RealManage Insight

The ABC's of DRV's in Texas

by Guest Blogger on Oct 15, 2019, 9:36:00 AM

Author’s Note and Disclaimer:  This article discusses Texas Property Owners Association (“POA”) Law and pertains to single family residential POA’s in Texas only.  

Even though a man’s home is his castle, he is still obligated to abide by deed restrictions if that home is in a common interest development encumbered by restrictive covenants. Likewise, property owners associations (POA’s) must consistently enforce their dedicatory instruments in a systematic, uniform, and unbiased manner or run the risk losing their right to enforce them.  This article will discuss deed restriction enforcement requirements for Texas POA’s and will seek to provide practical tools and tips to ensure proper enforcement.

Deed Restriction Enforcement for Property Owners Associations under Texas Property Code Section 209

Due Process Requirements

1. Notice under Texas Property Code Section 209.006 – the “209 Letter”

The Texas Residential Property Owners Protection Act, codified at Chapter 209 of the Texas Property Code, provides that BEFORE a POA may suspend an owner’s right to use a common area, charge an owner for property damage, levy a fine, or file suit against an owner for a violation of the deed restrictions, the association MUST give written notice to the owner by certified mail (i.e., the “209 Letter”) with the requirements below. The 209 letter must describe the violation or property damage that is the basis for the action, state any amount due to the association, and inform them that he:

(A)  is entitled to a reasonable period to cure the violation and avoid the fine or suspension if the violation is of a curable nature and does not pose a threat to public health or safety; and

(B)  may request a hearing under Section 209.007 on or before the 30th day after the date the notice was mailed to the owner (not received by the owner); and

(C)  may have special rights or relief related to the enforcement action under federal law, including the Servicemembers Civil Relief Act (50 U.S.C. 62 App. Section 501 et seq.), if the owner is serving on active military duty.[1]

If notice and an opportunity to cure or request a hearing has been given to an owner regarding the same violation within the last 6 months, another 209 Letter is NOT required to be sent.[2]  However, if the owner cures the violation but repeats it 6 months AFTER the 209 Letter was sent, then another 209 letter must be sent. 

2. Hearings under Texas Property Code Section 209.007 – the “209 Hearing”

Deadlines to request and hold the 209 Hearing.

  1. Owners may request a 209 Hearing before the Board on or before the 30th day after the date the POA mails the 209 Letter. If hearings are before a committee, the 209 Letter must state that owners have the right of appeal to the Board.[1]
  2. The POA must hold the hearing within 30 days of the owner’s request and must notify the owner of the date, time, and place of the hearing at least 10 days before the hearing. Either party may request one postponement for a maximum of 10 days or additional postponements may be granted by mutual agreement of the parties. Audio recordings of the meeting are allowed.[2]
  3. 209 Hearings should enable the parties to “to discuss and verify facts and resolve the matter in issue.”[3] The Association should have hearing procedures in place ahead of time to foster an open and respectful atmosphere for all parties.  Homeowners should be given an opportunity to present their position and the Board should be prepared to ask questions to come to a fair and equitable conclusion.  The Board should not feel free pressured to make a decision on the spot during the meeting but instead should discuss/vote on the matter after the homeowner leaves. 
    Circumstances under which 209 Hearings are Inapplicable.
  1. The notice and hearing provisions of Section 209.006 and 209.007 do not apply if: 1) the association files a suit for a temporary restraining order or temporary injunctive relief,[4] or 2) the suspension is due to a violation involved a significant and immediate risk of harm to others in the subdivision.[5]

3. Consequences of Failure to Provide Notice under Section 209.006

POA’s may lose their right to recover attorney’s fees if a 209 Letter is not timely sent.  In Park v. Escalera Ranch Owners’ Assn., the court noted that “Chapter 209 limits an association's attorneys' fees if it delays sending notice. If an association fails to provide presuit notice…it risks forfeiting all or a substantial portion of its attorneys' fees.”[6]  Thus, it is imperative that a 209 Letter be sent prior to incurring attorney’s fees or they may not be recoverable.  

 
Attorney's Fees

Requirements under Texas Property Code Section 209.008.

