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MarciaV (California)
Posts: 52
Posted:
Can anyone tell me how someone should get voted in as a president of an HOA in AZ? There was one director of our small HOA who "allegedly" appointed someone as president....for his benefit. I have requested documents showing this - but, I have my doubts it was done the right way.

The same person allegedly appointed as president of the HOA said the director gave him proxies to vote on all matters of the HOA. Aren't these illegal or not enforceable in AZ? I have also requested copies of the proxies and I have not received those. Yes - I requested both in writing and over a month ago.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Marcia

Others can chime in that know more then me, but generally there are two types of proxies. General and Directed.

Directed is limited in like you can vote for me on a specific date for candidate so and so only.

General is unlimited in like you can vote for me any time any way you care to vote.

I am over simplifing but I think the example is valid.

I also doubt my example of General can be that liberal and inclusive but I expect your users of such are doing so.

TimB4 (Tennessee)
Posts: 21,059
Posted:
Marcia,

You are correct that AZ law doesn't allow members to use proxies at general membership meetings.

However, AZ 10-3824, part of the nonprofit corporation act, does allow Directors to vote by proxy.

Members elect the Directors. Vacancies for Directors are typically filled by appointment by the remaining Directors.
Officers are appointed by the Directors. Since Directors may vote by proxy, it's likely that what the individual is telling you is correct.

Here is a link to a list of what laws and documents govern an HOA in AZ.

Tim

CarolR11 (Colorado)
Posts: 2,563
Posted:
Tim may be correct, Marcia, but you need to look at your own governing documents too. Our Bylaws, for example, in compliance with CA law, states that officers are appointed by the Board at an open meeting that Owners may attend.

How many directors are there?

Is this appointed president a director? Do your Bylaws or state law permit non-directors to serve as officers?

Note that the act that Tim cites that you can click on says that these director proxies are good for only one month (I think).
CarolR11 (Colorado)
Posts: 2,563
Posted:
Tim may be correct, Marcia, but you need to look at your own governing documents too. Our Bylaws, for example, in compliance with CA law, states that officers are appointed by the Board at an open meeting that Owners may attend.

How many directors are there?

Is this appointed president a director? Do your Bylaws or state law permit non-directors to serve as officers?

Note that the act that Tim cites that you can click on says that these director proxies are good for only one month (I think).
MarciaV (California)
Posts: 52
Posted:
Thanks, everyone who responded. Your input is invaluable to me. I will look at the documents this evening to see what they say in regard to nominating, etc.

I would like anyone's opinion on the following email sent to me from the supposed President.

I sent an email to the supposed President after our HOA meeting on May 26th and after he gave copies of a ledger from some sort of bookkepping program he is using. I asked to VIEW the checkbook, meeting minutes, etc. of the HOA and I specifically asked to see receipts for the health club membership, additional landscaping services, and garage door purchases that were made out of the HOA funds, which should not have been. I also asked to see meeting minutes that elected a property manager, the fees paid to him, and qualifications. I also asked to see proxies from the sole director (the developer) that gives thisso-called president the developer's votes.

What I received in return was this email below along with a "release" (PLEASE SEE AND READ THE ATTACHMENT)saying that my husband and I owe back dues (WE DO NOT and I have documents that prove this from the so-called president) and that he is demanding we sign a release basically saying we won't sue him, the developer, or the HOA for anything in the past and going forward. All of this came AFTER I requested to view the HOA documents stated above. This is an attempt to extort monies from us, in my opinion and to silence me. I have caught him in the act of using the HOA funds illegally and he is not happy. I have not reviewed the books as of this email - that is supposed to happen on June 15th. This to me is an attempt to intimadate me into not reviewing the books.

If anyone has a comment on the so-called RELEASE from an attorney - I would appreciate it as I've had some experiece with legal documents and I don't see where this could be from an attorney's office or that the document would not need to be notarized.

Here is his email to me:

Dear Marcia,
>
> I was so pleased to think we had resolved all differences and OLD issues and that we were headed towards a very positive future. I went to bat with the developer for you to get you released from the past due HOA fees which have been looming here for ever. An offer of mutual release was offered to you on May 29th. I did my best to get this done, and as of today we still do NOT have the signed Mutual Release document from you.
>
> What we did get was yet another email from you which everyone reading it has the same impression of it. If you are trying to alienate your neighbors, the board of the HOA or the developer, well you are achieving that goal. Marcia this simply may be your personality, your approach to everything.... I am not sure. What I do know is we sat in a meeting for 2 hours together, giving you the opportunity to review records, ask questions and present any issues or concerns and at the end of the meeting I asked... "Is there ANYTHING ELSE.? Are we all GOOD now?" The response was a positive from all including you & VVV (my husband) everything was AWESOME. Thanks WWW for the incredible job and wonderful improvements at Saguaro Suites is all that I heard.
>
> I am simply baffled by your 180 degree turn, yet this has happened before with you and so I am afraid the offer from the HOA and the developer "whom basically advanced monies to the HOA to cover the past due HOA fees from unit owners" is now a MUST be finished, signed sealed and delivered to me by tomorrow at 5PM, so the offer is cancelled.
>
> Attached is a slightly revised Mutual Release which the developer's attorneys sent to me yesterday since it appears we need to make sure all signatures and parties are documented beyond any possible question in the future.
>
> The choice is yours. As I said, this was NOT an easy deal to sell to the developer. I went to bat for you and now the ball is in your court. June 8th, 2012 by 5PM, this document needs to be signed by both you and VVV (my husband) and hand delivered to me. I will sign on behalf of the HOA and the developer via his POA, and then copy it to you and send the original to his office for signature by PPP (the developer's company). A final copy with all signatures will be delivered to you shortly thereafter.
>
> Once again, if not by 5pm tomorrow, then the offer of any settlement on the past due HOA fees from your account is no longer valid or an option.
>
> Thank you for your prompt attention to this communication. I am still in hope that we can put this all behind us.
WWW
>

