Posted:
Hi John:
Doing a quick glance through it again appears that the board DOES NOT need to have homeowner approval. It is at the boardâs sole discretion to provide replacement for existing common elements.
However, under Roads it does state in order to âmaximize the life of project roadwaysâ and âminimize repair and replacement costsâ. Therefore, the board needs to consider replace for less cost vs. patch for more cost.
The following is the section I mentioned previously you needed to check regarding misconduct or negligence:
Section 1. Pursuant to section 209(c) of the Michigan Nonprofit Corporation Act (being Act No 162 of the Public Acts of 1982, as amended) a volunteer director (as-defined in in Section 110(2) of the the Michigan Nonprofit Act) of Westwood Farms Assoeiation, is not personally liable to the corporation or its members for monetary damages for a breach of the director's fiduciary duty. However, this section shall not eliminate or limit the liability of a director for any of the following:
(i) A breach of the director's duty of loyalty to the corporation or its members.
(ii) Acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law.
(iii) A violation of section 551(1) of the Michigan Nonprofit corporation Act.
(iv) A transaction from which the director derived an improper personal benefit.
(y) An act or omission that is grossly negligent.
The following is the section regarding Roads:
C. Roads. Westwood Farms is served by West Road leading to the condominium. The interior roads in Westwood Farms are private and will be maintained by the Association. Replacement, repair and resurfacing of all roads and drives within the project will be necessary from time to time as circumstances dictate. It is impossible to estimate with any degree of accuracy future roadway repair or replacement costs. It shall be the responsibility of the Association to inspect and perform preventive maintenance of condominium roadways on a regular basis in order to maximize the life of project roadways and to minimize repair and replacement costs.
The following is the full text for the section you previously posted regarding Board acting in sole discretion:
section 3. Determination of Assessments. Assessments shall be determined in accordance with the following provisions:
(a) Budget. The Board of Directors of the Association shall establish an annual budget in advance for each fiscal year and such budget shall project all expenses for the forthcoming year which may be required for the proper operation, management and maintenance of the Condominium Project, including a reasonable allowance for contingencies and reserves. An adequate reserve fund for maintenance, repairs and replacement of those Common Elements that must be replaced on a periodic basis shall be established in the budget and must be funded by regular annual payments as set forth in Section 4 below rather than by special assessments. At a minimum, the reserve fund shall be equal to 10% of the Association's current annual budget on a noncumulative basis. Since the minimum standard required by this subparagraph may prove to be inadequate for this particular project, the Association of Co-owners should carefully analyze the Condominium Project to determine if a greater amount should be set aside, or if additional reserve funds should be established for other purposes from time to time. Upon adoption of an annual budget by the Board of Directors, copies of the budget shall be delivered to each Co-owner and the assessment for said year shall be established based upon said budget, although the delivery of a copy of the budget to each Co-owner shall not affect or in any way diminish the liability of any Co-owner for any existing or future assessments. Should the Board of Directors at any time determine, in the sole discretion of the Board of Directors: (1) that the assessments levied are or may prove to be insufficient to pay the costs of operation and management of the Condominium, (2) to provide replacements of existing Common Elements, (3) to provide additions to the Common Element not exceeding $1,000.00 annually for the entire Condominium Project, or (4) in the event of emergencies, the Board of Directors shall have the authority to increase the general assessment or to levy such additional assessment or assessments as it shall deem to be necessary. The Board of Directors also shall have the authority, without Co-owner consent, to levy assessments pursuant to the provisions of Article V, Section 4 hereof. The discretionary authority of the Board of Directors to levy assessments pursuant to this subparagraph shall rest solely with the Board of Directors for the benefit of the Association and the members thereof, and shall not be enforceable by any creditors of the Association
or the members thereof.
(b) Special Assessments. Special assessments, in addition to those required in subparagraph (a) above, may be made by the Board of Directors from time to time and approved by the Co-owners as hereinafter provided to meet other needs or requirements of the Association, including, but not limited to: (1) assessments for additions to the Common Elements of a cost exceeding $1,000.00 for the entire Condominium Project per year, (2) assessments to purchase a unit upon foreclosure of the lien for assessments described in section 6 hereof, (3) assessments to purchase a unit for use as a resident manager's unit, or (4) assessments for any other appropriate purpose not, elsewhere herein described. Special assessments referred to in this subparagraph (b) (but not including those assessments referred to in subparagraph 3(a) above, which shall be levied in the sole discretion of the Board of Directors) shall not be levied without the prior approval of more than 60% of all Co-owners in number and in value. The authority to levy assessments pursuant to this subparagraph is solely for the benefit of the Association and the members thereof and shall not be enforceable by any creditors of the Association or the members thereof.
If for some reason the board votes to do the patch for more money, and you are out voted ⌠I suggest that you make a strong statement that you want included in the meeting minutes that you disagree with the decision and why. This would then protect you if any homeowner later files legal litigation.