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KennethD3 (Texas)
Posts: 40
Posted:

I am in need of a clarification on the actual use of a Resolution. Our board seems to think they can create a resolution that is directly opposed to what the CC&R’s stipulate and pass it with a majority vote of the HOA board, thus (In my stupid opinion) nullifying the Amendment process and taking away the rights of the whole membership to vote on an issue.
For example only: Say our CC&R’s state a property owner SHALL not raise livestock (Pigs, chicken etc) for any commercial purpose. Then along comes this new board with 3 out of 5 who actually want to raise pigs, cows or any type of livestock for resale. This new board makes a motion to create a Resolution stating this…..The resolution is brought to the next HOA meeting, and a vote by this new board passes 3-2……
This in my (stupid opinion) overrides the actual CC&R’s and creates an issue where the board has not held up to its Fiduciary obligations to the entire membership.
What say you?
JohnT38 (South Carolina)
Posts: 1,631
Posted:
Quote:
Posted By KennethD3 on 10/28/2022 1:03 PM

I am in need of a clarification on the actual use of a Resolution. Our board seems to think they can create a resolution that is directly opposed to what the CC&R’s stipulate and pass it with a majority vote of the HOA board, thus (In my stupid opinion) nullifying the Amendment process and taking away the rights of the whole membership to vote on an issue.
For example only: Say our CC&R’s state a property owner SHALL not raise livestock (Pigs, chicken etc) for any commercial purpose. Then along comes this new board with 3 out of 5 who actually want to raise pigs, cows or any type of livestock for resale. This new board makes a motion to create a Resolution stating this…..The resolution is brought to the next HOA meeting, and a vote by this new board passes 3-2……
This in my (stupid opinion) overrides the actual CC&R’s and creates an issue where the board has not held up to its Fiduciary obligations to the entire membership.
What say you?

The only way to give you an answer is to post what the Resolution says and the section of the CCR's that you think are in conflict. Without that info we would just be speculating.
BillH10 (Texas)
Posts: 1,217
Posted:
A resolution cannot amend the CC&Rs by itself without some enabling higher authority. Only a vote to amend as described in the CC&Rs can amend the document.

BUT . . . The Texas Legislature modifies TPC209 and other laws which affect homeowners associations from time to time, I can see how a Board resolution to adopt the new property code provisions may have validity. We would not do business that way, we would have the Board approve an amendment to the association documents, file the amendment(s) in the usual manner with the County Clerk, and send a copy to each owner.

The CC&Rs are a higher authority, so to speak, than a board resolution just as the Texas Property Code is a higher authority than the association documents.

Now, before you go too much further on this, you should research what the Texas Legislature enacted in the 2021 session regarding Property Code Section 209 HOAs, chickens, and possibly other farm animals. I did not pay close attention as we have no TPC209 clients but it may be germane to your question.
AugustinD
Posts: 1,027
Posted:
Quote:
Posted By KennethD3 on 10/28/2022 1:03 PM

I am in need of a clarification on the actual use of a Resolution. Our board seems to think they can create a resolution that is directly opposed to what the CC&R’s stipulate and pass it with a majority vote of the HOA board, thus (In my stupid opinion) nullifying the Amendment process and taking away the rights of the whole membership to vote on an issue.
For example only: Say our CC&R’s state a property owner SHALL not raise livestock (Pigs, chicken etc) for any commercial purpose. Then along comes this new board with 3 out of 5 who actually want to raise pigs, cows or any type of livestock for resale. This new board makes a motion to create a Resolution stating this…..The resolution is brought to the next HOA meeting, and a vote by this new board passes 3-2……
This in my (stupid opinion) overrides the actual CC&R’s and creates an issue where the board has not held up to its Fiduciary obligations to the entire membership.
What say you?
You are correct. You are also highly intelligent. You nailed it: The amendments requires a vote of the owners en masse to be amended.

When the board creates this resolution, it is acting ultra vires. Acting ultra vires is not lawful.

