Do I Even Exist Anymore? The Association…or was it?

I am moving this here because I am completely baffled. As mentioned in the variance post….on my initial overview of this association, we do not have a board of directors. We do have three people that act as a president, vice president and secretary/treasurer. At this point I am wondering if we are using the wrong terms because we just don’t know what we’re doing. Or if we are in a heap of trouble.

We have a gate and roads and common areas that we maintain as a board. Our budget is about $30k for 41 homes. In 2016, the homeowners fired the property management company and decided to self manage. The same person acted as president with a very small handful of people willing to help. Over time my neighbor became the VP and when the president resigned, my neighbor took over and everyone voted at the annual meeting to shift the power from the VP to become the P and the Secretary became the VP. No additional homeowner present at the meeting volunteered. There was a quorum at the meeting. We have a 10% quorum and that was met and recorded at the meeting. Together the board asked me at a board meeting I happened to be attending to be a volunteer as the treasurer because I’m organized and in finance. And I volunteered as what turned out to be a tribute position. Ha!

So here we are…are we directors? Are we officers? Are we both? Are we NOTHING?!?

Max I will totally do that but for the purposes of discussion since we are here already and all in shock and disbelief this is a possibility! Or at least myself in shock and disbelief.

The annual budget is $30k, sorry I missed that.

In the end Max I think I had a poor understanding of the terminology and we have two directors and one elected official (me the official). But will definitely consult with attorney.

I am pretty sure the prior BOD just used the wrong selection when completing the Sunbiz because they shouldn’t have been completing it. Sunbiz is our corporate registration authority where we file annual reports.

I want her to talk to the attorney though for sure just to be sure we do ensure the course is right for this hot mess express.

Yes it is the same agency different state. I noticed when I researched the corporation that all prior president/vice president/secretaries had the D indicator which means Director. In the state of Florida you can be an officer and a Director and it designates that on our corporate annual report.

But I can definitely tell from this forum that I am not the first or the last to screw some stuff up with regard to an association.

Much like Gloria Gaynor, we will survive, but I like to do right by these people. So I will recommend the President pursue this immediately to be sure we are operating in accordance with the AOC and the statutes. Whatever it takes.

I don't know about a heap of trouble, but you do seem to have some confusion which unfortunately is more common than it should be. Hopefully you have copies of the CCRs/Covenants/Deed Restrictions, the corporate bylaws, articles of incorporation, and possibly other docs. You should do your best to read and understand.

You should also read and become familiar with Florida Statute(FS) 720 for HOAs, or 718 if you are a Condo association. FS 617 is general corporate law which also can come into play.

While the exact details should be in the docs, here is how it almost always set up:
1) Members (homeowners) elect the number of directors that the bylaws specify to the board.
2) The board elects people to fill the officer positions, generally from the board members. Your bylaws probably require officers to be directors, but no one here can can say for sure what yours say.
3) Any decisions should be made as a motion at a board meeting, and approved by a majority of the board. The president has no more say than any other board member.

Ideally you would be able to get your board to understand how to operate correctly, but it is more common than it should be to have an autocrat president who thinks he/she is king/queen.

With all of the laws and governing documents involved, Max is right that a good management company can help directors/officers understand what they should be doing.

Good luck in any case.

"While the exact details should be in the docs, here is how it almost always set up:
1) Members (homeowners) elect the number of directors that the bylaws specify to the board.
2) The board elects people to fill the officer positions, generally from the board members. Your bylaws probably require officers to be directors, but no one here can can say for sure what yours say.
3) Any decisions should be made as a motion at a board meeting, and approved by a majority of the board. The president has no more say than any other board member."

________________________________________

OK so the skinny is that our directors are also officers and they vote as a member of the board of directors, not in the capacity as an officer. They just use incorrect terms because we are just a bunch of homeowners trying to self manage. The HOA attorney is aware of our perceived issue and just responded that the BOD is also acting as officers and that it's common in a small development such as our own. They were elected in January as the BOD but didn't understand the importance of being a "Director" as opposed to a "President". Attorney recommends we amend the Annual Report to reflect the President as a Director as intended and leave me as the Secretary/Treasurer (not director) until the annual meeting so that proper election can occur. I was elected as an officer but not as a director. The intent is to vote me on as a director in January unless another person is nominated and accepts the nomination.

In the end, we do exist, and the prior BOD did the best they could self managing and made an error that the HOA attorney confirms can be amended. Pres and VP are Pres-Director and VP-Director.

