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KateS1 (Michigan)
Posts: 6
Posted:
Hello,

I'm fairly new to this, and need some guidance on my options. My community is newer development that still has some construction. The HOA had always been the developer, until completion of the subdivision. This past spring, the number of unbuilt, vacant lots fell below the threshold for the developer to retain control on the HOA. The members forced an election, and we voted in a new board. I am a board member, and am currently vice president. There is also a president, and a secretary/treasurer.

The problem I'm having is our president is a little bit out of control. He hasn't listened to reason, and I've run out of options to reel him in. Unfortunately, the secretary/treasurer is also a bit of the same mindset, so I am often out voted. I'd be fine with this, if what I was getting out voted on wasn't a violation of our bylaws (see below). I am hoping for some advice on what I can do, officially, to try to regain control of the situation.

Here are a couple of examples. President has decided to make himself the beautification police. Some people in our neighborhood have put latice up around their decks to keep animals out. There is nothing preventing this in our bylaws. However, the President has deemed this "ugly", and is sending letters to offending owners to remove. To make things worse, things that are prohibited in our bylaws are being ignored. We have a neighbor who has built a shed on his property. We received multiple complaints from his neighbors. When we went to talk to him, he lied to our face and said he had written approval from the developer when they were the HOA board to do this. I called the developer who quickly denied this was the case, and said the opposite was true - they had to tell him regularly that he was not approved to put up a shed. However, instead of sending notice that the shed must be removed, the President has decided that, since he thinks it looks nice, we should ignore it.

As you can see, this will quickly become problematic. I feel like I have to do something to get this under control, but I don't understand enough about HOAs to know how can you remove a board member who is not following his roles and responsibilities.

Thank you for reading.
KerryL1 (California)
Posts: 14,550
Posted:
If the homeowners voted for this person, they must vote him. See what your state laws say about recalling directors.

You directors most likely vote for him to be prez. You two can vote him out of that office, but he's still on the Board. Read your bylaws for more. But it sounds like you're outnumbered.

When the Board votes to contradict your governing documents, go on record in the minutes as opposed due to violation of your bylaw Aritice x, Section xx.x.

I wonder if your president is aware that your HOA's E&O insurance will not protect him if he knowingly votes against your governing documents. Perhaps you can adequate him.

Btw, it almost sounds like the president is making decisions without your Board voting. Is that so? How is that possible??

DaveD3 (Michigan)
Posts: 796
Posted:
How many on the board? I gather just 3 of you. Is that the number required per your governing documents?

Are you legally a site condominium development, or just houses in a subdivision. Houses in a sub and site condos look the same. It's how the development was incorporated.
If you're a condo association, google Michigan Condominium Act for some good reading on how you're legally bound beyond your documents.

And how many units in the association?

For those non-violations that have been issued, those people are certainly entitled to a hearing before the board. Inform them of such, and inform the president of such. Fortunately, "I don't like it" is not a valid regulation. Getting those people interacting with the board is probably a good start.

Aside from knowing the regulations and being able to cite them to the others on the board, there's little you can do directly. Recalling them is potentially an option if you can get support from the general membership and follow the rules to do so.
NpS (Pennsylvania)
Posts: 4,216
Posted:
Recruit someone to run for director at your next election. All you need is one more seat to turn the tide.

Sikubali jukumu. Read all posts at your own risk.
KerryL1 (California)
Posts: 14,550
Posted:
So, Kate, Dave also from Mich., seems to know the laws there and if meet the criteria that h mentions, it sounds like the Board must invite alleged violators to hearings as in CA. There probably are more rules too like how many days' notice prior to a hearing, etc.
DaveD3 (Michigan)
Posts: 796
Posted:
Quote:
Posted By KerryL1 on 07/13/2016 1:12 PM
So, Kate, Dave also from Mich., seems to know the laws there and if meet the criteria that h mentions, it sounds like the Board must invite alleged violators to hearings as in CA. There probably are more rules too like how many days' notice prior to a hearing, etc.