  1. Notice Required. As stated, clear written notice must be given in the POA’s 209 Letter that attorney’s fees will be charged to an owner’s account if a deed restriction violation continues after a certain date.  A POA may be reimbursed for “reasonable attorney’s fees and other reasonable costs incurred by the association…for enforcing restrictions…or rules of the association only if the owner is provided a written notice that attorney’s fees and costs will be charged to the owner if the…violation continues after a date certain.”[1]  Thus, the 209 Letter should clearly state the date by which the violation must be cured or attorney’s fees will be incurred.
    1. Texas Property Code Section 5.006. This statute provides for a mandatory award of reasonable attorney’s fees and costs to the prevailing party who asserted the action (i.e., typically a POA plaintiff) in a lawsuit based on breach of a restrictive covenant. 
    2. Texas Civil Practices and Remedies Code Section 38.00 This statute provides that “[a] person may recover reasonable attorney's fees…if the claim is for:…an oral or written contract.”[1]  Since the Declaration is considered a contract between the POA and the owner, attorney’s fees may also be recovered under this statute.[2] 
    3. Texas Property Code Section 204.010(a)(11). This statute provides that “if notice and an opportunity to be heard are given, [the POA may] collect reimbursement of actual attorney's fees and other reasonable costs incurred by the property owners' association…unless otherwise provided in the association’s governing documents.[3]
      No Attorney’s Fees before 209 Hearing. If attorney’s fees are incurred BEFORE the conclusion of the 209 Hearing or before the date by which the owner must request a hearing if none is requested, then the owner would not be liable for those attorney’s fees.[2]

      Requirements under Texas Property Code Section 209.008.

      Authority for recovery of attorney’s fees may be found in the statutes below:

     
    Judicial Enforcement

    The most commonly used method used by POA’s to enforce restrictive covenants is to file a civil lawsuit against the offending homeowner.

    Choice of Court.

    1. County or District Court. If a POA wishes to obtain injunctive relief such as a mandatory injunction ordering an owner to be permanently enjoined from committing a restrictive covenant violation such as constructing an unauthorized structural change to a dwelling, filing a lawsuit in County or District Court is typically proper.
    2. Justice Court. If a deed restriction violation “does not concern a structural change to a dwelling” and injunctive relief is not desired, then filing suit in Justice Court may be proper since justice courts do not have authority to grant a writ of injunction.[1] 

    Contempt of Court.

    After obtaining a judgment, if a homeowner violates a court order mandating them to cure a deed restriction violation, the POA may take the homeowner back to court to request an order compelling them to cure the violation or face serious consequences.  Per Texas Government Code Section 21.002(b) “[t]he punishment for contempt of a [a District of County Court judgment] is a fine of not more than $500 or confinement in the county jail for not more than six months, or both such a fine and confinement in jail.”[2]   Thus, a homeowner who violates a court order requiring them to cure a deed restriction violation may be held in contempt of court, assessed fines, or even serve jail time (although award of the latter is quite rare).

    Civil Damages.

    In addition to any requested relief, a POA may request that the court assess civil damages for violation of a restrictive covenant “in an amount not to exceed $200 for each day of the violation.[3]  Typically, most POAs plead a 5-10 days of civil damages (i.e., $1-2,000) in their deed restriction violation judgments or even more depending on the facts and circumstances of each case. 

    In conclusion, it is vitally important that POA’s diligently and fairly enforce their restrictive covenants in order to maintain and improve a subdivision’s appearance and property values.  However, such enforcement must be done with great care and meticulous attention to the requirements set forth in the Texas Property Code and Declaration as well as case law in order to ensure a successful outcome.  Should you have any questions regarding any of the above, please do not hesitate to contact us. Thank you!

     

    Guest Blogger:  Margaret R. Maddox, J.D.

    Attorney at Law/ Shareholder

    Daughtry & Farine, P.C.

    Houston, Texas

    www.daughtryfarine.com


    [1] Tex. Gov’t. Code §27.034(a) and (j).

    [2] Tex. Gov’t. Code § 21.002(b).

    [3] Tex. Prop. Code §202.004(c).

    [1] Tex. Civ. Prac. Rem. Code §38.001(8).

    [2] Boudreaux Civic Assoc. v. Cox, 882 S.W.2d.

    [3] Tex. Prop. Code. 204.010(a)(11).  (Please note that Section 204 only applies to certain counties per Tex. Prop. Code.  §204.002(a)(1-3).


    [1] Tex. Civ. Prac. Rem. Code §38.001(8).

    [2] Boudreaux Civic Assoc. v. Cox, 882 S.W.2d.

    [3] Tex. Prop. Code. 204.010(a)(11).  (Please note that Section 204 only applies to certain counties per Tex. Prop. Code.  §204.002(a)(1-3).

    Contempt of Court.Civil Damages.

 

[1]  Tex. Prop. Code §209.008(a).

[2] Tex. Prop. Ann. §209.008(b).

 

[1]  Tex. Prop. Code §209.007(a),(b).

[2]  Tex. Prop. Code §209.007(c).

[3]  Tex. Prop. Code §209.007(a).

[4]  Tex. Prop. Code §209.007(d). See also Haas v. Ashford Hollow Cmty. Improvement Ass'n, 209 S.W.3d 875, 2006.

[5]  Tex. Prop. Code §209.007(d).

[6]  Park v. Escalera Ranch Owners’ Assn., 457 S.W.3d 571 at 604.

 

[1]  See Tex. Prop. Code §209.006(a) and (b)(1-2).

[2]  Tex. Prop. Code §209.006(d).

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