255 N.E.3d 1181
Ind. Ct. App.2025Background
- Andy Sandoval, through the Paradise Properties Land Trust, owns two lots in the Willow Lake Estates subdivision governed by the Willow Lake Estates Home Owners Association (HOA).
- The subdivision is subject to Covenants and Bylaws that require payment of periodic HOA assessments, with liens available as a collection remedy.
- Sandoval stopped paying assessments in 2018, leading the HOA to record liens and initiate foreclosure proceedings.
- Sandoval argued the HOA failed to hold annual meetings, elect directors, prepare budgets, and maintain common areas, and that these failures rendered the assessments invalid.
- The trial court granted summary judgment to the HOA, ordering Sandoval to pay $39,000 plus attorney fees and permitting foreclosure; Sandoval’s motion to correct error was denied.
- On appeal, Sandoval challenged summary judgment, focusing mainly on the HOA’s alleged procedural failings as conditions precedent to assessment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether HOA breaches (failure to hold meetings, etc.) invalidate assessment liens | Sandoval: HOA must hold annual meetings, elections, and budgets; failure excuses payment. | HOA: Governing docs do not make these conditions precedent to assessment. | HOA’s procedural lapses do not invalidate assessments; summary judgment affirmed. |
| Whether statutes require annual meetings/budgets as a prerequisite to assessments | Sandoval: Statutory and bylaw requirements not met; so, no obligation to pay. | HOA: Statutes either do not apply (pre-2009 HOA) or do not invalidate corporate action for lack of meetings. | Statutes do not require invalidation of assessments for failure to meet procedural requirements. |
| Whether Sandoval may withhold assessments as his only remedy for HOA violations | Sandoval: Withholding payment is the only remedy due to lack of meetings/budgets. | HOA: Other remedies exist (like compelling meetings), not withholding payment. | Homeowners have other remedies; withholding payment is not permitted. |
Key Cases Cited
- Villas W. II of Willowridge Homeowners Ass'n, Inc. v. McGlothin, 885 N.E.2d 1274 (Ind. 2008) (Restrictive covenants are contracts governing real property; terms are enforced as written).
- Feather Trace Homeowners Ass’n, Inc. v. Luster, 132 N.E.3d 500 (Ind. Ct. App. 2019) (Withholding assessments is not a proper remedy for dissatisfaction with HOA performance).
- CSL Cmty. Ass’n, Inc. v. Meador, 973 N.E.2d 597 (Ind. Ct. App. 2012) (Nonpayment of assessments is not a remedy for HOA’s failure to maintain amenities).