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LaskaS (Texas)
Posts: 1,025
Posted:
good evening.

One of the obstacles that homeowners have in holding the board accountable is the unfair playing field where the board is funded by unlimited funds and homeowners have to use their own funds to seek a remedy.

Also, the board with the help of the hoa attorney can choose a very broad or narrow interpretation of the governing documents to suit their desires.

When I have been successful at calling into question the boards initial interpretation of our documents, the board has agreed to consult with our attorney.

The problem is, I have no idea what was asked. how it was asked, what information was provided, and I'm not given access top the attorney's response..

Since attorney communication with the board is privileged, a rogue board can literally say, "we asked the attorney and they said it was fine"

Can I get some feedback. I would like the ammend our documents to reflect something like the following.

Upon petition signed by 10% of the owners, The board must contact the hoa attorney for the purposes of advise and consultation on the matter in question. The owners will submit the the question to be asked of the attorney to the board and the board will submit the question, unaltered, to the attorney. The attorney's response will be shared with all owners.

Or something like this. I think if access to the hoa attorney was available to owners(for the matter submitted on petition) the attorney would truly be giving the answer to the association and thus is more like to act in an advisory role rather than as an advocate following rules of conduct for litigation and adversarial representation.

( excuse me if I got some of the terminology wrong, I'm not a lawyer. Augustine, what do you think? do you like the idea/
MelissaP1 (Alabama)
Posts: 13,836
Posted:
Again the HOA lawyer is NOT your lawyer. It is the HOA's lawyer. It is the board that controls and should control access to this resource/lawyer. It cost MONEY to contact the lawyer. The HOA should ONLY have 1 POC to talk to the lawyer over all. it saves time, money, and confusion.

When I was President it was my job to be that POC to the lawyer. That lawyer also worked for our accounting firm. So sometimes I could go through them to ask the lawyer questions. However, that didn't mean we did not get charged. It was just the bill went to them who passed it on for us to pay.

I don't get what you mean by "unlimited funds". Do not believe that exists other than in one's mind. I am not spending my own personal money on HOA operations. Outside of paying dues or a special assessment, my money isn't HOA's. So I don't get why you put that onto your board members. Think that is a bit fantastical.

Former HOA President
CathyA3 (Ohio)
Posts: 6,299
Posted:
Agree with Melissa.

The HOA attorney cannot talk to homeowners because there is a conflict of interest. Homeowners who want answers to legal questions need to consult their own attorneys.

In addition, corporate governance puts the board in charge, and that includes deciding on spending priorities. HOAs are not democracies, or social organizations. They are corporations, with all of the good and bad that this involves.

It is the nature of HOAs and COAs that they do not have a level playing field. The law has created the uneven playing field, and homeowners need to understand this. If it gravels your butt this much, then perhaps you need to rethink whether or not HOA or COA ownership is for you.
BancsS
Posts: 269
Posted:
Quote:
Posted By CathyA3 on 03/21/2022 6:43 AM
Agree with Melissa.

It is the nature of HOAs and COAs that they do not have a level playing field. The law has created the uneven playing field, and homeowners need to understand this. If it gravels your butt this much, then perhaps you need to rethink whether or not HOA or COA ownership is for you.

Cathy,

This is so true. I have been saying that often. Some people do need to rethink living in an HOA or COA. It's often difficult to find property that is not governed by one.

When I first became a member of an HOA, I ignored some of the bad press given to HOA's. I thought I was a pretty good neighbor, one that follows the rules, and keeps my property up in good condition. I didn't think I would have any problems living in one. I learned a lot in my 13 years of HOA living. And was willing to serve on the Board or become a volunteer. I went through a bad board to a pretty good one during that time. It varies a lot on the personalities of the board members. Unfortunately, it is impossible to determine that when one is buying a property for their homestead. The complexities of laws and the ambiguity found in governing documents add to potential problems.

I agree that individuals should not have access to the HOA lawyers.
JohnT38 (South Carolina)
Posts: 1,631
Posted:
"Upon petition signed by 10% of the owners, The board must contact the hoa attorney for the purposes of advise and consultation on the matter in question. The owners will submit the the question to be asked of the attorney to the board and the board will submit the question, unaltered, to the attorney. The attorney's response will be shared with all owners."

Do you have unlimited funds to spend on lawyer fees?
BenA2 (Texas)
Posts: 1,273
Posted:
The attorney's client is the Association, not the board. There is nothing preventing the board from sharing routine attorney communications with the members, and they should. The only thing they should not be sharing is information that could affect litigation. That is my opinion based on speaking to our attorney and reading articles by HOA attorneys. Of course, that does not solve the problem of your board not being forthcoming.