TimB4 (Tennessee)
Posts: 21,059
Posted:
Sounds like you need to take all your documents and communications and get some legal advice.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Marcia

It sounds like your association is still under Declarant (as in not homeowner) control. Is this true?

Thanks
MarciaV (California)
Posts: 52
Posted:
Hi, John:

That's a good question. The developer was still in control until 9.17.11 according to the newest annual report filed. But, I have never seen anything that elected this guy as president or a director. We now have out of 8 units, 5 owners and the other 3 units are owned by the developer and leased out.

Him being president is like me announcing to my boss this morning that he now reports to me!

And to Tim - yes, we most likely will have to get legal counsel. It's very expensive and we have the affordability issue. Any suggestions on attorneys in AZ to use or other resources?
TimB4 (Tennessee)
Posts: 21,059
Posted:
Marcia,

I have to admit that I missed a few issues in your other thread, that are carried over into this thread.

In re-reading the issues, I would recommend the following:

1) Read and understand your governing documents.

There are items like an individual having to bear the full cost of Association attorneys to be present at a meeting in your bylaws that may be unique to your Association.

2) Pick one issue to fight and when that's concluded, pick another issue to fight.

It seems that your lashing out at many issues all at once. This can cause you to overlook details. If you concentrate on one specific issue at a time you are more likely to win your battle or understand why you won't win.

I'd suggest sticking on the issue of your past due assessments and ignore that you are now paying it to this individual vs. that individual or that the Board is doing things that may not comply with the governing documents. Once this one issue is resolved, you can concentrate on other battles.

3) Legal actions.

Normally I would recommend not to threaten legal action unless your ready to go through with it as this can have the Association see you as potential litigation which can limit access to documents. However, since you have already crossed that line by saying you want your attorney copied on communications and you desire to bring an attorney with you to the meeting, your going to have to deal with any barriers this created.

My advice for legal council would be to pick one that has the specialty you need. As I see it this would be:

Issues with Assessments or covenant violation - use an attorney versed in Contract law (as the CC&Rs are contracts)
Violation of Bylaws - use an attorney versed in corporate law.
Violation of property lines - use an attorney versed in property law

Hope this helps,

Tim

LarryB13 (Arizona)
Posts: 4,099
Posted:
Marcia,

My recollection about your condos is that the developer/declarant still owns a majority of the units. (Correct me if I am wrong but I think you previous wrote that only 2 of 8 units have actually been sold and two more have some sort of rent-to-own lease.)

Many CC&R's are written so that the declarant remains in control as long as he owns even just one unit. As long as the declarant is in control, he can appoint whomever he wishes to the board of directors and the board can appoint whoever they wish to be president. In most associations, the members elect the directors and the directors elect/appoint/hire the officer(s). The president is an officer.

Technically, you could raise a complaint that there was no election for the directors but as long as the developer has a majority of the votes there would be no practical reason for challenging the lack of elections in court. If you did have an election, the declarant's votes would still outnumber all the owners' and his candidate would still win. Nothing would change.

Much of what you describe is what happens when you buy into an association that is still under declarant control. Unless there is a date specified in your CC&R's for transfer to the owners, your developer will likely retain control until all his units are sold.

This not say that the declarant can do whatever he wishes. He is still constrained by the Arizona Non-Profit Corporation Act and the statutes regarding condos.
MarciaV (California)
Posts: 52
Posted:
Larry and Tim ~ Many thanks again for the insight. It looks as if the developer was in control and he now has elected the President (I'm still waiting on documentation from him verifying this) and in turn, the president appointed one of the other homeowner's (his buddy) to be a director. It's interesting to me that he would not ask my husbaand or myself to be be on the board as we have lived there the longest and have dealt the longest with the HOA issues, developer and contractors. My gut feeling is that he does not want us that close. I've already rocked his boat by requesting to see documents and the checking account this Friday.

You're right, Tim - I am all over on issues. I'm so dang mad that it is hard to focus on just one. I will be concentrating on the monies in the account when I view the books this Friday. Are the issues worth suing over? Perhaps. The harassment, attempetd extortion of monies from us, and intimidation have taken a toll on my husband's health. He has a heart condition and undue stress puts him in the hospital. This guy's harassment and threats have hurt him. So, that is not worth it.

All I'm asking this man for is to use the monies for the benefit of the HOA and not himself and to run a clean ship. Period. This has not been done. One of the things that bothers me is that he will go around assessing for this and for that and those items will not be practical. He tried this once by telling us he was putting a pool on the property and that unless we gave him $5,500 - we could not use the pool, when we sold our property, the new owners wuld not be able to use the pool and on and on.

If when I view the documents and checkbook this Friday and see funds have been misused - any ideas on how to approach that with him at the time of viewing? I already see 4 items that are questionable from documents he gave me.

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