What would you do?

Do you support a board member who went against the other members? The problem concerns a very expensive project we are doing in our clubhouse. We,as a BOD voted for certain items. He, overseer of the project changed some items and now the vendors want more money for these changes.

When the project started I sent the decorator and builder(4)e-mails, which I have backups, that state "if any items are going to be changed you need the five BOD signatures." Of course they did not do this, and now we have some of the items installed. I know that we can sue the vendors but that will not get our clubhouse open within the next few weeks. Looking for other vendors to complete the project may take to long. This project has been going on since June. It was supposed to take 3 months and we are still at least one month away with no bathrooms and no kitchen.

Before we started I had a budget and we assessed a small amount per home (thank you reserves). I built in a 15% overage and the extra money will not put us in jeopardy of going beyond our budget but it will bring the full 15% in.

I am in a quandary over this situation. The BOD member who got us into this situation will not run again in December. So no,we will not throw him out with a month to go. What I wanted to do to him is illegal.

So again what would you do? Bite the bullet and pay for the extras or stop construction for additional months to find someone else to do the job?

I realize a lot of this is venting but the four others have offered their opinion's. We have a two, two vote and I am the deciding factor.

I agree, How did it get this far that he was able to do that...without the rest of the board knowing it....so I too would be interested to find out how the rest of the board feels about this....I know I would not like it...especially after working so hard....but this is a thankless job I am convienced.......and yes, we always have to move forward and not get stuck .

Whew! Condo living!!!!! Remind me what the up sides are.....

I think you are being overly generous keeping that board member around. I hope the board has at least relieved him/her from the construction oversight position. I agree, a meeting with the contractor(s) to discuss these unapproved changes is necessary. They need to take some of the responsibility if they ignored your emails and made changes based on what one board member told them.
BTW. Why is the project so far behind anyway? Do you not have penalties built into your contract? Harold

Nancy,
He probably knew better than to cross the wife's decorating ideas and caved in. Better to cross the rest of the Board than the person that cooks his meals, etc. Good thing that the rest of your Board agreed to remove this guy from his lead of the project.
And a very good thing that the contractor did not follow the contract. How dumb was that!

I understand your frustration, but how can you tell him to stay away from board meetings? You can certainly take away his board asigned duties, but he was elected by the members and only they can remove him from the board. Is the wife still on the decorating committee? Harold

You "threatened" him?!

I'm smelling a two-wrongs-don't-make-a-right scenario in the making.

It might be in your best interest to retract that threat. I'm not taking sides here or saying what he did was right, but it makes for a very sticky situation when you threaten someone to prevent their legal access to attend a meeting.

As someone mentioned, you can remove him from office, but as long as he's still a legitimate member of the board, that's not very kosher to prevent him from finishing his duly elected term of service. Even though it is for only a few months. In short what you are doing is preventing him from voting on any issues that he as a board member has a right to vote on for the next few months.

Donna, the quote marks around the word "threaten" are on my post, not hers.

I am not discussing his activities, that is for them to work out. But I stand by two wrongs not making a right.

His actions may be inappropriate. Board members are within their scope to say so at a board meeting, or, at the very least, put on the record at a board meeting that his actions will be investigated for conflict of interest. They would also be within their rights to remove him from any office or committee they may have assigned him to.

But they cannot remove him from the board, or deny him access to remaining board meetings, unless their documents specifically say they can do that, nor can they prevent him from voting on any issues that come up during what's left of his tenure, unless, as we know, their governing documents say they can. In which case, I'd like to know how that provision is worded because I'd certainly like to incorporate similar language into ours.

The previous poster was correct. He was voted in by the association members, and he can be recalled by them, not the board, unless the by-laws or CC&Rs say the board can.

So I stand by my statement that issuing "threats" to board members to make them stay away is NOT in the best interest of the board, and the threat, whatever it was, should be rescinded.

I realize the original poster, and probably many other board members, are angry at him right now. Their anger, righteous or otherwise, does not negate their own adherence to their guiding documents.

We did not "threaten" the board member in the sense of anything illegal. We told him we do not want him to attend the meeting because we would have to publically remove him. Our doc's say that a majority of the BOD can remove a director from the board if he has been in gross negligect of fiduciary duties. With his term closing in December we have decided to let him go out without public embarrasment.

There was a meeting with the vendors yesterday. We compromised on a few issues and had him return at his cost the rest of the items. We will institute a few changes to our R&R's that will ensure that this situation never happens again.

Thanks to all for the support and responses.

NancyD: That's very sensitive of you. However, if I were a member of the community, I would consider that tactic a gross negligence of the board's fiduciary responsibility as well.

I am not a fan of sweeping things under the rug. That can come back and bite you on the rear, and quite badly, later on down the road. IF there has been gross negligence of fiduciary duty, then is it not the board's fiduciary duty to conduct a formal investigation or a least a formal inquiry to determine what in fact has happened? And not behind closed doors? And formally remove the board member from office?

An "embarrassment" or not, what we have here is just what we see all the time in the newspaper regarding lawsuits that are filed - only one side of the story. You have fairly substantial pieces to support your version of the situation. However, it's not the whole story. All he has to do is conduct a viral word-of-mouth campaign putting the shoe on the other foot and giving the board a black eye through a counter-gossip strategy. And since your board has chosen NOT to publicly air the alleged negligence on his part, you would be contributing to that.

That's a lot of money and the charges are fairly substantial. I would think that getting him on record as to why and how the situation unfolded from his perspective would go a long way to giving the board any leverage it will need in justifying whatever actions it takes in the matter. Not to mention the fact that it could possibly involve actual criminal conduct, which the members of the community have a right to know regarding their money. Telling them later that you wanted to "avoid embarrassing him" is cliche and most people would have issues trusting your version, after the fact, many months later.

And I'm not quite sure what you mean by the "threat was not illegal." You intend to block him from his taking his rightful position at board meetings and participating in whatever business comes up from now til the duration of this term in December. If he does not agree to stay away, you have threatened him with public exposure.

Your documents allow the board to remove another board member under certain conditions. Trust the documents. By "threatening" public disclosure unless he stays away, I would argue that you are also using the documents against him. Suppose, just for the sake of argument, he HAS some way to support his actions? You don't think he does, most of us here don't think he does, but but he does have the right to a fair hearing, or at least discussion, on it.

Your documents don't say you can remove him if you SUSPECT gross negligence, etc etc.

In addition, by showing the community that you follow the documents as well, it maintains their integrity.

We don't not follow them if it gets uncomfortable for us.

If he refuses to participate in the formal, public hearing into the allegations, then the board can interpret that as no defense and the allegations would be easily voted as substantiated. At which point, the board votes to remove from office as per defined in the documents.

You've covered the board's bases, you've given him an opportunity to refute the allegations, and your community can retain their trust in the integrity of the board and their ability to support and execute the governing documents.

It's win - win - win.

They may even be able to better support whatever difficult monetary decisions you have to make regarding how to fix what was broken.

Nancy, you know the situation better than any of us and I would trust your Board has resolvced this matter in an appropriate fashion. When the Board selected him to 'oversee' the project perhaps there were changes/decisions required. Perhaps the overseer thought they were authorized to manage the project.

I think Michele brings up some valid considerations. Perhaps there are valid reasons for his actions which can explained. Documention in the records of a hearing or in the minutes of a Board meeting would be prudent.

Michelle,

Collectively the BOD decided to move ahead with the project and get to our goal. Moving ahead, we will not accomplish anything if we publicly chastise the board member. The question we asked ourselves was, will discharging him from the BOD rectify the situation? No. Will embarrassing him publicly accomplish anything? No. We felt that this was the proper course of action for us to take.

He did wrong. There is no question of that. We had sanctioned him by virtue of asking him not to attend the remaining 2 board meetings. All of this was moot because he resigned from the BOD by e-mail this morning. We will read his statement at the board meeting tonight. By doing this, 2 months away from the end of his term, he is leaving himself open for questions from the community.

It took a few days of negotiating by another board members and myself. We did have a few credits that were due so we offset the items that were already installed by these credits. The vendors are returning the items on order. The total cost will be $2,224. and again, it will be offset by the credits. These items enhance the project, albeit not in the original plan, but they do not interfere with the integrity of the project. As I said this is a very expensive project and when I did the budget, I calculated an additional 15% for overages. If you consider the $2224 overages, it represents 4% of that.

As all board members know there is a certain loyalty to other members. Not to say, that if there were something that could not be rectified or harmed the community in any way would not be brought out. There is nothing worse than dissension between board members. We are supposed to represent the community and do what is best for all. We did what we thought was best for all. Having a few days of reflection, I would still feel comfortable with the position we were going to take.

Nancy,
I bet I speak for a lot of folks here when I say, "I'm glad it's your problem, not mine." Some problems don't have solutions that seem to fit the offense. As for me if anything comes up that rings this bell about your post, I will sure scrutinize it closely, so we all thank you for that. I also belivee handling this problem will be a hands on reaction to question as they come up and you or no one is going to be able to set a schedule for how and what to do.
This problem probably has occurred more than oncce in condo's and Hoas, and you do the best you can do and get it behind you. I expect you can cut that 15K with the contractor a little and as far as the problem child taking blame, I doubt he will kick in any money, or make his wife pay. These additions he ordered will probably not turn out to be all bad and if worse comes to worse, you can have one huge bake sale and make him in charge of it. If it was me, I would worry, but knowing you are going tro do what you are capable of, I don't worry.