I'm sorry for all the confusion folks. It's hard to be presented with what appears to be a dumpster fire and then race to put it out only to discover it was a fog machine.

Carissa

Typically a BOD Member must be an owner. Owners vote to elect Members of the BOD (Directors) The BOD then elects Officers from among themselves. Typically all Officers are Members of the BOD (Director) but not all Directors are Officers.
BOD of 5

Jim Smith, President and Director
Sue Jones, VP and Director
Joe White, Treasurer and Director
Ed Black, Secretary and Director
Joan Green, Director

FYI Some Officer positions can be dual. I am VP & Treasurer on a 5 person BOD. A BOD can call for a election of Officers whenever they want to. As I understand it, Pres and Secretary cannot be the same person. Each Director gets only one vote. Typically the BOD will fill any vacancy on the BOD that becomes available such as a Director selling their unit.

We have Jill, President and Director. Karen, VP and Director. Carissa Secretary/Treasurer, was elected as an officer at a homeowner meeting in February after one director resigned.

We don't have any others willing to accept a nomination as director or be elected by a director as an officer.

Our insurance agent just shared with me she has 13 people on the corporate records between directors and officers on one particular neighborhood.

Makes sense Cathy. We have traditionally had three people performing three roles. This is the first year they only had two on the board after the third decided it was not his cup of tea (I think he had a lot of extra curriculars already). I guess I'm a "fill in" but because it must be an election, I'm only an officer. If I make it to the election, I'm troubled on deciding to accept the nomination.

I'm not on record making any votes in 2021.

In the event of a less than full board, the remaining directors can appoint directors to fill the empty positions for the rest of the term. The other two directors could make and pass a motion to appoint you to the empty director position until the next election.

Checked your Bylaws yet, Carissa?

Respectfully, as I’ve mentioned several times since I began posting here we are a very small community with no one willing to step up so we are doing the best we can with the information we have and learning as we go. Is it a fair assumption that we don’t know what we’re doing? Yes which is why we retained an attorney and refer to him as much as we can to make sure that we are doing right by the community. But to keep coming back to me and saying you don’t know enough information to be on the board, yes I know that. We don’t have anyone else. Do you got any ideas to help with that? Homeowners don’t want a PM. They want the board to collect dues and leave them alone.

I’m pretty sure that I have it from here on this particular issue. Thank you everyone for your comments and volunteering helpful information and links and anything that you provided to help me get further to help my community.

NP thanks for your comments. You ALL have been incredibly helpful with your thoughts and opinions and even though I feel like I'm not right for this position because I don't know it well enough, I'm probably the better option over the prior director.

Before a few days ago we were a board of three. Auguie called into questions the titles of the board which sent me off on a rabbit hole because in my capacity as an Officer for several businesses I am NOT a director. I know very well what that means as I've been in this capacity in my employment for a long time. I just didn't realize how that flowed in an HOA. So I had to quickly educate myself and the other two folks on these titles, their importance to making decisions, and how they all came to be. I had to make sure our election was in fact recorded as an election of directors and not officers. It was a lot of work to learn. It's backwards, I'd rather know what I'm doing and not learn as I go. It feels like every time I start to research and look into something, I hit a wall and I discover incorrect policies, procedures, or prior board activities that are not aligned with statutes.

EXAMPLE: Prior Director who acted as President did not pay dues. You can't get paid for this job. Not paying dues is a payment AND it left the remaining homeowners to pay their share. They didn't even get a 1099 for the value of what was effectively compensation.

While waiting for the attorney I pulled out the AOC which references the Bylaws for the Vacancies, and the Bylaws allow the Directors to fill a vacancy. I hope it doesn't cost but a few minutes of his time. I just have been too busy to sit down with this myself. It's like an onion. Get one answer but there's another question under it. Are they Directors? YES. Did they elect me properly? YES. Does that mean I'm a Director? YES.

Sure I can use the term appointed instead, but again that just becomes another exercise in vocabulary. What I'm saying might not be the proper term but it does not mean what happened wasn't proper if that makes sense.

In January, a BOD election was held because one director resigned. We are in the position that the members don't participate and so the board perpetually is the same people until one quits. So in January the directors had the annual meeting and elected a new director in accordance with the bylaws which direct the procedure for an election.

