E. LIQUIDATED DAMAGES
FCHOA Purchaser's Handbook - Revision Date: 2021-01-10
All references to forfeiture of all or a portion of surety deposits held by the ARC shall be considered liquidated damages for the failure to comply with the policies of the ARC as stated in this Handbook, reasonably interpreted by the ARC or the ARC Manager. Because each violation of this Handbook and ARC policies results in the expenditure of time and resources and the potential or real loss of neighborhood property values, the ARC, Property Owner, Builder, and all parties to the application and construction of improvements on a homesite agree, by applying to the ARC for approval of construction, that the full amount of surety deposited with the ARC may constitute the amount of liquidated damages, and that the ARC may forfeit all or part of the deposits in the discretion of the ARC or ARC Manager. The ARC estimates that a reasonable range of expenditures of time and resources and/or potential or actual loss of property values, in regards to violations of ARC policies, may vary from approximately $2,000 to $110,000 in value. This range of value was determined by estimating administrative and professional time, resources, and expenses, as well as estimating that any one instance of a violation of ARC policies, including delayed time of construction completion, could impact real or perceived neighborhood property values in amount of approximately up to 20 percent of average housing resale values. The Property Owner, Builder, and all parties to the application and construction of improvements on the applicable homesite agree to defend and hold harmless the ARC, the FCHOA, and all agents and employees of the foregoing from any action whose purpose is to claim a refund of surety deposits or fees held or charged by the ARC or anyone on behalf of the ARC, or otherwise challenge the right of the ARC to withhold or forfeit any or all surety deposits as liquidated damages. The ARC reserves the right to require a restoration of funds to be held on deposit if fees or forfeitures reduce the amount held.