Post back if you want suggesions on how to proceed to correct this.
AugustinD
Posts: 1,027
Posted:
Quote:
Posted By AugustinD on 10/28/2022 1:17 PM
You nailed it: The amendments requires a vote of the owners en masse to be amended.
Pardon. I meant the CC&Rsrequire a vote of the owners en masse to amend.
KennethD3 (Texas)
Posts: 40
Posted:
Bill- the chickens and live stock were just an example to use and not actually show the issue at hand for reasons I will not go into now, thank you for your response, and I have gone thru 209 line by line over the last 20 hours and it actually says nothing about which has a priority or if a resolution can supersede the CC&R's....which I doubt can happen.....
Thanks for your response....
KerryL1 (California)
Posts: 14,550
Posted:
With BillH & Aug, if your CC&Rs state that xx of owners must vote to amend them, then that's the way it is. For the board to pretend that a resolution that opposes a CC&R is as legitimate as a true amendment is dishonest

Do be aware of BillH10's caveats re: Texas associations.

Are you on the board, Kenneth?
KennethD3 (Texas)
Posts: 40
Posted:
Yep, thanks........I don't know what " BillH10's caveats re: Texas associations" may be but the logic to me sounds good....
AugustinD
Posts: 1,027
Posted:
Regarding caveats: Texas statute TPC 202 is another statute that Texas HOA owners and board members need to keep an eye on, because the statute may override certain covenants. For example, TPC 202.007 highly limits HOAs and their boards in restricting drought resistant landscaping.
WendyM5 (North Carolina)
Posts: 1,522
Posted:
Fiduciary obligations are for property or money. If a board decides to allow no grass front yards due to water crisis that is actually honoring their fiduciary duties. Or allow solar panels to help the environment.

yeah people may disagree, but that's their opinion, typically based on asthetics, not logic. what you perceive as a breach of ficuciary duty might be perceived otherwise by someone else, unless you are going to sue them or get on the board how will you change this?

vis ta vie
AugustinD
Posts: 1,027
Posted:
Quote:
Posted By WendyM5 on 10/28/2022 8:15 PM
Fiduciary obligations are for property or money. If a board decides to allow no grass front yards due to water crisis that is actually honoring their fiduciary duties. Or allow solar panels to help the environment.
This is issue-dependent and state, municipal, or county-dependent. I agree that bona fide regional (or global and national) emergencies may often translate to covenants, bylaws and rules going out the window, and the courts will approve.
CathyA3 (Ohio)
Posts: 6,299
Posted:
There is one situation where the board can vote to amend the CC&Rs, and that is when the sole function of the resolution is to bring the CC&RS into agreement with current state code.

For example, if the legislature created an amendment to require all HOAs to permit owners to keep up to three (3) chickens per home, then the HOA's lawyer could draft an amendment to the CC&Rs stating this, and the board could vote on a resolution that approves this amendment. This does not require a homeowner vote because the new state law takes precedence over the CC&Rs and must be complied with even if 100% of owners are opposed to it.

Obviously this exception does not allow for a board to slide in some unrelated amendment - ie, the board can't pass a resolution saying that "chickens" = "livestock".
JohnT38 (South Carolina)
Posts: 1,631
Posted:
Quote:
Posted By CathyA3 on 10/29/2022 12:20 PM
There is one situation where the board can vote to amend the CC&Rs, and that is when the sole function of the resolution is to bring the CC&RS into agreement with current state code.

For example, if the legislature created an amendment to require all HOAs to permit owners to keep up to three (3) chickens per home, then the HOA's lawyer could draft an amendment to the CC&Rs stating this, and the board could vote on a resolution that approves this amendment. This does not require a homeowner vote because the new state law takes precedence over the CC&Rs and must be complied with even if 100% of owners are opposed to it.

Obviously this exception does not allow for a board to slide in some unrelated amendment - ie, the board can't pass a resolution saying that "chickens" = "livestock".

