Chapter 5 - § 5.20 • FINES

• Jurisdiction: Colorado

§ 5.20 • FINES

An association has the power, without specific authorization in the declaration, to levy reasonable fines for violations of the declaration, bylaws, and rules and regulations of the association after notice and an opportunity to be heard.³⁰⁵ Additionally, the association has a statutory lien on a unit for fines imposed against unit owners.³⁰⁶

However, the CCIOA provides procedural protections to unit owners when fines are considered. Despite any provision in declaration, bylaws, articles of incorporation, or rules and regulations to the contrary, the association may not fine any unit owner for an alleged violation unless it has adopted, and follows, a written policy governing imposition of fines,³⁰⁷ and that policy includes a fair and impartial fact-finding process.³⁰⁸

If, as a result of the fact-finding process, it is determined that the unit owner should not be held responsible for the alleged violation, the association may not allocate any of the association's costs or attorney fees incurred in asserting or hearing the claim to the unit owner's account with the association, and a unit owner is not to be deemed to have consented to pay those costs or fees, notwithstanding any contrary provision in the declaration, bylaws, or association rules and regulations.³⁰⁹

One specific limitation has been imposed on the authority of associations to levy fines. They may not assess a fine against unit owners for violating a declaration, bylaw, or rule of the association by failing to adequately water landscapes or vegetation for which the unit owner is responsible when water restrictions or guidelines from a local water district or similar entity are in place and the unit owner is watering in compliance with those restrictions or guidelines.³¹⁰

Practice Pointer
Traditionally, the power to levy fines has been viewed unfavorably,³¹¹ and, although explicitly authorized by the CCIOA, that authority may be strictly construed against the association. When a client has been fined, or faces that possibility, be sure to carefully examine the documents for any explicit or implied limitations on the association's power to levy fines. For example, the CCIOA says fines may be levied "after notice and an opportunity to be heard." Even if the documents say nothing about fines, there may be language on notices or hearings that can be helpful. Finally, make sure the rule the client is accused of violating actually proscribes the alleged activity.

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