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PhilipC1 (Florida)
Posts: 6
Posted:
As new member of an HOA, I'm lost as to what 'period of declarant control' means legally. Can anyone point me to legal definition(s) on this. We have a declarant who has gone wild in foisting bogus charges on the membership. When members complain (some filing actions), the declarant hires an attorney to defend himself, claims the attorney represents the HOA, and then bills the members for that 'HOA' attorney's fees! Help!!
TimB4 (Tennessee)
Posts: 21,059
Posted:
Philip,

Declarant control means that the builder/developer has enough votes to make the decisions, appoint people to the Board, change the governing documents, etc. even if every homeowner voted against it.

Typically, the governing documents are written to provide 1 vote per lot/unit for each homeowner and 10 or more votes per lot/unit owned by the declarat. This ensures that the builder/developer has control of the Association until all of the unimproved lots are sold.

The Property Owners' Association Act, applicable to non-condominium developments, does not provide for a specific time frame for the transfer of control. It only specifies that certain things must happen "once the majority of the members of the board of directors other than the declarant are owners of improved lots in the association and the declarant no longer holds a majority of the votes in the association . . ." Therefore, this is when declarant control would end for non condominiums.

If your development is a condominium, then the VA Condominium Act has more conditions for declarant control.

Basically, the membership is at the mercy of the declarant until control is transferred to the membership. One way to minimize a declarants impact is to become involved as much as possible in the running of the Association as soon as possible. This can be as little as attending meetings and asking questions to volunteering to serve on committees or as an officer.

I know that this likely isn't what you were hoping to hear but I hope it helps,

Tim

MelissaP1 (Alabama)
Posts: 13,836
Posted:
That is the way a declarant HOa runs. The homeowners are NOT in control. That means the declarant rules. Yes the money for the lawyer is going to come from the HOA's budget. A HOA is only funded by it's members for it's members. HOA's are to be represented in court by a lawyer.

Suing your HOA is suing yourself and your neighbors. It is NOT the declarant. The declarant is NOT the HOA. A HOA is you and your neighbors. The declarant is the one that is currently in charge until it is turned over to the owner/members...

Former HOA President
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Phil

Tim and Melissa are wise and correct.

I occasionally say things somewhat different then they do. Here goes..LOL

Basically, the declarant controls all, is the HOA, and has you by the short hairs.

My initial advice is ask to be kissed first and accept what is happening as in make nice. Try that approach first.

That said, a declarant can be fought. Aha...the do not get mad...get even comes out in me.

1. If the declaranat is still selling lots, units, etc. hit him where it hurts, in the wallet. Do everything you can to discourage people from buying there. Anti developer web sites, signs against him, protest marches, nasty pics, etc.

1A. Do realize this will discourage new buyers but also drive the value of your unit down the toilet, but another subject.

2. Get present owners together, put up money, lawyer up, and sue the declarant.

2A. Do realize the declarant might be able to pay his legal bills out of the HOA funds and in the end raise your dues to pay for this. It could also put a black mark on the association for lenders so no one can borrow to buy there as in maybe buy your unit and you move on, but other subjects.

3. Sell and move on.

4. Maybe we want to get back to make nice, help him sell all the units so you can get his a$$ out of there, and you owners in control.

My opinions.

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

Suggestion #1 is not really a good idea as it just keeps the declarant in control and, as you noted, resale value of existing units takes a dive.

Suggestion #2 is not also not a good idea unless the declarant has done something blatantly illegal. Being a disagreeable ass is not something you can sue over (otherwise I'd be in court all the time).

Suggestion #3 is good if it looks like the declarant will be in control for ages and ages.

Suggestion #4 sounds the best.

One of the things I have learned from this forum is that buying into an unfinished development (one with unsold units) is risky due to the unknown and unpredictable nature of declarant control. Another problem is that if you buy in and then have to sell for any reason, you are unlikely to get a higher price for your home than what the developer is asking for brand new units. I would rather buy the last unit than the first or even the next-to-last unit.

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