It's interesting you brought this up. Our lawyer told us that we could not do this. We avoided this issue since we ended up rewriting our entire documents and having the owners vote on them.
AugustinD
Posts: 1,027
Posted:
The reason JohnT38's attorney's advice makes sense to me, or at least proceeding with the utmost caution, is that a state legislature could turn around and amend state statutes to say something different than what the board's amendment (without an owners' vote) says, with said board amendment being based on the earlier version of the statute.

I would want specific, express statutory authority for bylaw/covenant amendment by the board (without an owners' vote). For example, certain state statutes authorize HOA/COA boards to remove covenant sections with discriminatory (on the basis of race, religion et cetera) language, without an owners' vote.
JohnT38 (South Carolina)
Posts: 1,631
Posted:
Quote:
Posted By AugustinD on 10/29/2022 12:51 PM
The reason JohnT38's attorney's advice makes sense to me, or at least proceeding with the utmost caution, is that a state legislature could turn around and amend state statutes to say something different than what the board's amendment (without an owners' vote) says, with said board amendment being based on the earlier version of the statute.

I would want specific, express statutory authority for bylaw/covenant amendment by the board (without an owners' vote). For example, certain state statutes authorize HOA/COA boards to remove covenant sections with discriminatory (on the basis of race, religion et cetera) language, without an owners' vote.

I remember him making some quip like, "HOA's have the right to be stupid and include illegal passages in the documents but they'll never be able to enforce them if challenged."
CathyA3 (Ohio)
Posts: 6,299
Posted:
Quote:
Posted By JohnT38 on 10/29/2022 12:33 PM
Posted By CathyA3 on 10/29/2022 12:20 PM
There is one situation where the board can vote to amend the CC&Rs, and that is when the sole function of the resolution is to bring the CC&RS into agreement with current state code.

For example, if the legislature created an amendment to require all HOAs to permit owners to keep up to three (3) chickens per home, then the HOA's lawyer could draft an amendment to the CC&Rs stating this, and the board could vote on a resolution that approves this amendment. This does not require a homeowner vote because the new state law takes precedence over the CC&Rs and must be complied with even if 100% of owners are opposed to it.

Obviously this exception does not allow for a board to slide in some unrelated amendment - ie, the board can't pass a resolution saying that "chickens" = "livestock".


It's interesting you brought this up. Our lawyer told us that we could not do this. We avoided this issue since we ended up rewriting our entire documents and having the owners vote on them.

I'd be interested to hear your lawyer's reasoning.

What happens if the community votes down all or part of the amendment? Does the board enforce the current law or not? What happens when someone sues the board for not complying with new state law, or if someone sues the board for complying with it? Seems like this opens the door for legal wrangling if any of the new state law is at all controversial.

When we brought our CC&Rs into compliance with updated state law, our attorney wrote the amendment and provided us with a letter of instruction, including the text of the resolution the board was to vote on.
JohnT38 (South Carolina)
Posts: 1,631
Posted:
Quote:
Posted By CathyA3 on 10/29/2022 12:57 PM
Posted By JohnT38 on 10/29/2022 12:33 PM
Posted By CathyA3 on 10/29/2022 12:20 PM
There is one situation where the board can vote to amend the CC&Rs, and that is when the sole function of the resolution is to bring the CC&RS into agreement with current state code.

For example, if the legislature created an amendment to require all HOAs to permit owners to keep up to three (3) chickens per home, then the HOA's lawyer could draft an amendment to the CC&Rs stating this, and the board could vote on a resolution that approves this amendment. This does not require a homeowner vote because the new state law takes precedence over the CC&Rs and must be complied with even if 100% of owners are opposed to it.

Obviously this exception does not allow for a board to slide in some unrelated amendment - ie, the board can't pass a resolution saying that "chickens" = "livestock".


It's interesting you brought this up. Our lawyer told us that we could not do this. We avoided this issue since we ended up rewriting our entire documents and having the owners vote on them.


I'd be interested to hear your lawyer's reasoning.

