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LindaB20 (New York)
Posts: 23
Posted:
Hi,
I serve on a board of directors in a community that is new, six years old. The HOA has been in existence for two years. There are eight members on the Board of directors. Four of whom are behind on HOA dues. One of them is up for reelection so I stated that person should not run for relection until all dues are paid up to date and the other three should resign from the board until their dues are paid. I was out voted because they stated they did not know the bank was not taking their dues along with their mortage payment. How would you handle this?
TimB4 (Tennessee)
Posts: 21,059
Posted:
Linda,

To be honest, and I agree with your thinking, unless your governing documents specify that to serve on your board, members must be current in their assessments, then you could only request that they resign. There is nothing that could force them to resign or prevent them from running for office.

How it should be handled is simple, you follow your Associations collection policy. If you don't have one, one needs to be created and applied equally to all members.

It also appears that the larger issue is how did those individuals get so far behind and still think that HOA assessments were paid from the mortgage escrow account. Has the Treasurer been sending out late notices? If not, why not?

A typical collection policy could be:

30 days late - warning letter.
60 days late - 2nd notice letter
90 days late - 3rd notice, sent via certified mail
120 days late - Intent to lien or Notice of agenda item (to discuss the issue)
> 120 days late - Issue sent to attorney for collections, recording of lien and potential foreclosure.

JohnC46 (South Carolina)
Posts: 14,265
Posted:
Linda

Read your Covenant and Bylaws. They may well address loss of privileges for those behind on their dues. Not uncommon for hem to say a BOD Member is be suspended when behind in dues.

The info might well be in your docs. No need for a vote.
DanielW5 (South Carolina)
Posts: 4
Posted:
I've been in HOA business for 36 years. I've been President of my HOA for 7 years now.
Several words of advice;
#1, and this is important: The HOA Board members must always stand united! You are there to do good for your community. You can only accomplish that if you're on the same page. Work out your details OUTSIDE the meeting. You can't do business outside a meeting, but you can meet and work out differences.

2nd, and this is key to success:
Always remember you are a neighbor first, Board member 2nd! Treat everyone with that formost in your mind and you will avoid problems in the future and mistakes and you will foster a positive view of the HOA.
TimB4 (Tennessee)
Posts: 21,059
Posted:
Quote:
Posted By DanielW5 on 05/21/2014 5:40 PM

#1, and this is important: The HOA Board members must always stand united! You are there to do good for your community.

I'd like to add to this.

What standing united does not mean is that all votes have to be unanimous.

It does, in my opinion, mean that once a vote is taken, the entire board works together to implement what was decided.

If you disagreed with the decision and asked about it, you should simply say that this is what the Board decided or, I didn't agree with it, but the majority of the Board did, therefore we are moving forward based on that decision.
BanksS
Posts: 403
Posted:
Quote:
Posted By TimB4 on 05/21/2014 6:29 PM
Posted By DanielW5 on 05/21/2014 5:40 PM

#1, and this is important: The HOA Board members must always stand united! You are there to do good for your community.


I'd like to add to this.

What standing united does not mean is that all votes have to be unanimous.

It does, in my opinion, mean that once a vote is taken, the entire board works together to implement what was decided.

If you disagreed with the decision and asked about it, you should simply say that this is what the Board decided or, I didn't agree with it, but the majority of the Board did, therefore we are moving forward based on that decision.

Thank you Tim for your additional comments because a previous BOD where I live cost the homeowners thousands of dollars for making bad decisions. I have more respect for board members who will speak up and state their opinions. I abhor members who just sit back and let the more assertive, aggressive types run the show because they are afraid to speak up.
TimB4 (Tennessee)
Posts: 21,059
Posted:
Quote:
Posted By BanksS on 05/21/2014 6:36 PM

I abhor members who just sit back and let the more assertive, aggressive types run the show because they are afraid to speak up.

Sometimes it can be fear. Other times it can be that they don't care one way or the other (perhaps it can be called Director apathy) and simply want the meeting to end.
BonnieG1 (Nebraska)
Posts: 1,186
Posted:
Quote:
Posted By DanielW5 on 05/21/2014 5:40 PM
I've been in HOA business for 36 years. I've been President of my HOA for 7 years now.
Several words of advice;
#1, and this is important: The HOA Board members must always stand united! You are there to do good for your community. You can only accomplish that if you're on the same page. Work out your details OUTSIDE the meeting. You can't do business outside a meeting, but you can meet and work out differences.

