Texas: Not For Profit Charter Breach by Treasurer

Started by LindaM5 • 6 replies • 1276 views

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LindaM5 (Texas)
Posts: 32

Posted:

Forum: I have addressed this issue prior and wanted to update my current status regarding 2 board members who feel they "deserve" free boat storage on our property.

We have had storage established for years at $40.00 per month/space - no conflicts until these 2 yahoos came on board to Board in June - each have an eligible recreational vehicle (our complex is near a lake).

I have heeded and taken all advice provided from this site - and I'm still standing and fighting.

This storage "motion" authored by our Treasurer (with added benefit to our Vice President) has been on our Board decision docket since June 9th. It is still not resolved.

I have utilized every aspect of our documents to combat and revoke any actions to date. The Vice President resigned on 11/8 - when our Property Manager FINALLY concurred with me and said that storage can not be free. He's not real happy with me right now : )

New motion on 11/8 - is Board stalemated at 2 yea and 2 nay votes (myself Secretary and our President > I think he finally understands). Treasurer has now "changed his mind" and is willing to pay $20 per month (reducing from $40). I still think he is a potential thief and should not get special concessions!

I am firm that this is still in violation of our Not For Profit Charter with the State of Texas (and is stated in our Bylaws). No Board member can/should profit by position - without covenant or benefit to this HOA.

I have at least convinced the Treasurer that the Board can not decide this issue - we have tried and failed. He has agreed to take this to all owner quorum in our January Annual Meeting.

I still believe that even if he acquires majority vote of owners (he'll need 13 out of 24 votes) - our Treasurer can not "legally" profit from us; and our NFP Charter and Bylaws are breached/violated.

What do you all think? File note: no attorney has reviewed or had access to any of the "motions" - there has been an evolution of many amendments.

MaryA1 (Arizona)
Posts: 388

Posted:

Linda,

Frankly I don't think there is anything for the board or the members to vote on. It's against the bylaws and that's that! If the Treasurer is storing his boat then just bill him $40/mo. If he doesn't pay then he's delinquent and subject to the same collection procedures as anyone else.

LindaM5 (Texas)
Posts: 32

Posted:

Mary - I agree with you! I seem to be the only Board member who "understands", and we have too much owner apathy on this property for them to "read and understand" the Bylaws or NFP Charter also.

Currently the Treasurer does not have his vehicle stored here. The Vice President did have his here "free" for about 5 weeks (while the Board was in discussion/decision mode on motion) - but I put a tow tag on it as "unauthorized" after that Board majority vote accommodation expired - and he removed it. Neither members have attempted to store anything again since 8/30.

I also feel that this breach is liable for lawsuit - against the Treasurer (author/proponent and recipient of reduced rates). Because this issue has never been a unanimous Board decision - I think the Treasurer can be held individually, personally and financially responsible if this motion is voted on/enacted and he stores for $20 per month. I do not think this HOA should fund his defense - we do have Board liability insurance (deductible of $2,500) - and I am confident that he is banking on tapping that if there is a lawsuit.

I'm dealing with idiots!!

MaryA1 (Arizona)
Posts: 388

Posted:

Linda,

Next time the issue comes up, try asking the question: "Where does it say in the bylaws or the CCRs that board members get special treatment?" Frankly, I cannot understand why a member would agree with the
Treas' position; but if a majority of the members do agree then perhaps the bylaws or CCRs should be amended should be proposed to state that board members get special treatment in the form of reduced assessments, no boat storage charges, a free dinner at (insert name of high class restaurant in town)once a week, etc., etc.

SusanW1 (Michigan)
Posts: 5,202

Posted:

Apparently the board thinks it should have a "perk" for its service.

I don't think they are "profiting" from the free or reduced rate. That would be hard to prove in court.

They are getting treated differently than other Members, and that's the big NO-NO.

(They could be sent a 1099 for the value of the "perk" - see how they would like that!)

LindaM5 (Texas)
Posts: 32

Posted:

Mary: I have researched and preached (until my eyes are bloodshot and my fingertips bloody from typing) to this Board since 6/9 with specific "quotes" from our applicable documents, on why we can not do this. NFP violation and blatant equity void to all owners. Vice President & Treasurer both have stated: "they do not believe me!". I have countered with: "Have you even read our documents?". They both responded: "No, too much legal mumbo jumbo - can't stand reading them - and I don't have the time or need to".

Yes, this is the caliber of idiots that I'm dealing with. I finally have the President on board - he has READ some of the Declaration. I have one other board member (been with me for 6 years) - who also will not bother to read and heed. All have been poisoned with an assumed immunity = because we do have abundant apathy and non participation from majority of owners.

They think they can slip this "motion" by and no one will know or care. Well, guess what boys - I know and I care.

Susan: It is still my position if our Treasurer receives REDUCED storage for his boat from existing $40 to his requested $20 - then he IS profiting by position. As a regular owner (for almost 20 years) - he never even inquired about storage - now that he's a Board member he is pushing this like a bear on honey to get his boat here free or at a reduced rate.

I have a few good brain cells left and am pretty smart for a girl - and none of this makes sense to me.

Am I the only one that doesn't get it...or am I the only one that does get it?

HeatherB4 (Florida)
Posts: 51

Posted:

Just a thought...

As a homeowner, take him to small claims court for amount due on the storage for as long as he has not paid. The Courts will look at your by-laws and look through the mumbo jumbo and they will decided.

From what I understand, you have to disclose to the BOD to that you are taking compensation from the BOD, which he is. Our by-laws state that the BOD have to vote on this type of thing. For instance, we have someone in our neighborhood that owns the landscaping company that does all the landscaping for our neighborhood and is on the landscaping committee, if you look through our records you will find a letter stating that "Bill" owns the landscaping company and recives compensation for his work. The BOD have made a motion to accept this and everyone knows what he does and so fourth. No one has an issue with this, because he does great work and we recieve a discount. Now "Bill" being a non-board member does not have to do this, but they have decided to make sure everyone is ok with this.

BUT... in your case, their is still compensation being recieved from him. He thinks he deserves it, but also this is a non-profit and he can not recieve anything.

I would say contact an attorney, but that might be pricey for such a small amount. However, you can sue him. Also make sure he pays for the legal fees.

Good Luck

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