SECTION 1. ADOPTION AND ENFORCEMENT OF THE RULES (Adopted by Resolution of the BOD on 8/31/2001)

1.      Adoption of Rules. Pursuant to the governing documents of the Association and the laws of the State of Virginia, the Rules of the Kings Grant Home Owners Association of a general and permanent nature adopted by the Board of Directors of the Kings Grant Homeowners Association, as revised and consolidated into Sections 1 through 8, together with a Table of Contents, and Appendices, are hereby approved, adopted, ordained and enacted as the "Rules of the Kings Grant Home Owners Association" hereinafter known and referred to as the "KGHOA Rules."

2.      Authority:  The Association draws its authority for establishing and enforcing rules from the following: § 55-513 Virginia Code, which states “The board of directors of the association shall have the power to establish, adopt, and enforce rules and regulations with respect to use of the common areas and with respect to such other areas of responsibility assigned to the association by the declaration, except where expressly reserved by the declaration to the members…”Rules and regulations may be adopted by resolution and shall be reasonably published or distributed throughout the membership.”

3.      Establishment: A rule of the Association shall be established upon an affirmative finding by the Board of Directors that: 1) The rule is necessary to the execution of the business of the Association under its governing documents, 2) the rule is fair to the membership, 3) the rule treats members in an equitable fashion, 4) the rule is sufficiently clear to allow members to comply.  Moreover, the Association shall enforce its rules in an equitable fashion. Rules of the association shall be established, amended, or repealed by Resolution of the Board of Directors and shall be passed in open session by a majority of Directors present at any meeting of the Board of Directors (assuming a quorum is present) provided that the meeting agenda sets aside time for motions on the specific rule. A majority of votes cast, in person or by proxy, at a meeting of the membership convened in accordance with the provisions of the association's bylaws and called for that purpose, shall repeal or amend any rule or regulation adopted by the Board of Directors. After a rule is published, but before it becomes effective, any two members may petition the President of the Board of Directors in writing for reconsideration of the rule, providing reasonable grounds for amendment or repeal. Such petition shall not change the effective date of any rule, however it shall constitute a proper motion to reconsider at the next meeting of the Board of Directors.

4.      Amendments Any and all additions, amendments (including repeals) or supplements to the Rules, when passed and adopted by Resolution of the Board of Directors and in such form as to indicate the intent of the Board of Directors to make them a part thereof, shall be deemed to be incorporated into such Rules so that reference to the "KGHOA Rules" shall be understood and intended to include such additions and amendments. It shall be the duty of the Secretary or someone authorized and directed by the Secretary to keep up-to-date the “certified” copy of the book containing the Rules.

5.      Publication: All rules adopted by the Board of Directors will be published and made reasonably available to all owners at least 10 days before they become effective and will thereafter be published along with all other active rules at least once each year.

6.      Enforcement: . Rules and regulations may be enforced by any method normally available to the owner of private property in Virginia, including, but not limited to, application for injunctive relief or damages, during which the court may award to the association court costs and reasonable attorneys' fees… The board of directors of the association shall also have the power, to the extent the declaration or rules and regulations duly adopted pursuant thereto expressly so provide, to (i) suspend a member's right to use facilities or services, provided directly through the association for nonpayment of assessments which are more than sixty days past due, to the extent that access to the lot through the common areas is not precluded and provided that such suspension shall not endanger the health, safety, or property of any owner, tenant, or occupant and (ii) assess charges against any member for any violation of the declaration or rules and regulations for which the member or his family members, tenants, guests, or other invitees are responsible.

6.1.   Reporting: Violation of any rule may be reported by any member in writing (signed) to the Board of Directors or by any member in person at a meeting of the Board of Directors. Such a report in person may be heard by the Board in Executive session.

6.2.   Investigation: A report of a violation of any rule will be promptly investigated by the Board of Directors or alternatively committed, by a vote of the Board of Directors to an appropriate Committee for investigation.

6.3.   Notification: Any member found to be in violation of a rule will be notified in writing at his/her address of record by the Board of Directors within seven days of the finding. Unless an exigency exists, the member will have 10 days to resolve the violation or respond to the Association’s finding. The nature and findings of any complaint will be incorporated into the recorded minutes of the next meeting of the Board of Directors.

6.4.   Appeal Hearing  Before any charges or suspensions may be imposed, the member, at his/her written request, will be provided an opportunity to be heard and to be represented by counsel before a meeting of the Board of Directors. Notice of such hearing, including the charges or other sanction that may be imposed, shall be hand delivered or mailed by registered or certified mail, return receipt requested, to the member at the address of record with the Association at least 14 days prior to the hearing.