Every set of HOA rules that I have seen have a lot of boiler-plate content based on the Michigan condo laws. The condo laws have several sections where they dictate "this must be in the association documents" (or something to that effect).
SueW6 (Michigan)
Posts: 814
Posted:
This is a problem that many small boards fall prey to: the Board thinks it has to DO everything, instead of making sure things get done.

With a 3 member board, no ONE should be out there speaking for the Board.

Insist that a COMMITTEE be set up to deal with code restrictions/violations, and follow rules and regulations as stated in your bylaws. That might take your President out of the picture.

You don't say you are a condo association - or are you a HOA that represents a subdivision?

Private roads?

TimB4 (Tennessee)
Posts: 21,059
Posted:
Quote:
Posted By SueW6 on 07/14/2016 5:35 AM

Insist that a COMMITTEE be set up to deal with code restrictions/violations, and follow rules and regulations as stated in your bylaws. That might take your President out of the picture.

Keeping in mind that setting up a committee and finding volunteers willing to serve on the committee are two different things. Typically, in smaller Associations, the lack of volunteers requires that the Board does everything or hire independent contractors, a PM or an MC to assist with the day to day tasks.
NancyR9 (North Carolina)
Posts: 12
Posted:
I wish I had some guidance for you but I am hoping to gain some insight from the responses you are getting. I am on the board of a small (10 units)condo assoc. I also am dealing with a rogue president. So far none of the responses have helped. Our president refuses to have board meetings, which she would be the chairman of, and only holds an annual meeting where she tells what she has done, if she wants it known. She states she understands rules and requirements but that she has a right to ignore the governing documents and operate this way because she can go to everyone and ask them what they think before she acts. Trouble is she only goes to her friends which only amounts to 50% of the membership. Even if she had a majority in her corner it would take 75% in order to amend our by-laws. The other officers and board members are apathetic and are willing to go along with anything she does or says so long as they don't have to step up to the plate. I have decided to withhold my fees until the ethical and legal complications of how she is governing are resolved. I'm taking the stance that she has abandoned the governing documents. If anyone has a better solution I would like to hear it. I don't intend to ignore the situation and watch my ownership rights continue to erode.
NpS (Pennsylvania)
Posts: 4,216
Posted:
Quote:
Posted By NancyR9 on 07/15/2016 5:18 AM
I wish I had some guidance for you but I am hoping to gain some insight from the responses you are getting. I am on the board of a small (10 units)condo assoc. I also am dealing with a rogue president. So far none of the responses have helped. Our president refuses to have board meetings, which she would be the chairman of, and only holds an annual meeting where she tells what she has done, if she wants it known. She states she understands rules and requirements but that she has a right to ignore the governing documents and operate this way because she can go to everyone and ask them what they think before she acts. Trouble is she only goes to her friends which only amounts to 50% of the membership. Even if she had a majority in her corner it would take 75% in order to amend our by-laws. The other officers and board members are apathetic and are willing to go along with anything she does or says so long as they don't have to step up to the plate. I have decided to withhold my fees until the ethical and legal complications of how she is governing are resolved. I'm taking the stance that she has abandoned the governing documents. If anyone has a better solution I would like to hear it. I don't intend to ignore the situation and watch my ownership rights continue to erode.

1. How many board members are there? With 10 units, should probably be 3.

2. NEVER ever withhold fees. PERIOD. You might put the $ in escrow, but I would never consider this without consulting an attorney first.

3. Check your docs. If you're like most HOAs, directors get elected - then the directors choose who will be the prez, treas, sec, etc.

4. Option 1: Get the other board members to make you the prez instead of her. All that's needed is a majority of board members. If 3 members, 2 can make you prez. If 5 members, 3 can make you prez.

