Governance failures rarely announce themselves. They don’t begin with arguments, fines, or hearings. I didn’t expect to see these patterns in a small lakeside community governed by a Home Owners Association (HOA). Yet the familiar signs emerged. They start in the quiet corners where authority meets procedure and where small choices carry more weight than anyone expects. You see the same pattern in public companies when a board stops following its own rules. You see it in local bodies when a process yields convenience. You can also observe this phenomenon in homeowners’ associations when their structure becomes lax, and the negative consequences accumulate unnoticed.
What has unfolded at Webb’s Chapel Cove, a small community in North Carolina, follows that script. This is not a neighborhood disagreement. It is a study in what happens when procedure, documentation, and accountability move out of alignment. Over the past year, the record has built itself. The matter began with the required restoration of a state-regulated environmental buffer following earlier tree removal. The North Carolina Department of Environmental Quality (NCDEQ) reviewed the restoration work, issued written approval, and closed its file. Thereafter, the HOA imposed fines without the statutory hearing required under North Carolina law. New requirements appeared after the approval, none of which existed in covenants, guidelines, or prior notices. Personal communications were copied to the Board and treated as part of the governance process.
Everything in this article is drawn from documents, emails, state filings, and preserved witness statements. The aim of this article is straightforward: to examine how a governance structure functions when it deviates from its established rules.
The Regulatory Foundation: NCDEQ’s Role And The Initial Approval From The HOA
Governance starts with jurisdiction, and in buffer restoration cases, that authority sits with NCDEQ. The agency reviewed the restoration and replanting work that followed the earlier tree removal, confirmed that it met state requirements, and formally closed its file. That decision set the regulatory baseline. In January, during a meeting with HOA representatives, the same restoration plan was verbally acknowledged as acceptable. At that point, the structure was aligned. The state had approved the work, and the local association had recognized the approval.
Governance works only when lower bodies remain within the boundaries set by higher authorities. When an HOA chooses to depart from a regulatory determination, the burden is simple: any change must be documented, justified, and procedurally sound. This was the moment when alignment in this case began to deteriorate.
The Reversal: When Standards Shift Without Process In A HOA
On March 18, the Webbs Chapel HOA reversed its earlier position and introduced a new set of requirements. These included defined tree-spacing measurements, a three-inch caliper standard, biannual inspections for five years, and the rejection of plantings already approved by NCDEQ. None of these requirements existed in the covenants, the ACC guidelines, earlier notices, or any prior communication. They were not part of the governing documents at the time the state closed its file.
This dilemma is not a landscaping issue. It is a governance issue. In corporate terms, it mirrors introducing performance metrics after a project is complete and holding the operator to standards that did not exist when the work was done. Systems lose credibility when rules shift retroactively. Predictability is the foundation of any governance framework, and once it disappears, trust collapses with it.
The Due Process Issue: Fines Without A Statutory Hearing
North Carolina’s Planned Community Act is clear about what must occur before an HOA imposes fines. A written notice must be issued. A hearing must be scheduled. The homeowner must be given the right to appear and the opportunity to present evidence. Only after a valid hearing may fines be considered.
That process did not occur here. A hearing timeline was provided, but the only option offered was a Zoom link that did not function. No alternative method of appearing was supplied, and no in-person hearing was offered. As a result, there was no practical opportunity to appear or to present evidence. Despite this, fines were imposed and later referenced as if a lawful hearing had taken place.
In any oversight system, this is a structural red flag. It mirrors a corporate setting in which penalties are applied without committee review or without the procedural safeguards built into governance architecture. Due process is not a formality. It is the mechanism that keeps authority accountable.
HOA Transparency and Financial Stewardship: The Annex Issue
The annex of five homes on Cindy Lane sits along the edge of the broader community. We are formal members of the HOA, yet we receive no visible services. There is no clubhouse access, no pool, no landscaping, no road maintenance, and no snow removal. There is no maintained infrastructure of any kind. Still, we pay annual dues, adjusted only slightly, as if a marginal reduction accounts for the absence of value.
