Reconciling Assoc. Declaration with IL Condo Act

Started by KarolL • 12 replies • 680 views

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KarolL (Illinois)
Posts: 9

Posted:

I'm wondering if anyone can help me reconcile the following statements.

In our Declaration it states: "Except for directors designated by the Declarant or Developer, each member of the Board shall be one of the Unit Owners and shall reside on the Property: provided, however, that in the event a Unit Owner is a corporation, partnership. trust or other legal entity other than a natural person or persons, then any designated agent of such corporation, partnership, or other legal entity, or beneficiary of such trust, shall be eligible to serve as a member of the Board, so long as any such agent (other than a person designated by the Declarant or Developer) resides on the Property."

Our attorney is saying the requirement that they live on the property is not enforceable because it violates two provisions of the IL Condominium Property Act; Section 18(a)(1) which says that "all board members shall be elected at large" and Section 18(b)(2) which states that "the association shall have one class of membership". She goes on to say a residency requirement would violate Section 18(a)(1) of the Act because it does not permit board members to be elected at large, but rather limits the pool of candidates to residents. It would also violate Section 18(b)(2) of the Act because it would create two classes of owners -- resident owners who could be elected to the Board and non-resident owners who could not be elected to the Board.

I looked up the definition of at large: Not limited to any place, person, or topic; for example, a representative at large is elected by the voters of the state as a whole rather than voters of a particular district. I don't think this definition aligns to our attorney's definition. Board members are still being elected at large by homeowners, I'm not suggesting that a homeowner who is not living on the property could not vote, but that a Board member should live on the property as per our Declaration.

So, I'm looking for either validation of her position or contradiction.

Thank you for your thoughts.

KerryL1 (California)
Posts: 14,550

Posted:

Just a quick read, but I'd say your attorney's wrong. All owners have the same opportunity to vote for directors and their votes all count the same: one per unit. So there's no classes" of voters as there often is during developer control.

Say, Karol, I don't remember from your other post, is your HOA, by chance, still controlled by the developer?

The directors at large refer only to directors not to voters.

Is the attorney one who specializes in HOAs? WE have two attorneys on our board of 7 and neither know much about CA HOA statutes.

GenoS (Florida)
Posts: 4,276

Posted:

You already have an attorney's opinion. What more do you expect to find here? Internet lawyers telling you your attorney is wrong? I'm not one myself but I think 999 out of 1,000 attorneys would agree with your attorney's opinion. Your declaration seeks to create 2 classes of owners and that's not permissible in your state. If you don't like your attorney's opinion, pay for another one.

GenoS (Florida)
Posts: 4,276

Posted:

Looks like there's already another opinion from the past. Take a look at this Q&A published in 2002 in the Chigago Tribune.

KarolL (Illinois)
Posts: 9

Posted:

No, our HOA is no longer developer owned. And yes, our attorney specializes in HOAs. She's not on our Board, she's paid by our Association for legal advice.

KarolL (Illinois)
Posts: 9

Posted:

Thank you Geno. This was helpful.

AugustinD
Posts: 5,144

Posted:

"At large" in the context of elections means that the directors will serve the entire condominium and not say, just Building Q's residents, and nor will, say, Director Jane Smith be elected solely by Building Q's residents.

I think this is a stupendous blunder on your HOA attorney's part. It is not the first time I have seen a HOA attorney make such a blunder. Write a polite letter to the board, cc to the attorney; explain your position; quote definitionsn of "at large" in the context of elections, and see if they come around. If not, write a letter of demand.

AugustinD
Posts: 5,144

Posted:

As for the residency requirement, I agree with the HOA attorney that the Illinois statute says this is not allowed.

NpS (Pennsylvania)
Posts: 4,216

Posted:

Quote:

Posted By KarolL on 04/17/2019 12:15 PM
I'm wondering if anyone can help me reconcile the following statements.

