Oklahoma HOA fine rules

What this means for homeowners

• Oklahoma has no statute governing fines by a homeowners association. The Oklahoma Real Estate Development Act is eight sections long and none of them requires notice before a fine, sets a cure period, guarantees a hearing, or caps the amount of a fine — the act does not mention fines at all. Whether an Oklahoma owners association may fine, how much, and what steps it must take first are set by the recorded covenants, restrictions, bylaws and rules, together with the Oklahoma General Corporation Act or the Oklahoma nonprofit provisions for an association incorporated under them, which supply corporate mechanics rather than fine procedure.
• What the act does grant is an assessment and lien power, conditioned on a disclosure made when the owner joins. "The owners association shall have the power to enforce any obligation in connection with membership in the owners association by means of a levy or assessment which may become a lien upon the separately or commonly owned lots, parcels or areas of defaulting owners or members, which said lien may be foreclosed in any manner provided by law for the foreclosure of mortgages or deeds of trust, with or without a power of sale. In an action brought to enforce any lien authorized pursuant to the provisions of this section, the prevailing party shall be entitled to recover reasonable attorney's fees to be fixed by the court, which shall be taxed as costs in the action. No lien may be placed or mortgage foreclosed unless the homeowner was informed in writing upon joining the owners association of the existence and content of the owners association restrictions and rules, and of the potential for financial liability to the individual owner by joining said owners association" (Okla. Stat. tit. 60, § 852(C)). That written-information requirement is a condition on placing a lien or foreclosing, and it looks to what the owner was told when joining; it is not a notice before a fine.
• The act's applicability is narrow and turns on when the association was created: "The powers granted the owners association under this act shall apply only to owners associations created subsequent to the effective date of this act" (Okla. Stat. tit. 60, § 855). The act took effect June 5, 1975 by the emergency clause in Laws 1975, HB 1442, c. 292, so an Oklahoma owners association formed before that date is outside the powers the act grants. The act also requires that an owners association "be formed by the execution of an instrument signed and acknowledged by all owners of the real property included," that the instrument "set forth in detail the nature of the obligations of the members," and that it be "filed of record in the office of the county clerk of the county wherein the real property is located" (§ 852(B)).
• The remaining sections of the act give owners a few narrow rights and no fine procedure. Membership "shall consist of recorded owners of separately owned lots in the real estate development" and transfers with title, and the association "may also enforce the covenant and restrictions of the real estate development when specified by the covenants and restrictions" (Okla. Stat. tit. 60, § 854). "Any person owning property in a real estate development shall be entitled to bring action against any other person owning property in such development to enforce any of the restrictions or covenants of the real estate development which are specified by the covenants or restrictions," with reasonable attorney's fees to the prevailing party taxed as costs (§ 856). A copy or certified copy of all the recorded covenants and restrictions "shall be provided by the title company closing the sale to the buyer of property in the real estate development as a part of the closing of the real estate sale," for no more than $25 and delivered before or at closing (§ 857) — a duty on the title company at closing, not a records-inspection right an owner can exercise against the association later. An owners association, condominium association, cooperative association or residential real estate management association may not restrict a member from displaying the flag of the United States at a reasonable height not exceeding twenty feet on residential property in which the member has a separate ownership interest or a right to exclusive possession or use (§ 858). Section 853 concerns taxation of each lot as a separate unit.
• The Real Estate Development Act covers single-family developments. Oklahoma condominiums are governed separately by the Unit Ownership Estate Act, Okla. Stat. tit. 60, §§ 501 through 530, and that act contains no fine provision either — the closest it comes is a duty to obey and a remedy for breach: "Each unit owner shall comply strictly with the bylaws and with the administrative rules and regulations adopted pursuant thereto, as either of the same may be lawfully amended from time to time, and with the covenants, conditions and restrictions set forth in the declaration or in the deed to his unit. Failure to comply with any of the same shall be grounds for an action to recover sums due, for damages or injunctive relief or both, maintainable by the manager or board of managers on behalf of the council of unit owners or, in a proper case, by an aggrieved unit owner" (§ 508). The mandatory contents of condominium bylaws listed in § 520 include no fine, notice, cure-period or hearing item, and the condominium records right runs only to the accounts book: the book of receipts and expenditures "and the vouchers accrediting the entries made thereupon shall be available for examination by all the unit owners at convenient hours on working days that shall be set and announced for general knowledge" (§ 521). Oklahoma therefore has no fine statute on either the homeowners association side or the condominium side.