Is such behavior to be tolerated?

How likely is it that the other buildings have similar construction defects that may not have been uncovered yet?

What do your governing documents say about transition to the H/Os? Our CC&Rs, stated a % # of escrows closed, but other HOAs' documents may say a number of months or years. But this may be in your bylaws.

Do your documents allow the release of one building at a time to be under H/O control? And if so, would that building have its own board?? I'm confused.

Wotta memory, Glen! If you're right, that is.

And if you are, my new questions to Steve are: How old is the building in question? It sounds as if it's some months old because it's occupied. That must mean that there's a Certificate of Occupancy from the Building Dept.

But it's also the case that the developer may have had to pull permits to do the fix. So those should be public record.

But how old are the oldest buildings in your HOA?

As always, you guys are great. Let me answer some of the questions posed.

1) How likely is it that the other buildings have similar construction defects that may not have been uncovered yet?

****This particular building is very similar to all the others but has a slightly different apartment configuration. There is certainly the possibility that other buildings might be susceptible to this issue but since there is no talk of Transition, there is also no talk of hiring engineers and lawyers and CPAs.

2) What do your governing documents say about transition to the H/Os? Our CC&Rs, stated a % # of escrows closed, but other HOAs' documents may say a number of months or years. But this may be in your bylaws.
Do your documents allow the release of one building at a time to be under H/O control? And if so, would that building have its own board?? I'm confused.

****Our Offering Plan does not mention the word Transition a single time. As GlenL so brilliantly recalled, the builder will hold control until the last unit is sold. He can rent a unit in perpetuity and control for just as long. We do have 7 phases in the community, and I believe the builder made an error in having the documents allow a phase to be all sold out and then that phase will have control by the homeowners, but it also states that the Board of Directors has ultimate control.

3) How old is the building in question? It sounds as if it's some months old because it's occupied. That must mean that there's a Certificate of Occupancy from the Building Dept.
But it's also the case that the developer may have had to pull permits to do the fix. So those should be public record.
But how old are the oldest buildings in your HOA?

****The building in question is less than a year from having received its Certificate of Occupancy. The oldest buildings in the community are about 7 years old. This community was started a couple of years before the real estate downturn.

Steve

The fiduciary duty issue is going to be a tough one. Standards to be met are reasonableness of an average person under the circumstances at that time, not in hindsight. And that's after the transition. Not sure what it is pre-transition. Also depends on NY disclosure requirements which I am sure someone will comment on.

If the developer still is in control, Steve, just who are these "board member," and what kind of authority do they have?

HOA confidentiality topics should be discussed in your bylaw or in NY's HOA legislation or corporations codes.

Steve

I am not nor do I play a lawyer.

Bottom line is your BOD is controlled by the sponsor (developer, declarant) 4 to 3 as you say.

Typically legal matters are discussed in Executive Session and the 4-3 probably controls.

That said, you are aware of the issues so your best course of action is probably to gather a group of fellow owners who are as concerned as you are and plan a strategy that might well include legal action.

Hope this hlps.

The 12 monthly Board meetings are closed to homeowners. Only the yearly open board meeting (as per the prospectus) is open to all homeowners. But it is carefully orchestrated with questions needing to be submitted two weeks in advance and the head of the management company is the only one who answers questions.

The sponsor wrote into the prospectus that his company gets to keep its job for three years after the builder is gone. The two are extremely close.
Steve

Sorry. I was using a dilated brain when I wrote that.

What I meant to say was that the builder (Sponsor/Developer) wrote into the prospectus (Offering Plan) that the management company would stay on at our community for three years after the builder was finished and gone.

In other words, the builder decided that when he was gone, even though he no longer had a majority vote (or any vote for that matter)in the affairs of our community, he could make a decision for the homeowners that we would have his assigned management company operating our community for three years afterward.

Steve