Neither. Either you validate the $1250 bid, or, as Ingrid says, you get an attorney.
HOA directors are volunteers, often poorly trained. I think we have to cut them some slack.
Your originating documents explain the process for fining members, and I think that having two meetings with the board is generally sufficient. However, in this case, you have not validated the contractor's bid, and I think it's essential that you do so, because it's not up to you to invalidate it, it's up to you and the Board to come to an agreement as to its validity. If they think it's valid, they have the obligation to come after you.
I suggest that you track down the original contractor and validate the bid. If you can't track them down, then I think you're in for not just a couple of thousand dollars of legal fees, but you're also spending your HOA dues on legal fees against you.