Hundreds of NJ homeowners continue class action lawsuit against HOA lake assessments

By Deborah Goonan, Independent American Communities

Public domain photo of unknown lake.

 

Occasionally I hear from homeowners who want to know if they can be forced to pay assessments for a property owners’ or lake association, one they had not been made aware of at the time they purchased their home.

The answer is, it depends.

Sometimes, it all comes down complicated legal interpretations of decades-old deeds, titles, and covenants legally filed at the County recorders office.

Take Ramapo Lakes Association (RML), located in the Borough of Oakland, New Jersey, for example. The lakeside community started life as a vacation destination in 1944. At the time, the RML was set up as a stock corporation, rather than a non-profit homeowners’ association. But over the decades, the community changed to a year-round residential neighborhood, and stock certificates got lost in the shuffle as properties changed hands multiple times.

The result was that a majority of owners representing 1,645 homes had no idea they were purchasing property that  would be obligated to pay Property & Maintenance (P&M) fees for Crystal and Mirror Lakes.

For decades, RML collected voluntary association dues from members of its Crystal Lake Beach Club, and even began selling club memberships to the general public to help balance its budget.

But in 2012, thousands of owners were shocked to receive invoices for annual assessments from RML, including non-Club members, most of whom do not live on either lakeshore.

Of course, homeowners objected. Several of them consulted attorneys, and a class action lawsuit is now in process. The deadline for joining the class action suit ended several weeks ago. Other homeowners who have not joined in class action are working with their title insurance companies to resolve the matter in court.

 

Oakland residents face deadline in dues suit

Marsha A. Stoltz, Staff Writer Published 5:00 a.m. ET July 28, 2017 | Updated 11:11 a.m. ET July 28, 2017

 

OAKLAND — With a deadline set for Friday, residents of a former summer community have a decision to make: Will they fight claims that they owe back dues to a homeowners’ association, or give up and pay a group that many say they had no idea they were part of?

The association, Ramapo Mountain Lakes, has filed suit against the 1,645 property owners, claiming they are members of the association and that RML has legal standing to collect dues retroactively and in the future to finance the care of Crystal and Mirror lakes, which are both owned by the association.

About 700 of the owners or their title companies have already asked to be represented by two of the law firms assigned to organize the defendants into more manageable-sized groups – Cole Schotz in Hackensack and Saul Ewing in Princeton.

Read more:

http://www.northjersey.com/story/news/bergen/oakland/2017/07/28/oakland-residents-face-deadline-dues-suit/444147001/

 

Ramapo Mountain Lakes Association is the site of Crystal Lake Beach Club.  Club membership is voluntary and open to the public, offering  swimming, boating, fishing, and  sandy beach area for sunbathing and picnicking nearby. RML corporation owns and manages both Crystal and Mirror Lakes, and is responsible for their ongoing maintenance.

The most recent explanation of the class action lawsuit is posted below.

Source: http://www.crystallakenj.com/rml-urgent-shareholder-information

 

 

Note that the court could decide that all owners are legally obligated to pay assessments to a Lake HOA that they never even knew about until 2012. And if the court finds that all shareholders in RML must pay annual P&M for the lakes, homeowners could also be on the hook for all unpaid assessments beginning in 2012, including those that became due under a previous homeowner.

The court could also decide that RML has no right to collect mandatory fees, under the complex circumstances, but the ultimate outcome has yet to be determined. The fact that a significant legal controversy exists proves that the issue is not easily resolved.

 

What started the dispute?

The RML controversy began in 2012, following a flood caused by an overflow of Crystal Lake in 2011.

Homes flooded by Ramapo River on Lakeshore Dr Oakland NJ

By TwisterNJ | Posted August 28, 2011 | Oakland, New Jersey

Lakeshore Dr divides Crystal Lake and Ramapo River in Oakland NJ. Ramapo River flooded over Lakeshore Drive into Crystal Lake flooding numerous homes in the area. Cresting was still to come. The Devastation was traumatic for homeowners and neighbors.

http://ireport.cnn.com/docs/DOC-664427

 

As explained numerous times here on IAC, private maintenance and management of infrastructure is sorely lacking, particularly when it comes to effective stormwater management and flood control.

For many decades, RML did not adequately maintain its spillway nor its flood gates. And apparently Oakland Borough did not intervene until 2011-2012, when elected officials faced complaints from homeowners on Lakeshore Drive.

By 2013, Oakland Borough and residents of Crystal Lake were mired in conflict over when and how to reduce lake levels during significant rain events to prevent flooding. The Borough voted to follow a 1975 protocol for rain events of one inch or more: Oakland agreed to open its flood gates, and Ramapo Mountain Lake (RML) association reluctantly agreed to close its gates to prevent flooding on Lakeshore Drive.

At the time, some RML members complained that reducing lake levels would diminish the recreational value of Crystal Lake.

Amidst Controversy, Borough Will Continue Review of Crystal Lake Flood Management

Officials at a special meeting Wednesday night told residents that more data will be needed to determine what the final protocol on overflow gates at the lake will be.

By Devin McGinley (Patch Poster) – Updated June 20, 2013 4:37 am ET

Facing some controversy surrounding it’s adoption of flood control protocols at Crystal Lake, the borough told residents at a special meeting Wednesday night that it would continue to review the procedures as more information becomes available.

Last month, a meeting between the mayor and borough professionals hammered out a protocol, based on a 1975 settlement with residents around the lake, to open overflow gates anytime weather forecasts predicted an inch or more of rain within a 24 hour period.

“The next morning,” Mayor Linda Schwager said, “I was bombarded with emails, threats and nasty comments.”

Since the protocol was adopted, it has been used in five rain storms, though four of them exceeded two inches of rain, leaving the borough with little data on which to test the effectiveness of the policy.

“We’re trying to get enough of a sample size to make decisions going forward,” said Kevin Boswell, the borough’s engineer, explaining that the borough would have to review the impact of more one-inch storms to determine whether the protocol needed tweaking.

While Lakeshore Drive residents that have seen the water edge onto their properties in recent storms had pushed for the borough’s action, others saw the move as an unnecessary procedure that diminished the recreation value of the lake.

Read more:

https://patch.com/new-jersey/oakland/amidst-controversy-borough-will-continue-review-of-cr97668b91e3

 

By 2012, it had become apparent to RML that the aging dam in Crystal Lake needed costly repair. That is when the board members of the Association decided to issue invoices to all 1,645 property owners.

 

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