Texas Condo Held in Family Trust Voting Rights and Eligibility to Serve on Board

We have a mother and her adult son living in 2 separate Condominiums. Both are held in a Family Trust with Mom (late 70’s) as Trustee and son (52 with criminal record and mental issues) as beneficiary. According to the Mom, the son is now an owner because he paid off the loan on “his” unit. I believe the loan was in Mom’s name. Mom insists her son is now the owner or the unit. As an owner he could sit on the HOA Board, and/or vote in elections. I believe he would only be able to vote if given a Power of Attorney by the Trustee and is completely ineligible to run for the Board. Can someone please confirm? What are the rights of this beneficiary? Texas and Florida have polar opposite laws, it seems. Thanks!!

Adding to what Bill said, the trust is the owner of both homes. It does not matter whether the son has "paid off" a loan or anything else.
The only way the son could become an owner would be to dissolve the trust and put the house in son's name, and the legal in's and out's of that are way above my pay grade. So I assume that argument is out the window.

For what it's worth, we had a similar thread recently where an owner tried to pass on his seat on the board via power of attorney. As I recall, power of attorney would only apply to rights that an owner has as an owner, and no one owns his seat on the board - the owner only has a right to seek election to the board, and if the membership doesn't vote for him, end of story.

If I had to guess, I would say that a POA does grant sonny boy the right to run for election, but it would take a POA - just being a beneficiary of the trust would not. It is similar to a condo being owned by another non-person legal entity such as an LLC. The LLC may appoint an agent to act for it, and the agent may vote and serve on the board (unless governing docs and state law say otherwise.)

The answer may boil down to whether a trust is different in some way from an LLC, or if a beneficiary of a trust could be prohibited from acting as an agent of the trust (I can see the possibility of conflicts of interest in there, or the possibility of a beneficiary exerting undue and inappropriate influence).

I agree with Bill's recommendation to see a lawyer.

Ownership of real property can be complicated and a trust can make it more complicated. I would think that no one can answer the question of the son's ownership without knowing exactly what the trust says. I don't know, but I would guess trusts are not public record and they would not have to give you a copy.

It seems to me that this might be a battle that is not worth fighting. It sounds like the son is going to be owner eventually anyway. I would be inclined to accept their word that he is the owner unless someone is challenging it. If the HOA is like most, there is only one vote per unit so that shouldn't be an issue.

I would definitely consult with an attorney before taking any action.

The real issue is that they are bad actors but the kind of folks who always have a big smile for you. The mom while on the board sneak thousands of dollars into the budget, without motion or discussion for landscaping or other projects and then assign the work to her son. If that’s not bad enough he would buy supplies, get reimbursed by the HOA and then return the items for cash. Then there’s the “repairs” done to mom’s condo on the HOA’s dime. I could go on but won’t. In theory all is good but in fact we’re dealing with grifters.

Yes. At that time both she and I were on the Board. Our treasurer and the Management company could not reconcile the budgets they each prepared. I was President and tried to get someone to get us a budget to look at. Mom started arguing that we had an approved budget. I had carefully reviewed our minutes that documented every delay in obtaining a finalized proposal and the tabling of any vote. I wondered why Mom would make such a fuss so I got the latest proposed budget and saw that there was an $8,000 allocation for “additional landscaping.” It seems the treasurer added it at Mom’s request. We’re an old property with deferred maintenance out the wazoo such that this expenditure was ludicrous. At the next board meeting, I moved, to remove that allocation and my motion carried. Mom later said she thought no one would notice the expenditure and Son told me that Mom came home from the Board meeting and told him that he didn’t have the landscaping job. Mom and son are door knocking proxy hoarders. Son used to dance in gay bars and has personal relationships with coco’s full of gay men.

I expanded the issue and what is stated is true even though you may be reading too much into the phrase “personal relationships.”

Gathering proxies is perfectly legal and a common practice for those who are seeking election to the board. It may look "funny", but unless your state or governing docs put limits on the use of proxies, this tells me these two are effective politickers and the rest of the community is going to have to up their game.

Possibly/probably (also by IANAL). :-)

As I mentioned earlier, I do wonder about allowing a beneficiary to act as an agent of the trust - possible conflicts of interest or undue and inappropriate influence that may run counter to what the trustee(s) want. Definitely a question for a real lawyer who deals with trusts.

Too many unknowns. Lawyer time.

Thanks! Sent a request for an attorney’s opinion letter today. Doubt they will follow through. These property management companies really don’t care.

Hi. I requested that the BOD get an attorney’s opinion letter based on the potential for liability if the beneficiary asserts rights he doesn’t have. He could not only cause harm to the HOA as well as to other beneficiaries of the trust. It’s hard when you have grifters living on the property.