HOA Not Adherring to the law of South Carolina

KrisG2 (South Carolina)
Posts: 3

Posted:

Good afternoon, I am board member on a board that has gone bad. its a long drawn out story that has many twists and turns but in the end the self appointed president and his secretary have been ruling the roost and just plain doing whatever they wish. On December 8, this treasurer stepped down and together two members and this treasurer who stepped down appointed him the President. He proceeded to fire the property manager who has done nothing to warrant being fired but he wanted to put his friend in as property manager and ensure he rules the roost. He has done many things over the course of the months this happened and has continually gotten away.
I am board member with a respectable Airbnb, I have maintained my property, only allowed families to rent my property and I charged a hefty security deposit in case of damage or disturbance, Airbnb holds an insurance policy on every property they allow to be rented on their site of up to 1 million. So any guests cannot sue the HOA or board for injury or damage.
Anyway, because I went against this change of command and felt it was unethical and unnecessary they have not proceeded to personal attack me by not allowing Airbnb rentals. I am the only owner on the property that had one, it supplemented the income on the property for upgrades and utilities. I had it on the site for 7 years and never once has there been a complaint or disturbance but yet the new President allows drug dealers and gun dealers to rent his property and another board member rented to people who saw the police about 18 times in two months.
They created new rules and regulations and entered in the words no Airbnb's and short term rentals and proceeded to fine me 100., at that time there was no one renting my property. Under SC Law Bill 3886 states that rules and regulations that are being amended must be filed prior to Jan 10, 2019 to be enforceable for that year. They were not filed until mid March and they were not voted on by the HOA and nor were they properly amended.
So I put my hosting account to sleep and cancelled those rentals that I could, then that was not good enough and they wanted my entire profile shut down, I use it to rent when I travel and I thought that was bit of a stretch in demand. I shut down my account after the last letter on April 22, 2019 and forwarded to the by email the deactivation notice which they did not acknowledge and proceed to suspend from the board, I was not able to vote at the AGM, was not provided any information regarding the AGM at all and treated as if I didn't exist. They have now sent me a letter demanding 1,000 in fines from March 1 to May 10, since I did not provide notification of the deactivation, I did send them the deactivation notice from Airbnb on April 22. they have forced me to put my property up for sale, they are not following the rules of bill 3886, they are threatening a lien on the property and disconnecting the cable which is covered in my HOA fees, which are current.
At the AGM, they allowed two renters to participate and said they were owners, the land titles do not bear their names, they rejected a proxy vote from the people who live in the unit that were disturbed by the one board members tenant, they called the police every day for disturbance.
I have gone to lawyers, I have researched and there is no where for me to go to fight this false charge.
I am writing to find out if you know anyone in or around Myrtle that could guide me.

SheliaH (Indiana)
Posts: 6,964

Posted:

How many people are on your board? If you and the others outnumber these two by one or more, you should be able to vote them out of those positions. However, you probably won’t be able to remove them from the board itself – usually only homeowners can do that by either recalling them or voting them out in the next election. Check your documents to find out how – it may be you’ll need to rally your neighbors together, and that may be easier to do if you’re not on the board. Then again, if you leave, these folks will continue to do whatever they please and no one will be there to at least call them out.

As for the rental hoo-hah, that may very well end up on court, especially if they’re denying you services that you’re entitled to through your assessments (and those assessments are current). That might be where I’d start as a counter lawsuit. Sometimes people use the threat of lawsuits to stomp people into being silent, but if you fight back with your evidence, that puts them on the defensive and they’ll have to prove they filed the new rules according to the statute. You’re a board member, so you should have access to the documents you need to turn things against them. For example you say they allowed two tenants to vote as homeowners, although they’re not listed on the title – get those documents and show them to the judge.

You also need allies. Talk to your neighbors and see who else is fed up with these two – all of you working together should be able to call for a special homeowner’s meeting to straighten this out (or vote them out). If they refuse to hold the meeting, all of you may need to pass the hat and get a HOA attorney to compel them to cooperate or the whole mess will land up in court for a judge to decide. I hope otherwise, but if what you say is true, that’s where you’re heading, so buckle up.

By the way, you might want to check that statute to see if it applies to all HOAs or only those established as of a certain date – if your HOA was outside that effective date, the new law might not apply and you’ll be left with duking it out based on what your current documents say. Good luck to you.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

KrisG2 (South Carolina)
Posts: 3

Posted:

Thank you for your response, we have held a special meeting but because we were short 2 votes we lost the removal of them. There is now 4 people on the board, he was able to get his friends voted in to sit on the board. So removing them is quite difficult. We did call for another meeting however they ignored the request as they ignore everything that they don't like.
I have all the proof and back up with dates etc but to launch a lawsuit in SC would cost me between 20-25k to have these people removed. The owners and I tried to do it and it cost me out of my own pocket 2k which I will never recover.
As for the new Bill 3886 it encompasses all HOAs, there are no restrictions, all changed documents must be filed prior to the 10th of January for them to be enforceable that year.
I know they were able to file a civil suit for claim and delivery but it was tossed out of court, they were trying to get the judge to remove the property manager so that they could have their own in place, the judge dismissed the case and they proceeded to hire a lawyer and paid out the property manager of course at the owners expense. When the owners asked about it they said it was my and another owners fault for fighting back.
They do as they please, they took over the board as they pleased, the treasurer or now president filed an insurance claim without approval from the board and once it was approved decided he needed board approval for the deductible of 25k and that's when he plotted his take over. Along with he did a number of unethical things but hey, he felt he could because there is no recourse or protection for owners in the state of south Carolina.
I can pay the fine but its about principal now, its unfair and unlawful and the things they have done are unethical. The list is long. I have all the documents and proof to go to court.

