Legal Information to the Members

Does anybody know why an HOA member does not have the right to know about a pending lawsuit? I though that Davis-Sterling stated that legal negotiations were classified, but the existence of a lawsuit and what its was about was suppose to be public information to the members. In this case our property management will not tell us anything along with our Board.

Here is the background

“Recently I received a call from a perspective buyer. They wanted to know about a pending lawsuit with the HOA which was affecting their loan to purchase the property. In contacting the Board and the Property Management Company, they would not answer any questions or confirm or deny. I expressed concern that all sort of rumor would take place with the lack of information. This information needs to be know by the seller. A slip from a Board member implied there was something, but they could not talk about it and this Board member disagreed with this policy to not say anything.

In checking this out, I discovered the following which was not very hard to find out.

There is a “trip and fall” lawsuit filed in court for an elevator accident where there is not enough in our reserves to cover it. This should go through the HOA liability insurance company. Filing in court means nothing and is just part of the process and means a claim is being filed with the insurance company. That is why the HOA has liability insurance.”

Where is the name of the HOA in my mail.

Kerry,

I simply think he is providing a way to contact him.
If you look it up, it's not the name of the Association.

Interesting, Tim; he somehow was able to change his email addy in this thread. I did finally go to his earlier addy and it's for an unofficial newsletter he publishes about his HOA, which is "Harbourxxxx." I'm not interested in further promoting whatever his agenda is so I'm not spelling out his HOA's name. As I recall, his previous posts here have almost all involved accusations against his board of directors.

Yes, he is complying now, Tim. But, above he tries to pretend he did not have the name of his HOA under his OP and in previous posts. To me, that is sleazy behavior.

How about answering Michael's question if you're so impressed with him, Richard. You're a CA PM; surely you know the answer.

This thread has two threads going. One is to piss off KeeryL1 and the other to answer my original question.

Legal Information thread

KeeryL1 advice to check Davis Sterling was exceeding useful and I thank KeeryL1. What Davis-Stirling tells me seem to be very ambiguous. In one case there is no requirement for a Board to inform the membership of legal action. On the other case law says the they have a fiduciary duty to inform members of action that may affected them. This is my conclusion and appreciate the others that chined in about the reasons why a board would not be forthcoming.

"Case Law. The courts have noted, however, that boards have a general duty to disclose facts that materially affect the rights and interests of members. Whether a particular piece of litigation should be disclosed to the membership will depend on the facts surrounding the case and its potential impact on the membership."

https://www.davis-stirling.com/HOME/Disclosure-of-Lawsuits#axzz22g5x5vrm

The whole thing is kind of a convoluted answer which is somewhat in conflict with itself. Since lawsuits are in public record, I guess the membership and a Newsletter will have to do its own research. Say something like a new newsletter section "lawsuit of the month". Just kidding!! Our HOA has a discussion mailing list. It informed owner of what is going without putting that on a public web site. I think this type of information should be confined to that without the Board getting involved.

KeeryL1 thread

Since you KeeryL1 are concern about this bog inadvertently disclosing something, this system needs a way that an anonymous posting such as yours KerryL1 has some way which you could be contacted without dragging in the other on the bog to what is a private conversation. I tried to figure out how to send you this comment, but since you did no provide an email address at the end to your message, I could not do that. Here is what I wanted to tell you (and do not take it personally). I am only trying to provided these comments in a sincere way and I have no way to do it except publicly.

My censored email address service has over 500 email addresses available for our HOA members for anonymous and non anonymous postings. This means that these HOA members who use this email service cannot participate in this blog because you have censored this domain. Is that what you want? I think you need to identify the email address that this blog will accept in the policy of the blog (e.g. gmail, msn, yahoo, etc. -- is my logiqwest.com OK - that domain provides computer servers, maybe that inappropriate?). What is the criterial that an email address is considered an infractions? This need to be defined. What email address would you reject? That is very unclear and is very unfair since you are telling me I am breaking some rule that I have no idea what it is. I think that what you are concern with is my mentioning my news reporter hobby for our HOA web site. That was not the intend. As people say they are former board members and so forth, I am a former Board member and my title and email address was give to establish some understanding as to who I am. Whatever you think, I was doing that was not the intent. But I need to know what to do to make you happy. And please understand if this message embarrasses you, I have no way to contact except publicly. I provided you an email address with my original question that you could of sent me your concerns privately and we could of discussed this without the whole world knowing. If you want to complain to me or continue this conversation, respect the other on the blog and correspond with me though my email (either the one you think should be censored or the [email protected]).

For some reason I just do not think Michael is being altruistic concerning his HOA. Something smells funny.

If the lawsuit has been filed in court, then the filing is probably public record. (It is where I am, which is not California.) Go to the courthouse and ask to obtain a copy. It's entirely possible a summary of the court fiing is also accessible online for free.

The financial records of the HOA are supposedly accessible via what the HOA's governing documents and Davis-Stirling direct. Proper financial records (Profit and Loss statement, especially) should footnote expenses paid in any legal settlement, regardless of whether the matter went to court.

In addition, in my experience a competent HOA attorney would inform the Board to inform the Members of any pending litigation of a meaningful amount. What happened could affect voting in the next election, for one. Hence Members have a right to know.

I know the property, I know the management company and I now legal counsel. Yes it is true.

Well said, LetA.

Follow up questions I have for the Las Vegas HOA: Did it require that each Member have their own homeowners' insurance? If so, is that what the plaintiffs are envisioning getting access to?

The Membership of the Las Vegas HOA should have been informed and had the situation explained by the HOA counsel (or possibly the counsel provided by the HOA's insurer). If the Members were required to have insurance, then all the Members' personal insurers should have been put on notice.

Need to let it go!

A solution is get better legal counsel. A management company is not in the business of providing legal advise, but we can stand up when something is not right. It is worse when a MC doesn't stand up is the one who suggest garbage litigation. I dropped a HOA two weeks ago because of a Board refusal to act in the best interest of the HOA. It is not all about making money. We represent the association and all its members. Some of us have forgotten that.

When an HOA has their annual review, a CPA will have to note and comment on extraordinary expenses incurred by the community. Hopefully, this is disclosed by either the MC or the attorney. IF NOT, this becomes a problem.

Forgot to also state Richard gave you your answer ... as he noted essentially the State Law requires the lawsuit disclosure to sellers.