conflict of interest

Started by JamesB22 • 12 replies • 1056 views

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JamesB22 (California)
Posts: 19

Posted:

A new member of the board of my HOA is a real estate agent. She has represented both sellers and buyers in our complex. Is there any valididty to the idea that she would have a conflict of interest in voting on various issues that would come before the board?

RichardP13 (California)
Posts: 3,868

Posted:

Nope

The individual would have fiduciary responsibilities for the position they are at the moment. One as a Board member and a separate one as an agent.

KerryL1 (California)
Posts: 14,550

Posted:

We had one for 1-1/2 years recently on our Board, James, and she tried a couple of self-serving agenda items that would have helped her personally as a realtor. But there are 7 of us board members and she simply didn't persuade us to vote with her. She actually resigned form the board after not picking up as much business as she thought she would.

But, James, what examples can you think of that would be a conflict of interest?

JamesB22 (California)
Posts: 19

Posted:

if she knew that someone was behind on their HOA fee and there was a lien coming, she could try to get the owner to list their home with her and pay off the lien.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

And this is a bad thing? The money owed the HOA gets paid and you get rid of the owner who doesn't pay?

The HOA is NOT real estate. It's a corporation. It's irrelevant if this person is a Realtor or a Dog catcher. They are a member.

You want to find a conflict of interest you will. It's not like they are keeping it a secret they are a realtor and are an HOA member.

Former HOA President

KerryL1 (California)
Posts: 14,550

Posted:

OK, good point, James. She would know about the lien beg fore others which MAY give her an advantage. But filing a lien has to be announced in an Open Mtg. in CA. Then, any interested Owner could look it up in the county records and do the same thing. Right?

If she did have advance knowledge, as an executive session matter first, she would not use her knowledge to advance here own interests. Her fellow directors could discipline here. But this is outside my experience and I may be off base!

JohnC46 (South Carolina)
Posts: 14,265

Posted:

One could argue the profession of any BOD Member might profit form BOD information such as such real estate, insurance, plumbing, landscaping, etc. Should we ban them all?

JamesB22 (California)
Posts: 19

Posted:

discussing the filing of an lien is not done in open session, only exec, I believe

MelissaP1 (Alabama)
Posts: 13,836

Posted:

We file liens based on established policy. Behind 6 months, we lien. So it's not a private thing. Neither is having a lien filed. Do not see unfair advantage if they know or not. Matter of fact I see it as a plus for the HOA. The owner is going to sell which then forces the lien to be paid. Problem solved.

Former HOA President

KerryL1 (California)
Posts: 14,550

Posted:

I'll double check later, James, but we discuss filing a lien in executive session and announce it an the next open board meeting. (In our cue, it immediately follows the ES) I believe that is the law in CA--must be announced and recorded in the open meeting minutes by APN#

JohnC46 (South Carolina)
Posts: 14,265

Posted:

We once got someone to pay their past dues via their realtor. A For Sale sign went up. Our Treasurer called the realtor and informed her there was a lien on the house for past dues and asked if she really wanted to get involved in what could be a dirty/messy sale? The realtor called the owner and advised them to pay the debt of ASAP as she was not going to waste her time showing the house as the sale could get sticky. The owner paid his past dues.

KerryL1 (California)
Posts: 14,550

Posted:

Here's CA Civil Code, James: Civil Code §5673 Lien must be approved in open meeting and APN# recorded in minutes.

JanetB2 (Colorado)
Posts: 4,219

Posted:

NO ... Hmmm ... Seems I remember this same question before. So ... Looking for a different answer ... bet a different one was not received.

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