5. Option 2: If option 2 doesn't work, make a non-board member an ally, and get that person elected.

Sikubali jukumu. Read all posts at your own risk.
NpS (Pennsylvania)
Posts: 4,216
Posted:
CORRECTED:

Quote:
Posted By NpS on 07/15/2016 6:53 AM
Posted By NancyR9 on 07/15/2016 5:18 AM
I wish I had some guidance for you but I am hoping to gain some insight from the responses you are getting. I am on the board of a small (10 units)condo assoc. I also am dealing with a rogue president. So far none of the responses have helped. Our president refuses to have board meetings, which she would be the chairman of, and only holds an annual meeting where she tells what she has done, if she wants it known. She states she understands rules and requirements but that she has a right to ignore the governing documents and operate this way because she can go to everyone and ask them what they think before she acts. Trouble is she only goes to her friends which only amounts to 50% of the membership. Even if she had a majority in her corner it would take 75% in order to amend our by-laws. The other officers and board members are apathetic and are willing to go along with anything she does or says so long as they don't have to step up to the plate. I have decided to withhold my fees until the ethical and legal complications of how she is governing are resolved. I'm taking the stance that she has abandoned the governing documents. If anyone has a better solution I would like to hear it. I don't intend to ignore the situation and watch my ownership rights continue to erode.

1. How many board members are there? With 10 units, should probably be 3.

2. NEVER ever withhold fees. PERIOD. You might put the $ in escrow, but I would never consider this without consulting an attorney first.

3. Check your docs. If you're like most HOAs, directors get elected - then the directors choose who will be the prez, treas, sec, etc.

4. Option 1: Get the other board members to make you the prez instead of her. All that's needed is a majority of board members. If 3 members, 2 can make you prez. If 5 members, 3 can make you prez.

5. Option 2: If option 1 doesn't work, make a non-board member an ally, and get that person elected.


Sikubali jukumu. Read all posts at your own risk.
NancyR9 (North Carolina)
Posts: 12
Posted:
In reply to Np5:
1. There are 3 and they are elected to staggering terms. Thus each year we elect a new one HOWEVER, the pres. is also on the board and serves as chairman.
2. Escrowing the fees would suit me better than withholding them as the fees aren't the issue, I was only looking for a way to force compliance without having to sue.
3. Directors are elected and are supposed to elect the officers but the association has been electing the officers as well as the board.
4. Option 1 - I really don't want to be president; and
5. Option 2 - This would be the best solution IF someone could be talked into taking the presidency.
Thank you for your rapid response. I was sitting at the computer composing a letter to the officers and board when your reply came in and your answers prevented me from making a mistake by withholding my fees.
KerryL1 (California)
Posts: 14,550
Posted:
What, Nancy, do your bylaws say about electing directors? About electing officers? Are you telling us the the prez is not a director?

If your bylaws are silent, check NC's corporations codes assuming you're incorporated.
NancyR9 (North Carolina)
Posts: 12
Posted:
Per our bylaws, officers are elected by the members of the association and serve a 3 year term. The bylaws state "There shall be elected by the Board from the members of the Association, a President, who must also be a member of the Board, and who shall be chairman of the Board, a Vice-President, a Sec...." In actuality the members are electing both the board and the officers and the president is running the whole show and she sees no need to hold board meetings or consult the board about anything. I am 25 months into a 3 year term on the board. We have never met and I have never been consulted about anything even though I was clear I wanted to be involved. My requests for meetings are ignored. The board members and other association members are completely apathetic and say nothing about how the association is being ran. The President gossips everyday with three owners and they decide what will be done and how its done based on their wishes. I'm fighting this battle by myself. My sister owns 1/5 of the building and she agrees it's not right but will say nothing because she isn't willing to serve as an officer. She was secretary for years and was glad to get rid of it. The past president feels the same way, he was glad to get rid of it. This president, who evidently intends to serve for life, moved in from out of state, is a seasonal resident and has caused strife ever since she arrived. During the part of the year she doesn't reside here nothing gets done. At this year's annual meeting she had herself appointed Administrator of Banking. We have a Sec/Treas but she is no longer going to receive bank statements except through the president. It's not that I don't know how things are suppose to be done, I do. I have been a licensed Realtor in 2 states and worked in the legal field and finance my entire career. I have been in a small HOA (12 units) and I'm in a large community now that has homes and an RV park. I know how to read and interpret bylaws and how to prepare a Treasurer's Report. I've never seen anything like this. It's a one person show.
NpS (Pennsylvania)
Posts: 4,216
Posted:
Quote:
Posted By NancyR9 on 07/15/2016 12:47 PM
The bylaws state "There shall be elected by the Board from the members of the Association, a President, who must also be a member of the Board, and who shall be chairman of the Board, a Vice-President, a Sec...."

