New HOA Board

Hello Everyone,

I am so glad that I found this site. I am going to make sure that my HOA knows about it!

I am posting this message hoping that someone can shed some advice. It doesn't have to be legal but if someone knows of the Florida HOA laws that would be helpful.

So here is the first question. We are trying to vote on some new issues including board members and we keep coming up at a tie. What do you do when you come to a tie?

Here is the second and biggest. We are a small community consisting of 14 units. 5 Units are owned by residents, 3 are owned by absentee-owners (I am assuming that they live here half the year), 1 is owned by a investor and the last 5 are split between another investor's 2 companies.

Now the person that owns 5 units as a investor now wants to be on the board. He does not live in any of the units and actually lives in Canada. Because he has 2 companies that own the units and he feels that he can represent himself with 2 votes. 1st through his first company and then the 2nd have someone else represent him (a current resident).

First we feel that this is wrong to ask the current resident because this allows the husband to vote for him and then allow the wife to vote for him.

No matter what even if the wife does not vote for him he still believes that he can have 2 votes (one for each company). We are trying to keep this from happen but have not found anything in the Florida statues that says he can't do this.

Can someone shed some light on this?

Thank You,
Rick

Thank you JohnC46 for your input.

Yeah we understand that he gets to vote for the 5 units he owns but now he wants to be represented for a unit that he does not own. So he would technically have 6 votes. Plus he wants to be added to the board. The board is currently made up of 3 members and now they want to make it 5.

If it helps. Here are the concerns that we are addressing to our HOA lawyer. We explained to him that the community is current divided into 2 groups of 7 votes each (total votes 14) -a tie:

Group 1 had several concerns:

the owner/investor will not be at the meetings or on-site at Bayshore (he lives elsewhere);
the owner/investor wanted to delegate himself and my husband to be the 2 to go on the Board (in addition to the 3 positions open) to make the total 5 positions
that because my husband and myself live in the same house (joint owners of a unit) there would be both a conflict of interest all the way up to collusion - even though my husband would be representing the owner/investor.
that if both my husband, myself and the investor had seats on the Board (using 3 seats), then group 1 would only get the remaining 2 seats and it would be unfair to them - a 3 against 2 situation
several in the group thought the owner/investor should not need to be on the Board or have representation

Group 1 decided to also put forward a husband and wife team to be on the Board, although neither are delegates for any investors (joint owners of a unit).

Thanks
Rick

Your Bylaws will tell you, Rick, how many votes per unit.

Your Bylaws will tell you if co-owners can serve simultaneously on the Board. I think it's a very bad idea even if permitted. If both were elected to the Board as directors, they each would have a vote at board meetings.

Your Bylaws will tell you how many should be on the Board. You would need a vote of all Owners if the Bylaws limit the number to three. With John, 5 is too many for an HOA your size.

With John, you seem to think that all owners vote on board business at board meetings. That would be VERY unusual. Check your Bylaws and make sure you see the difference between Board meeting and Members (Owners) meetings.

There may be no proxy directors on Boards. Directors must be able to attend by phone or in person unless your Bylaws say otherwise.

Please don't mention the name of your community or HOA. It's against the site's posting rules.

What kinds of votes are you talking about? Directors voting at board meetings or owners voting at members' meetings? In either case, a tie is a tie and whatever motion is being voted on, it doesn't pass. Bring the issue up again in the future until there's a majority vote for or against. Until then it's a stalemate.

The HOA could require "voting certificates" be filed by institutional owners such as corporations. The corporation should designate on the voting certificate who is authorized to vote. If one person owns 5 units all by himself then he gets 5 votes in a membership vote. If he controls 2 corporations that together own 5 units he still controls 5 votes even if the voting certificates both name the same person, there are still only 5 votes for the 5 homes.

The answers to all your questions should be found in your Bylaws. Who or what determines the size of your board and how many Directors there should be? Look in your Bylaws.

In Florida a director cannot vote by proxy at a board meeting, so if an absentee owner is on the board then he or she may not vote unless they attend the board meetings (which thay can do remotely, by the way). Voting via proxy at a members' meeting is allowed if, again, your Bylaws allow it.

It sounds like your association is losing control to investors, and that's not a good thing. It sounds like it may be getting to the point of no return. If you want to impose some sort of rental or leasing restrictions you'll need to amend your CC&Rs and if you need more than 9 votes to approve an amendment then it's already too late since the investor's 5 votes is enough to block it.

Your best chance of re-gaining control is for the 5 owners who actually live there to align with the 3 part-time residents. Together that would be 8 votes and you'd be assured of out-voting the other 6. 8 votes may not be enough to amend your governing documents but it would be enough to control the board.

Your terminology is very confusing and non-standard. Board members are not "delegated", they are elected by the owners. How can anyone be "represented for a unit that he does not own"? What does "represent himself with 2 votes" mean? "... conflict of interest all the way up to collusion".... I don't understand that, either. Conflict of Interest is addressed in the FL HOA statute. The word "collusion" does not appear in it. A 3 against 2 situation is "unfair"? How's that? 5 votes, majority rules. Somebody wins and somebody loses. That's the definition of "fair".

What do your governing documents say about joint owners of a single residence serving as Directors? If they're silent then there's no state law against it.

"Florida statues were changed some years back to side more for 'investor' owners than actual 'resident' owners", that's not really true and if your lawyer told you that I think you need a new lawyer. Not that it particularly matters in your case, but as a general blanket statement that is incorrect. Since FS 720 was passed in the year 2000 it has NOT been amended to favor investor owners over resident owners one way or another.

How many votes does it take to amend your CC&Rs? How many votes does it take to amend your Bylaws? What is the 7-7 tie about? Changing the number of people on the board from 3 to 5? Your Bylaws or even Articles of Incorporation may allow the board to make its own determination about that from year to year.

He can "want" what he wants, but just because he wants the board to increase to 5, it doesn't mean squat.

That would have to come for a vote as outlined in the document that states how many board members there are and how to amend that number - either your bylaws or CCRs.

Make sure you have a definition of a "member", too.

On the first question, absent something to the contrary in your governing documents, a vote requires at least a majority to pass (some votes, such as CC&R amendments require more than a majority). 50% is not a majority so a tie means it does not pass.

On the second issue, it should be in your governing documents. If your governing documents give each unit a vote, the owner gets one vote per property. If it gives each owner one vote, regardless of the number of properties owned, then I think he is right about each of his companies getting one vote. If the title is in the companies' names and he is the CEO of both companies, it is still two owners.