Conflict of Interest Situation involving property manager

Hi,

I read this sight and I'm like wow, with the resources. I'm not a board member, I'm a member of my HOA for eight years. I loved my condo for the first five years. Unfortunately, I live next door and share common wall space on two floors with a condo that's a rental. The owner used to manage it including the screening and selection of tenants. She did very well with that. Then as she acquired more investment properties in the HOA (due to the foreclosure crisis), she handed the management responsibilities over to an individual who just happens to work for the HOA as the association property manager.

So essentially this guy is hired by the HOA and paid from our dues to manage the association for the HOA board yet he's also allowed to profit off of managing rentals for individual condo owners who hired him after he started his association management job. It wouldn't be as bad if he actually appeared to know what he's doing but he's been renting the condo out to folks who haven't been abiding or perhaps aren't even aware with the CC&Rs and bylaws against nuisance noise. The first tenants who numbered six by the time they were evicted by the HOA board had a large dog that barked and howled in his tiny yard every afternoon and evening bothering neighbors who complained. I tried to deal with it with the association manager not knowing he was also the rental manager for that property. He never told me he managed it. He just told me he'd handle it. He did by "erroneously" sending the cease and desist letter to a HOA resident who didn't even own a dog. At any rate, this nightmare lasted for nine months until the HOA board evicted those tenants and in response, they trashed the condo costing thousands of dollars in damage.

The next tenant was worse. Supposedly it was a man and his daughter only no one ever saw this teenage daughter. He blasted his stereo and TV until the house shook. It was horrible. The guy violated a lease provision banning dogs (because the prior dog cost over $700 in damage to the property) in fact he had four dogs violating the bylaws only allowing two that barked all the time. He got caught violating that lease and lying about it for several months until finally he was allowed to keep the dog that he acquired AFTER moving into a condo where his lease he signed said no dogs. But then he started subletting or having long-term guests who were also very noisy and rotated in and out within weeks or months. One board member who went to tell them to turn the noise down suspected several individuals were under the influence of meth. I've asked nicely, left letters, had the board and the management supposedly send letters, had board members document the noise, called the police etc. But the board even though they knew about it can't do anything. Every time I did what they asked, they'd up the requirements. I think they did that because they didn't want to pressure their own association manager or cause him to lose the rental income.

What bothers me besides having a rental manager who can't handle rentals is having to deal with him as an association manager. He does investigations of the rental on behalf of the board as its employee yet somehow the investigations come back unsubstantiated and the tenant's "cooperative". After I started complaining about the tenant, all of a sudden this hole in my fence that wasn't visible from common space had to be fixed and he sent out the notices but he didn't CC the board. So how do I know he's acting professionally or simply retaliating against me because he doesn't like the complaints against his tenant? So I asked the board to stop having him send letters as the association manager because he's the rental manager in a disputed property. So when they threatened me with the $200 fine, the letter was just unattributed and unsigned but I knew it was him because the dates were all screwed up which is something he does often in his correspondence.

So his tenant gets to violate the bylaws and CC&Rs on noises and also subletting which is a violation of our CC&Rs. The subletting is part of the problem. Because every time a new batch of tenants move in for a month or so, it's like starting all over with the noise problems. The problem with the association manager is that he's letting his rental interests dictate his management at least in terms of when there's complaints against one of his rentals.

My HOA board even as they tell me privately that he's not good at picking tenants still back him as an association manager who has the right to profit off of his rental contracts. It's not in his written contract and according to some rules, that means he can't do it not without amending it. But anytime I ask the board questions, they don't respond, just "affirm" that there's no noise problems and that it's perfectly fine that the association manager also handle rentals. The one who witnessed the people on meth even told me I should be grateful for that arrangement.

I'm not and am looking into legal options because I've not been able to enjoy my home for two years since the association manager took over the rental management. The owner, when I tell her the tenant's making too much noise, she sends out abusive emails association wide on our directory and then when I try to respond back civilly to libel, the board president or the association manager (also her rental manager) tell me I'm abusing the email directory.

I'm reading the topics on this forum and it's like there's very little standards for responsible HOA board operation and representation. We had an election that had to go get vetted by an attorney just this year. But this conflict of interest situation is wrecking havoc on my life and enjoyment of my home. I've talked to real estate managers, HOA people and the police and they all say it's problematic at best, unethical at worst.

I agree it would be a second job if it weren't conflicting with his association management but it has done that. According to his association management contract, he's in charge of enforcing action against CC&R and/or bylaw violations including any investigations conducted. If it's not his rentals, then he's not conflicted but if he's investigating and enforcing action against his own rentals than it is a conflict because he's much harder on other rental management companies and their owners for said violations than on his own. He actually tries to run interference for even complaining to the board about one of his rentals, making it difficult.

He has to be because when his latest tenant threatened to leave rather than abide by the lease or the CC&Rs/bylaws, he talked the guy into staying without making it clear that he was to follow the bylaws/CC&Rs. I can understand while as a rental manager, he might want to keep his tenant happy and paying out the 10 times in rent he's getting from each HOA individual's portion of his monthly salary on his association contract but that's not conducive to his roles and responsibilities as a property manager. Three board members told a couple of us they knew it was a conflict of interest but they still support what he's doing.

He gets paid less for his association management contract than for his 2-3 rentals. If he has to as an association manager rule against his

Technically according to our rules, in order for him to be able to do rentals, that's supposed to be included in his contract and that hasn't been done. That's the issue that has to be taken back to the HOA board as to why it's not following the rules and procedures in terms of amending a contract.

The membership at large opposes him in dual roles but the HOA board isn't allowing anyone to bring it up as an issue. This issue plus the manager essentially running the board is why so few of the old board got reelected this time.

With all due respect to Tim and Janet, I agree with Mary that this is a conflict of interest on the part of the PM. He is in effect acting as judge, jury and executioner, if Mary's post is accurate and by-passing the Board on these matters. Since they are unwilling to act, I would suggest calling animal control for barking dogs and the police for other noise problems. Legitimate problems like loud noise after hours and parties and such, not because someone hiccuped loudly once. Eventually the cops will get tired of coming out and make the Board handle things, some jurisdictions even charge for repeated calls for the same problem at the same address. Next to that, if the Board is still unwilling to act, then its time to start looking to vote some fresh blood on at the next election.

Mary,

Sounds like the issue is more of a conflict of interest as Glen and you stated.

I'd follow through with the suggestions I made about having the board modify the MC contract to prevent this issue in the future.

I would also add that you should request a meeting with the Board, bring neighbors with similar issues, and confront the board with the problem recommending that either the Manager quit managing individual leases or quits performing management duties for the HOA as it is apparent that there is a conflict of interest. You should have things like the police report and lots, did I mention lots, of other members with you to stress the point. If it's just you that shows up to the meeting, the complaint might be given the attention it should.

Tim