By-laws question

Started by MichelleJ • 5 replies • 1546 views

💬 Join us to post & get advice from 50,000 HOA & Condo leaders.

⚡ Takes 30 seconds

Already a member? Log in

MichelleJ (Alabama)
Posts: 5

Posted:

We (the community) are about 3 months away from getting control of the HOA from the builder. The builder is only planning on sending out a notice in the mail 30 days prior to the next meeting which he will announce him stepping aside & that we will be taking control of the HOA. I have been approached by residents about having a meeting to discuss how we can prepare ourselves for the transition of the HOA. We are having this meeting in 5 days. I've been reading our by-laws and have asked our current VP questions and have not been getting answers. I'm hoping some of you can help.

Our by-laws state in Article III, BOD: Number, Power, Meetings, under section 3, Number of Directors. Three members. The Board shall consist of three members. Section 4, Nomination of Directors: elected directors shall be nominated from the floor & may also be nominated by a Nominating Committee, if such committee is established by the Board.

Then under Article IV, Section 1, Officers. The officers of the Assoc shall be a President, VP, Secretary & Treasurer. Any two or more offices may be held by the same person, excepting the offices of President and Secretary. The President & Treasurer shall be elected from among the members of the Board of Directors.
Section 2, Election. Except during the period in which the Declarant has the right to appoint the officers of the Assoc. under Article III, Section 2, the officers of the Assoc. shall be elected annually by the BOD at the first meeting of the BOD following each annual meeting of the members.

I guess what I am having trouble with is the differnce between Directors and the Officers. I thought that the President, VP, Secertary & Treasurer were the BODs. Can someone explain this to me? If we are to have three members to the BODs and four Officers, that will at least give us an uneven number for breaking the tie on voting but what roles would the BODs have expect for electing the President & Treasurer among the Officers elected?

Should we as a community contact a Code Attorney to read the by-laws to help us understand them before we take control? We also have the problem that the current Board (Builder) has not been enforcing the rules of our by-laws. How can we make sure that the violations are taken care of before we take control?

Thanks for any help.
Michelle

PaulM (Pennsylvania)
Posts: 1,347

Posted:

MichelleJ:
You may want to check this site for 2 subject searches:
- Transition of Board
- Municipal Bond

then post your questions again. These searches have a wealth of information pertaining to the situation of creating a 'new' Board from assn. residents as well as ensuring that the developer 'leaves'
the assn. to residents with all being completed according to municipal code.

Since the Officers are actually named in your bylaws as Pres., V.P., Secy. & Treasurer, IMO, there is no difference between Officers and Directors. I believe the document is referring to the Board of Directors as an entity. Some assns. have 'officers' named to other positions (Advisor, Ombudsman, etc.) but they are non-voting positions, thus they are not part of the Exec. Board nor are they Directors.

GloriaM (North Carolina)
Posts: 829

Posted:

Quote:

Posted By MichelleJ on 06/15/2007 6:46 AM
We (the community) are about 3 months away from getting control of the HOA from the builder. The builder is only planning on sending out a notice in the mail 30 days prior to the next meeting which he will announce him stepping aside & that we will be taking control of the HOA. I have been approached by residents about having a meeting to discuss how we can prepare ourselves for the transition of the HOA. We are having this meeting in 5 days. I've been reading our by-laws and have asked our current VP questions and have not been getting answers. I'm hoping some of you can help.

Our by-laws state in Article III, BOD: Number, Power, Meetings, under section 3, Number of Directors. Three members. The Board shall consist of three members. Section 4, Nomination of Directors: elected directors shall be nominated from the floor & may also be nominated by a Nominating Committee, if such committee is established by the Board.

Then under Article IV, Section 1, Officers. The officers of the Assoc shall be a President, VP, Secretary & Treasurer. Any two or more offices may be held by the same person, excepting the offices of President and Secretary. The President & Treasurer shall be elected from among the members of the Board of Directors.
Section 2, Election. Except during the period in which the Declarant has the right to appoint the officers of the Assoc. under Article III, Section 2, the officers of the Assoc. shall be elected annually by the BOD at the first meeting of the BOD following each annual meeting of the members.