I do not like your bylaw amendment, especially with a low threshold of 10%. It could be very costly with just 10% of the membership forcing unnecessary legal fees. Your board is elected to make those decisions. If the membership doesn't like the board, vote them out. If the membership is too apathetic to vote them out, you are stuck with a bad board.

I also don't see the point of the bylaw change. Obviously, a board should consider an attorney's opinion when making decisions, but it is not the final say. If you disagree with their opinion, and it affects you, you can challenge it. It makes no sense to have the entire Association pay for each individual challenge. If it goes to court, you can ask the court to award your legal fees but I don't think the Association should pay every time a minority of owners want to challenge the board's opinion.
KerryL1 (California)
Posts: 14,550
Posted:
Agree with Ben.
AugustinD
Posts: 3,698
Posted:
Quote:
Posted By BenA2 on 03/21/2022 8:01 AM
The attorney's client is the Association, not the board.
I agree. Though as I think BenA2 and Kerryl1 know, but just to get reality in writing here, of necessity the Board often is the voice of the Association.
Quote:
Posted By BenA2 on 03/21/2022 8:01 AM
There is nothing preventing the board from sharing routine attorney communications with the members, and they should.
I would say that sometimes a Board's sharing attorney communications might be prudent under some circumstances.
Quote:
Posted By BenA2 on 03/21/2022 8:01 AM
The only thing [the Board] should not be sharing is information that could affect litigation.
In addition and IMO, the Board should not be sharing with the owners any communication from the attorney on any topic that could lead to litigation. And the latter is the rub: Almost anything could be said to potentially lead to litigation.

As others have pointed out, an owner in a COA/HOA with an apathetic membership and rogue board is stuck with the usual options: Lawyer up and spend a fortune; move; accept the reality of the apathy.

Accepting that so few are interested in xyz is hard.

Lastly, to me it seems likely that no way would a majority of the owners at this COA vote for such a bylaw amendment. I would rather spend my time communicating with owners about concerns and so campaigning to change the board makeup at the next election.
AugustinD
Posts: 3,698
Posted:
Quote:
Posted By LaskaS on 03/20/2022 10:03 PM
Augustine, what do you think? do you like the idea/
For the record, before reading BenA2's post and KerryL1's assent to Ben's post, I was going to say that I do like the idea but think the threshold has to be higher. But then BenA2's comments reminded me of a few things. (I know CathyA3 knows these things well, but I think BenA2 said it a bit better.)

Given the ugliness and quantity of HOA/COA disputes reaching the courts, I do not think the following is too pie-in-the-sky.

In another thread, and a bit in the vein of the thread herein, LaskaS spoke of a new model where every HOA/COA would be required to hire, perhaps only part-time, an in-house arbitrator or mediator. The arbitrator or mediator would have an attorney's license but would not have a client per se. The arbitrator or mediator's opinion would not be binding on the board. But said arbitrator or mediator would offer her or his opinion on the law and so perhaps keep disputes from getting ugly. The arbitrator or mediator's client is, get this [wink] the covenants, state and federal statutes, case law and the facts (as best the facts can be understood). This is who the client is for a district court judge, right?

If for nothing else, I am posting this to encourage board directors to also be loyal to the covenants, state and federal statutes, case law and the facts. When one takes one's ego out of disputes; just let's the covenants et cetera speak for themselves (possibly with some input from the HOA/COA attorney); is open to having one's mind changed, in my experience the effect is calming. Or at least one ends up more calm than if one injects one's ego (said ego typically being a psychological menace) into a dispute.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
I agree with what most have said especially the 10% threshold being so low. What a shit show that could be meaning a lot of questions. Laska has to remember the attorney fees that could be accumulated. If Laska wants legal opinions, hire yoour own lawyer. Get a group of like thinkers to fund this.
BancsS
Posts: 269
Posted:
Quote:
Posted By AugustinD on 03/21/2022 9:37 AM
Posted By LaskaS on 03/20/2022 10:03 PM
Augustine, what do you think? do you like the idea/
For the record, before reading BenA2's post and KerryL1's assent to Ben's post, I was going to say that I do like the idea but think the threshold has to be higher. But then BenA2's comments reminded me of a few things. (I know CathyA3 knows these things well, but I think BenA2 said it a bit better.)

Given the ugliness and quantity of HOA/COA disputes reaching the courts, I do not think the following is too pie-in-the-sky.

In another thread, and a bit in the vein of the thread herein, LaskaS spoke of a new model where every HOA/COA would be required to hire, perhaps only part-time, an in-house arbitrator or mediator. The arbitrator or mediator would have an attorney's license but would not have a client per se. The arbitrator or mediator's opinion would not be binding on the board. But said arbitrator or mediator would offer her or his opinion on the law and so perhaps keep disputes from getting ugly. The arbitrator or mediator's client is, get this [wink] the covenants, state and federal statutes, case law and the facts (as best the facts can be understood). This is who the client is for a district court judge, right?

