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EricM9 (Delaware)
Posts: 10
Posted:
So our HOA (12 condos) has an outsider as a "Managing Agent" who is considered the HOA President and makes a salary. The HOA Council which is supposed to be setup per the bylaws (3 members) is not. There is no council.

The President always has meetings on Mother's Day so there hasn't been a quorum I believe for a decade (from what I've been told).

I bought into the condo last June. My question is does the Managing Agent hiring continue indefinitely because of that?

The bylaws simple state
Operation of the Project may be conducted for the Council by a responsible corporate or individual managing agent who shall be appointed by the council in accordance with the Code of Regulation. The managing agent is hereby authorized and appointed to receive service of legal process on behalf of all the members of the Council, and service of process upon such managing agent shall be deemed to be sufficient service of legal process upon all members of the council.

Above that is says Section 9. Compensation of Officers: No officer shall receive any compensation for action as such. (I'm assume Managing agent is exempt)
JohnB26 (South Carolina)
Posts: 1,569
Posted:
you need an ATTORNEY AT LAW a/s/a/p
CarolR11 (Colorado)
Posts: 2,563
Posted:
I entirely agree with JohnB. I'm not one, but it seems that your bylaws clearly state that the "council" hires the property manger.
TimB4 (Tennessee)
Posts: 21,059
Posted:
I am not an attorney and I do not work in the legal profession.

The perception of the individual being the HOA President may simply be a perception and not a reality. A managing agent (i.e. a property manager or PM) should be paid for their duties. However, there should still be a Board of Directors (Council), to supervise the PM. It appears that at some point in the past, membership apathy ran high, nobody wanted to do the work associated with running a condominium Association and simply appointed authority to a paid contractor (who likely has zero real interest in the property except for their paycheck).

As others have said, you should seek advice from an attorney (perhaps one versed in corporate law) to see what options you have to retake control of your Association.
LarryB13 (Arizona)
Posts: 4,099
Posted:
Eric,

If the person calls himself "Managing Agent" he can be paid. If he calls himself "President" (or any other officer) he cannot be paid.

Owners may call for a meeting any time they wish and a quorum can usually be established by proxies or absentee ballots as well as by attendees.

You could also collect proxies from other owners to use at the infamous Mother's Day meeting. You could nominate yourself to the Council and vote yourself in with the proxies. As the only member of the Council, you could appoint enough other owners to form a quorum and start running the place yourselves.
TimB4 (Tennessee)
Posts: 21,059
Posted:
Quote:
Posted By LarryB13 on 03/26/2014 3:29 PM
Eric,

If the person calls himself "Managing Agent" he can be paid. If he calls himself "President" (or any other officer) he cannot be paid.

I disagree. Just as Directors and Officers are two different jobs, I would expect that a PM and President would be two different jobs. If both positions were held by the same individual, they could be paid for the duties of the PM but not for the duties as President. Of course, the conflict of interest issue should be enough to derail an individual holding both positions.

Personally, I think that the membership took a back seat and, over time, the perception has become that the Managing Agent and President are the same job.

Perhaps, since Eric says that their is no Council (BOD), over time, they have actually become the same job. One way to check would be for Eric to do some research. Review and read the contract and, if the Association is incorporated, check the records at the corporation commission to see who is identified as being on the Board and in what position.

LarryB13 (Arizona)
Posts: 4,099
Posted:
Quote:
Posted By TimB4 on 03/26/2014 7:11 PM
Posted By LarryB13 on 03/26/2014 3:29 PM
Eric,

If the person calls himself "Managing Agent" he can be paid. If he calls himself "President" (or any other officer) he cannot be paid.

I disagree. Just as Directors and Officers are two different jobs, I would expect that a PM and President would be two different jobs.

Tim,

My statement was based on the wording of the bylaws provided by Eric. Specifically,

"Operation of the Project may be conducted for the Council by a responsible corporate or individual managing agent who shall be appointed by the council in accordance with the Code of Regulation. The managing agent is hereby authorized and appointed to receive service of legal process on behalf of all the members of the Council, and service of process upon such managing agent shall be deemed to be sufficient service of legal process upon all members of the council.

"Above that is says Section 9. Compensation of Officers: No officer shall receive any compensation for action as such."

Regardless of the duties performed by the individual, if he is called the Managing Agent, there seems to be no problem with compensating him. But if that same person is doing the same job and also holding himself out to be an officer of the corporation then he cannot be paid per section 9.
TimB4 (Tennessee)
Posts: 21,059
Posted:
Quote:
Posted By LarryB13 on 03/26/2014 8:07 PM

My statement was based on the wording of the bylaws provided by Eric. Specifically,

"Above that is says Section 9. Compensation of Officers: No officer shall receive any compensation for action as such."

Larry,

I understand that. I consider this similar to governing documents specifying that Directors may not be paid but many saying that Officers may be paid, even if both positions are filled by the same individual.

TimB4 (Tennessee)
Posts: 21,059
Posted:
Actually, I think we are in agreement but are just looking at the issue from two different perspectives without the benefit of having all the information which, if we had it, we would likely agree on which perspective is correct.

If I'm understanding this correctly, your of the opinion that an individual who, as President of the Association, has the duties associated with managing the Association. (one position)

I'm of the opinion that the individual was hired as the managing agent to run the Association and either:
1) was also elected to serve as President of the Association (two positions with different duties)
2) because the duties were similar, was perceived by the members as being President (but actually is not the appointed or elected President)

I'm not even sure Eric knows which perspective is correct.
EricM9 (Delaware)
Posts: 10
Posted:
My clarification is more if there's no council how can a mgmt agent continue to exist. Can people have appoint him (guessing 15 years ago) and without quorum at meetings or a council, he just continue to exist (and get paid)

JohnC46 (South Carolina)
Posts: 14,265
Posted:
Could this be a case of no Council (BOD) elected as all are happy with the way the Managing Gent (Property Manager) runs it so they just leave it go a such?

TimB4 (Tennessee)
Posts: 21,059
Posted:
Quote:
Posted By EricM9 on 03/27/2014 2:53 PM

My clarification is more if there's no council how can a mgmt agent continue to exist.

Auto renewing contracts
EricM9 (Delaware)
Posts: 10
Posted:
John: With nearly 0 in reserves I don't think most realize what's happening

Tim: Auto-renewing might be it. I assumed I can ask him to see the contract?
TimB4 (Tennessee)
Posts: 21,059
Posted:
Eric,

In my opinion, having a copy of the contract really isn't relevant at this point in time. What is needed is to gather support and put a Board/Council in place (as only the Board would be able to exercise the cancellation clause of the contract).

Once a Board is in place, the Board will have the authority to correct all other issues in accordance with the procedures outlined in the governing documents and applicable State laws.
JanetB2 (Colorado)
Posts: 4,219
Posted:
Quote:
Posted By EricM9 on 03/27/2014 7:47 PM
Tim: Auto-renewing might be it. I assumed I can ask him to see the contract?

Yes ... you should have the right to see or review the contract. I agree with Tim in that most likely the contract automatically renews unless cancelled or changed by the board of directors prior to renewal each year.

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