Secret HOA Board

Can an HOA exist without anyone actually being on the board?

The last standing board member resigned in January, but we heard yesterday that he still has the files and gave the checkbook to another "previous" board member so he could buy a fidelity bond. So it's quite secretive and smells funny because in January they were notified that one of the owners is filing a formal complaint with the county's board that oversees disputes between HOA's and the owners. A call to the county board says that if there is no board, they're hands are tied and they claim that they've never had this problem and wouldn't know what to do without a "hoa board" to take to task, so their hands are tied. Which also smells funny.

It would appear that they are pretending there isn't a board to prevent an owner from moving forward with filing a complaint with the county hoa board due to approving an illegal fence material. And that's even after the county review board slapped their wrists over the same issue several years ago, but upon reminding them of that, they didn't change their minds in fact it emboldened them.

If the guy writing the checks says he's not a board member and there is no board, but he is writing checks, well that doesn't sit right either. Is that criminal?

The only seated board member who was the last to resign did a number on our HOA and then ran for the hills when he heard that he was being taken to task over his tactics and decisions. He killed any further collection on past dues that were in the process of court paper filed and would not deposit a check that was written last fall. In fact when he was reminded to deposit it before the six months was up, that was when he quit, leaving the HOA without a board or anything else.

Any suggestions or thoughts? Our documents say we can take a neighbor to court but what about taking the board members who claim there isn't a board, but is doing business anyway? Is there legal recourse there?

No one wants to be on the board, it seems that only a few are ever on it because no one wants to come in and clean up the mess this guy has made. Between him and new neighbor they have collectively destroyed the hoa it would seem. The talk about dissolving it has come back to life, but no one wants to take the lead on that either.

Ron,

If there is no board, then gather members together and have a court appoint you and them to the Board.

If there is no board, petition the court for receivership (but it will cost a whole bunch in the long run).

If there is no board, gather signatures to hold a membership meeting and hold elections.

Even if all the Board members (i.e. Directors) resigned, there may be Officers (hence the past board member paying checks).

Dave,

As you are aware, Directors and Officers are different positions (even if held by the same individual). One can resign from one position and remain in the other unless there is a qualifying factor (example: President must also be a Director). Typically, it's the Officers who have signature authority and not the Director (and Directors are who make the Board).

Should the issue be looked into? Yes.

Is it criminal behavior? Could be, or it could simply be someone who is still on the signature card making sure the bills are paid because nobody else has stepped forward to take over.

Thank you for the replies, yeah, do nothing hecklers is right! no one thinks anyone's misusing money, I don't know him much, but he's a stand up guy, there wasn't a board in place to make him an officer or anything else for that matter and when you don't inform the hoa that you took control of the checkbook, well, it doesn't look good, period. This hoa has been cursed from the beginning going on 18 years and has finally hit rock bottom with it being "abandoned".

No one will step up now, including myself, I got that t-shirt, for a short bit anyway and can't take the stress so I guess we have to wait and see what happens, maybe he forms a board himself to at least keep it afloat, the membership will not ban together to do jack squat. Never have and never will.

Thanks again.

Officers of the corporation (listed on the annual report filed with the State) could continue on with the day-to-day operations of the HOA.

The "signers" on the bank account should be on file with the bank.

Contact this person signing checks and find out what his legal capacity is.

Dave

In some Covenants Officers and/or Members of the BOD do not have to be owners, residents, members of the BOD etc. It might well be possible for one to resign from the BOD and remain an Officer.

I do not believe the OP has "all" of the information and/or understands all they have.

John is right, we don't have all the information because it appears they are running a secret board operation and are choosing to keep the hoa in the dark. If we don't have anyone sitting on the board to appoint officers and such, then how did he get permission to write checks to begin with?

We can't ask anyone any questions because we were told there was no board and no one responds to the emails sent to the hoa's email address.

This hoa is dying a slow death, and maybe this will allow it to be shot and put out of it's misery.

Not free, but it sounds appropriate in this situation.

RonB10 Md
Respectfully I should have added : After every Board member "tossed the keys in", what would NOT get done in whatever legal form of organization is yours ?

If a quorumable Board cannot be resurrected, for example, will suppliers/ service providers have no way to negotiate/contract to provide & be paid ? If home sales are negotiated dependent on an estoppelling-type certificate from management or the Board, will units effectively become unsaleable ? If there are common areas requiring liability insurance or asset/unit perils coverage, will coverage be renewable or even get cancelled immediately ? What about construction deficiency claims ? etc . . .

Owners should be asking themselves those & other questions if they want the association to follow the path of collapse. Not like a conventional business collapse. . .