Fogarty v. Hemlock Farms Community Association

Dennis and Mary Fogarty (plaintiffs), condominium owners at the Hemlock Farms Community, filed a declaratory-judgment action against the condominium’s homeowners’ association (the association) (defendant), challenging the association’s authority to levy a special assessment for certain capital improvements. A covenant in the Fogartys’ deed required them to become members of the homeowners’ association and to pay annual dues, fees, and assessments for the “control, maintenance and repair of streets, roads and recreational facilities.” The covenant said nothing specifically about paying for capital improvements. After the association voted to impose a special assessment on all members for the construction costs of a mail office, administration building, and clubhouse, the Fogartys refused to pay the assessment and instead filed the declaratory-judgment action. The trial court upheld the special assessment and granted summary judgment for the association. The Fogartys appealed, arguing that their deed covenant only authorized special assessments for the maintenance and repair of streets, roads, and the beach and other recreational facilities—not for the type of capital improvements approved by the association. The association argued that absent an express prohibition restricting the association from levying special assessments for capital improvements and considering the association’s authority under the bylaws to levy special assessments for various purposes, the Fogartys were obligated to pay the assessment.