Developer won't turn over duties and allow POA board to be elected.

Started by RobertT13 • 18 replies • 681 views

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RobertT13 (Oklahoma)
Posts: 16

Posted:

Hello all,

I am new to this discussion board. In the past, I have been the Treasurer of an HOA board, and understand the basics of an HOA.

I am currently in a situation where I live in a 40 acre development of 27 lots/homes with a pretty simple "Declaration of Covenants and Restrictions". These covenants detail a Property Owners Association for this development. The development has been complete for 2 years. The only common maintenance is a gravel road through the development which has to be graded 1 or 2 times per year. All fairly simple and basic stuff.

The problem is that a POA Board has yet to be elected. The developer is still collecting annual assessments of $400 and won't return calls or emails with any of the owners. He will get the road graded if we call his secretary enough times.

How should we proceed to take control from the developer and form a POA Board of owners?

This is in Oklahoma.

Thanks!
Rob

AugustinD
Posts: 5,144

Posted:

What does the Declaration say about the Developer turning control over to members?

RobertT13 (Oklahoma)
Posts: 16

Posted:

The Declaration does not say anything about turning over duties from the Developer to the Owners. There is no mention of how the Board comes into being.

AugustinD
Posts: 5,144

Posted:

What does the Declaration say about assessments? Who sets them? How much?

Is your HOA a corporation?

RobertT13 (Oklahoma)
Posts: 16

Posted:

The Covenants state that the "Pinehurst Property Owners Association" is a non-profit corporation incorporated under the laws of the State of Oklahoma.... and that the it will 1)administer and enforce covenants... 2)collect assessments for the improvement and maintenance of common areas... 3)perform such other acts which are provided for and generally benefit the Association and it's members. Other verbiage details a $400 fee per year.

Additionally, the Covenants state that the assessments will commence as to all tracts on January 1 of the year immediately following the conveyance of the fifth tract to an owner. All tracts have been sold to owners for at least 3 years, and all development has been completed for at least 3 years.

The section in the Covenants that pertains to the POA is only 2 pages long and easy to understand.

AugustinD
Posts: 5,144

Posted:

Are there Bylaws? If so, do these Bylaws address election of directors?

RobertT13 (Oklahoma)
Posts: 16

Posted:

I don't believe there are any by-laws. Are the by-laws typically a separate document from the Covenants? I have a rather thick "Abstract of Title" document that contains the Covenants... but no by-laws for the POA.

RobertT13 (Oklahoma)
Posts: 16

Posted:

AugustinD
Posts: 5,144

Posted:

Quote:

Posted By RobertT13 on 03/16/2020 6:12 PM
I don't believe there are any by-laws. Are the by-laws typically a separate document from the Covenants?

Yes. If it's a corporation, there should be by-laws. See if your HOA is listed in the Oklahoma Secretary of State corporations site: https://www.sos.ok.gov/corp/corpInquiryFind.aspx . I did a search but am not quite sure about the names that came up. Often the Secretary of State will have copies of the Bylaws. Or you could ask the developer for a copy.

RobertT13 (Oklahoma)
Posts: 16

Posted:

I did query the Okla Sec of State site earlier and didn't find any entry for "Pinehurst Property Owners Association".

The Developer will not communicate with any of the land owners... so it doesn't help to contact him.

In the Covenants it states that "Hayden Hurst Foundation, Inc", is the owner of the following described real property.....
and, contained within the Covenants is a section describing the POA. The POA is described as the "Pinehurst Property Owners Association" (the Association), a non-profit corporation incorporated under the laws of the State of Oklahoma......

So, I assume that the "Pinehurst Property Owners Association" should be a separate Okla corp from "Hayden Hurst Foundation, Inc"?

RobertT13 (Oklahoma)
Posts: 16

Posted:

I believe "Hayden Hurst Foundation, Inc" is a Texas corp...

KerryL1 (California)
Posts: 14,550

Posted:

Since you're a corporation there must be bylaws and it's in ours where it's state how the owners take control of the HOA from the developer. You also should have Articles of Corporation.

