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GeanL (Georgia)
Posts: 4
Posted:
I am the HOA president of a 44 home subdivision that was established this year from a new development. Our situation is that we had the Vice President claim to have made a payment for HOA dues for the upcoming year a few weeks ago by taking an envelope with cash in it to the treasurer’s home and handed it to the Treasurer’s wife at there front door. In a social gathering this was brought to my attention that it was cash and the VP confronted the Treasurer’s wife who did not recall being handed and envelope. The wife pulled me aside and said that she did not recall receiving an envelope from the VP and stated that she would have remembered being handed an envelope.
I am looking for some suggest on how to address this situation. Here are a few thoughts. One is to have a special meeting with all of the board and invite the VP’s husband as the homeowner since his wife if the VP and review the situation and then do a follow up letter to everyone.
Please share some thoughts.
RogerB (Colorado)
Posts: 5,067
Posted:
Gean, if the Treasurer's wife unequivacally states she did not receive this payment then it is the responsibility of the VP to prove payment was made. Why didn't the VP request a receipt? To pay in cash and not request proof of payment would make me concerned as to whether the VP has sufficient judgement to serve on the Board.
HaroldS (Arizona)
Posts: 906
Posted:
I agree it was dumb to pay cash and not request a receipt, but this is a small association and surely board members know each other and their spouses, and it might seem petty to demand a receipt from someone you know. So Roger, why do you assume the treasurer's wife's word is so impeccable? Which therefore implys the VP must be lying. You say the VP should prove she gave the envelope. How do you go about proving you handed someone an envelope of cash? How much money are we talking about anyway?
You'll probably never know who is lying, and even if the VP pays it - again - or flat refuses to - this will undoubtedly cause friction on your board for the rest of both of their terms. I don't envy your situation. Definitely a lose/lose whatever you do. Harold
BrianB (California)
Posts: 2,820
Posted:
it is the VP's responsibility to prove payment, simply because the VP owes the debt to the association. It's the VP who is contracted to pay a set amount each year/month, not the treasurer's wife (she is obligated to pay the amount as well, but not TO the VP). The treasurer's wife has no responsibility in this... she is not obligated to pay, nor is she a board member, or have any role requiring her to accept. In essence, the VP just handed a wad of cash to a stranger, and said "make sure this get's to the treasurer of the HOA, would you?".

Had the VP handed the money to the treasurer, then i would have a different opinion, as the treasurer has a duty in the HOA. Not so, the treasurer's wife.

Look at it this way: If you owed the IRS $8000, who's obligation is it to make sure you pay? Your's or the IRS? If you tell the IRS "Well, i gave the money to someone... they weren't IRS, they didn't work for the IRS, they weren't actually an agent, but they promised to give you the money, and since they said they would, i never asked for even a receipt", do you think the IRS would say "Oh, okay. Our bad.".

Nope. If you owe Tom money, you can't hand it to Larry and say "Okay tom, i paid larry, so the debt is clear."

RogerB (Colorado)
Posts: 5,067
Posted:
Posted By HaroldS on 11/12/2006 4:00 PM
So Roger, why do you assume the treasurer's wife's word is so impeccable? Which therefore implys the VP must be lying. You say the VP should prove she gave the envelope. How do you go about proving you handed someone an envelope of cash?

Sorry Harold, I did not assume anything. I said "if the Treasurer's wife unequivacally states she did not receive this payment then it is the responsibility of the VP to prove payment was made." What in this implies anything about the treasurer's wife or the VP? It is obvious to me that the person paying is always responsible to prove they have paid a bill.
WilliamT (Arizona)
Posts: 489
Posted:
One should NEVER pay cash to anyone for HOA dues without obtaining a receipt, even if the recipient of the cash is your best friend.

If I were the president of that board, I would refuse to hear this complaint because it is a personal issue between two individuals; the VP and the wife of the treasurer. If the wife says she did not receive the envelope, then obviously the treasurer is stating that he did not receive the money from his wife. The board can not and should not attempt to determine who is telling the truth.

The VP owes the dues assessments and they must be paid. If, as he stated, he gave cash to the wife of the treasurer, then his recourse is not with the board, but through the state legal process, such as the small claims court.

The board has no jurisdiction in legal matters such as this and must make that clear to the VP. All the board knows is that the VP owes the assessments and the funds have not been received. Everything else is simply he-said, she-said.

The board should proceed to collect the assessments from the VP and leave it up to a judge to decide the case of "What Happened to the Envelope".

And, very important, just because the person is the VP, he/she should not be treated any differently than any other homeowner. He owes the money and the asociation needs to collect it. He made the mistake of giving cash without a receipt, and the burden of proof is on him, so let him fight his own battle in court. Don't even consider forgiving the dues because then you're having the association pay for his error in judgement.

Collect the dues from the VP using the standard dues collection/delinquent procedures. Assuming that he did not give the envelope to the wife, then if you forgive the dues for the VP, then you are implicitly stating that the VP is telling the truth, and the treas wife is lying, and you are treating the VP with favoratism by not enforcing the dues collection process on him; and you may open the association (and the board members individually for not acting in a fiducary manner) to a lawsuit.
BradP (Kansas)
Posts: 2,640
Posted:
Most people in this world know that you should not pay cash for something without getting a receipt. This whole situation sounds fishy to me. Basically you have the word of the VP and the word of the Treasurer's wife to go off of. Since they conflict and there are no witnesses then burden of proof falls to the VP to prove payment was made since they owe the debt. We are all thinking that the VP is trying to pull a fast one, however, the treasurer's wife may have noticed the cash and no receipt and decided to a pull a fast one of her own.
AsunteW (North Carolina)
Posts: 6
Posted:
First, that was a stupid thing to do. It can 't be proven, the dues will be delinquent. He must pay again-
BrianB (California)
Posts: 2,820
Posted:
Brad, your last sentence is correct... we really don't know who is pulling the fast one here... but, as you (and others) point out, the burden of proof goes on the payer...
GeanL (Georgia)
Posts: 4
Posted:
OK the end result of this bad story is that the VP did finally realize that the dues were paid by check and did not think that the blaming and raising a stink about the missing cash(that turned out to be a check) was actually and issue. Poor representation of a director and this is not the first time something like this has happened.
The second issue pretaining to the treasurer and maintaining the finacial records came to an end as well. Upon review the records for the first year, lack of a budget or data sheet showing what has come in and out created a deciding factor for the remaining members.
We voted both members off of the board.
I am cleaning up the books for the past year and we are starting our process for the yearly dues.
Happy Holiday's to everyone who responded! Next year will be much better!
MaryB3 (Maryland)
Posts: 21
Posted:
I agree with RogerB. I wouldn't want that VP on my board. Cash - is he/she crazy?

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