Board Member/President Not Paying Dues

Started by RoxanneG • 19 replies • 1162 views

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RoxanneG (Washington)
Posts: 20

Posted:

Hi,
The story is long, so I will jump towards the end. Our president/board member was not happy that we hired an agency to collect dues and maintain our financial records. He had been "doing the books" for several years, but had no formal experience with this, and many RCW and other legal violations occurred while he was volunteering his time to this. Well, he has not paid his HOA dues for an entire year. He will not be voted out because there are no owners who care, plus most of them don't want to pay dues either.
Do you have any other suggestions?
Thank you.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

Easy... Place a lien on him. Done.

Former HOA President

MaxB4
Posts: 3,513

Posted:

Quote:

Posted By MelissaP1 on 03/15/2021 2:27 PM
Easy... Place a lien on him. Done.

NO! Send the president to a collection agency, preferably a lawyer. Make sure it is done proper with a Board vote.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Rox

Let us start with are you on the BOD?

MelissaP1 (Alabama)
Posts: 13,836

Posted:

A collections agency? Bad idea. This is a lien situation when it comes to unpaid dues. Has more teeth and less expensive. Plus it accumulates.

Last I checked a HOA has no right to one's social security #. A lien doesn't require that information to file. It's against the property not the person.

Former HOA President

RoxanneG (Washington)
Posts: 20

Posted:

There were 5 board members with staggering term limits. Two board members' terms expired last March, my term expires this month. His term and one other board member's term expire next year, but one of these members has been out of the country for over a year and has not had correspondence with us.

MaxB4
Posts: 3,513

Posted:

So, please explain the benefits of a lien when the person is the Board president? We'll collect when they leave in four or five or twenty years.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By MelissaP1 on 03/15/2021 2:34 PM
A collections agency? Bad idea. This is a lien situation when it comes to unpaid dues. Has more teeth and less expensive. Plus it accumulates.

Last I checked a HOA has no right to one's social security #. A lien doesn't require that information to file. It's against the property not the person.

I agree with an HOA has no right to a SS. Collection attorneys how ever have ways of filing on Credit Reports so as a threat, it is a valid one.

BenA2 (Texas)
Posts: 1,273

Posted:

Quote:

Posted By MaxB4 on 03/15/2021 2:38 PM
So, please explain the benefits of a lien when the person is the Board president? We'll collect when they leave in four or five or twenty years.

Liens are relatively inexpensive and easy. They usually are attached to the property so even if someone sells without going through a title company, they remain with the property until paid. It sometimes can take years to collect the money but not always. If the owner wants to get a home equity loan or refinance, they have to pay the lien first. The person being board president is irrelevant.

MaxB4
Posts: 3,513

Posted:

Quote:

Posted By BenA2 on 03/15/2021 3:41 PM

Posted By MaxB4 on 03/15/2021 2:38 PM
So, please explain the benefits of a lien when the person is the Board president? We'll collect when they leave in four or five or twenty years.

I know exactly what a lien is and how to place one on a property. Done it many times. This is the Board president for gods sake.

KerryL1 (California)
Posts: 14,550

Posted:

Roxanne, how many residences in your HOA?

Are the two directors whose terms expired a year ago still serving as directors? All you still serve when your term expires? It's confusing because you make it sound as if you have no annual elections.

So please tell us: How many directors do you have physically present on the Board right now. You? The prez? Any others?

Do you Bylaws permit your Board to declare the seat empty of the director who's been absent (and silent) for a year?

If you have enough active directors, you can vote to remove the prez from that office. He'd still be a director though.

Why did it take a year to find out the prez isn't paying dues? Doesn't you Board review the financials each month? Are they paid annually? Monthly? Or?

MichaelS56 (Minnesota)
Posts: 858

Posted:

Do the other owners know the President has determined not to pay any of the monthly assessments? If not they should be told.

BenA2 (Texas)
Posts: 1,273

Posted:

I'm sorry if I offended you. You asked, "please explain the benefits of a lien when the person is the Board president?" I was only trying to answer. I am also a board president and I promise you that if I stopped paying my dues, a lien would be placed on my property.

RoxanneG (Washington)
Posts: 20

Posted:

Other owners do not know this about the president.

RoxanneG (Washington)
Posts: 20

Posted:

There are 15 units and we do not hold annual elections. The president does not call meetings, and now with covid, I don't know how we would have a meeting anyway. I pushed for hiring an outside agency to collect our dues. She has been helpful, but not great. She has straightened out our books, but hasn't gone after non-dues payers yet. She said she would, but I don't know what that means.
The people who serve on the board do not read what is expected of them. They are all passive. There is no mention about removing board members who have been inactive.
How would I go about telling the other owners? We have kept past due accounts confidential among Board members.

MaxB4
Posts: 3,513

Posted:

Quote:

Posted By BenA2 on 03/15/2021 4:48 PM
I'm sorry if I offended you. You asked, "please explain the benefits of a lien when the person is the Board president?" I was only trying to answer. I am also a board president and I promise you that if I stopped paying my dues, a lien would be placed on my property.

If you were the president of my association and you didn't want to pay your dues, you would not be serving very long. Whatever it takes to have you removed.

TimB4 (Tennessee)
Posts: 21,059

Posted:

The board should take action just as they would for any other member who is behind paying assessments. It's simply not relevant that they were or were not serving on the board.

Typically an action would include:

1) Letter specifying that the Association records do not show assessment payments for mm/yy to mm/yy totaling $xxx.xx. Explain that it's possible the records are in error and if payments were made to please provide proof (cancelled checks, etc.) so the records can be corrected. If payments were not paid, please pay in full by mm/dd/yyyy to avoid late charges and penalties.

2a) If they respond work with them (payment plan, etc.).

2b) No response, turn the issue over to the attorney for collection efforts along (courts, leins, etc.)

I expect that when you specified hiring an agency, you mean similar to a bookkeeper, cpa or management company to process assessment payments and maintain the books.

MaxB4
Posts: 3,513

Posted:

Quote:

Posted By TimB4 on 03/15/2021 7:45 PM
The board should take action just as they would for any other member who is behind paying assessments. It's simply not relevant that they were or were not serving on the board.

Typically an action would include:

1) Letter specifying that the Association records do not show assessment payments for mm/yy to mm/yy totaling $xxx.xx. Explain that it's possible the records are in error and if payments were made to please provide proof (cancelled checks, etc.) so the records can be corrected. If payments were not paid, please pay in full by mm/dd/yyyy to avoid late charges and penalties.

2a) If they respond work with them (payment plan, etc.).

2b) No response, turn the issue over to the attorney for collection efforts along (courts, leins, etc.)

I expect that when you specified hiring an agency, you mean similar to a bookkeeper, cpa or management company to process assessment payments and maintain the books.

And he will veto sending himself to a collection agency.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Max.

It typically doesn't work that way in an HOA.

The President of the board doesn't have veto powers.
They are only one vote.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

A President or any other officer isn't above paying their dues. My vice-president stopped paying his out of some kind of "protest". We had a 6 month we lien policy. Which once he hit 6 months we have forced a lien on him.

Just because your an officer doesn't make you exempt from paying dues or being forced to. Liens are your best bet to collect.

Former HOA President

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