2nd, and this is key to success:
Always remember you are a neighbor first, Board member 2nd! Treat everyone with that formost in your mind and you will avoid problems in the future and mistakes and you will foster a positive view of the HOA.

I agree about Board members needing to be united. But sometimes I think there can ba an exception. Like the time our President had me contact our PM to come one evening and pick up a beer can that was in our yard. I did contact the PM who did come, pick up the beer can and came to my unit to tell me it had been picked up. Picking up litter was definitely not in his contract.
The time this happened only two other people were on the Board with me.These were the President and her husband
There were other things she did I did not agree with. Some I knew before she resigned and one I found out after she resigned and I was voted (by the new Board) as President. Basically her and her husband were making all the decisions. I could really write a long story about what happened, but I know people get tired of reading on and on and on
RichardP13 (California)
Posts: 1,767
Posted:
Quote:
Posted By BonnieG1 on 05/21/2014 8:18 PM
Posted By DanielW5 on 05/21/2014 5:40 PM
I've been in HOA business for 36 years. I've been President of my HOA for 7 years now.
Several words of advice;
#1, and this is important: The HOA Board members must always stand united! You are there to do good for your community. You can only accomplish that if you're on the same page. Work out your details OUTSIDE the meeting. You can't do business outside a meeting, but you can meet and work out differences.

2nd, and this is key to success:
Always remember you are a neighbor first, Board member 2nd! Treat everyone with that formost in your mind and you will avoid problems in the future and mistakes and you will foster a positive view of the HOA.


I agree about Board members needing to be united. But sometimes I think there can ba an exception. Like the time our President had me contact our PM to come one evening and pick up a beer can that was in our yard. I did contact the PM who did come, pick up the beer can and came to my unit to tell me it had been picked up. Picking up litter was definitely not in his contract.
The time this happened only two other people were on the Board with me.These were the President and her husband
There were other things she did I did not agree with. Some I knew before she resigned and one I found out after she resigned and I was voted (by the new Board) as President. Basically her and her husband were making all the decisions. I could really write a long story about what happened, but I know people get tired of reading on and on and on

Call a PM to come out and pickup a beer can? Please tell us that is a joke.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Let me get this straight Mr. BOD President. You want me to call the PM to pickup a beer can? Do I have this correct?

If so, go have sex with yourself, bye.
PatriciaH4 (Texas)
Posts: 42
Posted:
Why so many board members and why an even number of them? It must be difficult if there is a tied vote.

In Texas, the state legislature changed things in 2011, so those who are behind on their dues are able to vote and be elected to the board (although the CCRs state the member has to be in good standing in order to do any of those things.

I would check your state law first, then your CCRs.
BonnieG1 (Nebraska)
Posts: 1,186
Posted:
Call a PM to come out and pickup a beer can? Please tell us that is a joke.

This is not a joke. She actually thought people would agree with her doing this.
Shortly after this our PM emailed notice of cancelation. People were upset. She called a meeting to explain her side of things (The beer can was just one issue) but said no notes would be taken as it was an informal meeting.
This was just one of the things she did that if I mentioned you would probably think each was a joke.
BonnieG1 (Nebraska)
Posts: 1,186
Posted:
Thank you Tim for your additional comments because a previous BOD where I live cost the homeowners thousands of dollars for making bad decisions. I have more respect for board members who will speak up and state their opinions. I abhor members who just sit back and let the more assertive, aggressive types run the show because they are afraid to speak up.

I spoke up and according the President (at that time) I was the bad person for not agreeing with her and her husband and she told me she was going to let everyone know about me.
I just told her I would tell my side.
This is the President that actually had the PM come to pick up a beer can.
She also called me a liar. One thing she said I lied about was the beer can. She told me I picked it up and did not relay her message for the PM to pick it up. I lost it when she told me that. Long story. I did think about just going out and picking it up myself and the only reason I didn't is because I thought she might ask me about it.
VictorM2 (Arizona)
Posts: 8
Posted:
I have been battling my fellow Board members for months now since I started back in January. The other four have been on the Board for coming on ten years. I found out about some issues involving conflicts of interest, open meeting violations, and bid rigging.

