NO MEMBER SHOULD PROFIT FROM BEING A BOARD MEMBER

Are you on the Board?

If not, there is little you can do except to gather support and replace the existing board members with those who will make better decisions (perhaps you).

If you are on the Board, the Board made a bad decision when they awarded the contract and should learn from this. Make sure you get multiple bids (a minimum of three is standard) and review the companies. It's ok to award the contract to someone on the Board, but do so with caution.

The Board itself is likely protected by the Bad Judgement Rule. This defense basically says that the Board made the best decision they could at the time with the knowledge they had available when the decision was made. Even if this decision turned out to be a bad decision, the volunteer board did it's best at the time the decision was made.

With Tim, are you on the Board Dorrinnda?

Eight hundred dollars is not much money in today's world and definitely not worth making too much of a fuss over.

Yes, I am sure someone else said he would have done the job for less. Apparently the board was aware of this other person but chose not to use him for this project. Maybe this was work beyond that person's skill level or maybe he was not available when the work needed to be done.

For those who advocate getting three competitive bids: If I was a contractor and you asked me to bid on a piddling $800 job my response would be to burn your house to the ground, salt the earth, take your dog, and sell your family into slavery. You would definitely be off my Christmas card list.

I agree, we get multiple bids on larger projects, but on smaller projects, especially if we have a vendor who's done similar satisfactory work for us, we just start with one bid from them and accept if it seems reasonable.

Board members CAN be hired to do a job, especially if they have unique expertise to do the work. And they should be paid for it. However, the minutes SHOULD reflect that he/she was hired.

"Conflict of interest" also means that jobs should not be created in order for Board members to be paid. If there was a legitimate need for the job to be done, then he/she had no conflict in accepting the work.

I could see your complaint if the work was unsatisfactory, but you did not say that.

Best answer by far.

I stand corrected.

So, PiTa, here's a hypothetical for you.

If the president did the work without a vote of the Board, billed the HOA, and the Board paid him anyway, who is guilty of what? Or is that conduct OK?

Board members are not paid FOR SERVING ON THE BOARD.

That does not mean a board member can not be hired to do a job IF THEY HAVE THE EXPERTISE NEEDED. (Of course, the customary bidding would first take place)

I have a feeling this was an emergency situation, but the OP does not say. I'd am curious as to the job the president performed for $800.

Sorry, Sue. there IS a conflict of interest. She profits from the work she does for your HOA. But just because there IS a conflict of interest, doesn't mean the Board should not have her do the work. It's OK so long she has disclosed her conflict; does not discuss the topic at Board meetings, does not vote (recuses herself) on who gets the contract.

The below is from a CA attorney's web site, but applies to your state too, I believe. She is termed an "interested director" because she has a personal or financial interest in the board's vote. Sometimes the interested director is asked to leave the room during the discussion.

" If the interested director makes full disclosures and recuses himself and if a disinterested majority of directors approves the proposal of the interested director, the burden of proof falls to the person challenging the transaction. (Harvey v. The Landing HOA.)

Problems. Even when a director recuses himself, associations should avoid contracting with companies where a director has a financial interest. Such arrangements are fraught with peril both politically and legally.

1. Political Problems. At election time, owners may accuse the board member of reaping secret profits, taking advantage of his or her position on the board, doing shoddy work, etc. and demand his/her ouster.

2. Legal Problems. If the work by the interested director's company is defective, the board faces the unpleasant prospect of making legal demands on a fellow board member. At the same time, they face political problems with the membership for having given the fellow director the contract in the first place."

"RECOMMENDATION: So as to avoid problems, boards should adopt and carefully follow an ethics policy." For more, see Davis-Stirling.com.

Richard, I completely understand the appeal of using directors' business skills to do HOA work for pay. But they still have to do legally & so at they don't appear to b practicing cronyism. The $800 doesn't bother me, it bothers the OP.

The Pres is guilty of malfeasance.

The other directors, if they did not stop payment of his submitted invoice, are guilty of nonfeasance.

HOWEVER

The issue 'may' be a mountain from a molehill

IF

The actual work was NEEDED and PROFESSIONALLY performed in a TIMELY manner at a REASONABLE price.

No, the pres' and board's action w/o an actual recorded vote is NOT OK

Thanks Pita -