What happens if the community votes down all or part of the amendment? Does the board enforce the current law or not? What happens when someone sues the board for not complying with new state law, or if someone sues the board for complying with it? Seems like this opens the door for legal wrangling if any of the new state law is at all controversial.

When we brought our CC&Rs into compliance with updated state law, our attorney wrote the amendment and provided us with a letter of instruction, including the text of the resolution the board was to vote on.

See my replay to AugustinD. We didn't give them the option to vote down all or part of an amendment. The only option they had was to vote down the entire document(s). This was a total rewrite.
AugustinD
Posts: 1,027
Posted:
Quote:
Posted By JohnT38 on 10/29/2022 12:56 PM
Posted By AugustinD on 10/29/2022 12:51 PM
The reason JohnT38's attorney's advice makes sense to me, or at least proceeding with the utmost caution, is that a state legislature could turn around and amend state statutes to say something different than what the board's amendment (without an owners' vote) says, with said board amendment being based on the earlier version of the statute.

I would want specific, express statutory authority for bylaw/covenant amendment by the board (without an owners' vote). For example, certain state statutes authorize HOA/COA boards to remove covenant sections with discriminatory (on the basis of race, religion et cetera) language, without an owners' vote.


I remember him making some quip like, "HOA's have the right to be stupid and include illegal passages in the documents but they'll never be able to enforce them if challenged."
I think like three different topics are now being discussed.

If the board files a Declaration with an allegedly lawful amendment, passed only by the board (meaning no owners' vote), and if state statutes say what the Declaration amendment says, then the substance of the amendment is only as vulnerable to legal challenge as the state statute.

I guess owners could sue to get the amendment thrown out due to there not being an owners' vote. But the board could then just turn to enforcing state law on xyz matter pertaining to HOAs/COAs.

Or maybe JohnT38's HOA's attorney meant boards cannot write legal language to save their lives; the board would mess it up; and then the amendment would be not enforceable?
JohnT38 (South Carolina)
Posts: 1,631
Posted:
Quote:
Posted By AugustinD on 10/29/2022 1:25 PM
Posted By JohnT38 on 10/29/2022 12:56 PM
Posted By AugustinD on 10/29/2022 12:51 PM
The reason JohnT38's attorney's advice makes sense to me, or at least proceeding with the utmost caution, is that a state legislature could turn around and amend state statutes to say something different than what the board's amendment (without an owners' vote) says, with said board amendment being based on the earlier version of the statute.

I would want specific, express statutory authority for bylaw/covenant amendment by the board (without an owners' vote). For example, certain state statutes authorize HOA/COA boards to remove covenant sections with discriminatory (on the basis of race, religion et cetera) language, without an owners' vote.


I remember him making some quip like, "HOA's have the right to be stupid and include illegal passages in the documents but they'll never be able to enforce them if challenged."
I think like three different topics are now being discussed.

If the board files a Declaration with an allegedly lawful amendment, passed only by the board (meaning no owners' vote), and if state statutes say what the Declaration amendment says, then the substance of the amendment is only as vulnerable to legal challenge as the state statute.

I guess owners could sue to get the amendment thrown out due to there not being an owners' vote. But the board could then just turn to enforcing state law on xyz matter pertaining to HOAs/COAs.

Or maybe JohnT38's HOA's attorney meant boards cannot write legal language to save their lives; the board would mess it up; and then the amendment would be not enforceable?

You are correct. The issue came up because the previous Board considered an amendment that would allow owners to enclose their porches or build additions on their concreate patios. (Limited Common Areas.) This can't be done because the S.C Horizontal Property Act says you can't. They simply didn't care.

On a side note, I was recently told by a good friend of mine that the current Board is considering allowing a homeowner to enclose their patio into a sunroom. As the old saying goes, "You can't fix stupid".
KennethD3 (Texas)
Posts: 40
Posted:
Thanks go out to all of you who responded, sorry for being way tooooooo late in a reply. We are still trying to get our hands around issues here that prior boards have passed and I guess that many of them will be pulled.

Great ideas and good findings, thanks to everyone who commented

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