If for nothing else, I am posting this to encourage board directors to also be loyal to the covenants, state and federal statutes, case law and the facts. When one takes one's ego out of disputes; just let's the covenants et cetera speak for themselves (possibly with some input from the HOA/COA attorney); is open to having one's mind changed, in my experience the effect is calming. Or at least one ends up more calm than if one injects one's ego (said ego typically being a psychological menace) into a dispute.

I like the idea of a mediator/arbitrator. I found it particularly difficult to deal with a small, self-managed HOA with long-term board members. Egos can certainly be a big factor in how a board makes decisions. With such a small group, it's hard to change perceptions about an owner that has had a major dispute with them. One gains a reputation as a troublemaker or a kook. I don't think an attorney will be completely objective because they want to make money. A mediator or arbitrator has no skin in the game so perhaps would be more objective. It could save both parties money and the bad feelings that go along with disputes.
CathyA3 (Ohio)
Posts: 6,299
Posted:
My main issue here is the same as it is for any provision that allows homeowners to override board decisions:

Board members have a fiduciary duty to act in the best interests of the association, and there are already mechanisms in place for dealing with board members who don't. The board is accountable.

Homeowners have *no* duty to act in the association's interests. They may act in their own self interest even if that interest is harmful to the association, and there are no mechanisms in place to correct this. Homeowners have zero accountability other than what's in the CC&Rs.

In addition, board members are often privy to information that homeowners don't have. Any decision can seem easy if you eliminate essential pieces of input.

This is what corporate governance looks like. It's not a perfect system by a long shot, but it's certainly possible to make it worse.

It seems counterproductive to force associations to spend more time and money to get legal opinions that, yes, this is going to blow up in your faces if you try it, that's why the board isn't considering it, but thank you for the billable hours.

LaskaS (Texas)
Posts: 1,025
Posted:
i guess i wasn't clear.

The reason i'm looking for some solution regarding access to the associations attorney is because time and time again, the board has made a mistake regarding who is responsible for what. and or, just lazy board members not wanting to get the actual correct answer and they make a decisions on what they think sounds right.

for example. the 5 vs 4 seats up for election this year. this had a single answer. i was able to find numerous references and emails that would have had 5 seats up for election this year.

the managing agent was to create a story that was impossible to follow and it involved making several assumptions along the way,,, only then did he come up with an explanation for saying there were 4 seats.

the attorney would have been paid to look at all the data and provide the answer. ..

another example. after hurricane harvey.. the board at the time decided to use common funds to mold treat inside all downstairs units.

According to our declaration, this is the responsiblity of the individual owners. The association can require that a unit owner perform the treatment and get documentation supporting it. but they can't use common funds just becasue they want to make sure everyone does it correctly.

This resulted in everyone upstairs subsidizing all of the downstairs unit owners. The inside of a unit is not common area. Not treating the unit for mold could result in damage to the other units. this is why the board has the authority to insist the treatment be done. however. there's a big difference between insisting each unit get it done, and using common funds for work done on the behalf of individual owners.

in the second instance. myself and another owner both vehemently objected and pointed to the declaration and our own attorney's responsiblity chart. the board willfully ignored the chart and declaration and chose to utilize the phrase"the board can do all such things that it reasonably believes are in the best interest of the association"

the part they forgot was, within its authority and without contradicting the governing documents.

If owners could have forced the board to get the attorney's advice. and if owners had been permitted to submit the wording of the question without being edited. the attorney would have given the board the chart previously showing who is responsible for what and then she would have advised the board that the board has no authority to use common funds for an owner responsiblity, even if they do think it's a good idea. Its not authorized. regarding the threshold... ok if 10% is too low, maybe 20%.. that means 20% of owners would have to agree to spend association funds (our funds) to get the attorney to clarify the correct interpretation of our documents. 20% of owners are not going to agree to use association funds for questions that are frivolous.

The board having the lock and key to the common funds is at issue. The current board has spent thousands of dollars consulting the attorney over the past 3 years trying to use the litigation to prevent owners from speaking up and exposing what was going on.

