Abusive Collection Tactics

A growing number of HOAs are taking the position that they have the right to shut off water or other utilities in order to force owners to pay assessments, fines, or penalties. We have met with a number of owners who have gone days, weeks, and even months without water, literally coerced into paying thousands of dollars in disputed fines, charges, and unawarded attorneys’ fees in order to have basic utilities necessary to live. We do not believe that this is a power granted to the HOAs, either under Arizona law or an HOA's governing documents, and that the HOA who exercises this power acts outside of the law and exposes itself to potential liability.

Another common trend is the serial lawsuit, where the HOA sues an owner for unpaid assessments or fines, obtains a judgment that includes attorneys’ fees and court costs, and then later sues for additional amounts, including the prior judgment in the second judgment. The second suit often seeks to foreclose but needs to include the prior assessments in order to meet the threshold for foreclosure. This often involves double dipping, forum shopping, and improperly exercising the power of foreclosure after already electing a non-foreclosure remedy. It also seems to be a common practice to include attorneys’ fees not awarded in the earlier suit in the second suit, thereby getting a second bite at recovering fees that a court has refused to award.