A hut with an extreme: business asks not to hang HOA debts on their heads
The business stood up for the heads of homeowners' associations, who were increasingly being held accountable for HOA debts — similar situations were recorded in the Nizhny Novgorod region, Dzerzhinsk and Moscow. The Chamber of Commerce and Industry has sent an appeal to the State Duma with a request to stop making chairmen "extreme". Currently, the Civil and Housing Codes describe the status of the association's leadership in different ways, which is why courts often shift personal responsibility for non-payers' debts onto it. This scares people away from the post of chairman of the HOA — as a result, houses remain without proper management, settlements with resource workers are hampered and repairs are postponed. Why the bankruptcy of partnerships does not work and which form of management of apartment buildings is more profitable today — in the material of Izvestia.
Why HOA chairmen should be responsible for debts
The Chamber of Commerce and Industry (CCI) announced the legal confusion surrounding the work of the HOA. We are talking about the status of the chairman of the Management Board, the distribution of powers and the boundaries of responsibility. Sergey Katyrin, the head of the Chamber of Commerce and Industry, sent a letter describing the problem to Vyacheslav Volodin, Chairman of the State Duma.
The problem is that the Civil and Housing Codes describe the HOA management system differently. According to the Civil Code, a partnership must have a chairman and a management board, according to the LC, the highest body is the general meeting, and the executive body is only the management board. As a result, it is unclear who the head of the association is: an independent leader or only a member of a collegial body.
The Ministry of Construction, in a letter dated November 2024, indicated that the Housing Code does not make the chairman solely responsible for everything. The law does not contain a list of controlling persons of the HOA, therefore, it is impossible to automatically consider the head of the partnership responsible for his debts. But in practice, courts often follow a different path.
— This situation leads to discrepancies in the status of the chairman and the boundaries of his responsibilities. As a result, HOA heads and board members are often involved in subsidiary (additional. — Ed.) responsibility without real grounds, — Sergey Katyrin explained.
According to the president of the Chamber of Commerce and Industry, due to the risk of personal losses, people refuse to head the HOA or act too cautiously, which slows down settlements with resource supply organizations and home repairs.
HOA debts most often appear due to non-payments by individual owners, explained Natalia Milchakova, a leading analyst at Freedom Finance Global. Money for light, water and heat is underpaid by a few, and the entire partnership has to answer. At the same time, in courts, responsibility is often personalized and shifted to the chairman.
For example, in Dzerzhinsk, the former chairman of the Oktyabrsky HOA was ordered to pay about 6 million rubles of debt for heat after the liquidation of the partnership. Sometimes the heads of associations are to blame themselves: for example, in the Nizhny Novgorod region, the chairman of Galkin-8 was prosecuted for more than 1 million rubles because of his unscrupulous actions.
But debt is not the only problem. In Mytishchi, the HOA "Yauza 2000" has been suing for several years because of the house territory, Raisa Koval, a resident of the house, told Izvestia. After the recognition of the land surveying as illegal, all expenses for its maintenance fell on the residents of one of the buildings.
— In fact, this is a raider seizure of a common territory. But the chairman turns out to be extreme: he walks through the courts and is solely responsible," added Raisa Koval.
The CCI believes that this legal confusion should be eliminated at the level of the law or through constitutional interpretation. Otherwise, the risks for the HOA chairmen and for the residents of the houses will only grow. The editorial board sent a request to the Ministry of Construction.
How to collect debts from the tenants of the house
The legal uncertainty surrounding the personal responsibility of HOA chairmen makes this position unprofitable, said Ilya Vasilchuk, a judicial lawyer and an expert on the security of electronic real estate transactions. According to him, people without financial skills are often elected to the board, as a result, the partnership, represented by the head, signs "bad" contracts and "drives" the house into debt.
Formally, the law divides responsibility, the lawyer clarified. The Chairman is responsible only for his own decisions, and members of the management Board, except for those who voted against or did not participate in the voting, should be responsible for losses due to unfair actions.
— But in reality, it is the chairman who is most often brought to civil, administrative and even criminal responsibility, and not all those who voted in favor, — Ilya Vasilchuk emphasized.
The proposal to change the rules of responsibility looks logical and timely, HOA debts should not be automatically shifted to the chairman, says Stanislav Guzhov, associate professor at the Faculty of Management at the Institute of Management of the Presidential Academy.
"It's not about immunity, but about clear grounds — for proven guilt or gross violations," the associate professor believes.
The number of such cases is growing now. These are usually stories with large debts, a mess in documents, and a lack of decision-making. According to the expert, clear rules in the law will encourage owners to take control of houses into their own hands and increase competition with management companies.
— It is more logical to collect debts from non-payers, but often this path is a dead end. There are measures ranging from bankruptcy and travel bans to installments, but they don't always work. The authorities could give credit holidays for communal services in difficult situations and, conversely, simplify bankruptcy for hard—core defaulters, Natalia Milchakova believes.
How the bankruptcy of the HOA affects the tenants
A separate issue is the bankruptcy of the HOA. Formally, the law allows this: the partnership is a non—profit organization, there is no direct prohibition. But at its core, this is not a business, but a tool for managing common property with a pronounced social function, the CCI letter says.
In practice, HOA bankruptcy does not work. Partnerships have almost no liquid assets: office equipment and inventory cost pennies, and the common property of the house belongs to the tenants and is not subject to foreclosure. As a result, creditors do not receive money, and the procedure itself turns into a way of pressure and a reason to hold the chairmen and members of the management board accountable.
At the same time, the law exempts HOA members from partnership debts and vice versa, which makes the model convenient for owners, but it harms the interests of creditors and pushes the courts to shift risks to management. For comparison, housing cooperatives provide for limited subsidiary liability of shareholders, but there is no such mechanism for HOAs.
— The bankruptcy of the HOA does not lead to repayment of debts, but creates a management vacuum, conflicts and interruptions in the maintenance of houses, — says Sergey Katyrin.
The Chamber proposes to clearly define the management structure, the boundaries of responsibility of managers and exclude the bankruptcy of HOAs as socially significant organizations.
The risks of managing a home
The HOA format is losing out to management companies today, especially in mass housing, Stanislav Guzhov noted. People are deterred by high responsibility, legal risks, and the need for managerial and financial skills.
The main problem with this form is the passivity of owners and a poor understanding of their rights. Self-government without a criminal code is risky: it is rare to find a lawyer, an economist, and a builder in one house. The board does not always have the strength and money to hire specialists, says Denis Zhalnin, CEO of the development company People.
With a management company, the risks are lower, but it is important to behave like a customer, not just a payer, the developer emphasized. If expenses are not controlled, the management company can accumulate debts and disappear, leaving a worn-out house.
Direct management is the weakest form, added Sergey Chuzhakov, Development Director of the Floors company. There is often no single person responsible, decisions are made chaotically, and if one of the owners signs the documents for everyone, then they come to him with penalties.
A separate risk is associated not with the form of management, but with the one who acts as an intermediary in settlements with resource providers. If the house pays for light, water and heat through the management Company or the HOA, and this organization does not transfer money to suppliers, and then goes bankrupt or disappears, the resource workers have the right to go directly to the tenants. In this case, the debt is collected from all owners, in proportion to their share. That is, the problem arises not because the house was chosen by the management company or the HOA, but because of the unreliability of the intermediary, whose financial mistakes the residents themselves will have to compensate.
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