When I advised the President of these issues, he pretty much laughed and treated me like a child. Months later he has finally realized that I was right all along and his excuse was:

"Over the last 8 years we have been guided by different management companies on the use of the governing documents that a gated community should adhere to. These documents are the architectural guidelines and CC&R’s. The different management companies have guided us on the types of meetings we’ve had, either open session or what we call executive session. None of these companies referenced the ARS documents from the state. It has been unfortunately that the way these meetings were held were brought up in such a force full way with one of the Directors but in talking with the management company and having them review some of our past meetings it has been confirmed we need to change the way we hold executive meetings on specific issues.”

So his reasoning for those violations is that none of the past management companies had advised him that the Board was subject to the state laws. Is it just me or does anyone else find that to be a lame excuse?
PitA1
Posts: 222
Posted:
The Covenants would specify the existence of the HOA.

If incorporated (usual, but not 100%):

The By-Laws would specify its administration.

Requirements for directors would be in the (corporate) By-Laws.

The Covenants, however, probably define: Member and Member In Good Standing.

to go even further:

ANY and ALL member will have a vote to amend the Covenants whether in good standing or not.

A corporate matter, budget, by-law change, election of directors / officers is a different matter - the bylaws may (or may not) restrict voting to 'paid in full' members.

The above, imo, is 'standard' contract law.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Victor said:

So his reasoning for those violations is that none of the past management companies had advised him that the Board was subject to the state laws. Is it just me or does anyone else find that to be a lame excuse?

Sorry to say but many BOD's/owners defer to the Property Management company as the experts, highest authority, etc. Their bad.

RichardP13 (California)
Posts: 1,767
Posted:
Quote:
Posted By JohnC46 on 05/23/2014 12:11 PM
Victor said:

So his reasoning for those violations is that none of the past management companies had advised him that the Board was subject to the state laws. Is it just me or does anyone else find that to be a lame excuse?

Sorry to say but many BOD's/owners defer to the Property Management company as the experts, highest authority, etc. Their bad.


One of the issues Boards struggle with is what can be discussed in executive session. Many Boards will discuss everything under the sun mainly because they are uncomfortable with discussing amongest a crowd and having to either answer questions or defend their positions or actions.
BanksS
Posts: 403
Posted:
Quote:
Posted By RichardP13 on 05/23/2014 12:25 PM

One of the issues Boards struggle with is what can be discussed in executive session. Many Boards will discuss everything under the sun mainly because they are uncomfortable with discussing amongest a crowd and having to either answer questions or defend their positions or actions.

I think this is very true. Unfortunately I live in a state that does not require open board meetings. At one point I asked to attend the board meetings and the board refused to allow it. Since board meetings are not open to the members, I began asking for board meeting minutes. Their response is to delay or make excuses. Eventually I get them, but not without multiple requests and at one point a visit to my attorney. Some of you say that the members are accountable to be involved in your association so you know what is going on. Since I began asking for minutes, the secretary keeps the information in the minutes to a bare minimum. The board minutes have gone from 1-2 full pages of info to 1-2 paragraphs.
PitA1
Posts: 222
Posted:
If your corporate BOD refuses to maintain proper minutes as per your state's not-for-profit corporate law, feel free to petition a court of law for the appointment of a receiver.

This act ALL BY ITSELF will wake them up and virtually force the desired changes you desire.

However, be prepared to pay the receiver (via a dues increase) $50-70,000 per year AND fully and properly fund your reserves.

The corporations choices are always:

1) operate properly and in good faith
2) dissolve and wait for the courts to take over (eventually)
3) have a receiver appointed upon a valid petition

CAVEAT EMPTOR
TimB4 (Tennessee)
Posts: 21,059
Posted:
Quote:
Posted By PitA1 on 05/23/2014 2:18 PM

The corporations choices are always:

1) operate properly and in good faith
2) dissolve and wait for the courts to take over (eventually)
3) have a receiver appointed upon a valid petition

4) gather support and change the Board (by either a recall election or simply not reelecting)
PitA1
Posts: 222
Posted:

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