Fraudulent Board of Directors Meeting

WalterM3 (Georgia)
Posts: 442

Posted:

Hi,

I went in June to our annual HOA meeting. We have 250 units. Seventy-five units voting make a quorum. So I signed in and was given a ballot for the Directors election. There were 8 candidates for 7 positions. The ballot had the candidate 8 names, pick 7. The ballot also had a line where you had to list your address. So it wasn't a secret ballot. I started to leave because I thought that it ought to be a secret ballot. But I decided to stay and vote. The election was held and new directors seated.

Time passes as happens, and I was asked a question by a neighbor that sent me to the HOA Bylaws. Checking the Bylaws I found that a secret ballot for directors was not only a "nice to have" it was required by the Bylaws:

"Nomination and Election of Directors. Election to the Board of Directors shall be by secret written ballot cast at the annual meeting, unless dispensed with by unanimous consent of those present at such meeting. At such election the Members or their proxies may cast, in respect to each vacancy, as many votes as they are entitled to exercise under the provisions of the Declaration. Directors shall be elected by a plurality of the votes cast. Cumulative voting shall not be permitted."

So my questions for the group are:

1. Is the Board seated fraudulently?

2. What should be done now?

SheliaH (Indiana)
Posts: 6,964

Posted:

The address shouldn’t have been put on the ballot – I suspect it was there to check to ensure the people casting votes were actual owners. However, it would have been better to have some sort of sign-in sheet where you could write your name and address, and then get a ballot. In my community, we use a pre-printed owner’s list, so you find your name, sign and date it. If you sent a proxy and then decided to show up in person, the proxy is cancelled and you vote as usual.

You really should have asked about this at the time you got the ballot or at least during the resident forum, if there was one (preferably before the election was conducted). But since you didn’t, you could talk to a private attorney about the legality of this board because we aren’t attorneys, but before you do - have you asked the board why the ballots were written this way? If not, why not? If you did, what was the response? You may want to have some neighbors come to the meeting with you when you bring this up – their response might determine your next move. They may hold another election or let this election stand – if that’s the case, they should explain what happened and why apologize for not ensuring secrecy and ensure this is fixed for the next election.

As a practical matter, I would opt to leave the vote as is unless there was evidence of major fallout, like ineligible homeowners (due to delinquencies) signing in under a neighbor’s address to vote (with or without permission) or if someone faced some sort or retaliation because he/she didn’t vote for someone on the ballot. I can’t imagine what that would be, though – maybe deny an exterior change request or start sending a bunch of CCR violation notices? Even then, you’d have to prove cause and effect, which might not be easy.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

WalterM3 (Georgia)
Posts: 442

Posted:

Thank you. They've checked people in on a list in the past, checked eligibility to vote (paid up in dues etc.) and then you were given a ballot that allowed for secrecy.

I don't know if this was an oversight or what. But it seems like the Board couldn't take any legal action against any home owners under these conditions.

BillH10 (Texas)
Posts: 1,217

Posted:

Sheila, in Texas owners must sign their ballots and write in their address or the ballot cannot be tallied.

We fold the ballots in such a way those counting the ballots cannot see the signature or address when counting the votes.

I have no knowledge of Georgia law or HOA practices, it would be best if the OP conducted research into what GA requires and allows.

MaxB4
Posts: 3,513

Posted:

Quote:

Posted By BillH10 on 08/08/2022 11:11 AM
Sheila, in Texas owners must sign their ballots and write in their address or the ballot cannot be tallied.

We fold the ballots in such a way those counting the ballots cannot see the signature or address when counting the votes.

I have no knowledge of Georgia law or HOA practices, it would be best if the OP conducted research into what GA requires and allows.

Bill,

What you describe is not voting by secret ballot, which is required per the OP's Bylaws.

BillH10 (Texas)
Posts: 1,217

Posted:

Max, yes, so it seems. I fully expected massive pushback, there has been none in the associations we manage or in the one in which we reside.

The legislative mandate a few years ago which requires the ballot to be signed de facto eliminated any language in association documents regarding secret ballots.

I don't pay much attention to the machinations in Austin so I don't know why the signature requirement was mandated. Obviously someone's ox was gored and they had enough horsepower to influence their legislator to require the change.

WalterM3 (Georgia)
Posts: 442

Posted:

The Bylaws pretty clearly state that Directors will be elected by secret ballot. I couldn't find that secrecy requirement in the Georgia Code. But the ballots that were used had a space for the street address, which gives up the home owners identity. So the whole thing looks invalid to me. I appreciate everyone who leaves a response.

