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LarryH19 (Texas)
Posts: 4
Posted:
Our POA board in Texas attempted to amend the CCRs in 2008 to allow for the expiring CCRs to be extended. A member/owner vote was not conduted. The Board president filed the amendment with the county clerk.
Now the current board's position is that that unless an injunction was filed within 4 years the amendment becomes legal?
Anyone ever heard of such a rule?
NpS (Pennsylvania)
Posts: 4,216
Posted:
Quote:
Posted By LarryH19 on 10/02/2014 7:48 AM
Our POA board in Texas attempted to amend the CCRs in 2008 to allow for the expiring CCRs to be extended. A member/owner vote was not conduted. The Board president filed the amendment with the county clerk.
Now the current board's position is that that unless an injunction was filed within 4 years the amendment becomes legal?
Anyone ever heard of such a rule?

Hi Larry

Not sure about TX, but I have seen language that an amendment is presumed valid if not challenged within 1 year. The presumption means that the burden of proof is on the challenger to show that the filing was defective, not on the HOA to show that it wasn't defective. This presumption also means that people can and should consider it to be "legal" until a challenger is successful in proving otherwise through the courts.

You refer to an attempted amendment. Apparently, you have identified some flaws. Perhaps you can share what the defect is.


Sikubali jukumu. Read all posts at your own risk.
LarryH19 (Texas)
Posts: 4
Posted:
by attempted, I mean they did not send the document out for vote to all members/owners. Since that is supposed to be the first step in amending CCRs it would appear that their subsequent filing of the document would be illegal or outside due process.
NpS (Pennsylvania)
Posts: 4,216
Posted:
Quote:
Posted By LarryH19 on 10/02/2014 8:16 AM
by attempted, I mean they did not send the document out for vote to all members/owners. Since that is supposed to be the first step in amending CCRs it would appear that their subsequent filing of the document would be illegal or outside due process.

Agreed.

Now the question you need to consider is whether you have an objection based on principal only or if your objection is to the actual contents of the amendment. You should probably consult a local attorney to evaluate how long a legal challenge would take and how much it might cost.

BTW, you can always put the HOA on notice with a strongly worded letter that the vote was defective and the HOA must re-take the vote with advance notice to all owners. Let them know that you did not receive an advance copy of the amendment and were not notified of the vote. Then see what happens.

Sikubali jukumu. Read all posts at your own risk.
LarryH19 (Texas)
Posts: 4
Posted:
changing topics a bit, we would likely never be able to get 67% of the members/owners to vote either by personal ballot or by proxy. 67% is the current Texas statute requirement to amend CCRs.
Has there ever been precedent set where the approval/disapproval can be based on the combined total of votes/proxies returned in lieu of the full membership?

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

67% of the members may not have to vote. Granted a 67% Quorum might be required but that is not the same as 67% voting nor 67% needed to approve.

Examples:

100 owners. 67 agree to be part of the Quorum either in person or via Proxy thus the 67% Quorum is met. Items can be voted on.

Of the 67, let us say only 40 actually vote. 21 for and the amendment passes.

A Proxy can say for Quorum purposes only and not be a vote. Might sound like smoke and mirrors but it can and has been done. It requires work gathering all the Proxies for Quorum purposes only but it can be done.

Hope I am making this clear.

NpS (Pennsylvania)
Posts: 4,216
Posted:
Quote:
Posted By LarryH19 on 10/02/2014 10:17 AM
changing topics a bit, we would likely never be able to get 67% of the members/owners to vote either by personal ballot or by proxy. 67% is the current Texas statute requirement to amend CCRs.
Has there ever been precedent set where the approval/disapproval can be based on the combined total of votes/proxies returned in lieu of the full membership?

From TX law at http://www.statutes.legis.state.tx.us/SOTWDocs/PR/htm/PR.209.htm:

Sec. 209.0041. ADOPTION OR AMENDMENT OF CERTAIN DEDICATORY INSTRUMENTS.
(b) This section applies to a residential subdivision in which property owners are subject to mandatory membership in a property owners' association.
(c) This section does not apply to a property owners' association that is subject to Chapter 552, Government Code, by application of Section 552.0036, Government Code.
(e) This section applies to a dedicatory instrument regardless of the date on which the dedicatory instrument was created.
(f) This section supersedes any contrary requirement in a dedicatory instrument.
(h) Except as provided by this subsection, a declaration may be amended only by a vote of 67 percent of the total votes allocated to property owners in the property owners' association, in addition to any governmental approval required by law. If the declaration contains a lower percentage, the percentage in the declaration controls.
(i) A bylaw may not be amended to conflict with the declaration.

