Questions about Bylaws and covenants PLEASE HELP!

Hi everyone! I'm new here to the board and I have several questions.

I live in an assoication with 54 houses and a board that wants to increase our dues. The President and tresurer are husband and wife. And many of us feel that they want to turn our neighborhood into their own little Utopia.

Here are my questions:

1. What's the difference between a bylaw and a covenant? I can't find anywhere where it states that the bylaws can be amended but it says that the covenants can not be change for 40 years from now.

2. Can anyone tell me what this statement means: "The presence of members or of proxies entitled to cast sixty percent (60%) of all the votes of each class of membership shall constitute a quorum. If the required quorum is not present, another meeting may be called subject to the same notice requirement, and the required quorum at the subject meeting shall be one-half of the required quorum."

We have 54 houses in our neighborhood. So does this mean that they need 60% of those 54 houses present in order to vote on something? For many years now, they have not been getting the 60% and they are still taking votes. Is this wrong??? And if it is what can I do to fix it?

3. Several members have asked for minutes, budgets, and the knowledge of why they want to increase our dues. The Board has refused to give anyone anything and blantly said that their request "is denied." The bylaw state that all members have free access to the books, etc. They informed us to come to the meeting and become more involved in the association if we want to know that information. What can I do?

PLEASE HELP!

This board just spent $7000 for new plants at our entrance but now they want to increase our dues for some project.

4. What should we do if we think money is not being spent correctly? A few years ago it was voted to take $5 from each house and create an Entertainment fund. That's $240. They have $400 listed for a Block party and $500 listed for a Children party fund. They are way over the $250. What should I say or do at the next meeting? Or is there anything I can do before hand?

PLEASE HELP!

Thanks for reading so much!

Frustrated in Coventry, RI
Mark

Who says a husband and wife can't serve on the same board - unless the documents definitely forbid it? It's not a good idea of course - especially as president and treasurer, but maybe no one else would run for office. In any event, they each would have a vote on board matters, but only one vote when members are voting. It was the board who elected them to the position of president and treasurer. The board can also remove them from those positions, but not from the board.
They definitely need to be called on their refusal to provide records requested. Perhaps if there are others willing to be board members, the members should recall these two.

HaroldS,
In a condo 1 vote, 1 unit.
This assumption that if an item is not addressed in the Documents, it is alright to do it: is flawed and should not be routinely adopted.

Why? Most associations have units with multiple owners, outside Husband and wife. Vacation homes can be owned by any number of people. Suppose you have one unit in a complex that has 20 units and a board of three. It is certainly not proper to have all the Board members from a single unit.
So to answer your question; "Reason says", only one board member from each unit.

It is also just as reasonable to assume that if the documents don't specify; then it can not be done. But decisions have to be made on what to do because the documents don't specify, reason should prevail, and all ramifications should be considered. If it is done, then the issue and rational has to be approved by all owners. I personally, would never approve of it for any reason. Why we continue to make trouble for ourselves is a mystery.

Mark,
Your question #2 deals with having a Quorum to hold a meeting. It's say you need 60% representation in person or proxies to hold a meeting. If you don't get 60%, then you can adjourn that meeting, open up another meeting and only need 30% to hold a meeting. Me thinks someone has been messing with your documents although not necessarily, stranger things have happened. You need to request from your Board a copy of the original documents and compare them with what you have now. Any difference has to be noted on your present Master Deed as exhibits. You can also go to courthouse and look up your association and all documents on file. You can go to your county courthouse web site and look up specific property information. You should have a copy of any State HOA Laws. Go to State web site and look up business licenses to find out if you are incorporated.
Go to County Courthouse web site and look up Court Dockets, Civil and Criminal to see if your association has been involved in any legal matters.
Same site you can use Names to check this kind of information. This is all public Information and perfectly legal to access.

Gloria and Harold,
I have posted that I understand if a non-member is allowed by the documents, then they can be elected.

In others posts here recently it seems to be suggested if it is not in the documents, then it is ok to do it (whatever "it" may be. I questioned this rational and still do. I also had this issue with RonW I think. He believes that the best qualified person available should be on the Board. For a lot of reasons I don't support this. One reason: Who decides who is qualified? Two reason: A non member should never usurp the right of any owner. I would not like to justify in court that a non-member has more authority than a member.

But, I have a couple questions for you or one to start.

Do you know if there are any requirement (legal) that demands the construction of the original documents of any association has to be done by a lawyer. I know you can amend the documents without a lawyer, and register the changes at the court house. I have looked all over the place and I can't see any mention of who draws up Documents. I understand a lawyer might keep the developer out of trouble and stack the deck, "so to speak", so I don't see anything that requires any original documents to be scrutinized by any State or County, or city official. It looks like they appear out of the blue, trotted down to court house and registered and folks say, "Oh, that's the law," when if fact they are someone's opinion and if legality is questioned it has to be settled by the next judge in line to hear cases, whick means he may not have any special knowledge about HOA's and will try and determine the legality from the wording in the documents.