LaskaS (Texas)
Posts: 1,025
Posted:
yes it can get expensive. so the outcome the owners are seeking clarification no would have to justify the expense.

our annual budget is 1.3 million.
of that, approx 300,000 is budgeted for ongoing maintenance and repairs of the property.
i'm not talking capital improvements. i'm not talking utilities, or insurance or reserves. I'm talking yearly ongoing preventive maintenance for 24 buildings .

for the past 3 years. less than 150,000 was spent on maintenance and repairs each year. This is why i'm so mad. I'm not saying i think the association should spend 300,000 a year. i'm saying. the board is the one who came up with the budget, that's how the maintenance fees are determined each year. And the board has not ensured that the preventive and regular maintenance issues are getting done. They aren't getting done. emergency repairs are getting done, and bare minimum landscaping and road upkeep.
MelissaP1 (Alabama)
Posts: 13,836
Posted:
How expensive do you think maintenance should be or the emergency repairs? Look at Surfside. How much money did you think fixing that leak at the pool would have cost in maintenance?

I think you are not aware of what things costs. What you have quoted sounds pretty much on par on what it would cost for maintenance items.

Former HOA President
JohnT38 (South Carolina)
Posts: 1,631
Posted:
Quote:
Posted By MelissaP1 on 03/22/2022 4:31 AM
How expensive do you think maintenance should be or the emergency repairs? Look at Surfside. How much money did you think fixing that leak at the pool would have cost in maintenance?

I think you are not aware of what things costs. What you have quoted sounds pretty much on par on what it would cost for maintenance items.



LaskasK said, "And the board has not ensured that the preventive and regular maintenance issues are getting done. They aren't getting done. emergency repairs are getting done, and bare minimum landscaping and road upkeep."

Melissa, how is it that you are up to speed on what the preventive/regular maintenance needs are in LaskasK's community? How did you arrive at your conclusion that the money spent was adequate?
MelissaP1 (Alabama)
Posts: 13,836
Posted:
From Laska other posts over time it has added u. This is not their first post about complaining about projects not getting done or costing this and that

My electrical system got hit once at my house. Could you tell how much had to spend to fix it by looking? It was $6K. All you can see is the lights working.

Former HOA President
AugustinD
Posts: 3,698
Posted:
Quote:
Posted By LaskaS on 03/21/2022 8:20 PM
The board having the lock and key to the common funds is at issue.
State statutes and the COA's governing documents give the board this authority. Short of amending state statutes, your only recourse is by electing new directors. You do not have the support at present to do so.

If an owner is talented at communicating and either (1) has a flawless record when claiming this or that law or covenant is violated; or (2) at least admits they have made their own mistakes with regard to state statutes and the covenants, then I think the owner's time is best spent in a massive communication campaign.

CathyA3 (Ohio)
Posts: 6,299
Posted:
Quote:
Posted By LaskaS on 03/21/2022 8:20 PM
... snip ...

The board having the lock and key to the common funds is at issue.

This is how HOAs/COAs work. It's how corporations work.

You don't have to like it. You can spend your time banging your head against the wall of corporate law. Or you can understand the law and figure out a productive way to work within it. Or you can walk away (and probably be a lot more content with your life). But the law is not going to change because you don't like it.
MaxB4
Posts: 3,513
Posted:
Quote:
Posted By MelissaP1 on 03/21/2022 4:20 AM
Again the HOA lawyer is NOT your lawyer. It is the HOA's lawyer. It is the board that controls and should control access to this resource/lawyer. It cost MONEY to contact the lawyer. The HOA should ONLY have 1 POC to talk to the lawyer over all. it saves time, money, and confusion.

When I was President it was my job to be that POC to the lawyer. That lawyer also worked for our accounting firm. So sometimes I could go through them to ask the lawyer questions. However, that didn't mean we did not get charged. It was just the bill went to them who passed it on for us to pay.

I don't get what you mean by "unlimited funds". Do not believe that exists other than in one's mind. I am not spending my own personal money on HOA operations. Outside of paying dues or a special assessment, my money isn't HOA's. So I don't get why you put that onto your board members. Think that is a bit fantastical.

So, if the association had a legal issue with your bookkeeper, who would the lawyer represent in the dispute?

Never, ever a good idea in that sort of relationship.
MelissaP1 (Alabama)
Posts: 13,836
Posted:
Did not represent the bookkeeper per se. It was a lawyer they used to file our liens or foreclosures. We could use any lawyer we wanted and we did. He just also worked with them as well.

Former HOA President
MarniD (Florida)
Posts: 39
Posted:
I have been to mediation, YOU DO NOT NEED A LAWYER TO GO. Do it on your own. You file the necessary papers, the HOA must go, they have no choice, then you both choose the mediator and then that mediator presides over the hearing. You are in one room, they are in another, you state your case, they bring it to the HOA, they say what they think, and the mediator then gives you both the information and what either side is willing to do. Our lawyer in our mediation was mostly silent as we presented the case. End result was nothing was accomplished, but it cost me $3K to get nothing. Avoid the lawyer, the fees for the mediator is about $300.00 per hour and on average it takes about 2 hours if that. Good luck

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