One month later that director resigned. At the next board meeting which I was present as a member, I was appointed by the remaining two directors to fill the vacancy. Directors can elect officers which is why I chose the term elected but elected/appointed they followed the bylaws to appoint a new director to fill the vacancy. ​

Still haven't heard from atty but I expect to get confirmation that I read the bylaws correctly.

It was our Annual Homeowner Meeting where the members were notified via snail mail that the director was resigning and there'd be an election and the HOA was looking for volunteers to be nominated.

We aren't just keeping the same people every year until someone decides to quit because we don't know the rules. We are doing what we can because we have no one else.

Under Florida law, HOA directors are entitled to serve for their term and until their successor is duly elected. If no new directors are willing to volunteer, Florida law permits those people who are already on the board to continue to serve until a replacement steps forward to take their position. We do not go through the formal election process when no one is volunteering for the position.

I'm not saying we don't hold an annual meeting and look for volunteers to serve on the board every single year. I'm saying there are no volunteers so the people on the board agree to stay on the board. When a director says, OK I'm done here, you figure it out...we held the same annual meeting and said, look folks, this director is leaving and we need someone else.

Do you mean to say that you've never had a person on this forum say they've served year after year because no one else will?

Looks like we chased Carrissa off, post count is zero.

Clarissa - Florida requires that HOA board members must take a certification course and submit the certificate. Many of the law firms and management companies offer free online courses. Have you taken one? It might help with some of your questions.

This is from a lawyer in California.

https://www.davis-stirling.com/HOME/Director-Removal-by-the-Board

Removing An Appointed Director. Except for the circumstances described above, a board cannot remove a director it appointed to a vacant seat. An appointed director has the same powers and duties as other directors. An appointed director occupies a seat on the board the same as if he/she had been elected to the board. Accordingly, the removal of an appointed director follows the same process as used for removing an elected director.

Great point by LoriM15. I had completely forgotten this. For the archives, from Florida statutes:

720.3033 Officers and directors.—
(1)(a) Within 90 days after being elected or appointed to the board, each director shall certify in writing to the secretary of the association that he or she has read the association’s declaration of covenants, articles of incorporation, bylaws, and current written rules and policies; that he or she will work to uphold such documents and policies to the best of his or her ability; and that he or she will faithfully discharge his or her fiduciary responsibility to the association’s members. Within 90 days after being elected or appointed to the board, in lieu of such written certification, the newly elected or appointed director may submit a certificate of having satisfactorily completed the educational curriculum administered by a division-approved education provider within 1 year before or 90 days after the date of election or appointment.
(b) The written certification or educational certificate is valid for the uninterrupted tenure of the director on the board. A director who does not timely file the written certification or educational certificate shall be suspended from the board until he or she complies with the requirement. The board may temporarily fill the vacancy during the period of suspension.
(c) The association shall retain each director’s written certification or educational certificate for inspection by the members for 5 years after the director’s election. However, the failure to have the written certification or educational certificate on file does not affect the validity of any board action.
[snip for brevity]

I am sorry CarissaM left.

The opinion stated by the attorney says, except in a few instances, where a director has disqualified themselves, directors can't be removed if they were appointed. They have the same rights as if elected by the membership.

Now, there could be an instance if the governing documents have such a provision, but I haven't seen one.

In what you posted, exactly where does it say a director, if appointed by a board, can also be removed, with or without cause, by a board?

When JohnC made his statement, was he referencing Florida, South Carolina, or just anywhere?

Where???

617.0808 Removal of directors.--A director may be removed from office pursuant to procedures provided in the articles of incorporation or the bylaws, which shall provide the following, and if they do not do so, shall be deemed to include the following:
(1) Any member of the board of directors may be removed from office with or without cause by the vote or agreement in writing by a majority of all votes of the membership.

(2) The notice of a meeting of the members to recall a member or members of the board of directors shall state the specific directors sought to be removed.

(3) A proposed removal of a director at a meeting shall require a separate vote for each board member sought to be removed. Where removal is sought by written agreement, a separate agreement is required for each board member to be removed.

(4) If removal is effected at a meeting, any vacancies created thereby shall be filled by the members at the same meeting.

(5) Any director who is removed from the board shall not be eligible to stand for reelection until the next annual meeting of the members.

(6) Any director removed from office shall turn over to the board of directors within 72 hours any and all records of the corporation in his or her possession.

(7) If a director who is removed shall not relinquish his or her office or turn over records as required under this section, the circuit court in the county where the corporation's principal office is located may summarily order the director to relinquish his or her office and turn over corporate records upon application of any member.