Please help. Condo board refusing to follow our declaration and bylaws

Hello, I am an owner in a condominium community that was basically destroyed by hurricane harvey.
126 unit owners lost everything and have been displaced.
The chaos and ensuing cleanup and lack of communication resulted in a removal of the previous board and board president.
the new temporary board was elected.
upon being elected on this new board, i quickly realized that i was the only board member that was actually a resident owners.
our bylaws don't require residency to be a board member. But obviously, being the only resident board member, I was going to have different opinions from the board members who were owners and rented their units out.

Noone on the board had any previous board experience( i know i know, its bad and gets worse)
There were no proper procedures or procedures at all followed.
for the first three months the board was trying to fill out fema applicatoins,, and figure out how to start the rebuild process.( we had no flood coverage as we are outside of the flood zone)

I quickly realized the other board members had no interest in rebuilding, They preferred to have a developer buy out the entire property , so they could just get their money and move on.
However, our bylaws and declaration are pre 1994 texas.. thus, it takes 100% owner approval to agree to sell. so the rest of the board begrudgingly started planning for rebuild.
When i continued to voice objections to the board wanting to present the owners with the worst possible rebuild options. I immediately became enemy number one. Long story short, after meeting after meeting insisting the board needed to present a fair and accurate estimate of what is necessary for rebuild.. I resigned.

ok.. much more has gone on since then, a homeowners facebook page was creeated, but i was banned because of my consistent posts regarding the incompetence and illegality of what was going on. I was excluded from notice of meetings, and not until i contacted the attorney and management company did the board then start sending me notifications.

however.. here is where we are at now.. the new board is occupied being run by one person who i'm to sorry to say is completely incompetent and doesn't know a thing about contracting or rebuilding. She is hell bent on proving me wrong and saving face.
back in march the board at a homeowners meeting presented estimates and a prospective rebuild agenda..and clearly stated in writing also. the board has only signed on contract for project management and structural engineer. and the other contracts under consideration were
1. the rebuild of buildings(company b, who was among 5 companies that the board recieved bids from)
2. the clean up ,demo
3.. the mold certificate inspection..(despite several owners protesting that mold certificatoin was a joke, and common funds should not be used for individual owners having a mold certificate,, all units were already treated as prescribed by fema.. ,, also,, it was 6 months after flood before the board finallystarted anything,, yet, the warned owners that they couldn't start rebuilding unless the board approved it.. (obviously inaccurate, and obviouisly illegal, but again, you have displaced owners who just want to get back to their homes. and unfortunatly many are older and had the mistaken impression that they have to listen to the board, ( i and other owners repeatedly told owners the current board was misinforming them, and as long as they got the required permits and inspections, they could start their units:

They clearly stated sic "no other contracts will be signed until the board recieves 51 % approval of the rebuild plan , the same as required for a fema loan"

ok,, well, with no communication from the board, and no vote.. and no informatoin despite repeated requests.(remember, most of the downstairs owners where displaced and not living here)
the board then entered contracts for work that is clearly defined in our declaration as the responsibility of the owners themselves)despite objections from a few vocal involved owners,(for work that is clearly defined in our declaration as the responsibility of the owners themselves)
The board has not kept any minutes and despite several owners asking for months where are the minutes of the meetings where these decisions were made... the board simply says, we have been busy,, or we are still getting them together.... ITS NOW A YEAR LATER.
The board has spent 600,000 of our million dollars we had in the reserve..
the board unbelievably spent 400,000 dollars on foundation work...!.. despite several foundation companies, an engineer we hired to
come create a complete scope of work that was necessary, and the engineer of record for thisproperty for the last 30 years all saying,
the foundations (other than 2 buildings,,out of 24)were not in need of immediate repair,, The board president contacted some
engineer from out of down who is basically a professor and expert witness, and she hired him to create a complete independent
report of our buildings and property.
Well lo and behold.. his findings were all fine, but his interpretation and recommendations were extreme and made without having any starting data.. By the way, the engineer of record on our property who had overseen all bulding work had all the data, but the president of the board didn't want to work with him becasue she felt he was in thepocket of the previous board(ridiculous, i know)
He recommended 22 out of 26 buildings needed work..

ok. let me get back to the issue. the current board has already burned through 2/3 of our reserves and refuses to listen toi reason,, they are spending the money like its free money,, and they now have decided to assess the owners for another million dollars.!

