Responsibility for Outlots in a Subdivision

by Mark
(Franklin, WI.)

Visitor Question: I am a second owner in a 52 house subdivision created 18 years ago. I have lived here 10 years and just received information from the city that I am a 52nd owner of 3 outlots and a pond and will be required to maintain them through an HOA.

We have never had an HOA; the developer went bankrupt before the subdivision was completed. Back taxes of $50k have accrued. The county of Milwaukee has foreclosed on them, and I believe now owns the land. On my title there is an exceptions covenant, and listed on the land plat it states the HOA is responsible for maintaining the outlots.

1) Can I be forced to join an HOA 10 years after buying my home?

2) Can I be forced to take "ownership" of these outlots?

Editors Reply: This is an unwelcome surprise, isn't it?

In two respects this is similar to many other questions and communications we are receiving:

(1) The HOA was never formed, even though the subdivision was organized to assigned rights and responsibilities to the HOA (homeowners association), and (2) A common area now is being neglected because of lack of the existence or authority of an HOA to address something that was originally set up to be maintained by an HOA.

Our site isn't legal advice, since we are planners and not attorneys. You and your neighbors may want some legal advice before this is all resolved, so you can start scouting for an attorney either living in your subdivision or somewhere in a neighbor's network.

From the planning and zoning administration perspective, at first glance it would seem that you could argue that the county as the owner of the property (if indeed that is the case) is responsible for maintaining the property. But the county cleverly has figured out that a covenant says that the homeowners are responsible. This point of view would be quite defensible legally in most states and situations, although a specific state law could have addressed just this situation.

You ask if you can be forced to join a homeowners association. Yes, you can, if indeed one is formed. People buying into a development where an HOA exists don't get to choose whether or not they join--it is not the same thing as a neighborhood association. Often this feels very unfair if people do not realize that there is a homeowners association, or that one was supposed to have been organized and was not.

Your second question is whether you can be forced to take ownership of these outlots. Again the answer is yes, if and when an HOA is formed.

So if we were in your shoes, we would take these steps:

1. Call a quick and informal meeting of everyone in the subdivision so that everyone is informed of the exact situation. At that meeting determine what you will do about finding an attorney who read your specific covenants and other relevant documents, and then compare that to state law and case law that may exist in your area. If you are going to have to pay one, decide how you will collect the money. Also discuss times and places for meeting with your elected representative in county government (probably in your situation, you have a geographic division of the county into districts, so you have a specific designated representative).

2. Meet with your elected county representative. Designate a few neighbors to take the lead in this meeting, but probably you should invite any resident to attend and listen, unless you are sure that the elected official would interpret this as a hostile move. Make sure you come away from that meeting with a clear understanding of whether the county actually owns the land, and if not, how they interpret the ownership.

3. After an attorney licensed to practice in your state has read all the relevant documents, call another meeting, this one a little bit more formal. Invited participants should be the attorney and whatever county staff members and elected officials are relevant to the situation. (Start with whoever signed the notice you received.) Have the county official speak first, then the attorney, ask both to answer questions. Then you homeowners will need to have a discussion to decide what to do.

We would love to tell you that this will all go away if you ignore it, but probably not. If the county has taken this step, it is likely to be inclined to pursue this to the point of obtaining performance from someone other than the county itself.

If this will be an expensive or technical problem for the homeowners, it could be that the county government would take pity on you and take over the burden themselves. This is why you need to start out with being pleasant with county staff members and elected officials. A joint problem-solving approach and a reasonable negotiation is likely to bring the best results for you.

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