You have a 3 member board.

Per your docs, the Board elects the officers - The vote of the owners means nothing.

All you need is one other person to remove her from being the prez.

If neither of you is willing to be prez, then you're stuck with the one you got.

Hate to sound callous, but if you're not willing to replace her yourself or find someone who'll step up, then having a lousy prez is on you.

Sikubali jukumu. Read all posts at your own risk.
KerryL1 (California)
Posts: 14,550
Posted:
NpS is right, Nancy. The part of your quote that matters is: "There shall be elected by the Board from the members of the Association, a President, who must also be a member of the Board..." This means the Board elects a president who must be an HOA member.

Beyond his reply, what do your bylaws say about who may call a meeting? Ours, for example, and many others say that the president or any two other directors may call a meeting. If your bylaws are silent, read your state corporations code, which will state how meetings are called.

Your bylaws also probably do not give all power to the president. Now, boards can & do give (up) their power to the prez but that's a big mistake. One reason is what you describe. a second is that the rest of the Board will be ,liable is the president willfully breaks the law or opposes your governing documents.

If you cannot get others to support doing things legally in your HOA, you're doomed to what you've got unless you're willing to go to court.
NancyR9 (North Carolina)
Posts: 12
Posted:
First I want to apologize to KateS1 for hijacking her post.

Our bylaws do allow any director to call a meeting.

The bylaws state all of the powers and duties of the Association are to be exercised by the Board. The President is given general powers, including the power to appoint committees. Knowing that the President is intentionally violating the governing documents makes the liability issue a big concern to me, especially since the Association dropped The Employee Dishonesty and Business Income portion of our policy in 2014 in order to lower costs.

I guess I've got to decide if I'm willing to go to court. Wouldn't I (an owner)be suing myself (a board member)?
KerryL1 (California)
Posts: 14,550
Posted:
Yes, you'd be suing yourself.

Why not call a Board meeting and see what happens? Will the at least one other director attend so you have quorum? The, the 2 or 3 of you decide who chairs it. If the prez is not even a director, vote her out of the office of president. Maybe you have some support that you don't know about.

At the very worst, you can get yourself on record as not supporting some of her decisions, as insisting you follow your bylaws, and if it were me, insisting on purchasing D & O insurance.

I don't know about others, but I'm outta ideas for Kate. And your topic is exactly the same.
NancyR9 (North Carolina)
Posts: 12
Posted:
Thank you to all who replied. I got some excellent advice and suggestions.
BobD4 (up north)
Posts: 1,002
Posted:
Quote:
Posted By NancyR9 on 07/15/2016 5:18 AM
. . . I have decided to withhold my fees until the ethical and legal complications of how she is governing are resolved.

NancyR9 : As pointed out above by NPS, fee with-holding is a bad strategy. Think : pointing a gun at your own head. Some jurisdictions further treat escrowing as 'did not pay at all'.

Howsoever frustrating it is now, losing your vote, good standing & possibly Board membership will leave you even further out of the loop. Whatever information you now are able to get directly, would be cut off & replaced by collection activity . . . liens . . . toxic backlash . . . whatever.

You may have to wait patiently, whatsoever the factuals. Watch the financials, push for audit & actioning such. Good luck.
KerryL1 (California)
Posts: 14,550
Posted:
Good advice from BobD.
NancyR9 (North Carolina)
Posts: 12
Posted:
You have all been great. I can't believe everyone willing to help. I'm going to send in my fees and watch it play out.
KateS1 (Michigan)
Posts: 6
Posted:
Thanks everyone who replied. I got pulled out of town unexpectedly and was not able to read and respond, but appreciate all the insight.

