Missouri HOA / Help needed

Started by JeffW11 • 17 replies • 3278 views

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JeffW11 (Missouri)
Posts: 2

Posted:

HOA was formed by the developer when the subdivision was started. HOA was filed with the Secretary of State's ofice December of 2006.

In December of 2010, the HOA was dissolved by the Secretary of States office. We are in the process of getting the HOA reinstated with the State.

We are being told by an attorney that when the HOA was dissovled, that means the the By-Laws were no longer valid and that we are going to have to start over from scratch.

First question, are "By-Laws" and "CCR's" considered the same thing? Most of our homeowners have a copy of CCR's that they received at the time of closing, but they do not have anything that states "By-Laws".

Second question, if the State dissovles the HOA, does that mean that the current HOA CCR's are no longer valid?

From what information I have been able to find:

First, the Developer files for HOA with the State.
Then, the developer files the CCR's with the County.

If the HOA is dissolved by the state, that really just means that the HOA loses the benefits of being incorporated. But that does not mean the CCR's are no longer valid. Even with being dissolved the CCR's still must be followed.

Again, we are located in the State of Missouri.

CarolR11 (Colorado)
Posts: 2,563

Posted:

Welcome to the Forum, Jeff.

From the online freedictionary.com: "Bylaws generally provide for [types of and scheduling of] meetings, elections of a board of directors and officers, filling vacancies, notices, types and duties of officers, committees, assessments and other routine conduct."

Your CC&Rs & your articles of incorporation take precedence over your bylaws, so the latter must not conflict with the former.

Assuming you're incorporated like most HOAs, your attorney should be able to use a boilerplate version of the bylaws of most HOAs to fashion yours, and wouldn't need to start entirely from scratch. Bylaws usually rely a great deal on their state's corporations code and sometimes other state statutes. (There may, though, be some differences in your HOA from most, e.g., perhaps you have "classes" of membership or some sort of "fractional" voting.)

Because your CC&Rs run with each lot/owner, I think you're correct that members still must abide by them even though your HOA currently isn't registered with the state.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Quote:

If the HOA is dissolved by the state, that really just means that the HOA loses the benefits of being incorporated. But that does not mean the CCR's are no longer valid. Even with being dissolved the CCR's still must be followed.

Correct. Sounds like the lawyer is looking for business to bill out thousands of dollars to re-write your CCR/Bylaws. Scumbag lawyer.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Typically when a state dissolves your HOA, it means they haven't heard from you in awhile. You can get the state to recognize you again simply by re-filing a 1 page form stating the officers, name of hoa, etc.

CarolR11 (Colorado)
Posts: 2,563

Posted:

Steve's remarks remind me that bylaws usually aren't recorded with any gov. agency and usually aren't included with the documents you receive when you close escrow on your HOA purchase.

If your attorney did use the language that your bylaws are no longer "valid," I too am now more suspicious than previously that s/he's out for a quick buck. While there may be parts of your bylaws that are out of date, e.g., there's language in them about the declarant's (developer) rights & duties and you're no longer under developer control, this doesn't mean the bylaws are "invalid." If there's something in them that conflicts with your state laws, this still doesn't mean your bylaws are "invalid"; it just means that you must comply with state laws instead.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Jeff

We often have the discussion here about what type lawyer is needed concerning HOA's. Some say Real Estate Attorney others say Covenants and Bylaws are best interperted by a Contract Attorney.

Myself, I vote for Contract Attorney.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

Real Estate attorneys should not be involved in this. HOA's are not Real Estate. It is corporate and contractual laws that just happens to deal with real estate. It's best to hire a lawyer that is familiar with contractual/corporate laws.

It sounds like you all maybe or have been turned over by the developer? I did not get that status from your posting. Sounds like the developer has turned over things and thus no longer registered under their name with the state. You the owners if it is under control of the owners will have to re-register with the state.

CC&R's and by-laws are not the same thing. CC&R's are filed at your local county office. By-laws do not have to be on file in most states. CC&R's go with your deed restrictions. By-laws just fill in the blanks with more detail than the CC&R's. CC&R's are considered public documents. I would get a copy and review them.

Former HOA President

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By SteveM9 on 04/29/2013 2:26 PM
Typically when a state dissolves your HOA, it means they haven't heard from you in awhile. You can get the state to recognize you again simply by re-filing a 1 page form stating the officers, name of hoa, etc.

This I agree with.

