HOA Defense, Litigation, and Consumer Fraud

We represent homeowners and consumers who find themselves in disputes with HOAs, their management companies, and the law firms who represent them. Your HOA has a team of lawyers and other professionals at their disposal. You should, too. 

The Dessaules Law Group is one of the few Arizona law firms that represent homeowners against their HOA. If you have been sued by your HOA, threatened with a lawsuit, or just feel that you are being treated unfairly you need to protect your rights and your greatest asset. 

Our trial lawyers also represent individuals and consumers who find themselves victims of consumer fraud or unscrupulous and/or illegal debt collection practices.

We fight for you.

Collection Defense

Are you being sued by your HOA?

Whether you have been served with a lawsuit, learned about a lien, or just received a demand letter, it is never too soon to speak with a lawyer to advise you about your rights. Do not ignore it and do not wait. Any delay can result in your HOA and its lawyers trying to add additional fees and bogus to your account and there is one thing that our experience has taught us: The longer you wait, the harder it becomes to get rid of those charges and fees. You might think, or even know, that they wrong, but doing nothing is never an option. They most likely will eventually sue you and, if you do nothing, they will get a judgment against you.

Chances are that your homeowner's association has hired a collection lawyer. By the time they file a case in court, it is not uncommon that the ledger they show the judge includes thousands of dollars in vague collection charges, attorneys fees and costs. You might think that you are current or that maybe you're just one or two payments behind. But they will say you owe far more than that. 

One facet unique to most HOA judgments, in contrast to other types of judgments, is what we call the blank check. Judgments are supposed to be for a definite amount. Most of the lawyers representing HOAs that we have encountered, however, add self-serving language purporting awarding themselves attorneys fees and costs incurred trying to collect the judgment. The HOA lawyers then decide for themselves what additional fees they believe are reasonable (hint: all of them) and then automatically include those fees as part of any collection effort without ever going back to court.

The result is that a judgment for a few hundred dollars often balloons into a judgment of several thousand dollars. Garnishments continue well beyond the face amount of the garnishment because the lawyers have included the attorneys fees incurred in obtaining the garnishment as part of the garnishment — and even though Arizona law expressly prohibits a judgment creditor such as the HOA from collecting fees against the owner in a garnishment. One attorney candidly admitted to an owner that the amount of the judgment just increased because he had to answer the phone to tell the owner the balance of the judgment.

This abusive practice often preys on the unrepresented owner and an over-worked court system and often results in the HOA or its attorneys incurring thousands of dollars to which they are not entitled. We have not found any other area of the law where judgments include the right to prospective attorneys’ fees. Yet the practice is so commonplace that many judges do not even question it.

We believe in early intervention. We strongly encourage every homeowner who lives in an HOA to request in writing a copy of his ledger and to call us immediately if the ledger reveals any irregulaties. Sadly, many of the cases that we see are default judgments where you, the homeowner, didn't even know there was a lawsuit in the first place! It is shocking the number of lawsuits in which the HOA says they cannot find you. They know where you live, they send you mail every month, and they are your neighbors. But when the case ends up in court, the HOA and its lawyers suddenly claim they cannot find you, or tell the court that they do not know where you live, or accuses you of "ducking" service because you were not home the two or three times that the process server knocked on your door. 

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.

Selective Enforcement

The HOA approves a particular design change for everyone except you. Or it refuses to grant you the same rights and privileges that have been extended to dozens of other owners. For example, you own an RV and want to park it in your backyard and the HOA, despite allowing others to park RVs in their backyard, refuses to afford you the same option and instead imposes countless fines, sends you numerous cease and desist letters, and threatens to seek an injunction against you in court if you don’t remove it from the community. Or the HOA refuses to grant you permission to install a pool in your backyard but all of your neighbors have installed pools in their backyard. Or the HOA adopts a rule specifically intended to target you or your property.

The examples are endless. While the HOA has the power to enforce validly-adopted rules and regulations, they cannot enforce those rules unreasonably or selectively. This can be is a powerful defense to any HOA enforcement action.

Foreclosure Defense

Are you being sued by your HOA? These lawsuits may involve just a demand for a money judgment, which the HOA's lawyers may try to collect by garnishing your wages or a bank account, or they may be asking for a judge to force the sale of your property to pay for their bill.  