And no worries, Nancy, for hijacking the thread. Sorry you are going through this too.

For my problem, a little bit more detail:

We are a 3 person board. The president and I are just at the beginning of a 2 year term. The third member (secretary/treasurer) will end his term in April. The builder still has the ability to veto decisions until the community has completed. The secretary/treasurer seems to be firmly on the side of the President in such matters, so it seems my best recourse is to get the builder on my side.

We are a subdivision of ~300 single family homes. In Michigan, it's still considered a "condo", because of how the developer divided up the land. So we have what seems to be very boilerplate bylaws that refer to "condos", "units", etc. Our bylaws are horrible. They are 5th or 6th generation copies that have been scanned in, so no easy way to search them. Page numbering and font changes several times in the document, so I assume they were several documents from other communities mashed together. But for my purposes, it makes it very difficult to reference something quickly. What I have found is, as others have stated, anyone receiving a violation has the right to a board meeting to discuss/defend/whatever. I'm thinking that's the best play right now is to make that known. If the neighborhood sees the president's behavior up front and personal, that may help get a groundswell to help remove him (if that's an option, I cannot tell from our mess of bylaws). Worst case, the developer can veto any fines/violations that are levied, so I can pursue that option as well.

Thanks again everyone for all your help. I really wish people like my president were as level headed as everyone on this forum is. I ran for the board because I believe it is possible to improve the community without being overbearing. Not everyone is on the same page as me, however

KerryL1 (California)
Posts: 14,550
Posted:
Dave of MI advises you to to read MI's condo laws. Makes sense.

Meantime, you idea to inform owners of the requirement to be invited to a hearing for their alleged violations sounds good.
LetA (Nevada)
Posts: 2,679
Posted:
I am new to this too, what are MC's and PM's?
DanaT (Tennessee)
Posts: 214
Posted:
Quote:
Posted By NancyR9 on 07/16/2016 2:14 PM
You have all been great. I can't believe everyone willing to help. I'm going to send in my fees and watch it play out.

You made a very wise decision to pay your dues! :-). Your fight should never be with the Board, rather your documents. If the documents are being abused, use them to make your point. In Virginia, withholding your dues will only get you into legal trouble as well as interest rates applied to your unpaid balances. That process will also put you as "Not a Member in Good Standing". Now the HOA has a right to remove certain privileges, under their control.
DanaT (Tennessee)
Posts: 214
Posted:
Quote:
Posted By KateS1 on 07/18/2016 6:11 AM
Thanks everyone who replied. I got pulled out of town unexpectedly and was not able to read and respond, but appreciate all the insight.

Our bylaws are horrible. They are 5th or 6th generation copies that have been scanned in, so no easy way to search them. Page numbering and font changes several times in the document, so I assume they were several documents from other communities mashed together. But for my purposes, it makes it very difficult to reference something quickly.

See if your State requires your CCR's to be documented through the County Court House, where your HOA is located. If so, you can go down and copy the original documents, submitted by the original builder. That's how I got mine. Just as you stated, our copy was copied so many times, they were very hard to follow and pages were out of order.
DanaT (Tennessee)
Posts: 214
Posted:
Quote:
Posted By LetA on 07/18/2016 6:51 PM
I am new to this too, what are MC's and PM's?

In Virginia, PMs are Property Management Companies. I have no idea what MCs are, maybe just "Management Companies"?
TimB4 (Tennessee)
Posts: 21,059
Posted:
PM = property manager (either an independent contractor or simply the representative of the Management Company)

MC = Management Company
JoyceR2 (Virginia)
Posts: 156
Posted:
Document, document, document and keep minutes. Place these concerns on the meeting agenda. Make recommendations in the form of motions and record them in the minutes with descending vote(s) and reason. Reference By-Laws. Recommend rules and regulations by motions that do not conflict with the By-Laws. Read all governing documents.

Check online for some guidelines to small HOA properties and rules/regulations for those communities. Prepare them for your community and make a motion to adopt them at meeting.

Document, document, document...........

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