Any comments? Anyone?

Gloria,
Nicely put and very helpful. I wish somehow some of our powers that are in this HOA mess ()legislatures) could read comments like yours and realize the importance of what you are saying. This kind of structure does no one any good over the long run. Just think how many HOA's are operating on documents completely imadequate to do the job.

Mark, to be official amendments to the CC&Rs must be recorded with your County (or Counties) Clerk and Recorder.

Lee55,

First, put this on a new thread. Go to discussion page and select new topic.

While you are doing this, flesh out your information about your HOA or condo. The more information you supply the more specific the replies will be. Picture yourself reading you entry for the first time and try to imagine how you could formulate a reply based on what you said.

Ellen,
Please note Mark post was written in 2007, not like to be relevant now.

I don't know how or why these old threads keep appearing, but we seem to have a lot of them lately.

Well ... speaking as a member of a 50+ unit community, where the President is my husband and I am the Treasurer, I have to smile at your quandary.

We have never more than the minimum number of nominations to fill the open board positions and the last election looked as if we might have to appoint an outside "agent" to fill one of the spots. Our MC investigated for us, and according to our CCRs, "members, agents, employees, etc" may be on our board. To be a member, you name needs to be on the title of the unit. The MC determined, therefore, that more than one member of a household COULD be on the board. In matters before the board, we can both vote (although in principle we never second each other's motions). In matters before the community, we may only issue one vote. It's all on the up-and-up per our bylaws and might be fine by yours. Depends on the specific text.

2. I read this a little different than the others ... I believe it is 60% of Homeowners who are "eligible" to vote. If your CCRs do not allow delinquent members to vote, I don't think those homeowners should be counted toward quorum. So, instead of 60% of 54 units, it might be 60% of 50 units if you had 4 delinquencies. The next meeting would require 1/2 the original number to meet quorum ... but these restrictions are usually just for member voting, not regular board voting. Often, the board can meet and vote at their regular meetings on things within their rights and it would be fine.

3. Check your bylaws ... our have specific requirements for opening the books and timelines associated with a "written" request. As a board member, you can point out the requirements to the other board members and express their liability for failure to comply.

4. Many HOAs allow the boards to make the budget without approval from the community ... it's one of their jobs. If it is not required that your community approve the budget, then those who are concerned should step up and get on the board to change things ... you can likely also recall board members if you do not feel they are acting with sound interest -- check your CCRs.

While I don't personally think it's a wise expense for an HOA, I believe parties are generally accepted as a community function. However, your CCRs should specifically spell out the responsibilities of the board -- if social functions and the like are not hinted at, you could make a good case against it. At any rate, any function alluding to "family" or "children" should be removed or renamed.

Robert:

I did not mean to suggest that we determined that it was okay simply because the MC said so ... they researched the matter and pointed out the relevant sections in our covenants. The language is very straight forward and clear and was also presented at the time at the meeting. Our governing documents -- and I'm sure many other communities do as well -- allow even for non-homeowners to be on the board.

I do not think it is ideal practice for more than one person from the same household to be on the board and said as much when nominated at the meeting, but I do take slight issue with your statement "on this site when we respond we have to be careful we are not sending the wrong message and someone thinks, why can't I do what they do." To me, the fact of the matter is simply that, you can if your documents support it. If they do, the two people from Mark's community are doing nothing unethical and should not be subjected to the slight suggestion of wrong doing. If their documents support it, they should have no additional scrutiny than any other board member. In the end, they were elected. If their documents do not support it ... that's a different story.

I clearly understand that you are opposed to the concept of multiple members from the same household on the board as well as non-homeowners but I think on this site, we should be careful not to let our opinions cloud the issues presented in the governing documents. In most cases, this issue is addressed in the governing documents by defining who can be elected to the board. If your documents include a group of non-homeowner "members,""agents,""employees" and define what these are, it IS addressed. You may not like it or agree with it ... and then you should work to amend the documents.

Now, not all communities allow non-homeowners on the board. If that is the case, the criteria for board members might be different ... it comes down to what the documents say, not the opinion on the matter.

This is unequivocally logical. Directors can usually be whoever the Members choose to elect. Governing documents often don't even restrict this to Members, and it's also a matter of who is willing to do these chores.

The problem with a husband and wife on the Board is that they will tend to work together in a more or less exclusive manner. Less is obviously better. This can also be true of Directors who are friends or who are more motivated and energetic than others.