The key phrase is in (h) - If the declaration contains a lower percentage, the percentage in the declaration controls.
In Section (f) dedicatory instrument refers to all of your organizing docs.

So if (b) and (c) don't apply and if it's not in your declaration, it looks like you're SOL.

Sikubali jukumu. Read all posts at your own risk.
MelissaP1 (Alabama)
Posts: 13,836
Posted:
Was there any changes made? Or was this a filing to extend the validity of the rules? If itis a change, then yes members should have a vote. However, if it is for simply extending the rules time period then see no issue. It cost money to file these documents. The cost can be a few hundred dollars. Money you do not get back and have to repay to file again. Is it worth it?

Former HOA President
BillH10 (Texas)
Posts: 1,217
Posted:
Larry--first, I am not an attorney, nor do I practice law.

We manage HOAs in Texas and have, at the direction of the Board, just begun the process to amend the Bylaws and CC&Rs for one of the associations we manage.

To amend your CC&Rs as they are presently written, and assuming they do not contain a different (lower) percentage, you must have the affirmative vote of 67% of the property owners of the Association in person (including electronic voting) or by proxy. Your CC&Rs may actually have a higher percentage, but the maximum percentage was reduced to 67% by the legislature during the last session.

If your CC&Rs are written as are those of the association we are presently working with to amend their documents—and they probably are, given their age—the full 67% approval is required and is so stated. You cannot amend with a lower majority percentage at a meeting at which the quorum is met.

My statement above does not comport with the response provided by JohnC46. His statement is accurate in certain instances but the Texas association documents, mainly the CC&Rs, I have seen almost always require approval from a percentage of the full membership of the association, and not a majority or super majority of those in attendance at a meeting which meets quorum requirements but which does not meet the amendment percentage requirement.

However, it may be possible to amend the Bylaws of the corporation based upon a majority percentage of those attending a meeting called for that purpose, assuming the quorum requirements are met. You will need to read carefully both the CC&Rs and Bylaws.

Finally, many documents contain auto-renewal clauses which do not require affirmation of the members of the association. I have seen CC&Rs in Texas which state the Term of the declaration, covenants, and restrictions run with and bind the land for a stated period and renew automatically, unless the Declaration is amended by the required percentage of association members to specifically terminate the Declaration. Your documents may contain similar language.
LarryH19 (Texas)
Posts: 4
Posted:
The POA original CCRs were written in 1978 and were written for a period of 25 years with one automatic 10 year extension. Any extension or amendment required 75% of the owners/members to vote prior to the end of the original 25 year period.

In 2008 the Board changed the language of duration to "successive 10 year periods". But they still left the statement that required 75% of the owners/members to vote prior to the end of the original 25 year period.

To the best of our knowledge by polling long term owners there was never a vote in either case above. The board at that time (2008) simply filed the document with the county clerk.

So my question regarding this falls back to are the documents still binding or not.

We have a lot of members who may opt out of paying dues if they feel the CCRs are no longer valid.
BillH10 (Texas)
Posts: 1,217
Posted:
Larry

Again I am not an attorney nor do I practice law.

My interpretation is this:

1. The 25 year base term plus the 10 year automatic renewal expired last year. That is a matter of fact, governed by the original language, regardless of what the Board attempted in 2008.

2. Changing the language in the Governing Documents (Bylaws, CC&Rs, etc.) is controlled by the amendment process described in the documents. Since I do not have a copy of yours, I am reluctant to speculate beyond saying that it does not appear the 2008 actions of the Board were valid.

My recommendation is this:

1. If you are a member of the Board, or are simply a member and wish to see the POA continue, urge the Board to consult with an attorney who specializes in HOA law, ASAP.
2. If you wish to see the POA "expire", challenge the Board as to the legality of the 2008 action, including requiring them to show proof or a written opinion from the attorney, etc. regarding the four year protest "rule".
3. You, of course, can retain an attorney on your own to research this for you.

As a final comment, consider what will happen if the POA "expires"--common area maintenance, architectural standards, etc. I have see others post that in attempting to dissolve an association or divest property, it was discovered the local town, city, county, or whatever, would not accept responsibility for common areas and the property owners had to continue an association structure or retain the property, regardless.

In the association in which we reside, we have a 10' wide strip of land we wished to "gift" to an adjacent school as it is of no use to the association and would be of possible use to the school. The board was advised by counsel that every property deed in the association would have to be modified, with associated surveys required and who knows what else. Of course it was cost prohibitive. I mention this as the members of your POA need to understand the possible ramifications of letting the association expire.

Good luck.

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