6.5.   Adjudication:  The determination of whether a member is deemed to be in violation of any rule of the association shall be made by affirmative vote of a majority of Directors of the Board at any meeting (provided a quorum is present), or by a majority of any two or more Directors designated by the Board of Directors to make such determinations.

6.6.   Fines:  In accordance with the laws of the Commonwealth of Virginia, the amount of any charges so assessed shall not be limited to the expense or damage to the association caused by the violation, but shall not exceed fifty dollars for a single offense or ten dollars per day for any offense of a continuing nature and shall be treated as an assessment against the member's lot for the purposes of § 55-516 of Virginia Code. However, the total charges for any offense of a continuing nature shall not be assessed for a period exceeding ninety days. After the date a lawsuit is filed challenging any such charges, no additional charges shall accrue. If the court rules in favor of the association, it shall be entitled to collect such charges from the date the action was filed as well as all other charges assessed pursuant to this section against the lot owner prior to the action.

6.7.   Schedule of Fines, Suspensions and Penalties: The Board of Directors shall maintain and publish (at least once each year) a schedule of the amounts of fines, length and extent of suspensions, and other penalties for each offense for which the Association may enforce. The association may define de minimus violations for which the Board may expend minimal Association resources to enforce, however, in this case, the Association reserves the right to reconsider which violations will be considered de minimus at any later date.

6.8.   Good Standing: Any member found to be in violation of any established rule, notwithstanding whether that rule is defined as de minimus, shall not be entitled to vote, hold office, or address the membership or the Board of Directors at any meeting of the members or the Board of Directors until such time as the member is no longer in violation.

SECTION 3 COLLECTION OF DUES, FEES, FINES, AND OTHER CHARGES (Adopted by Resolution of the BOD on 8/31/2001)

1.      General The Association may charge its members for regular dues assessments, special assessments, boarding fees, rules enforcement fees, repairs to the common area that are an owner's responsibility, legal fees and other costs associated with collection of funds on behalf of the Association. The purpose of this rule is to set out procedures for collection of those charges.

2.      Authority  The Association draws its authority to levy dues from a number of governing documents to include: Articles of Incorporation of Kings Grant Homeowners Association, Article III, Purpose and Powers of the Association, Paragraph  which states, in part, “(b) fix, levy, collect and enforce payment by any lawful means, all charges or assessments pursuant to the terms of the Declaration or the Virginia Subdivided Land Sales Act …” and § 55-515, Virginia Code, Compliance with declaration, which states, in part, “…Every lot owner, and all those entitled to occupy a lot shall comply with all lawful provisions of this chapter and all provisions of the declaration. Any lack of such compliance shall be grounds for an action or suit to recover sums due, for damages or injunctive relief, or for any other remedy available at law or in equity, maintainable by the association, or by its executive organ or any managing agent on behalf of such association, or in any proper case, by one or more aggrieved lot owners on their own behalf or as a class action. The Association shall be entitled to recover reasonable attorneys' fees and costs expended in the matter.

3.      Payment Schedule Amounts payable to the Association for regular dues, special assessments, rules enforcement fees, fees for repair of common areas, and charges associated with the collection of such fees, are not delinquent if postmarked by, or hand delivered to the Association’s Treasurer no later than, sixty (60) days after the date on the initial bill. Amounts payable for boarding fees, rental of common property, and charges associated with the collection of such fees are not delinquent if postmarked or hand delivered to the Association’s Treasurer no later than 10 days after the first day of the month following the month in which the service was provided.

4.      Late Fees, NSF & Interest Charges a) A late fee of the lesser of $50.00 or 10% of the amount billed by the Association shall be charged on all amounts billed by the Association one day after the date the amount becomes delinquent. If a lot owner has arranged for an alternative payment schedule and has made a partial payment any late fee shall be the lesser of $50.00 or 10% of the remaining balance. b) A $35.00 Non-Sufficient Funds charge will be charged for any check returned by the bank, notwithstanding other fees as may be triggered by such NSF action. c) Any balance which is delinquent for more than thirty (30) days will incur an interest charge of 1% per month of the delinquent balance which remains unpaid (original amount payable plus any additional fees or charges assessed under this rule), d) Payments received shall be first applied to late charges, interest, or collection expenses, then to assessments.