It is not necessarily a negative thing, although it can be. It's misconduct for some Directors to exclude others from decisions or relevant information. At the same time, any two people can discuss anything – even if it's Directors discussing HOA business (unless it's in a state that explicitly prohibits this outside of official meetings).

I think it amounts to this -- if some Directors discuss HOA business (let's call it brainstorming) and come to conclusions, then they must inform the other Directors and come to meeting prepared to review the gist of this with those not included in the original discussion and persuade them. They must not simply bring what they come up with to meetings as a done deal, unless the full Board delegated it to them as a "Committee" or group effort.

It's an issue of communication and control. If Members feel a husband and wife (or some good friends) are more likely to control information and decisions and act as an executive committee or "shadow board", then they may prefer to elect other volunteers if such are available. If they feel that this is a couple or a group that will accomplish more and contribute more, then they may elect them. It's a situation that deserves attention, but not a problem that can be reasonably prohibited in Bylaws.

Perhaps the real issue is whether the Members had equal opportunity to vote in election, or if there are enough Members who participate.

Lookit that. I agree with her points and back them up. Then she "completely disagrees" with me and repeats what I said. ;-)

Panties in a twist?

Only if expressly prohibited by the CC&R's or law; as others have pointed out Richard the type of votes that are limited to the one vote per unit are things such as voting for BOD members and amending the CC&R's. The BOD takes care of the day to day operation of the Association, such as enforcing the CC&R's, hiring contractors, seeing that the assessments are collected and the bills paid or overseeing the MC to do these things. Apples and oranges, there are many small and not so small corporations where family members serve side by side on BOD's with no problems.

Richard,

What Glen said, and to put it another way:

If a unit has but one vote, they only get to vote once for their Directors. They (and all the other units) can still vote for anyone they want to have on the Board (insofar as permitted by governing documents and state law). If non-Members are not prohibited, they can vote for people who don't own homes there, if they think such will be good Directors for their HOA. If not prohibited, they can vote for a group of friends, people who present themselves as a "team", a husband and wife, etc.

Each type of group might be a problem, or not. Any individual might be a problem, or not. Any might make particularly good or prolific contributions, or not. All these judgment calls are left to the discretion of the Members when they vote to elect Directors, unless the governing documents or state law has a particular provision.

For this type of question it helps to think of an HOA like a corporation. The Shareholders of a commercial or non-profit corporation get to pick whoever they like as Directors. They may care whether two nominees are married to each other, but this is usually permitted, and they can show how they care by their votes. Nominees may own stock in the Company or not; they are required to disclose, and Shareholders may consider that when they vote. And so on.

An HOA (whether actually incorporated or not) is not entirely like most other Corporations. Most for-profit and nonprofit corporations are national, whereas HOA's are limited to a very small and specific geography. (Some state Corporation laws differentiate HOA's on that basis.) Owning shares in most for-profit corps is voluntary, as is membership in most non-profits; whereas HOA membership is usually mandatory, based on ownership of a home. Many HOA's have a relatively fixed membership up to a few hundred, whereas most other corporations have a fluid membership that can be in the thousands or millions. HOA's are in many respects like local government, where other corporations are not.

But I don't see how these differences pertain to the question of who is allowed to sit on the Board of Directors.

Then I suggest you either change them or put on a larger size.

Michele,

I agree with you. It all depends upon what the docs say; the same with all issues. And, the only improper "appearance" that will exist is in the minds of some members, usually those who are bent on causing trouble and always finding fault with the BOD.

But then, Robert, so is the broad statement that husband and wife on board = bad.

It covers a lot of innocent people, especially given that neither the husband nor wife have done anything yet, other than be married to each other.

The 2007 question re: husband/wife has already been answered and tucked away.

The post was resurrected by LeeS.

LeeS simply wanted to know if it was "legal" for husband/wife to serve as officers on the same board.

Somehow he couched it as a "fairness" issue, to but I won't go there.

It appears the thrust of the responses is, if it's not addressed in the governing docs (two members from the same household restricted from being on the board), then there is nothing "illegal" about it.

Some of us went even further to say that the scenario, in and of itself, is not inherently unethical, improper, unacceptable, etc etc etc.

The only thing that matters is the actual actions and activities of a board member once he/she is on the board, regardless of that person's relationship to other board members.

If the directors or officers start behaving badly/improperly, then vote them off next election.

Or recall them if it gets really bad.