I could go to SC and file a case and pay the 65.00 myself to register it but then I don't have a lawyer and I would begin to know the civil code to proceed.

SheliaH (Indiana)
Posts: 6,964

Posted:

If you want legal advice, you need a private attorney because we aren't lawyers - and even if we were, we don't have any documents to review. Even then, there's more to lawsuits than just knowing what the law says, although that's a great start.

You can also look at the South Carolina statutes - all I did was Google it and found the following:

Statutes on HOA associations - https://www.scstatehouse.gov/code/t27c030.php

South Carolina Code of Laws (state law) - https://www.scstatehouse.gov/code/statmast.php

There may be some county statutes you'll also need to look at, so start Googling.

Even more important - you raised a number of issues, so the first thing you need to do is set some priorities as to what's really important to you and go on from there. Since you've spoken of losing the Airbnb reservations, are you interested in monetary damages from that? That could be a place to start and depending on the total amount, perhaps this is something you can pursue in Small Claims Court, where you won't need an attorney.

If the other selective enforcement has cost you money and you can prove it, you might be able to go after the board members individually and the HOA itself, but the association's master insurance may come into play and that can ultimately cost you more time and money as its attorney goes toe to toe with yours, because that's what you're looking at.

You didn't say how many owners are in your community, but if you were short two votes to boot out this bunch, you might be able to try a recall again and this time get the numbers you need. However, you will need to make this about the entire association, not just your issues. I'm not saying that's why you lost the first time, but this board may bring that up to persuade people from asking questions, so you need to anticipate that and prepare a response. Talk to some of your neighbors again (the ones who were in your corner), see how they feel and then decide what you want to pursue.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

SheliaH (Indiana)
Posts: 6,964

Posted:

If you want legal advice, you need a private attorney because we aren't lawyers - and even if we were, we don't have any documents to review. Even then, there's more to lawsuits than just knowing what the law says, although that's a great start.

You can also look at the South Carolina statutes - all I did was Google it and found the following:

Statutes on HOA associations - https://www.scstatehouse.gov/code/t27c030.php

South Carolina Code of Laws (state law) - https://www.scstatehouse.gov/code/statmast.php

There may be some county statutes you'll also need to look at, so start Googling.

Even more important - you raised a number of issues, so the first thing you need to do is set some priorities as to what's really important to you and go on from there. Since you've spoken of losing the Airbnb reservations, are you interested in monetary damages from that? That could be a place to start and depending on the total amount, perhaps this is something you can pursue in Small Claims Court, where you won't need an attorney.

If the other selective enforcement has cost you money and you can prove it, you might be able to go after the board members individually and the HOA itself, but the association's master insurance may come into play and that can ultimately cost you more time and money as its attorney goes toe to toe with yours, because that's what you're looking at.

You didn't say how many owners are in your community, but if you were short two votes to boot out this bunch, you might be able to try a recall again and this time get the numbers you need. However, you will need to make this about the entire association, not just your issues. I'm not saying that's why you lost the first time, but this board may bring that up to persuade people from asking questions, so you need to anticipate that and prepare a response. Talk to some of your neighbors again (the ones who were in your corner), see how they feel and then decide what you want to pursue.

Finally, there's always the media - don't know if any of this would make a story someone might want to run in the paper or on TV, but if there's sone sort of action hotline, call and see what happens.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

KrisG2 (South Carolina)
Posts: 3

Posted:

Good morning, thank you for this information, I had a lawyer for advice but he says that its not cost effective for me. But I am being coerced into paying the $1,000 since the board does not respond to questions or negotiations. I do not feel I owe this money but their silence and unwillingness to discuss will force me into paying the unlawful fine and then I will go to small claims court and go for the lost income. I may insist that they pay immediately as they will likely ignore the claim against them and push more legal fees on me so if I prove their tendency to ignore situations that may work.

I jump all over the place because they have do so many wrong things its hard to keep track. There are 73 owners in the complex, there are 102 units and some owners own more than one unit. The President himself owns 5 and the lady whom he allowed to vote in the place of her dead parents had 4. She is not the executor of the will and I know its still in probate and the land registry still has her parents on title for 3 and 1 for her brother.

I actually have a conversation this evening with an investigative reporter from the local news channel who is doing segment on bad boards and HOAs.
In Canada property managers, board and HOAs are governed by the Condominium Law and in order to be on a board you have to do about a 3 hour test. Property managers have to be licensed and they are governed and the boards of HOAs all have to pass this test and if they do not then they can no longer be on the board and are removed.
its actually a good way to keep governance over bad boards and I would like to see it happen in Myrtle Beach. if you want to see what I am talking about google https://www.condoauthorityontario.ca

My priority is to not pay the fine, however since they are ignoring me and the lawyer, I have included the owners in this situation and they have been quite supportive however they only go so far and then give up and get tired of hearing about the wrong doing. its a tough audience, I have proof to all of my accusations on their unethical actions.

Property Managers do not need to be licensed in south Carolina so even I could be a property manager, the one thing about his friend is that she was in forfeiture in 2006 and never cleared it up, I found out she was operating without a business license, earning an income as a property manager and then when I found out the board president filed a business license for her. had I not found this out it would have continued as her not having any license.