That raises a governance question, not a preferential one. Requests have been made for itemized spending tied to the annex, documentation of how services are allocated, the methodology used to calculate assessments, and the basis on which dues are set.
When assessments are not grounded in measurable cost distribution, the governance challenge resembles a corporate division subsidizing another without disclosure. It obscures accountability, blurs performance, and raises questions about fairness. Transparency in financial stewardship is the foundation of credibility in any organization, whether the budget belongs to an HOA or a public company.
Communications Breakdown: When Personal Correspondence Enters the Governance Record
One of the clearest indicators of structural weakness in this case is what happened when simple, factual communication entered the HOA’s official record. The sequence shows how quickly oversight can erode when interpretation replaces documentation.
The first communication was a single request for comment sent to HOA President Tim Rogers. It asked for responses to documented items: NCDEQ’s approval, the later reversal, the fines issued without a lawful hearing, the post-approval requirements, the restaurant interaction supported by a written witness statement, the Sunday approach at my home, and the sharing of information from a confidential complaint. The message contained no threats, no pressure, and no commentary beyond the factual record.
Rogers forwarded the email to the HOA attorney and described it as harassing. The plain text of the original email does not support that characterization. This reflects a familiar governance pattern: inquiries framed as engagement can be recast as confrontation when oversight becomes uncomfortable.
A second email followed. Greg Smith, a community member who does not serve on the Board, sent a lengthy message copied to the full Board. His message included personal commentary, character claims, and a request for law enforcement presence at meetings. None of these points were drawn from the documented record. The structural issue is clear. When individuals outside a governing body influence tone, perception, or decision flow, governance boundaries blur. Corporate investors see the same risk when unofficial voices shape board interpretation without mandate or accountability.
The entire communication sequence illustrates how quickly a process can drift when structure gives way to personal interpretation—a dynamic common in larger governance failures as well.
The Restaurant Incident And Outside Influence
Another documented event occurred at a local Mexican restaurant—Margarita’s. The facts are specific. I was seated at the bar with my wife when Greg Smith approached. Greg Smith made physical contact and mentioned the HOA matter in his statements. A third-party witness later provided a written statement describing the interaction as intimidating. All of this is recorded through time-stamped documentation and preserved witness accounts.
The relevance is structural. Governance systems, whether residential or corporate, weaken when off-record interactions begin to influence institutional decisions. Strong systems depend on clear boundaries between personal encounters and official processes. When those boundaries shift, perception starts to replace procedure. Investors watch for this dynamic in companies because it signals underlying governance tension.
What The HOA Dispute Reveals About Governance Risk
Viewed through a governance lens, the patterns in this case mirror those seen in far larger institutions. Rules were applied inconsistently. Standards were introduced after the fact. Penalties were imposed without due process. Financial transparency around assessments was limited. Personal influence entered decisions that should have been institutional. Basic rights were met with claims of retaliation. And there was no neutral oversight to keep the structure aligned.
Whether a budget is five figures or thirty billion, governance failures follow the same principles. The earliest warnings appear not in financial statements but in behavior: shifting standards, blurred authority lines, and decisions driven more by narrative than documentation. Smaller systems often expose these risks because there is less noise in the record. This case shows how misalignment, ambiguity, and the erosion of procedure create risk in any structure.
Closing
HOA President Tim Rogers and community member Greg Smith were both offered the opportunity to comment. The purpose here is clarity and fidelity to the record. The documents speak for themselves, and the analysis follows established governance principles rather than opinion.
This is not a story about a neighborhood disagreement. It is an examination of what happens when a governance structure loses alignment with its own rules. The hope is always to resolve these matters and move forward. But when process, documentation, and accountability break down, addressing failure becomes part of protecting the broader community. Occasionally the only way to bring a system back into alignment is to confront the gaps directly, even if the goal is simply to put the issue behind us and restore order for everyone involved. The goal is not conflict. The goal is a functioning system within an HOA.