5.      Temporary Suspension of Charges Pursuant to § 55-513, Virginia Code, after the date a lawsuit is filed challenging any such charges, no additional charges shall accrue. If the court rules in favor of the Association, it will assess the lot owner for such charges as would have accrued from the date the action was filed as well as all other charges assessed against the lot owner prior to the date of the action being filed.

6.      Other Action to Recover Amounts Payable If an amount payable to the Association for dues assessment or special assessment remains delinquent for more than thirty (30) days, or 120 days after the billing date if an alternative payment plan has been arranged, but in no case more than 12 months after the date on the initial bill, the President of the Board of Directors will file in the clerk's office of the circuit court in Stafford County a lien against the property of the lot owner for which the assessment was made for the delinquent amount together with the schedule of accruing charges. For all delinquent debts the President of the Board of Directors may take legal action or file suit or seek any other remedy available at law or in equity to recover outstanding amounts payable and associated costs, to include collection and all reasonable attorney’s fees and costs expended in the matter.

7.      Settlement of Disputed Charges The President of the Board of Directors shall be authorized by a majority of votes of the Board of Directors in any session where a quorum is present (such vote may be held in Executive Session) to agree to alternative terms of settlement of any account if it is determined that such settlement is in the best interest of the Association and its members collectively.

8.      Process for Delinquency Notification For all balances in excess of $250.00  that are past due, the following notification process applies:

8.1.   First Notice First Notice of Past Due Charges including detail of assessments, late fees, NSF charges and interest charges that apply will be sent by First Class Mail (at the address of record) to a member 60 days after the billing date.

8.2.   10 Day Demand  10 Day Demand for Payment including detail of assessments, late fees, NSF charges and interest charges that apply will be sent by Certified Mail (return receipt requested) (to the address of record) to an owner 90 days after the billing date.  This Notice will recite intent to turn the matter over to an attorney for collection enforcement if either, a) balance is not paid within 10 days, or b) the Treasurer of the Board of Directors is not contacted and alternative terms for payment arranged within 10 days.

9.      Alternative Terms for Payment Alternative terms for the payment of amounts payable to the Association may be arranged by the Treasurer of the Board of Directors with any member who requests such terms. Such terms will, in any circumstances, require full payment of amounts payable to the Association 120 days after the billing date, will be in writing, and will state that if the full amount payable to the Association is not received by 180 days after the date on the initial bill, the matter will be turned over to an attorney or a collection agency for collection. Notwithstanding any alternative terms for payment, amounts due will be subject to late fees, interest charges, NSF charges, collection fees, reasonable attorney fees, and any other charges assessed under this rule.

10.  Charges for Legal and Collection Services If a delinquent account is referred to an attorney or collection agency for collection, the owner will be charged the Association's reasonable attorney or collection agency fees and related costs.

11.  Legal Actions to Recover Amounts Payable Legal actions to recover amounts payable to the Association may include: a) a lien against a lot, b) a judgment against an owner, c) eviction from rental property, d) any other legal means of recovering the debt, including turning the action over to a collection agency.

12.  Other Charges The Association may charge the owner for: a) Fees charged by Property Manager to collect funds payable to the Association, b) Notification, filing and satisfying liens, c) Enforcement of the Association's Rules, Bylaws, Declaration or Policies, d) Costs of litigation, e) Repairs to the Association's common areas that result from the acts of owners, their tenants or guests f) rents and boarding fees, g) any other lawful charges associated with managing the affairs of the Association.

SECTION 4 GENERAL RULES

GENERAL RULE 4: USE OF ROAD EASEMENTS (adopted by resolution of the Board of Directors, October 20, 2001)

1.      Authority  55-513 Virginia Code - "The board of directors of the association shall have the power to establish, adopt, and enforce rules and regulations with respect to use of the common areas.

2.      Rule Parking of commercial vehicles on community ingress/egress easements, bridal easements, or common property, or on any member's property without the member's expressed permission, is prohibited.

3.       Exceptions Parking of the following is excepted: a) vehicles engaged in the construction or maintenance of roads, bridal easements, utilities, or common property, b) vehicles parked pursuant to written permission of the President of the Board of Directors.

4.       Enforcement With the following exceptions, enforcement procedures set out in Section 1 of these rules apply:

4.1.   Notification The member will have 24 hours to resolve a violation.

4.2.   Adjudication The President of the Board of Directors and any other Director together may determine whether a member is in violation of this rule.

4.3.   Fines In addition to any fine assessed for violation of this rule, a member may be charged for towing expenses incurred by the Association for removing a vehicle that has been parked in violation of this rule.

SECTION 6 ELECTIONS (adopted by resolution of the Board of Directors, April 19, 2002)