Management Co.

We have had a management company for almost a year and the home owners have really never had much dealings with the person that handles this account. Recently I spoke with her and inquired as to why some things have changed in the running of the development. Since we have been governed by our By Laws and Covenants since 1988. Her response was something to the effect that she uses the Planned Community Act instead of our Covenants and By Laws. She (The management Comp. Rep.) said the Planned Community act trumps the Covenants and By Laws, is this correct?
Right we have a board who knows nothing, or very little, about the covenants and by laws. This concerns me that the Rep. may have too much power and the board members not knowing enough to question her actions.

From the statute (below), it seems like she might be right.

§ 47F-2-103. Construction and validity of declaration and bylaws.
(a) To the extent not inconsistent with the provisions of this Chapter, the
declaration, bylaws, and articles of incorporation form the basis for the legal authority for
the planned community to act as provided in the declaration, bylaws, and articles of
incorporation, and the declaration, bylaws, and articles of incorporation are enforceable by
their terms. All provisions of the declaration and bylaws are severable.
(c) In the event of a conflict between the provisions of the declaration and the
bylaws, the declaration prevails except to the extent the declaration is inconsistent with this
Chapter.

NpS is correct.

NC has several statutes that govern HOAs; the Planned Community Act is one of them.

First, the management company rep seems too lazy to figure out what the actual governing rules are. Either the Planned Community Act or another NC statute could be the governing one.

Second, regardless of what statute governs, NC statutes regarding HOAs often contain language similar to what NpS posted: the statutes often defer to the HOA's own rules.

So in the analysis of what governs, first, the right NC statute should be determined, and second, it should be determined what is the final authority: a specific provision in the statute or the HOA's own rules.

The HOA can be held liable for the management company's bad acts, so the HOA should crack down on this behavior.

In California, many of the manager and management companies use a book called Condominium Bluebook. It is similar to what Roberts Rule of Order is, but for HOA and California in particular. The book includes all of the Davis-Stirling parts of the Civil Code, many applicable parts of Corporation Code and many other codes rules are are specifics to HOA. In California, governing documents will identify the projects as Common Interest Developments (CID) governed by the Davis Stirling Act.

So, if a person asks how we govern, we would say by the Davis Stirling Act and Corporation Code. As an example, the rules say garbage cans have to be behind your fence and the fine for non-compliance is $50.00. The D-S Act will tell me how that is administered. Or a common mistake, Bylaws will say Boards can take Actions Without a Meeting. That is now outdated. There will times when governing docs might prevail if their requirement is lower.

Every association is going to be a little different. For instance, when I set up a new association, I have to go line by line to figure out how much their dues are, how applied, what the late fee is, the interest rate, when payments are due, when late, what insurance is required, what their rules are, how many directors, what officers there are, when the annual meeting is, what is their fiscal year.

A couple of you are jumping down the managers neck, but did anyone read what the OP said? Right we have a board who knows nothing, or very little, about the covenants and by laws. This concerns me that the Rep. may have too much power and the board members not knowing enough to question her actions. Who's fault is that?