We absolutely do not want to go to court, we already know that it is sueing ourselves, and our hoa attorney would like nothing better than to run up bills.

today we are getting ready to get the signatures required for a recall vote.. we've been through this once. so we know what it entails. luckily, we won't have to go through the delay of the board not accepting the petition and having to go to court.etc.. i have two board members that agreed, if we get 51% votes for recall, they will call a special meeting .the president or 2 board members can call a special meeting according to our documents, otherwise theowners have to get a petition to call as special meeting and the board has to accept it, and the lawyers try and refute it blah blah...

Here is my question... once we get the signatures for a recall vote,, once the two sympathetic board members call for the special meeting,, can the board continue to sign contracts and pass a special assessment despite knowing that the owners do not agree and are in the process of voting them out...???

sorry for the length..
please any possible angles you can think of that will help??? we already know we have to have a special meeting,, we don't want the board president to spend the next 3 weeks scorched earth,, signing contracts and agreements that are not required, and not necessary and will put the owners further behind.

Unless there are QUALIFIED candidates capable of PROPERLY running a troubled corporation,

y'all may be better off petitioning for a receiver.

Our by-laws also outline what is on the hoa and what is on individual units, but in the case of fire or other disaster, it's the master policy that pays for individual units. For condos in Texas, it's required by law (TUCA) to maintain that coverage.

Very sorry to hear about your troubles in the wake of Hurricane Harvey, LaskaS. You said the association had no flood insurance. Was all the damage and destruction attributed to flooding? Was there no other insurance coverage?

jennifer, our property does not fall under tuca.. it falls under the pre tuca condo law.. which specifically gives the board the right to not carry flood insureance .. we aren't in an insureance required mandated flood zone.. we actually didn't flood til the army corp of engineers opened the damns,, .. so while our property of course carries the required master policy,, it specifically does not cover floods..

in my original post, the last sentence .. says he sugguested 22 of the 26 buildings needed foundation work..

I wrote this in the wrong place,, The engineer of record who had overseen all of the work on our propertyh for the last 30 years, insisted that a recommendation to digup and put piiers on 22 of the 26 buildings was ridiculous and he does not agree..

the engineer who made the recommendation for 22 og 26 buildings needing work,, was the engineer the president of the board wanted to hire, who had never been ont he property, who had no beginning data,, he was just supposed to provide confirmation that the building were structurally safe.. instead he provided measurements and recomendations on what would be necessary to correct the foundatoins.. HOWEVER>> THE BUILDINGS ARE ^) YEARS OLD.. theyh are supposed to settle! none of them were structurally unsound,, none were not functioning,, all doors and windows were working.. etc..

I can give you the name of our HOA attorney but I think the rules of this forum don't allow me to do so in public so if you email me [email protected] I will give you his name.

Many sections of TUCA apply to all condo regimes regardless of when they were built, and insurance is one of those sections.

