Economy May Lead to Increased Claims of Discrimination
Most associations are being affected by the economy in one way or another. The biggest consequence is an increase in account receivables. As associations struggle with ways to collect unpaid assessments it is important to remember that:
- your collection policy must be followed
- if your policy doesn’t allow for deviations it should be amended
- if your policy allows for deviations make sure to document why the board is deviating from the policy.
Deviating from your collection policy – even if allowed- may lead to claims of discrimination. Two situations might be:
- Association sues an owner with a Hispanic surname but doesn’t sue an owner with an Irish surname when both owners have similar balances;
- Association doesn’t file a lien against builder or developer owned lots but does record a lien on other owners – many who fit within some protected class.
Think before you deviate…
There are only so many tools that an association, its manager, and its attorneys can use in collecting delinquent balances. There are no secrets. It is important that everyone follow the collection procedures to the letter. If there is a trick to this, I have learned that the manager must stay in contact with and work closely with the attorney (or paralegal) who is handling collection cases. We all need to be on the look-out for ways to increase revenue and decrease expenses (almost impossible!).