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New Georgia Court of Appeals Ruling Affects Enforceability of Amendments Adopted by Common-Law Homeowners Associations

aerial view of suburban Austin Texas

There are two types of homeowners associations (generally subdivisions) in Georgia—- those that are subject to the Property Owners Association Act (POAA) and those that are not.  Associations not subject to the POAA are known as common law homeowners associations.  The members of a common law association can vote to amend their declaration to submit to the terms of the POAA.

Common law associations who do not adopt the POAA are subject to O.C.G.A. 44-5-60 (d) (4). That statute provides that covenants imposing greater restrictions on the use of land cannot be enforced against a property owner without that owner’s consent.  That means that if an amendment is adopted by the vote of the number of members required by a declaration, the amendment can be enforced only against the owners who consented to the adoption of the use restriction. That is not the situation with the POAA.  Amendments approved by the required number of members apply to all owners, not just those that voted in favor of the use restriction.

Many common law associations have presented amendments that adopted the POAA and in the same document added use restrictions. This resulted in a lawsuit challenging that process. In Marino v. Clary Lakes Homeowners’ Association, Inc., the declaration provided for its amendment by a vote of a majority of the members. The members adopted an amendment that submitted the property to the terms of the POAA and also adopted a use restriction requiring that owners park their vehicles in garages (the “Garage Use Covenant”).

The Marinos bought their property in 1994, prior to the Garage Use Covenant, and did not consent to the passage of the Garage Use Covenant. They refused to park their cars in their garage and the Association sued to enforce the covenant and to collect fines. The Marinos argued that the vote of a majority of the members, while sufficient to adopt the POAA was insufficient to adopt the Garage Use Restriction because the POAA requires all amendments to documents that are subject to the POAA must be approved by at least 2/3rds of the members. In other words, once a majority of the members voted in favor of the amendment, the terms of the POAA became effective immediately. Thereafter, the Garage Use Covenant required the approval of 2/3rds of the members. The Marinos argued that the Association could not enforce the Garage Use Covenant against them because they had not consented to it as required by O.C.G.A. §44-5-60(d)(4), nor had it been approved by at least two-thirds of the votes in the Association as required by the POAA.

The Court of Appeals sided with the Marinos on this issue, finding that in order for the Garage Use Covenant to be exempted from the provisions of O.C.G.A. §44-5-60(d)(4) and enforceable against owners who did not consent to it, the Garage Use Covenant would have to be adopted by 2/3rds of the members in accordance with the amendment procedures of the POAA. As it was approved by only a majority of the owners, O.C.G.A. §44-5-60(d)(4) applied to the Garage Use Covenant and so it was only enforceable against those owners who consented to it, not the Marinos.

The lesson from this case is that any amendment adopting the POAA simultaneously with use restrictions must be approved by at least two thirds of the Association vote in order for the use restrictions to be binding against all owners. Readers should note, however, that the decision of the Court of Appeals may be appealed to the Georgia Supreme Court so this may not be the final ruling on the issues raised in the Clary Lakes case.

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