I guess what I am having trouble with is the differnce between Directors and the Officers. I thought that the President, VP, Secertary & Treasurer were the BODs. Can someone explain this to me? If we are to have three members to the BODs and four Officers, that will at least give us an uneven number for breaking the tie on voting but what roles would the BODs have expect for electing the President & Treasurer among the Officers elected?

Should we as a community contact a Code Attorney to read the by-laws to help us understand them before we take control? We also have the problem that the current Board (Builder) has not been enforcing the rules of our by-laws. How can we make sure that the violations are taken care of before we take control?

Thanks for any help.
Michelle

Michelle:

All that means is that there are to be only three Board of Dircetors. Every annual meeting you need to accept nominations from the floor. The board members nominate amongst themselves the postions (offices) which which they want to hold. President & Secretary cannot be held by the same person because of the duties in which these offices hold. I hope that helps.

JudithC (Virginia)
Posts: 253

Posted:

That is a fairly common arrangement in that the membership elects the board (of directors), then the board elects the officers. The board chooses how they want to apportion the tasks. Some of our homeowners rail about it, but that is the way it is done here also. (Also, our officers' terms are for one year and the directors terms for 3 -- so new members on the board get a chance to be an officer right away).

You might want to search your documents carefully. We can, in fact, have a Treasurer who is not a member of the board of directors, for example. That is handy if you have a CPA floating around that just wants to think about numbers and not all the other nonsense. The President and secretary not being the same probably stems from state law.

MichelleJ (Alabama)
Posts: 5

Posted:

Thank you all for your feedback.
I've been reading the by-laws, about three times now just today and I'm still a little confused.
Of our 3 BOD's they are responsible for the affairs of the Assoc & have all the power & duties necessary for the administration of the Assoc's affairs and, as provided by law, may do all acts and things as are not by the Declaration, Articles, or these By-Laws. They have the power & are responsible for annual budget, common expenses, common area, hiring contractors for common areas, collecting & depositing assessments, making & amending use restrictions & rules & regulations; enforcing the by-laws, keeping books. Two of the BOD's have a two year term and one has a one year term.
The officers of Presdient, VP, Sect. & Treasurer are different. Each officers term is one year. The Pres. is the chief executive officer of the Assoc & presides at all meetings of the Assoc. & of the BODs. The Pres. has general powers & duties which are incident to the office of president of a corp. organized under the AL Nonprofit Corp Code. Secretary of course, keeps minutes of all meetings of the Asoc & BODs.

What I'm confused about is - do the officer's have voting priviledges or is it just the BOD's? If the BOD's have the power to enforce the by-laws; annual budget and common area, what is the purpose of the Officers? Why couldn't the 3 BOD's be the Presdient, VP & Sectetary and the Treasurer just not be on the BOD with voting rights?

Thanks,
Michelle

JM2 (Oregon)
Posts: 439

Posted:

Hi Michelle:

The membership elects the Board Members. Then, the board members get together and decide who (among them) will have which office. Every year, after the election, the board will choose officers.

It looks like your initial board has two members with two year terms, and then one member with a one year term. Likely as not, the one-year term will roll over next year at your annual meeting to a two-year term, and then alternate between two members elected one year, each for a two year term, and then the following year, one member elected for a two year term. That way, your board always has at least one experienced board member.

The corporation (your HOA) needs to have a president, secretary and treasurer. That's why the BOD chooses its officers, from among the board. Each BOD member has a fiduciary duty to the corporation/members, that's different than their role as members of the association. Then, each BOD member ends up with a particular office (Pres/Sec/Treas) which assigns them some additional, different tasks, to carry out in the name of the association and board.

J. Patrick Moore, CMCA

🎯 You've read this entire discussion

Join the conversation with 50,000 HOA & Condo Leaders:

✓ Ask follow-up questions
✓ Share your experience
✓ Get expert advice
✓ Access 350,000 discussions

Create Free Account →

⚡ Takes 30 seconds

Already a member? Log in here