Suspended HOA Disclosure (CA)

Yes. There are always unintended consequences with every decision. One of those may be that since you left in the middle of a term, you will likely be labeled a dissenter by other board members and that may be the only message your membership hears. Keep in mind, one individual likely did not cause the issue. The whole Board is responsible for the issue.

While you were on the Board, what steps did you take to resolve the issue? Did you offer to do the required work to be reinstated? Did you propose a plan of things that were required to be reinstated?

What did you do to prevent the issue from happening again? Did you create a yearly calendar of events for the Board to follow and ensure specific tasks were completed? Did you propose new policies to correct the issue that caused this in the first place?

If none, then you are as responsible for the issue as those who are still serving.

Instead of choosing to disclose the information, why not offer to help resolve the issue?

You very clearly stated that the purpose of disclosing this issue to the membership isn't to resolve the issue but to "get back" at the individual with whom you had disagreements and, perhaps, personality conflicts with. That, in my opinion, is the biggest issue with disclosing this information.

If you want to recall or have the individual not reelected, the fact that you chose to quit serving while that individual is still serving does not put you in the best light to launch such a campaign. You would have had more of an impact with such a campaign had you remained on the Board (at least in my opinion). However, if you want to recall that individual, then simply follow the procedures required to do so.

Well suspended and administratively dissolved are two different things.

Additionally, either one can easily be fixed by filing the annual reports and paying a fee.

One thing that wasn't mentioned was if the issue was ever resolved. If it was, then there is no longer an issue except to make sure it doesn't happen again.

The OP also mentioned tax-exempt status. I don't know if property taxes for HOA's in CA are tied to corporation OR if the OP mistakenly believes that all non-profits are tax exempt. In rereading the posting, I'm starting to believe that it is the latter.

Thanks for your input Tim, you have some good points. I'm actually a CPA, and finding out about the suspension (which occurred prior to my residing in the complex or being on the Board) caused a conflict of interest. The suspension could lead to a shift in liability, and ethically I could not perform the tasks associated with remedying the suspension pro bono. If I had, I could be held personally liable as the work of correcting the suspension would be done outside the scope of my professional liability insurance. The HOA never contracted with my firm to correct the suspension.

I did provide instructions on what steps needed to be taken to correct the suspension, however I did not volunteer to perform the work due to the issues stated above. Ultimately, I suggested the Board hire an attorney or CPA who specializes in HOA's to remedy the situation. Initially, the Board did not want to spend the money and the President took it upon herself to resolve the issue. Once she realized it was beyond her scope, the Board contracted with a CPA (via an informal e-mail vote which I was not included on) to perform the work. That was back in October, and we were told it would take 6 weeks to resolve. While on the Board, I followed up with our President monthly on the progress, and she kept saying the firm contracted was working on it. It's been 6 months, and no resolution or explanation as to why.

My resignation, while it may look poor on the surface, was not without some good intention. We have a newer resident who has prior experience in condominium property management, and he narrowly missed out on being elected at our last annual meeting. The Board sought out his expertise while reviewing roofing contractors, and I felt he could bring some much needed experience since we are self-managed. I suggested the Board have him take my place upon my resignation, and they agreed. I have no desire to do property management, and my intention for being on the Board was to assist with financial planning. Ultimately I felt I could not do that while the HOA was suspended.

I guess it's probably best to refrain from disclosing the suspension at this time. Instead I should probably just followup on the matter at the monthly meetings, which are sparsely attended by residents.

Thanks for your insight.

Makes me think of: AA

(not alcoholics, but orifices)

ps. Tim, delete if indicated

Wouldn't non-disclosure be considered a breach of fiduciary duty? If I bought into an HOA thinking there was a duly constituted corporation in control, and later found out there was none, and that that fact had been wilfully withheld from me.... isn't that the very definition of fraud? Maybe California is different.