HOMEOWNERS' ASSOCIATION

The legal entity, incorporated or unincorporated, that is responsible for the governance or common property of a common ownership community.

OWNER

A lot owner in a homeowners' association.

PARTY

Includes:

An owner; and

A governing body.

§ 247-3 Homeowners' Association Dispute Review Board.

The County Commissioners shall appoint a Homeowners' Association Dispute Review Board consisting of seven voting members.

(1)

Two members should be selected from residents of self-managed and professionally managed homeowners' associations within Charles County, and may include members or former members of governing boards.

(2)

One member should be selected from persons involved in housing development and real estate sales.

(3)

Two members should be selected from persons who are members of professions associated with common ownership communities (such as attorneys who represent associations, developers, housing management or tenants) or investor-owners of units in common ownership communities, including at least one person who is a professional community association manager.

(4)

Two members should be Charles County residents who are not members of the classes set forth in Subsection A(1), (2), and (3) of this section.

Designees of the Department of Planning and Growth Management are ex officio nonvoting members of the Board. The County Commissioners may also designate other persons as ex officio nonvoting members of the Board.

Each member serves a three-year term. Of the members first appointed, two must be appointed for one-year terms, two must be appointed for two-year terms, and three must be appointed for three-year terms. A member appointed to fill a vacancy serves the rest of the unexpired term. Members continue in office until their successors are appointed.

Voting members of the Board receive no compensation for their services.

The Board must submit an annual report by September 1 to the County Commissioners summarizing its activities, needs, and recommendations, and the extent to which the goals of this article are being met.

§ 247-4 Filing of disputes; exhaustion of association remedies.

The Board may hear any dispute between or among parties. Either party may file a dispute with the Board by submitting, in writing, a description of the dispute, naming all parties, in a form approved by the Board. The County Commissioners may set a fee for filing disputes with the Board to offset administrative costs.

A party must not file a dispute with the Board until the party makes a good faith attempt to exhaust all procedures or remedies provided in the association documents.

However, a party may file a dispute with the Board 60 days after any procedure or remedy provided in the association documents has been initiated before the association.

After a homeowners' association finds that a dispute exists, the association must notify the other parties of their rights to file the dispute with the Board. The association must not take any action to enforce or implement its decision for 14 days after it notifies the other parties of their rights.

When a dispute is filed with the Board, a homeowners' association must not take any action to enforce or implement the association's decision, except filing a civil action under Subsection F, below, until the process under this article is completed.

If, at the time of the filing of a dispute with the Board, or at any time prior to the resolution of a dispute by the Board, there is an existing civil action involving the same parties and same general facts, the Board shall stay its proceedings pending the outcome of the civil action. In the event that the resolution of the civil action decides all issues that constitute the dispute as filed before the Board, or otherwise renders a Board decision on the dispute moot, the Board may dismiss the dispute.

§ 247-5 Production of evidence.

The Board may:

(1)

Compel the attendance at a hearing of witnesses and parties, administer oaths, take the testimony of any person under oath and, in connection with any dispute, require the production of any relevant evidence; and

(2)

Issue summonses to compel the attendance of witnesses and parties and the production of documents, records and other evidence in any matter to which this article applies.

If any person does not comply with any summons issued under this article to compel the attendance of persons or the production of documents, records or other evidence in any matter to which this article applies, the County Attorney, on behalf of the Board, may enforce the summons in a court with jurisdiction.

Any court with jurisdiction may, on request of the Board, in accordance with state law and the Maryland Rules of Procedure:

(1)

Require compliance with a summons;

(2)

Require the attendance of a named person before the Board at a specified time and place;

(3)

Require the production of records, documents, or other evidence;

(4)

Require the transfer of custody of records, documents, or other evidence to the court; or

(5)

Prohibit the destruction of any records, documents, or other evidence until a lawful investigation by the Board is ended.

The failure to comply with any order entered under this section may be punishable as contempt of court.

§ 247-6 Mediation; dismissal before hearing.

The Board may investigate facts and assemble documents relevant to a dispute filed with the Board, and may notify a party if, in its opinion, a dispute was not properly filed with the Board.

If the Board, after reviewing and considering a dispute, finds that, assuming all facts alleged by the party which filed the dispute are true, there are no reasonable grounds to conclude a violation of applicable law or any association document has occurred, it may in its discretion dismiss the dispute. The Board may reconsider the dismissal of a dispute under this subsection if any party, in a motion to reconsider filed within 30 days after the dispute is dismissed, shows that:

(1)

The Board erroneously interpreted or applied applicable law or an association document; or

(2)

Material issues of fact which are necessary to a fair resolution of the dispute remain unresolved.

Any party may request mediation.

If a party requests mediation, the Board must notify all parties of the filing and of the mediation session.

The County must provide a qualified mediator to meet with the parties within 30 days after a party requests mediation to attempt to settle the dispute.

If any party refuses to attend a mediation session, or if mediation does not successfully resolve the dispute within 10 days after the first mediation session is held, the Board must promptly schedule a hearing under § 247-7 unless a hearing has already been scheduled under § 247-7.

§ 247-7 Administrative hearing.

The Board shall hold a hearing on each dispute that is properly filed unless the Board finds that:

(1)

The dispute is essentially identical to another dispute between the same parties on which a hearing has already been held under this section; or

(2)

The dispute is clearly not within the jurisdiction of the Board.

The Board shall give notice to the parties to a dispute by either personal delivery or by certified mail restricted delivery, return receipt requested. Said notice shall be received by the parties at least 14 days prior to the public hearing regarding the dispute, and shall give notice of the time and place of the hearing and a description of the dispute.

At any hearing, a party or a witness may be advised by counsel.

Each participating Board member must not have any interest in the dispute to be heard.

If any party, after proper notice, does not appear at the scheduled hearing, the Board may order any relief to another party that the facts on record warrant.

The Board must apply state and County laws and all relevant case law to the facts of the dispute. At the close of all of the evidence, the Board shall deliberate, and, within 14 days, the Board shall issue its written decision and order.

A decision of the Board authorized under this article is binding on the parties, subject to review only by the Circuit Court for Charles County upon a petition for judicial review filed pursuant to the Maryland Rules of procedure by any party aggrieved by the decision within the time prescribed for petitions for review of administrative agency decisions by such rules of procedure.

Enforcement of orders.

[Amended 6-15-2011 by Bill No. 2011-04]

(1)

Failure to comply with a lawful order of the Board issued under this article is a civil infraction under Article 25B, Section 13C of the Maryland Code,[1] subject to a fine up to $500.

[1]

Editor's Note: Repealed effective 10-1-2013; see Local Government Article (2013 Maryland Laws Ch. 119), Subtitle 2, §§ 11-201 through 11-211.

(2)

The Board shall also have the ability to seek equitable relief in the District Court for Charles County, Maryland, to enforce outstanding orders.