A recent case reported in Virginia Lawyers Weekly highlights the significant financial risk to homeowners associations (“HOAs”) when sidewalk maintenance is neglected. In this case, a resident tripped on an uneven sidewalk—maintained by the HOA—and suffered severe injuries. The injuries required surgery and 10 months of treatment, resulting in $200,000 in medical expenses. The plaintiff also lost valuable time from their online retail business. Ultimately, the case was settled for $650,000 before a lawsuit was even filed.
This scenario serves as a reminder HOAs to evaluate their responsibilities under their governing documents. Here are several steps HOAs can take to reduce liability and protect their communities from similar claims:

1. Conduct Regular Inspections

HOAs should establish a schedule for inspecting sidewalks and other common areas. Look for hazards such as uneven pavement, cracks, and other trip-and-fall risks. Inspections should be documented, as records can serve as evidence of diligence in case of a claim.

2. Prioritize Repairs Promptly

When issues are identified, repair them as soon as possible. In the case mentioned, the sidewalk had a two-inch height discrepancy—a tripping hazard that could have been addressed through grinding, leveling, or slab replacement. Delaying repairs increases the risk of accidents and makes claims harder to defend.

3. Enhance Lighting

Poor visibility can exacerbate sidewalk hazards. Installing streetlights or sidewalk lights can help residents navigate safely at night and deter potential accidents. Lighting improvements are a relatively small investment compared to the cost of a personal injury claim.

4. Consider Risk Transfers

HOAs should review their insurance policies to ensure adequate coverage for premises liability. Additionally, HOAs may consider hiring third-party contractors for sidewalk maintenance and ensuring these contractors carry proper insurance.

5. Communicate with Residents

Encourage residents to report hazards promptly. Open communication creates a partnership between the HOA and the community to maintain safety.

6. Consult Legal Counsel

If your HOA is unsure about its responsibilities or how to implement these steps, consult an attorney experienced in HOA law. Proactive legal advice can help reduce risk and ensure compliance with applicable regulations.

Lessons from the Case

This $650,000 settlement underscores how expensive negligence can be. By implementing regular maintenance schedules, prioritizing safety improvements, and ensuring proper insurance coverage, HOAs can mitigate these risks. Taking proactive measures is not just about avoiding lawsuits; it’s about creating a safe and welcoming community for all residents.

In our last blog we discussed Governing Documents for homeowners associations. Condominium communities also have governing documents. However, the terminology we use to refer to these documents is “Condominium Instruments. “

What comprises the Condominium Instruments?

Continue reading “What are Condominium Instruments?”

In 2008, Virginia enacted legislation requiring condominium and property owners’ associations to establish reasonable procedures for resolving member and citizen complaints. The legislation further required the Common Interest Community Board (the “CICB”) to establish regulations for the associations to govern the complaint process.

What does this mean for your association? You will need to establish, or amend, your written procedures to comply with the regulations.

Continue reading “4 things your HOA needs to know about Virginia’s complaint process”

Many boards of directors for community associations engage management companies to help the board operate their community. These relationships arise from written contracts negotiated by the parties. It is essential that homeowners’ associations and management companies have their contracts reviewed by their experienced HOA attorney.

When determining the terms of a contract, Virginia courts employ what is known as the “plain meaning” doctrine. This doctrine basically means that when an agreement is clear, a court will look to the ordinary meaning of the words of the contract itself. Consequently, the parties need to ensure that all of the terms they believe are part of an agreement are in the written contract itself.

A recent Virginia Supreme Court case presents a prime example of why it is important to have your association attorney review contracts between community associations and management companies. Continue reading “HOAs and Management Companies – Does your contract say what you think it says?”

I read a recent article in the ABA Journal that differentiated between the teaching of “issue spotting” versus “problem solving” in law schools. This article strikes at the core of the services we provide as attorneys. We believe firmly that although it is our responsibility to help identify potential issues that you may face, our legal advice is fully realized when we help you solve your problems.

Continue reading “What Should You Expect From Your Attorney?”

In conversations with clients, it seems that people misuse the terms “mediation” and “arbitration” more than most other legal terms. Although I do not have any empirical data, my educated guess is that many businesses and construction contractors (who did not depend upon advice given by an experienced business attorney) insert “arbitration” clauses into their contracts thinking that they mean “mediation.” Some transactions involving the sale of real estate include an arbitration clause. Countless times, clients involved in a potential lawsuit point to the “arbitration” clause, and are disheartened when I explain to them the arbitration process. Many thought they were avoiding the potential high costs of litigation. These terms are NOT interchangeable and in this blog post I will explain the basic differences between them.

Continue reading “Mediation and Arbitration – There is a big difference”

We frequently are asked whether volunteer board members can be civilly liable for actions taken while a board member. This issue is of serious concern because lawsuits tend to be over inclusive, naming every possible defendant in the initial complaint. Why sign up as a volunteer board member if it could bankrupt you?

Continue reading “What Does It Mean to be on the Board of Directors of your HOA? Potential Liability (Part 2 of a Series)”

It’s a simple fact of business life that you and your company’s fellow shareholders or members will not always see eye-to-eye. Furthermore, our personal lives change and that effects the level of willingness in which some participate in a business venture.

As in any relationship, businesses also reach that awkward stage in which a shareholder or member wants to leave his current business venture and start something new. We have discussed starting your business and provided guidelines for setting forth the rules for governing your business. This article addresses some of the difficulties that arise during the “break-up period.” For the purposes of this article, we will use the terms “shareholder” and “member” interchangeably, as well as the terms “director” and “managing member.”

United States Supreme Court

Previously we blogged about a pending case before the Supreme Court that had the possibility to significantly increase the liability of persons for assisting in the preparation of a “prospectus.” As of June 13, 2011, the Supreme Court handed down an opinion in that case, styled as Janus Capital Group, Inc. v. First Derivative Traders, No. 09-525 (S. Ct.).

The determination of this case is relevant to accountants and business lawyers who assist in the preparation of documents for the purpose of raising money for investment. The Janus Capital Group, Inc. case presented the question of who may be deemed to have “made” an untrue statement for the purposes of Rule 10b-5, and specifically whether someone who assisted in the preparation of a prospectus could “make” a statement through such assistance. As the result of a 5-4 decision, accountants and business attorneys may breathe a little easier. Continue reading “Can an advisor be held liable for the false statements in a prospectus made by another?”

An all-too-common scenario occurs when a homeowners association attempts to collect past dues and the homeowner files bankruptcy. The law is clear that the bankrupt homeowner is still liable for those post-petition dues. The United States Bankruptcy Code at Section 523(a)(16) makes the homeowner liable for “a fee or assessment that becomes due and payable after the order for relief to a [homeowners association] for as long as the debtor . . .  has a legal, equitable, or possessory ownership interest in such unit.”

In other instances the homeowner decides to walk away from the property and surrenders the property to the lender. Instead of foreclosing, however, the lender simply does nothing. Therefore, the title of the property is still in the name of the bankrupt homeowner who walked away from the property, and they are not paying the assessments. The lender has not foreclosed so they are not paying the assessments. How can the homeowners association collect these past due post-petition assessments?