In a recent win by the consumer-focused organization, Civil Justice, the court of appeals found that HOA dues are a form of consumer debt subjected to the Consumer Protection Act.
Why does this find matter?
The Consumer Proection Act prohibits use of confessed judgments.
Confessed judgments allow creditors to quickly obtain judgments because the debtor often has waived a lot of his or her defenses by agreeing to the confessed judgment language.
The creditor files a Confessed Judgment complaint along with an affidavit spelling out why the debtor owes the money. If the court is convinced the creditor meets the Confessed judgment requirements laid out in the law then it can enter the judgments without further proceedings.
In the case of Goshen Run Homeowners Association, Inc. v. Cumanda Cisneros , the HOA used a confessed judgment clause and attempted to have it enforced.
The homeowner objected to its use taking the case all the way to the court of appeals.
