Virginia Court Decision Demonstrates the Importance of HOA Boards and Homeowners Making Prudent Decisions Relative to Litigation

The Virginia Supreme Appellate Court decision in Lambert v. Sea Oats Condo. Ass’n, Inc. that we reported on April 21, 2017 is a prime example of how important it is for those who are contemplating becoming involved in litigation to know what they are getting involved in and the high financial and non-financial costs of becoming embroiled in litigation that never has a certain end result.

The Lambert Decision

The Lambert case started out with a dispute between a homeowner and her homeowners association over who was responsible for the payment of $500, for the cost of repairing the entry door to the homeowner’s condominium unit. When the parties could not resolve the $500 dispute, they turned to the court system— a decision that had to have been motivated by emotion and not good sense. The case then went to trial in the general district court where the association prevailed. The unhappy homeowner then appealed to the circuit court which reversed the trial court’s decision, but did not award the homeowner her attorney’s fees as requested. The homeowner, upset with not having been awarded over $9,000 in attorney fees that she had incurred in pursuing the $500 dispute, then appealed to the Virginia Supreme Court of Appeals. The appellate court ruled that the lower court’s decision on the amount of attorney fees that should have been awarded was incorrect but, rather than award a specific amount for the attorney fees, sent the case back to the original trial court for a determination of the correct amount of attorney fees to be awarded to the homeowner based on factors that had been outlined by the reviewing court. Thus, after each side had incurred thousands of dollars in legal fees, the $500 battle between the homeowner and the association had still not been fully resolved at the time that the decision by the Supreme Court of Appeals had been reported.

Understanding the Costs of Litigation

Disputes between homeowners associations and their members are commonplace and are to be expected as a natural consequence of living in condominiums and other common interest communities that are governed by a homeowners association that is controlled by a board of directors. Recognizing that there are always going to be disputes concerning a multitude of different possible issues that are involved in community living, it is critical that the people who are involved in those disputes have an understanding of how the dispute resolution process works and the high costs of litigating claims—including the obvious financial costs and the less obvious, financial and non-financial costs.

The obvious financial costs that are incurred in litigating claims include expenses for attorney fees and court filing fees, but there are also a myriad of other less obvious expenses that are commonly incurred by litigants such as: