65.654¹ Reinstatement following administrative dissolution

65.654¹ Reinstatement following administrative dissolution

Hallo,
We are a community of 11 properties in a back country setup towards Mt. Hood, Oregon, the declarant field bankruptcy a few years back, and the last couple of lots were just sold.
The declarant established the ARTICLES OF INCORPORATION on 08-10-2007 And filed an ADMINISTRATIVE DISSOLUTION on 10-10-2008. There was never an established HOA in place since there was nothing to enforce than blank empty land.

On 3 of the properties the neighbors finished building already, a fourth one is about to finish in the next few month. They are pushing on the HOA subject.

Now that all the lots are sold the declarant has to start the turnover process within 90 days according to the bylaws and CC&RS.
The declarant has not initiated a turnover meeting.
The declarant has not nominated an interim Bord of director for this process.

One of the neighbors reached out to a law firm to send out notices to initiate the turnover process without consulting with the rest of the owners.

My questions:
- can the neighbor send out notices to to owners without waiting for the 90days to laps
- do we have to reinstate the HOA, since the only common thing we have is a gate and some easements?
- does it require a majority vote or a 100% vote to reinstate the HOA in Oregon?
- do I have the option to opt out at this point since the HOA is dissolved for the past 12 years?
- what would be a good solution if we decided not to reinstate the HOA to cover a fair share of the gate, electricity and maintenance costs?
- if we decide to reinstate the HOA can we change the CC&Rs in the same process?
- in this state, is the HOA considered dead or is it in some kind of dormant stage?

Thank you all for you feedback and happy holidays!

Best,
Thomas

I recommend getting competent legal advice. There is a learning curve to all this, and a competent legal advisor can point out the most direct route as well as the hidden gotchas.

Most folks don't understand all of the ramifications of being in an HOA. You become the legal and financial partner of all of the other members of the association. That should make you at least a little bit nervous.

Any covenants and restrictions attached to your land are legally binding, and they can't just be set aside - they typically run with the land, meaning future owners are also bound by them. Most HOAs are incorporated, which is a separate issue from the covenants and restrictions. If the HOA owns any common property (streets, land, etc.), then incorporation is a good idea - without it, homeowners would be jointly and personally liable if anyone were injured on the common property and sued. Incorporated HOAs can also obtain Directors and Officers insurance, without which anyone who volunteers to serve on the board would be putting their personal assets at risk in the event of legal problems.

In addition to covenants and restrictions, and any articles of incorporation, your HOA is also subject to any state laws governing community organizations and/or non-profit corporations, as well as applicable federal laws (eg. Fair Housing laws and FTC regulations).

And these are just the highlights...

Anyone can do what they desire. When one is on the board, they must be in compliance with proper procedure.


The answer to one, answers the others.

Keep in mind that there are two associations.
The HOA, which is formed by the deed restrictions (aka covenants)which requires upkeep of common area, provide services, etc.
and
The corporation - HOA, Inc., which is formed by filing paperwork with the State.

What you are discussing is the Corporation being administratively dissolved (likely from failure to file annual reports).
The HOA itself still exists and must comply with the governing documents and applicable statutes.

Unfortunately, not being a corporation removes legal protections from all members.
See: Differences Between Incorporated & Unincorporated HOAs

To dissolve the HOA itself requires:
1) dissolve the corporation
2) Dispose of common area
3) Transfer responsibility for various services (if needed)
4) Amend the deed restrictions (takes 2/3 or more to agree)


Typically, all that is required is filing past annual reports - unless the time lag has been too long.
See: Forget to File Your Annual Report? Need to Reinstate Your Business?


No. You would have to have the deed restrictions changed (see your CC&Rs to identify how to amend).


The HOA continues to operate as it has, in compliance with the governing documents.
Nothing needs to be changed.

HOWEVER, as stated earlier, the owners are at greater risk by not being incorporated.


You may amend the governing documents at any time.
Simply follow the procedures contained within the documents.


It is simply unincorporated.
Everything else operates as it had.

If something happens (say an injury on common area) and legal action is taken each and every member will be served legal notice, each and every member will be required to hire an attorney, each and every member will be required to pay the legal fees.

If you are incorporated, the corporation (i.e. HOA,inc.) would be served legal notice and fight the fight (not each individual owner).

Hope this helps,

Tim

Thank you all for the feedback to my questions.

Best, Thomas.