oh kimberly,, if you only knew,,

I was acutally elected to the board after harvey.. the owners removed the previous board because of an egregious debris removal contract that was entered into. Right after Harvey, the president agreed to pay a small company to have 3 dumpster delivered.. somehow, this small company ended up convincing the president that they would handle all of the debris removal..(we're talking bout 125 homes being gutted and emptied onto our landscaping, it was worse than a third world country. Unfortunately ,as often happens when a disaster strikes, unscrupulous contractors come out of the woodwork.. this company ended up billing the hoa for 455,000 for the debris removal!... ,, I and several other owners , simultaneously called profession debris removal companies to come and give us estimates. and both the compnay i contacted and another owner who had a debris removal come give a quote,, these companies quoted, 125-155 thousand... and somehow the company that the president hired billed us 455,000.!.. and to top it off, when owners started asking questions, the president refused to admit that maybe he was being taken. Ends up, this company based on the invoices they were turning in, was charging the hoa.. 115.00 dollars a cubic yard!!......... the city of houston paid contractors 13.60 a square yard.. and on top of that, when documentation or reciepts were requested,, this company could not produce a single dump receipt,, despite charging us for what was claimed to be hundreds of dump fees.

anyway,,it's too much,,it's just too much,, we were able to stop the thievery by that company,, and a new temporary board was elected,(i was one of them).. but lo and behold,, i soon realized that i was the only resident owners that was on the board,, !!!.. every other board in the history of the property was resident owners.. but because of the disaster and everyone displaced, most people were evacuated, which basically left these other owners to be elected to the board, I didn't realize none of them were residents.. until we started meeting, and i noticed that every suggestion i had was met with indifference or lack of urgency.. Lo and behold, one day i saw two of the board members cars at the office, so i walked up to see what was up,, they were secretly meeting with real estate developers.. !!.,,. their entire purpose for getting on the board wsa to facilitate a sale,. Their condo's were just investment properties that they rented out. and obviously,, they would rather just get a cash payout and walk away,, rather than having to spend tens of thousands of dollars to rebuild... ... anyway,,, it went down hill from there... from that point on, i was enemy number one. .. Only when i finally stood up at a homeowner meeting and told the owners that i believed they were being given misinformation and incomplete information,. I said, an investor has every right to want to sell their property, but they have no right to feed the owners false information to trick them into selling.. ...anyway,, needless to say,, The rest of the board was pis*** and a month or so later, after I just couldn't take the incompetence and lies anymore, i resigned.. anyway,, much more has gone on.. that initial group resigned after it was revealed taht they were in fact manipulating the bids and tryuing to present the worst case scenario to the owners. and now boardzilla is president,, she was the only one who didn't resign, and she literally thinks she is the boss.. she has threatened owners who questoin her,, she has threatened employees that if they cross her, they are gone.. She has approved payments upwards of 180,000 for a company to come and clean out the inside of the units.. but guess what,, 91 of 125 units were already professionally demo'd to the studs and cleaned 9 months ago... !!.... yet ,, she's so incompetent, she hired this company and they ended up billing us 1800 a unit for 121 units.. so basically they claimed they had to completely demo and clean and treat 121 units. despite owners having records and pictures showing that thier units were already clean.... its gets worse..but i can't keep on writing, or i will be miserable all day..

I think you have taken on way too much personal responsibility. Seems you are carrying this burden on your shoulders...and I have to ask how much help you are actually receiving from those that did lose everything?

You were spared, but it was a natural disaster and should not be your albatross.

My opinion and thoughts. I would do what I must to relieve the stress of it all. Sometimes it comes down to looking out for #1 and that's just the truth of it.

I wish you the very best.

K.

jennifer, I just went and read the statute..

actually,, under the insurance provisions..

j) If the cost to repair damage to a unit or common element covered by the association's insurance is less than the amount of the applicable insurance deductible, the party who would be responsible for the repair in the absence of insurance shall pay the cost for the repair of the unit or common element.

Doesn't the above clause mean that if there isn't enough insureance than the owners will be responsible fore rebuilding what they normally would be responsible for according to our documents..??

Statues cannot be read in a vacuum, and I do not know anything about flood insurance, so I want to tread carefully here but I will tell you an example for us, and though I am not an attorney, our prior HOA attorney is the person who pointed me to this.

We had a fire. I was told one unit owner didn't have her own insurance, so only her exterior was rebuilt, I accepted that. After all, walls-in are on us, right? Wrong, in the case of fire or other disaster.