CarolR11 (Colorado)
Posts: 2,563

Posted:

Just a word about bylaws. They really are important even though not recorded. All corporations must have them. Bylaws establish policies and procedures for the governing of an HOA. Elections, terms of directors, notice requirements for meetings, etc. The key word is "governing." Generally a majority or super majority of owners' votes are required to amend them

Rules & Regulations, on the other hand, basically establish limits on members' behavior in HOAs' common areas and sometimes limited or exclusive use common areas. These are sometimes call "Guidelines," "Handbooks," etc. They often can be amended by the Board or proposed by the board with a comment period from HOA members, or by other means.

I'm bringing this up because it seems I've seen some instances now & then when posters think that bylaws are rules for HOA members' conduct. I imagine it's because of the word byLAWs.

MatthewW4 (Arizona)
Posts: 500

Posted:

Jeff,

I have had a little experience with adminstratively dissolved corporations. The most common reasons why the state dissolves a corporation is failure to file whatever annual reports may be required or, in some states, failure to file a corporate income tax return.

If you can locate your state's corporate statutes there is likely to be a section about what happens when a corporation is administratively dissolved. In most states it appears to be that very little changes except that the corporation is supposed to stop "doing business." The corporation continues to exist and the board retains all the powers it had before dissolution.

I seriously doubt that administrative dissolution invalidates your bylaws and, even if your statutes do dictate that, all your board or membership has to do is re-adopt them. It is no big deal.

Normally there is a period of time, five years seems typical, where the corporation may seek reinstatement under the same name. It may not be cheap as there could be filing fees and late fees for each month that the reports or returns remain unfiled.

Your conclusion that the CC&R's are uneffected by the administrative dissolution of your HOA is correct.

JohnB26 (South Carolina)
Posts: 1,569

Posted:

MathewW4

DITTO ~ DITTO ~ DITTO

JeffW11 (Missouri)
Posts: 2

Posted:

Thank you all for the information that you have provided, it has been very helpful and clears up some things for me.

From what I have found being dissovled due to "failure to file a correct and current annual report". I believe that it would be in our best interest to find a different attorney that has more experience in this type of work. I was not involved with the initial research of locating an attorney.

I just have a feeling that we could get different answers from different attorney, which can be very frustrating and confusing.

Again, thanks for all of your feedback and assistance.

BrianB (California)
Posts: 2,820

Posted:

man, i hate to defend attorneys...

When the corporation that is recognized by the state as an HOA was "dissolved" or "dissoluted" or "taken off the legal list of corporate entities in the state", then very, very technically, that corporations by-laws were also made moot (dissolved). Why? Because in the eyes of the law, the corporation didn't exist, and thus, rules for running a corporation that doesn't exist also don't exist. or, at best, they exist but don't do anything. So, either they are dissolved, or they become Congressmen.

That said: Everyone else here has the ticket: simply refile with the state, and if you wish, formally re-adopt the very same by-laws you had before. Voila, they are now real/working again. Don't re-write them, don't pay to rewrite them, just reform and adopt them again as part of the process.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

Quote:

When the corporation that is recognized by the state as an HOA was "dissolved" or "dissoluted" or "taken off the legal list of corporate entities in the state", then very, very technically, that corporations by-laws were also made moot (dissolved).

But...... the homeowners are still bound by the CCR's that are attached to their deeds regardless of the dissolution. So... not much has changed.

BrianB (California)
Posts: 2,820

Posted:

Steve (and the others) are correct. The CC&R's run with the land, not with the corporation.

By-laws simply exist to say how you will run a business. If there is no "business", then there's no need for a set of rules on how to elect a CEO, where the non-existent committee's won't be meeting, etc..

Without an active HOA, there's no needs for by-laws. Without an active HOA, every homeowner must enforce the CC&R's.

CarolR11 (Colorado)
Posts: 2,563

Posted:

Jeff's OP seems to say that no one in his HOA can find the Bylaws, so unless they can be located, I assume they'll need some prepared for them upon reinstatement.

MatthewW4 (Arizona)
Posts: 500

Posted:

Quote:

Posted By BrianB on 04/30/2013 1:51 PM

When the corporation that is recognized by the state as an HOA was "dissolved" or "dissoluted" or "taken off the legal list of corporate entities in the state", then very, very technically, that corporations by-laws were also made moot (dissolved). Why? Because in the eyes of the law, the corporation didn't exist, and thus, rules for running a corporation that doesn't exist also don't exist. or, at best, they exist but don't do anything.

Brian,

There have been several discussions about dissolved corporations in the past on this forum. From what I have seen, most states have laws similar to those in my own state. By law, the corporation continues to exist after administrative dissolution and the only real change is that the corporation is no longer authorized to do business, except for those acts necessary to wind up its affairs. See, for example, ARS 10-11421.

BrianB (California)
Posts: 2,820

Posted:

correct, matthew...

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