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SharonH6 (Illinois)
Posts: 4
Posted:
Hi, This is my first question, but probably not my last. Our Association Board is out of control. It is so bad that the Circuit Court is considering the removal of the whole Board. Since this is unusual, the members are asking what can be done to manage the Association between Board removal and the new elections. Someone has to pay the bills. Is it normal for the Court to appoint something like a Guardian? Are there parlimentary steps to manage in the absence of a Board? Lost here.
TimB4 (Tennessee)
Posts: 21,059
Posted:
Sharon,

If your issue is already before a court of law, the best advice will come from your attorney.

I am not an attorney and I do not work within the legal profession. However, I would expect that if a court of law removes a sitting Board of directors that they will also make any necessary appointments to the Board for a determined length of time. This could include:

Sitting nominees who would have been deemed properly elected

Appointing a receivership - a single individual to run the affairs until an election is held and approved by the court (note all costs associated with receivership will typically be paid by the Association so expect a possible increase in assessments to cover those costs).

Appointing a group of volunteer homeowners who step forward to be an interim board (check with your attorney to see if such a list can be proposed to the court).

Tim
SharonH6 (Illinois)
Posts: 4
Posted:
Thank you Tim,
Your note makes sense to me. I will ask the plaintiffs to contact their attorney to see what he thinks. The last time they spoke, the attorney indicated that the Court/Judge would welcome advice on reasonable procedures. I've researched Parlimentary Law but Roberts Rules does't have guidance on this situation. I'll see what can be done.

This week the attorney for the plaintiffs asked the Board for a list of Association members as "ordered" by our Bylaws and by state law.. but they refused. Will strengthen the court's view against them. But next week a court order will be issued for the names, so that members can be notified.
Sharon

DonnaK5 (Michigan)
Posts: 1
Posted:
Sharon,
I am not a professional but have a bit of experience with an association board. I have sat on the board twice, but left because they were breaking our by-laws and have been fighting this out of control board since 2006.That was the reason I got involved. May I ask why this is in circuit court? What charges ? Just yesterday, I asked four of our board members to step down, we have a law suit against the association, members and individuals. They are using our association monies to pay for all legal fees and not telling the public, or other members about it. We even have our own website, in which they just recently removed our archived minutes for 2010 except for Nov, Dec(no meeting),Jan . They also just voted to destroy the 2010 ballots at the annual meeting ,while they know they are going to court.I am asking for Prejudicial Conduct charges against the individuals named in the lawsuit for breaking our by-laws and state laws. The pending suit is scheduled in August.On your problem at hand, The advice I had from an association law attorney is this, to get the people behind you, and to form a new board (Interim) so that if the court disables the current board you are ready to step in and take care of day to day operations until a special election takes place. The members lawsuit asks for receivership, but you could also pay an ombudsman to do this as well.The court or your attorney will tell you what you need. Most important thing is to have a quorum board in place to be able to take over. An idea for some research on your part, I find it hard to believe they will not list the board members. We cannot get a list from our association either, they refuse. It is State law, but they just refuse do it. So a couple of things you can do- 1.If you need to check on the names of your board members, then go to where your charter is kept, here it is our capital of lansing. We call the website d.l.e.g. in Mi. I do not know where yours is called.Research by name of Association. There you will find their license number to operate, names of all your board members and this must be filed every two years here, or the association non-profit status is terminated. This is a non-profit association, but both profit and non-Profit can be found in your state.2. If you need a members list of all association members, you may go to your township in which the association is in and get a copy of residents there. It will cost a nominal fee, let the attorney know and he can recoupe your fee in court. Here it is 35,00 dollars. It is so well worth it, then you will have a list to either sent post cards, or newsletters to all members, to inform them of your proceedings.It is all the members rights.Our lil association is an Association Law practice, meaning anyone in association law field would get a lot a practice with us, it would be a dream for a student, because it is a nightmare and they would think all other associations were child play after dealing with ours.Good luck and let us know the out come.
SharonH6 (Illinois)
Posts: 4
Posted:
Hi DonnaK5

It is amazing how similar our situations are. At first I thought you might belong to our association. But no..
Our first lawsuit is due to the Board manipulation of the last election. Names of candidates were removed from the ballot without cause or warning. The Judge felt it was serious enough to impose a Temporary Restraining Order to put the election on hold until a formal court case can be heard. But he left the present Board in place while waiting for the hearing. Since that time, the Board has refused to tell members about who resigns from the Board and who is appointed to replace them, and then when those appointees resign. They have cancelled our monthly open meetings and are holding closed meetings without reporting.. violation of state laws. The Board refused to call the Annual Meeting of Members to order and refused to acknowledge the meeting then called using Parlimentary Procedure and a President, ProTem. Big muddle. The discovery request from the plaitiffs lawyer asked for the membership lists, in accordance to our Bylaws and our state laws, but they (the Board) simply refused to turn it over. Now next week there will be an application for a court order. The states Attorney General's Office is looking over the whole range of complaints and violations of fiduciary duty to the Association. There is a disorderly conduct complaint against our President already. The county States attorney is getting interested in the complaints about improper financial management. Our savings have been seriously affected both by repeated budgets that are thousands over our income and passed without member input. I could go on and on.
The Plaintiffs lawyer is now starting an action to ask the court to remove the Board. He is confident that the pile of violations of state law AND our bylaws should be enough.
Why does this happen? What is the motivation? We are a relatively small Association. No one gets paid. Obviously, at this point, the positions don't bring honor and respect. So WHY? If people felt like this about a job I was doing, I'd resign in a moment. As someone said.. where do we find the Bylaws Police? Everyone says that our situation is JUST a civil case and to hire a lawyer.
SusanW1 (Michigan)
Posts: 5,202
Posted:
Does this board have a lawyer?

Any lawyer would explain to the board what they have done which will not pass judicial review. That lawyer would be consulting the board to its present actions. So . . . it concerns me that they continue to function.

In the meantime, the Members WILL pay for the lawyer and any lawsuit filed against it, no matter where it comes from.

Mysterious . . .
SharonH6 (Illinois)
Posts: 4
Posted:
The Board has a lawyer paid for through the Board Bond and Liability Insurance. This lawyer seems to be limiting his involvement by refusing to be involved in the refusal to deliver the membership lists. His task is to try to defend the lawsuit regarding the improper election behaviors, only.

They have hired a second lawyer.. and you are absolutely right. the members through our savings are paying both the deductable and the second lawyer fees. The Board approved those payments.. of course. Any recovery of monies would have to wait until the next board considers more lawsuits. No eagerness for that right now.
Sharon

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