An HOA's right to foreclose is limited. Generally speaking, an HOA cannot foreclose unless an owner is either one year or $1,200 behind in assessments. The calculation of these amounts often can turn on the misapplication of payments, the failure to properly account for all payments, or a self-serving description of what constitutes an “assessment.” In one particularly noteworthy case, an HOA billed the owner thousands of dollars in attorneys’ fees, called them “assessments," and then initiated a foreclosure action based solely on the failure to pay attorneys’ fees. We were fortunate in that case to stop the foreclosure.

We are not suggesting that every foreclosure action, or even a majority of foreclosure actions filed, suffer from such obvious defects. But sadly not every foreclosure lawsuit conforms to the statute. In addition, if you were unfortunate enough to fall behind in your assessments, there are strategies for avoiding the loss of your home while at the same time fulfilling your obligations to your HOA.

YOUR HOA CAN, AND WILL, FORECLOSE IF GIVEN THE OPPORTUNITY. THE FACT YOU HAVE A MORTGAGE OR MAY EVEN BE UPSIDE DOWN ON YOUR LOAN WILL NOT STOP THE FORECLOSURE TRAIN.

Fair Debt Collection Practices Act

The Fair Debt Collection Practices Act (“FDCPA”) protects individuals from abusive, deceptive, and unfair debt collection practices. It  prohibits a debt collector from using misleading, deceptive, or false representations in the collection of debts. It further prohibits the use of unfair or unconscionable means to collect debts, including the attempt to collect debts to which the debt collector is not legally entitled to collect.  

The FDCPA also requires that a debt collector must provide the following information to the consumer within five days after the initial communication to a consumer unless the information is contained in the initial communication: (1) the amount of the debt; (2) the name of the creditor to whom the debt is owed; (3) a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector; (4) a statement that if the consumer notifies the debt collector in writing within the thirty day period that the debt, or ay portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against the consumer and a copy will be mailed to the consumer by the debt collector; and (5) a statement that, upon the consumer’s written request within the thirty-day period, the debt collector will provide the consumer with the name and address of the original creditor, if different from the current creditor.

FDCPA violations can include calling you before 8 AM or after 9 PM, calling third parties more than once trying to locate you or telling them that they are attempting to collect a debt, trying to collect a debt that is not valid (e.g., you previously paid the debt or it is barred by the statute of limitations), making threats or implying that you could go to jail for non-payment, and threatening to take actions that they legally cannot take.

An FDCPA claim can be brought individually or as a class action. Damages for individual actions under the FDCPA can include actual damages, statutory damages in an amount not to exceed $1,000.00, attorneys’ fees, and costs. Damages for class actions can include actual damages, statutory damages in an amount not to exceed the lesser of $500,000 or 1% of of the net worth of the debt collector, attorneys’ fees and costs.

Wrongful Garnishments

Garnishment is the practice of seizing funds in the possession of a third party to pay a judgment. One of the more common practices is the garnish an owner’s wages directly from his employer. Arizona law allows wages to be garnished in an amount up to 25% of the wages. Arizona law strictly controls the right of garnishment and it can be a powerful tool for the collection of a judgment.

HOAs in our experience routinely abuse the garnishment process, often collecting far more than the face amount of the judgment.

Wrongful Liens

You have discovered a lien recorded against your property that you believe is invalid, either because it is more than you believe you owe, you do not recognize the individual or entity who has recorded the lien against your property, or the party recording the lien has failed to follow the proper procedures for obtaining a valid lien. Arizona law allows an owner of real estate to file a special action to remove a wrongful lien and to recover damages and attorneys’ fees if the other side does not agree to its removal.

Consumer Fraud

Individuals are victimized by consumer fraud every year. Consumer fraud is any deception, unfair act or practice, or false representation, concealment, or promise in connection with the sale of “merchandise.” Merchandise, as the term is used in the Arizona Consumer Fraud Act, includes any goods, intangibles, real estate, or services. California and other states have similar Consumer Fraud Acts. 

We represent individual and classes of consumers against those who seek to take unfair advantage of them and violate the law. We represent the victims of fraudulent, abusive, unscrupulous, and predatory business practices.