Our declaration defers to our by-laws. It lists out what unit owners are responsible for EXCEPT THAT which is covered by insurance per the bylaws. So we go to the bylaws, and they say that a master policy must be maintained that covers the INTERIORS to original specs, but any owner added improvements are on us.

Then we go to Chapter 82 of the Texas Property code, which mandates this coverage, so our bylaws are good, they match, but would be moot if they did not.

Under the statute, whether insurance is actually maintained, what is required TO be maintained falls back on the association regardless.

So on to your sit, which is a bit different. You didn't have flood insurance. Were you required to? I think so, but I am not 100% sure. The stature says 'reasonable available'. Is flood insurance reasonably available?

Your bylaws were written before TUCA. TUCA supersedes them.

Im not sure why it would make sense to hold volunteer "amateurs" personally accountable (legally with monetary provisions in court?) for not reading provisions like this correctly - it would seem this could put a huge chill on well intentioned, community volunteers ...

To be clear, if you told me I would be held "personally" responsible with risk to my family and fortune, by trying to help out my neighborhood and then misreading or misunderstanding something like this - I would not volunteer.

I have - while sometimes it makes sense to play semantics games, it doesn’t in this case. I stopped playing “definitions” years ago.

? I think all board members know that once they step into the role of director of a corporation they accept fiduciary responsibility and can either go through a lawsuit, in which they are defended by the HOA insurance provided attorney, and in some cases can be found personally liable.

It's part of why over and over on here many of us say 'You (whoever) need to consult an attorney before you do xyz or do't do xyz'.

Willful ignorance is not a defense. There is no excuse to be ignorant of the laws. Even an insurance agent advising is not enough. They are not lawyers. One would hope they understand the laws in the state that govern insurance master policies for HOAs and COAs but the final responsibility lies with the BOD to make sure adequate coverage is maintained.

Please specify, precisely, what erroneous statement(s) I have made

Geno,

I appreciate your opinion may be different than mine, but I don’t believe the forum was designed for any of us to spar with others or with those seeking help - whether they ar right or wrong is many times not the point.

We can be light hearted and occasionally humorous, but PaaN is tiring and, frankly, makes me want to simply spend my time elsewhere. I know I can spend the time elsewhere, but as you tell from my posts about helping neighborhoods out, this is serious to me. I want to help, or at least share my experiences.

Correct. The association must rebuild all that is required per state law to be covered by insurance, regardless of whether the insurance was actually maintained.

In Texas, for condos with more than one story, what is covered by the association on a regular basis is out the window for cases of fire and other disaster. Texas mandates that it all be covered.

Which makes total sense. It's not desirable to depend on individual owners to carry insurance or not. Not when their lack of doing so affects everyone. It's also not desirable to have units that are never rebuilt due to lack of individual insurance.

If your association was required to carry flood insurance, and it didn't, Paa is correct that this would be a breach of fiduciary duty on the part of the board members who declined to obtain and maintain what Texas state law demands.

ps.

While their 'governing documents' may, or may not, indemnify the BOD their D&O insurance will only cover misfeasance NOT mal or non feasance.

There probably is a fine line between non and mis, however, IMO, this insurance SNAFU trampled said line.

I am giving them the benefit of the doubt.

The OP states 'unawareness' of the statutes so mis is out.

leaves mal or non

If the OP's BOD actually WAS aware of the statutes then they are guilty of MALfeasance.

D'OH

'willful ignorance' = malfeasance

ignorance = nonfeasance

neither is covered by D&O insurance

while my 'manner of speaking' may have been misleading, I attempted to state that the BOD did NOT perform misfeasance (which is covered by D&O insurance) but the MUCH MORE SERIOUS act of nonfeasance

the HOA is SOL no matter how it happened

we actually agree, albeit communication is always an issue

I am not confused, and if we want to parse all the feasance's and breaches of fiduciary duty and so forth, my opinion is that should be a separate thread as that is not what the OP of this one needs help with.