In our Declaration it states: "Except for directors designated by the Declarant or Developer, each member of the Board shall be one of the Unit Owners and shall reside on the Property: provided, however, that in the event a Unit Owner is a corporation, partnership. trust or other legal entity other than a natural person or persons, then any designated agent of such corporation, partnership, or other legal entity, or beneficiary of such trust, shall be eligible to serve as a member of the Board, so long as any such agent (other than a person designated by the Declarant or Developer) resides on the Property."

Our attorney is saying the requirement that they live on the property is not enforceable because it violates two provisions of the IL Condominium Property Act; Section 18(a)(1) which says that "all board members shall be elected at large" and Section 18(b)(2) which states that "the association shall have one class of membership". She goes on to say a residency requirement would violate Section 18(a)(1) of the Act because it does not permit board members to be elected at large, but rather limits the pool of candidates to residents. It would also violate Section 18(b)(2) of the Act because it would create two classes of owners -- resident owners who could be elected to the Board and non-resident owners who could not be elected to the Board.

I looked up the definition of at large: Not limited to any place, person, or topic; for example, a representative at large is elected by the voters of the state as a whole rather than voters of a particular district. I don't think this definition aligns to our attorney's definition. Board members are still being elected at large by homeowners, I'm not suggesting that a homeowner who is not living on the property could not vote, but that a Board member should live on the property as per our Declaration.

So, I'm looking for either validation of her position or contradiction.

Thank you for your thoughts.

I'm tending to go along with Kerry's thinking on your questions. Here are my thoughts.

1. Every time I've seen an "at large" designation, it has meant a board member who does not hold an officer title like President, Secretary, etc. Nothing to do with physical geography of the owner. Not sure why statute is worded the way it is - Maybe to promote the idea that the responsibility of every board member is to care for the entire community and a board member cannot just be limited to the function of say Secretary or Treasurer. After a quick scan of your statute, I didn't see any requirements about how officers get selected. If not in the statute, all that means is that it doesn't have to be specifically stated in the by-laws.

2. As Kerry said, equal voting rights is what's relevant. Different classes are common when developer is involved. The Developer's Class A votes have greater weight than the Owners' Class B votes. That goes away when the developer is out of the picture.

3. There is a common sense reason to exclude non-resident owners from being on the board of a high-rise. At some point in time, this issue must have been litigated and decided by Illinois courts. I suggest that you ask your attorney for a particular case where the issue was decided.

Best of luck.

Sikubali jukumu. Read all posts at your own risk.

AugustinD
Posts: 5,144

Posted:

Here's second attorney who opined as Geno's internet attorney opined, in March, 2019:
https://www.dailyherald.com/entlife/20190323/board-members-need-not-be-full-time-residents

KarolL (Illinois)
Posts: 9

Posted:

thank you.

KarolL (Illinois)
Posts: 9

Posted:

thank you.

KerryL1 (California)
Posts: 14,550

Posted:

Augustin's citation seems a good one, but I think NpS's advice to ask your HOA attorney for case law, which maybe doesn't exist?

Our HOA bylaws have no restriction about residency and we've had two examples of directors who don't liv here full-time. One a was a newer owner who had a condo here for vacay purposes. He lived 2 hours away, was terrible disinterested director, and sold his unit after a year.

The 2nd has been off & on the Board for several years. He lives across the street and also is not interested in our actual documents or policies. Often when the Board votes he doesn't know what they're talking about if it's something in our common areas. He won't even take a look even though they get their directors report several days before the monthly open meeting.

Given our HOA's experience, I'll campaign hard against this guy if he runs again in Oct. And I think Karol should do the same. Such directors just don't have a feel or real knowledge about or devotion to their HOAs. Sure, they can attend by phone but only makes their ignorance about their HOA worse, not better.

I noticed in another thread, maybe by Hector of FL, that FL's going to have a law that absentee owners can't vote in recall elections. Interesting.

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