HOA Annual Meeting, Board and Quorum

Started by JasmineH • 8 replies • 958 views

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JasmineH (North Carolina)
Posts: 2

Posted:

Our developers are currently holding 3 of 5 positions on our board. The other 2 positions are held by neighbors within the community. We now have enough houses to where the neighbors hold the majority votes. They have refused to meet with us annually as stated in our bylaws for the past 2 years. This year the neighbors have decided to withhold payment of their dues until we have our annual meeting. Can the 2 boards members call a "special meeting" without the consent of the 3 developer board members? Our bylaws state the below. Can we also vote off the 3 board members during this meeting?

1. A meeting of the association shall be held at least once each year
2. Special Meetings of the association may be called by the president, a majority of the executive board or by lot owners having 10% of the votes in the association.

KerryL1 (California)
Posts: 14,550

Posted:

Welcome to the Forum, Jasmine. For clarification, is it the developer and "his people" who refuse to hold an annual meeting?

How do you know that the Owners (not "neighbors") may now control the board? What do your documents say about what has to happen so that Owners can control your HOA?

You quoted, "Special Meetings of the association may be called .... by lot owners having 10% of the votes in the association." This means, yes, you can call a special meeting of the Association, which means Owners (AKA members). Note this would not be a meeting of the Board.

You'll get better replies form those who've experienced the turnover form developer to the Owners from others.

JasmineH (North Carolina)
Posts: 2

Posted:

Yes he and his family are refusing to hold a meeting.

No statements in the docs regarding the owners controlling the board. Only verbiage regarding the votes.

We received a call from the developers regarding they were ready to turn the Board over. I scheduled the meeting and all owners showed and the developers never came. They told us they will reschedule for another date. So we are still waiting.

Thank you for your reply.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Jasmine

Typically Covenants/Bylaws give the developer voting control until a specific level (units/homes sold) is reached and/or a specific date such as 01/01/2020. This has nothing to do with Special Meetings. It is what it is.

Review your docs as to when they must turn over control and act accordingly.

RichardP13 (California)
Posts: 3,868

Posted:

FYI, let's say their are 100 homes and the developers have 49 homes still to sell and the owners occupy 51. You have a majority of homes, BUT not a majority of the votes. In this scenario, you have 51 votes to use and they have 147 votes, or 3 votes to 1 for every home still under developer control. Which means until you have more VOTES, they will still be in control of the Board.

DouglasK1 (Florida)
Posts: 2,046

Posted:

Richard,

Is your three votes per lot just an example? I don't see anywhere in Jasmine's posts where it specifies that for her association. In ours it was 10 votes per developer lot so turnover was in the 90% sold range.

Jasmine,

It would really be best if you get developer cooperation in the turnover rather than holding a special meeting without their involvement. While it might be legal, there are things you want to get from the developer such as records and bank accounts which they are more likely to hand over voluntarily if you don't try to just boot them to the curb. Speaking of legal, if the developer didn't recognize the election, court is where this could end up. You may ultimately prevail, but it could be expensive and take years.

Escaped former treasurer and director of a self managed association.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By DouglasK1 on 03/01/2018 3:19 PM
Richard,

Is your three votes per lot just an example? I don't see anywhere in Jasmine's posts where it specifies that for her association. In ours it was 10 votes per developer lot so turnover was in the 90% sold range.

Jasmine,

It would really be best if you get developer cooperation in the turnover rather than holding a special meeting without their involvement. While it might be legal, there are things you want to get from the developer such as records and bank accounts which they are more likely to hand over voluntarily if you don't try to just boot them to the curb. Speaking of legal, if the developer didn't recognize the election, court is where this could end up. You may ultimately prevail, but it could be expensive and take years.

Sound advice.

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

A minimum of three votes will keep the developer in power for a long period of time. Ten even longer. And yes that was an example.

DaveE2 (Georgia)
Posts: 1

Posted:

Some advice from my experience: At this stage, do not get lawyers (especially big law firms) involved at all. If you do, you all will lose for sure. Here in Georgia, against the advice of some, the president hired a huge law firm named Leuder and started going after homeowners for every minor infraction. Now the entire neighborhood is at war itself -- between those who are personal friends of the president and others who believe there is a better way. I am about to sell my house and getting out.

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