Our rules say not to use the real names, but have your tried to contact the Hayden Hurst Foundation, Inc? As the Owner they should possess the articles and the bylaws.

It sounds like the developer is NOT the owner?

RobertT13 (Oklahoma)
Posts: 16

Posted:

The developer is Troy Hurst... thus "Hayden Hurst Foundation, Inc." .... so again Troy Hurst won't communicate with us.

Not sure why is says "Owner" at the top of the covenants.

I don't think the developer ever created the "Pinehurst Property Owners Association LLC". And thus, no by-laws.

I have contacted a Lawyer who works land disputes. I haven't talked with him yet, just dropped of the covenants and left a brief description of our problem with his secretary.

Your information has helped greatly in preparation to speaking with the lawyer.

Any final advice my friend.

THANK YOU!!

AugustinD
Posts: 5,144

Posted:

Quote:

Posted By RobertT13 on 03/16/2020 6:29 PM
I did query the Okla Sec of State site earlier and didn't find any entry for "Pinehurst Property Owners Association".

Give them a call and see if they can help. If you know the names of people who might be in charge (one way or another), then maybe the Secretary of State can figure this out. (Granted your Secretary of State's staff may all be working from home.)

Quote:

Posted By RobertT13 on 03/16/2020 6:29 PM
So, I assume that the "Pinehurst Property Owners Association" should be a separate Okla corp from "Hayden Hurst Foundation, Inc"?

Yes, I think this is most likely. Though maybe the Hayden Hurst Foundation is listed somewhere in the Articles of Incorporation or in the Secretary of State's records.

You can also try submitting a formal corporate records request to the developer. Do what's described here: http://oklegal.onenet.net/oklegal-cgi/get_statute?98/Title.18/18-1065.html. Cite this statute in your request. Request a copy of the Bylaws, for one. Send your request certified mail, return receipt requested.

RobertT13 (Oklahoma)
Posts: 16

Posted:

Thanks again for all of your advice. I will be prepared for my meeting with the lawyer I have contacted.

Regards,
Rob

GenoS (Florida)
Posts: 4,276

Posted:

Quote:

Posted By RobertT13 on 03/16/2020 7:00 PM
The developer is Troy Hurst... thus "Hayden Hurst Foundation, Inc." .... so again Troy Hurst won't communicate with us.

I wish you luck, but regardless of any other violation of the Posting Rules here, that's clearly a violation. HOATalk doesn't need to be hearing from that guy's lawyer about anything (real or imagined).

JanetB2 (Colorado)
Posts: 4,219

Posted:

Quote:

Posted By RobertT13 on 03/16/2020 5:12 PM

I am currently in a situation where I live in a 40 acre development of 27 lots/homes with a pretty simple "Declaration of Covenants and Restrictions". These covenants detail a Property Owners Association for this development. The development has been complete for 2 years. The only common maintenance is a gravel road through the development which has to be graded 1 or 2 times per year. All fairly simple and basic stuff.

The problem is that a POA Board has yet to be elected. The developer is still collecting annual assessments of $400 and won't return calls or emails with any of the owners. He will get the road graded if we call his secretary enough times.

How should we proceed to take control from the developer and form a POA Board of owners?

Hmmm ... From what I see Oklahoma statues are vague with really no HOA Statutes: https://law.justia.com/codes/oklahoma/2014/title-60/section-60-852/

Because the development is complete and has been for two years ... if it was me I would send a letter to your fellow POA owners to set up a meeting for electing the POA board (and I would copy the developer). After the board is elected I would set up a bank account for the POA and then expect the Developer to turn over records for the POA and any monies paid to that date which had not yet been spent on prior POA “required” maintenance as demanded via the CCR’s.

I would also get the owner’s together to hire an attorney to oversee the transition. YEP ... that attorney would be your CYA and should be a nominal fee if the development is complete. Seems your developer just wants to pocket $10,800 minus cost of grading a gravel road once or twice per year because you owners have not yet taken control.

RobertT13 (Oklahoma)
Posts: 16

Posted:

Thanks! That's what we are doing.

RobertT13 (Oklahoma)
Posts: 16

Posted:

I didn't read the rules. I apologize.

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