WalterM3 (Georgia)
Posts: 442

Posted:

The Bylaws pretty clearly state that Directors will be elected by secret ballot. I couldn't find that secrecy requirement in the Georgia Code. But the ballots that were used had a space for the street address, which gives up the home owners identity. So the whole thing looks invalid to me. I appreciate everyone who leaves a response.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Invalid, I doubt it. Not done "properly, maybe.

MaxB4
Posts: 3,513

Posted:

If done in that manner in California, it would have been invalidated.

DouglasK1 (Florida)
Posts: 2,046

Posted:

Quote:

Posted By MaxB4 on 08/08/2022 1:27 PM
If done in that manner in California, it would have been invalidated.

Just curious, what would be the actual procedure to invalidate the election? Is there a state agency in CA that enforces, or would one or more owners need to bring legal action?

Escaped former treasurer and director of a self managed association.

DouglasK1 (Florida)
Posts: 2,046

Posted:

Quote:

Posted By MaxB4 on 08/08/2022 1:27 PM
If done in that manner in California, it would have been invalidated.

Just curious, what would be the actual procedure to invalidate the election? Is there a state agency in CA that enforces, or would one or more owners need to bring legal action?

Escaped former treasurer and director of a self managed association.

KerryL1 (California)
Posts: 14,550

Posted:

Disagree with JohnC. "Not done properly. Maybe" is far too lenient to the Board. The Bylaws are clear.

While I don't agree with the OP that the election meeting was "fraudulent," I do think the results would be invalid. But now, a few months later, what do you think should be dome, Walter? And how would you do it?

I don't think it's worth legal fees, etc., to try and "overturn" the results. I think I'd just let it be but make sure that the next election is done per your Bylaws and GA state codes.

Were you, by chance, the 8th candidate? Do directors only serve for one year? And that's why there were 7 vacancies? Have you, by chance been shared with an alleged violation by this Board?

MaxB4
Posts: 3,513

Posted:

Quote:

Posted By DouglasK1 on 08/08/2022 1:41 PM

Posted By MaxB4 on 08/08/2022 1:27 PM
If done in that manner in California, it would have been invalidated.

Just curious, what would be the actual procedure to invalidate the election? Is there a state agency in CA that enforces, or would one or more owners need to bring legal action?

https://www.davis-stirling.com/HOME/S/Small-Claims-Challenges

WalterM3 (Georgia)
Posts: 442

Posted:

Kerry,

For it to to be fraudulent then the Board of Directors/attorneys didn't follow the Bylaws on purpose. And I think that is what happened. The Board recently wanted to do a $25,000 project and replace the mail kiosks. They are just having a power trip.

I don't plan to go to th courts and have the election declared invalid. I would just say that if this Board attempted any legal action against a home owner that home owner could file a motion to dismiss based on the clearly invalid way the election was held.

Thanks for your response.

WalterM3 (Georgia)
Posts: 442

Posted:

Kerry,

I was not a candidate. When I saw the ballots had a place for one to put their street address, I started to leave. Now I am glad that I stayed for the whole meeting.

WalterM3 (Georgia)
Posts: 442

Posted:

Quote:

Posted By KerryL1 on 08/08/2022 1:41 PM
Disagree with JohnC. "Not done properly. Maybe" is far too lenient to the Board. The Bylaws are clear.

While I don't agree with the OP that the election meeting was "fraudulent," I do think the results would be invalid. But now, a few months later, what do you think should be dome, Walter? And how would you do it?

I don't think it's worth legal fees, etc., to try and "overturn" the results. I think I'd just let it be but make sure that the next election is done per your Bylaws and GA state codes.

Were you, by chance, the 8th candidate? Do directors only serve for one year? And that's why there were 7 vacancies? Have you, by chance been shared with an alleged violation by this Board?

Well, thereby hangs a tale. The directors serve 3 year, staggered terms. So 2 or 3 drop off every year. So only 2 or 3 seats should have been open. To put all 7 seats up for grabs looks like the "fix" was in. There was one candidate they wanted to get on the Board and the only way to do that was to have all 7 seats available. That's what I think.

KerryL1 (California)
Posts: 14,550

Posted:

Can you state the wording in your Bylaws about staggered terms, Walter? From what you just wrote, it seems the election also was invalid because the staggered terms bylaws wasn't adhered to.

Doesn't your property manager have any input into the election procedures? Does the HOA's attorney attend?

