HOA Board Member 'pay to play'

Started by NathanG4 • 9 replies • 1974 views

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NathanG4 (Hawaii)
Posts: 2

Posted:

Can a HOA Board member who is a contractor use his position to force owners to use his company for property improvements?
He is also the head of the Architectural Review Committee. We submitted an application to build a fence. We never received any response from the ARC at all, just a very high price quote from the BOD contractor guy. The implication was clearly we write him a check and we get our fence - 'pay to play'. Is this legal?...

KerryL1 (California)
Posts: 14,550

Posted:

Holy ukelele! It would be an extreme conflict of interest if a board member forces Owners to use his services! Now everyone can say, so what? the "so what" is he stands to profit from his decisions, but that's a terrible way to run an HOA.

What do your governing docs say about ARC approval? Who may give it? What is your recourse per your own documents or per HI HOA law? A bid form someone probably does not cpnstitutue ARC or Board approval. Start doing some homework by doing some reading. Or talk with neighbors who are in the know about rehired procedures and approvals.

NathanG4 (Hawaii)
Posts: 2

Posted:

My next door neighbor just had an addition built onto his house. Of course he used the BOD guy's company to build it. They put on the wrong color of roof shingles- doesn't even come close to matching - gray vs tan. Apparently not a problem. No one dares to complain.
The price quote he gave me included 42 cubic yards of fill. Online fill calculators say it will take less than 7 cubic yards. When questioned he said 'whatever...thats the price.'

CyrstalB (Maryland)
Posts: 457

Posted:

If I understand your post, you applied for approval for a fence.
You never received said approval but you did receive an estimate for the fence, from a company owned by a board member.
Are you not allowed to find your own contractor, as in your governing documents says the ARC gets to choose the company?

TimB4 (Tennessee)
Posts: 21,062

Posted:

Nathan,

Had you not already contacted them back, I would have suggested the following:

Write back to the individual and say thank you for the bid. Perhaps you misunderstood. I was contacting you in regards to your position within the Association requesting Association approval for the fence.

It still might work. It just won't have the same impact had that been the response to his bid.

DouglasK1 (Florida)
Posts: 2,046

Posted:

Do your governing docs specify how long the ARC has to reply? Ours say that the ARC has 15 days to respond with either approval or disapproval, and if they fail to respond in 15 days the application is automatically deemed approved. If you have a clause similar to this, you should be good to go.

Escaped former treasurer and director of a self managed association.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Doug

There was a nasty lawsuit (time and money) here in SC concerning if not heard back from in so many days, the project is approved. The court ruled though the owner did not hear back from the BOD that did not mean approval for his garage. The court ruled the garage was still non-conforming and it had to come down.

NpS (Pennsylvania)
Posts: 4,216

Posted:

Quote:

Posted By JohnC46 on 09/13/2015 9:09 AM
Doug

There was a nasty lawsuit (time and money) here in SC concerning if not heard back from in so many days, the project is approved. The court ruled though the owner did not hear back from the BOD that did not mean approval for his garage. The court ruled the garage was still non-conforming and it had to come down.

Question about the case: Did the HO comply with the HOA's published garage specs? If not, I can see where the HO would probably have lost.

Sikubali jukumu. Read all posts at your own risk.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

NPS

I do not believe there were any published specs as these were expensive, custom homes so one size/spec would not have fit all.

The HO was a Dentist and had the bucks to legally fight it. He claimed they had like 30 or so days to respond and when they did not respond, he went ahead with construction. HOA tried to stop it but it got it legally tied up. It was finished by the time it came up for a hearing (whatever) where the court ruled against him.

It was a very fancy, standalone, two car, brick garage. If I recall it cost like $35K to build and down it came.

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