SHERRILLS FORD, N.C. — For months, several homeowners in the fairly new Magnolia Cove development in Sherrills Ford have complained that their needs haven’t been met by the homeowners association since they closed on their houses.
“Originally when they were marketing the homes, it said the lawn maintenance was included, there'd be a swimming pool, mailboxes," she said. "Right now, we don't have any of those. Even though we paid money for a deposit for the swimming pool, we have no idea when it's going to show up.”
Marsha Cheese, another homeowner in the development, echoed Austin's complaints, saying neighbors have been waiting for more than a year for some key features.
“We still don't have our community mailbox. We have to drive eight miles round-trip to the post office in Sherrills Ford to pick up our mail," she said.
Homeowners agreed that when they closed, each household paid $1,200 towards a community pool and quarterly dues close to $500 dollars. In addition to a lack of a pool and mailbox, some residents said there was no real house warranty. Many said they ended up addressing issues on their punch list at their own expense.
According to documents, the HOA is run by one person and has no board of directors. WCNC Charlotte tried reaching out to Aaron T. Guess, the developer with Story Homes. He has been named in multiple lawsuits filed against him. Some are from subcontractors who didn’t get paid. At least one is from a would-be buyer who said they lost their deposit money because he canceled their contracts. As of writing, WCNC Charlotte is still waiting for a response from Guess.
Attorneys Mike Hunter and Ben Karb, specializing in HOA and real estate law with Kirk Palmer & Thigpen, P.A., told WCNC Charlotte even when an HOA is still under the developer's control, that person is still obligated to fulfill certain duties. Those duties include holding an annual meeting, holding regular open board meetings, having an operating budget, and maintaining certain documents.
Hunter said owners are entitled to request and receive such documents.
"Those include the minutes of all membership meetings and all board meetings, accounting records, the HOA's bylaws, and articles of incorporation," he said.
Hunter added, "Probably more important than anything is the board is obligated to provide financial statements to the owners every year, within 75 days after the close of the fiscal year. This includes both on the income and expense statement and a balance sheet."
When owners asked for those financial statements, they received documents that were sparse on details and at most only two pages long. But there could be a way to get more from the developer.
"The Planned Community Act actually allows owners to force the board to conduct an audit," Karb said.
Hunter said if Guess refuses within a certain amount of time, the homeowners might just have to go to court.
"That's where a judge orders someone either to do something or stop doing something. That's what an injunction is," he said. "So the judge could order him to cooperate with the performance of an audit and produce bank statements and other financial records to reflect where the owners' assessment income is being spent.”
Karb added, "What I tell communities is if you've got a bad developer, your greatest assets are your numbers. Get your owners to band together to force the developer to change because you certainly speak louder, the more people you have.”
WCNC Charlotte also learned Magnolia Cove used the services of Cedar Management earlier this summer. However, the vice president of the group said in September it was in their best interest to part ways with Story Homes.
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