WalterM3 (Georgia)
Posts: 442

Posted:

Wow. I didn't thnk of this per se but something is definitely rotten here.

"Term of Office. Each director shall be elected to serve a term of three (3) years. The terms of the directors shall be staggered such that the terms of no more than three (3) directors shall expire in any given year. Directors shall hold office for the term for which he or she was elected and until his or her successors are elected and qualified. or until his or her early resignation, death, or removal. No director shall serve more than two (2) consecutive three (3) year terms."

WalterM3 (Georgia)
Posts: 442

Posted:

This meeting was run entirely by an an attorney I believe from the firm they hire to represent the HOA. None of the Board members spoke during this part of the meeting. Some did say, "Vote for me," and such.

Usually the HOA president chairs the meeting, the architectural chair speaks, the Pool chair speaks, the treasurer gives the financials and so on.

WalterM3 (Georgia)
Posts: 442

Posted:

This meeting was run entirely by an an attorney I believe from the firm they hire to represent the HOA. None of the Board members spoke during this part of the meeting. Some did say, "Vote for me," and such.

Usually the HOA president chairs the meeting, the architectural chair speaks, the Pool chair speaks, the treasurer gives the financials and so on.

WalterM3 (Georgia)
Posts: 442

Posted:

This meeting was run entirely by an an attorney I believe from the firm they hire to represent the HOA. None of the Board members spoke during this part of the meeting. Some did say, "Vote for me," and such.

Usually the HOA president chairs the meeting, the architectural chair speaks, the Pool chair speaks, the treasurer gives the financials and so on.

SheliaH (Indiana)
Posts: 6,964

Posted:

Quote:

Posted By WalterM3 on 08/08/2022 4:19 PM
Kerry,

For it to to be fraudulent then the Board of Directors/attorneys didn't follow the Bylaws on purpose. And I think that is what happened. The Board recently wanted to do a $25,000 project and replace the mail kiosks. They are just having a power trip.

I don't plan to go to th courts and have the election declared invalid. I would just say that if this Board attempted any legal action against a home owner that home owner could file a motion to dismiss based on the clearly invalid way the election was held.

Thanks for your response.

You ask the question and then say you're not going to take legal action to have the election declared invalid. That's fine, but why not go to a board meeting and ask about this - it could have been an oversight, as you said earlier. Otherwise, what was your point in bringing this up at all?

When you see something is wrong, but fail to at least point it out so it can be investigated and perhaps fixed, you're basically saying you're ok with what the board does after that. If that's the case, why complain if this board then take legal action to go after, say, a delinquent homeowner? Are you suggesting all of that should be thrown out because of this?

What did you do when this mailbox project was discussed? Did you go to the meetings and express yourself? Did you find like minded neighbors and run some people against this board in that election?

And you still haven't said why you didn't bring this up at the meeting or why it took you two months to realize they address thing was improper. What exactly do you want to resolve and what are you willing to do to accomplish that? If the answer is nothing, sit down or let someone with more backbone take this on.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

MaxB4
Posts: 3,513

Posted:

Quote:

Posted By SheliaH on 08/08/2022 6:44 PM

Posted By WalterM3 on 08/08/2022 4:19 PM
Kerry,

For it to to be fraudulent then the Board of Directors/attorneys didn't follow the Bylaws on purpose. And I think that is what happened. The Board recently wanted to do a $25,000 project and replace the mail kiosks. They are just having a power trip.

I don't plan to go to th courts and have the election declared invalid. I would just say that if this Board attempted any legal action against a home owner that home owner could file a motion to dismiss based on the clearly invalid way the election was held.

Thanks for your response.

You ask the question and then say you're not going to take legal action to have the election declared invalid. That's fine, but why not go to a board meeting and ask about this - it could have been an oversight, as you said earlier. Otherwise, what was your point in bringing this up at all?

When you see something is wrong, but fail to at least point it out so it can be investigated and perhaps fixed, you're basically saying you're ok with what the board does after that. If that's the case, why complain if this board then take legal action to go after, say, a delinquent homeowner? Are you suggesting all of that should be thrown out because of this?

What did you do when this mailbox project was discussed? Did you go to the meetings and express yourself? Did you find like minded neighbors and run some people against this board in that election?

And you still haven't said why you didn't bring this up at the meeting or why it took you two months to realize they address thing was improper. What exactly do you want to resolve and what are you willing to do to accomplish that? If the answer is nothing, sit down or let someone with more backbone take this on.

So the attorney ran the meeting and have to assume they ok'd the address on the ballot. How many people really want to become the enemy of the law firm representing/controlling the HOA?