Robert,

I agree there are some members who will complain about something and have a valid complaint. I will also agree that not all boards operate as they should. However, IMO and my experience as an involved HOA member, in many, many instances some HOAs seem to be plagued with members who are only looking for the board to do something wrong. Regarding the issue we have been talking about, if the docs allow it, there is nothing wrong with it. So, IMO, the only people who would see some impropriety in it would most likely be those who are just looking to cause trouble. The majority of HOA members don't even get involved in HOA issues. They are content to just let someone else do all the work.

Richard,
One thing strikes me here. Are you alone in your efforts and how strong is your supporters.
It lookis like the MC is leading the parade. If true that is wrong, the Board leads the parade. Try and ignore the MC company as an adversary. Your fight has to be with the Board, you elected them, you had nothing to do with the management company being hired. If the board goes, so goes the MC.
Another thing is your concerns about legality. Look more to hothe ongoing actions are harming the association. Once you can convince everyone your intentions and devotion is to make the association better, you have a better chance of having some influence.

That is what hampers your efforts now. You can't move anything. You can always take them to court but make that your last choice and don't hide the fact you want a say in your organization and are willing to discuss how to bring chaqnce about and have the capability to share the load.

You and your supporters don't want to get in the position that you win a battle and lose a war, change little by little.

Your questions as posted will reguire legal opinion, which appears to be another fault in your association. MC making policy, lawyers doing day to day business is not good. Your Board needs to take hold and run this show, not the MC or lawyers. Unless they are commiting a felony, legality, push comes to shove, might be determined by a judge. Who knows what he will rule, but probably will favor the most convincing evidence submitted to him.

Look at your documents about the rules for calling an executive session and see if you object , enter your remarks at a Board meeting or certified letter to the Board. Unless your documents specifically state otherwise, I'm guessing who attends that ES is by invite of the President of Board and he has to have reason for anyone outside Board to attend.

Last, you all are in a tough spot with the association apparently supporting legal council all the time. Most associations don't have lawyers on retainer, they used them as needed. So be careful you all are above Board with no personal agenda or vendettas hanging over you. Go slow and build with time. Your special meeting should be the crux to sort out problems and see who is going to far on what side of the fence. I also give my best guess, that you do not have to have MC reps at your meeting, this is a special homeowners meeting, you all called it by your documents and you all can select who runs the meeting, and attends.............that's my guess.

Husband and wife can NOT both be on the board!!!
Linda

Our documents forbid husband and wife both being on the board; yet will allow somebody who doesn't even live here to be on the board. Go figure.
Linda

Richard,
Take your lawyers advice, about how to stay out of court and still get job done. Make sure of your documents and demand to the MC and Board these provision be met. Get a spokesman or two for your group, maybe even set up a website, call it some like United Property Owners, or something, just don't signify it is an official site of association. They apparently are used to pushing you all around, and if so will continue. Develop a thick skin and get your eye on the prize. Select a couple spokespeople for your group and you should be one of them, you have good communication skills.
Make public your groups intent, always include an offer to set down at the table. Right now, get up a mission statement for your group, then, ask your lawyer to construct a letter to the Board, not the MC, and state the demands of the documents about Special Meetings. This has been going on for a long time, no doubt, so there is no urgency to upset the apple cart right yet, work hard, BE SMART, and let your momentum build, do not be defensive or feel you have to explain your actions to them. Always come back to: This is what the documents say. Note that you do not have to please the majority of your members, you have to serve the association, the documents are the way that will allow you to get inside and effect change. Be ready at any given time to take over the association. IF, there is any bad stuff going on, or if the MC and the Board feel threatened, they may cut and run. Let's assume not and they are neighbors (the board yes, the MC no).
Also, remember, what you read on this site is nothing but talk and opinions, especially mine. There are some sharp knives that post here and in my opinion know more association law than anyone I know. They can dig anything out of the laws that make it to publication, ask here for clarification if in doubt. Special meeting requirements for you association are not unique or complicated in my opinion, the Board and MC have no right to stifle the documents. But, so what, you all should resolve you are going to get the job done, preferable with a mutual interest, certainly with the health of the association, long term, your goal.

Michael, Mary posted recently about how many amendments are likely when states pass legislation..........I big bunch if I read her right.

So, I sort of look at association governance as a microcosm of a legislative branch. I think once the requirements of the documents are met as written at the time, you have to follow them. Now, I don't think we can look at our documents as written in stone, believing they certainly are not, I can't say that originals conditions hold priority over amendments.
Situation is, my opinion: There are few associations that have documents that are perfect, and times change and realities change. It is the wise Board that pays attention to this, and any newby Board should not be intimidated by the documents. Make them say what is good for the association above all else and you will make progress. Of course you should not adopt any illegal amendments, and that might change from year to year. Example: Many HOA and condo forbid clothes lines. This is being tested under the "Green Space Legislation" or something like that. But it will come I expect, that provision will have to be eliminated.