Murray-Lobb Attorneys represents various community associations in Texas, including:
- Property owners’ associations,
- Condominium associations,
- Commercial associations, and
- Master planned communities.
Our Texas community associations attorneys provide legal assistance in establishing different types of community associations and with ongoing representation when needed for issues like corporate and legal compliance, collections, deed restriction enforcement, conflict resolution, and litigation.
How to Set up a Property Owners’ Association in Texas
The Texas property code contains rules for how to set up a property owners’ association or another type of community association in Texas.
For example, if there are no pre-existing restrictions in a subdivision creating a property owners’ association, Texas Property Code Sec. 204.006 says that:
- At least three homeowners in a neighborhood can create a petition committee,
- The petition must be approved by at least 60 of the property owners in the subdivision (excluding lienholders, contract purchasers, and owners of mineral interests),
- If the petition is approved, it is binding on all properties in the subdivision, and
- If the petition is not approved within one year, it is void, but another petition committee can be formed to try again.
Once approved, the property owners’ association will need to:
- Set up a nonprofit organization,
- Draft articles of incorporation and bylaws,
- Elect board members and officers,
- Establish covenants, conditions, and restrictions for how the POA will operate and the rules for homeowners in the neighborhood,
- Get the approval of the homeowners (at least 75) for the restrictions through a separate petition process,
- Establish a procedure for future modification of the covenants, conditions, and restrictions, and
- Draft rules and regulations that summarize the covenants, conditions, and restrictions for homeowners.
Of course, the procedure for setting up a community association may vary depending on the neighborhood and the type of community association that you are setting up – for example, there are different rules for property owners’ associations, condominium associations, and commercial associations.
Laws Governing Community Associations and Property Owners’ Associations in Texas
Laws that affect a Texas community association can be found in the Texas Property Code, other Texas laws, and federal law. For example, these are just some of the laws that will impact the creation and the ongoing operation of community associations in Texas:
- The Texas Property Code – including the formation, management, and powers of a POA in Texas, and the regulation of solar energy panels, roofing materials, and standby electric generators,
- The Texas Condominium Act (for condominiums created before 1/1/94) and the Texas Uniform Condominium Act (for condominiums created after 1/1/94),
- The Texas Nonprofit Corporation Act – property owners’ associations must be formed as a nonprofit corporation, although condominium associations can be a for-profit corporation or a nonprofit corporation,
- The Texas Fair Housing Act, and
- The Texas Debt Collection Act, which regulates debt collection within the state and regulates the collection of community association fees.
Various federal laws may impact the operation of your community association as well, including:
- The Fair Housing Act (FHA),
- The Americans with Disabilities Act (ADA),
- The Fair Debt Collection Act,
- The Freedom to Display the American Flag Act,
- The Over-the-Air Reception Devices Rule,
- The US Bankruptcy Code (automatic stays), and
- The Servicemembers Civil Relief Act.
Once you have set up your Texas community association, you must be prepared for the inevitable headache of collecting dues from the homeowners as well as the possibility of disputes with homeowners, regulatory disputes, and unexpected litigation.
With the assistance of experienced corporate counsel, you may be able to avoid some of the pitfalls, but you will most likely need ongoing advice and counsel to remain in compliance with state and federal laws and regulations and to resolve disputes with homeowners and government agencies.
Do You Need a Property Owners’ Association Attorney?
Once you have decided to form a community association, you may need an attorney’s help to 1) set up your community association, and 2) provide ongoing legal counsel and advice.
Your property owners’ association, condominium association, or commercial association may need the assistance of corporate counsel to:
- Help set up your community association in compliance with Texas and federal law,
- Form your community association’s business entity, draft and file the articles of incorporation, and assist with bylaws as needed,
- Advise and assist your association to ensure compliance with local, state, and federal laws and regulations,
- Deed restriction enforcement,
- Debt collection efforts,
- Amendments to the association’s governing documents as needed, and
- Representation of the association or board members for allegations of breach of fiduciary duty and other disputes with homeowners.
Murray Lobb’s community association attorneys can help your association avoid unnecessary litigation, resolve disputes out of court whenever possible, and represent your association or board members in court when litigation cannot be avoided.
Please feel free to contact any of our Murray Lobb attorneys with questions about how to set up a community association or for representation for your property owners’ association, condominium association, master planned community, or commercial association. We also remain available to help you with all your general business, corporate, and estate planning needs.