KerryL1 (California)
Posts: 14,550

Posted:

Well your so-called HOA attorney ran the meeting and permitted two major errors errors--the visible address and the lack of staggered terms per your bylaws. Apparently all OK with this so-called attorney.

With Shelia, what do you want to do, Walter? Do you speak up at open board meetings (if they're allowed in GA?)

WalterM3 (Georgia)
Posts: 442

Posted:

Quote:

Posted By SheliaH on 08/08/2022 6:44 PM

Posted By WalterM3 on 08/08/2022 4:19 PM
Kerry,

For it to to be fraudulent then the Board of Directors/attorneys didn't follow the Bylaws on purpose. And I think that is what happened. The Board recently wanted to do a $25,000 project and replace the mail kiosks. They are just having a power trip.

I don't plan to go to th courts and have the election declared invalid. I would just say that if this Board attempted any legal action against a home owner that home owner could file a motion to dismiss based on the clearly invalid way the election was held.

Thanks for your response.

You ask the question and then say you're not going to take legal action to have the election declared invalid. That's fine, but why not go to a board meeting and ask about this - it could have been an oversight, as you said earlier. Otherwise, what was your point in bringing this up at all?

When you see something is wrong, but fail to at least point it out so it can be investigated and perhaps fixed, you're basically saying you're ok with what the board does after that. If that's the case, why complain if this board then take legal action to go after, say, a delinquent homeowner? Are you suggesting all of that should be thrown out because of this?

What did you do when this mailbox project was discussed? Did you go to the meetings and express yourself? Did you find like minded neighbors and run some people against this board in that election?

And you still haven't said why you didn't bring this up at the meeting or why it took you two months to realize they address thing was improper. What exactly do you want to resolve and what are you willing to do to accomplish that? If the answer is nothing, sit down or let someone with more backbone take this on.

At the annual meeting I raised my hand to ask about why there wasn't a secret ballot. Recall that in the moment I had forgotten that secret ballots were --required-- by the Bylaws to elect directors. I did think in the moment that a secret ballot was how it should be done. I started to leave but it was a good thing that I stayed.

It didn't matter anyway because the attorney running the meeting ignored my raised hand.

Going to a monthly Board meeting and saying or implying that they ran a fraudulent meeting that allowed them to see who voted for whom would not be a good idea I think.

I ignored the mailbox project. I told a couple of people that there was nothing wrong at either mail kiosk that tightening a few bolts wouldn't fix.

It just yesterday occurred to me to put this issue on HOATALK. One always gets great feedback and criticism here. And thanks for yours. My main issue that I wanted people here to see was -- can the Board as [fraudulently] constituted act legally on any home owners? I don't think it can. As far as alerting the Board or the attorneys, let sleeping dogs lie.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Walter you ask: My main issue that I wanted people here to see was -- can the Board as [fraudulently] constituted act legally on any home owners? I don't think it can.

While not playing lawyer, this seems like a reach on your part.

WalterM3 (Georgia)
Posts: 442

Posted:

Quote:

Posted By JohnC46 on 08/09/2022 10:00 AM
Walter you ask: My main issue that I wanted people here to see was -- can the Board as [fraudulently] constituted act legally on any home owners? I don't think it can.

While not playing lawyer, this seems like a reach on your part.

Why? All seven Director seats were up to be filled. None of them was filled properly.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By WalterM3 on 08/09/2022 10:38 AM

Posted By JohnC46 on 08/09/2022 10:00 AM
Walter you ask: My main issue that I wanted people here to see was -- can the Board as [fraudulently] constituted act legally on any home owners? I don't think it can.

While not playing lawyer, this seems like a reach on your part.

Why? All seven Director seats were up to be filled. None of them was filled properly.

I agree what they did may not follow the letter of the law but I do not see it as egregious as you do. Also unless challenged it is what it is. Do you think if done the way you say it should have been done, would the results would be different?

ElleN (Idaho)
Posts: 4,420

Posted:

Quote:

Posted By WalterM3 on 08/08/2022 4:19 PM
I don't plan to go to th courts and have the election declared invalid. I would just say that if this Board attempted any legal action against a home owner that home owner could file a motion to dismiss based on the clearly invalid way the election was held

Regardless of who is on the Board, by law owners agreed to the covenants when they bought into the HOA. If an owner violates the covenants, the HOA has the lawful right and often, legal obligation, to correct this. Who is on the board or how the directors were elected is not relevant.