HOA mgt comp does whatever they want without the board approval.

Started by MamiE • 24 replies • 445 views

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MamiE (Texas)
Posts: 12

Posted:

Hello! New to here
Our management company conspired with a third-party guy and used our HOA money to renovate certain buildings without our approval in favor of specific owners.
Is it difficult to sue them and get our money back?
We are looking for an attorney who can handle our situation and sue them for breach of the agreement.

WendyM5 (North Carolina)
Posts: 1,522

Posted:

depends on what the HOA & MC contract says. Ours says the MC can spend up to $750 for non emergencies.
might want to get that document first to see if they are actually violating the terms of the contract

vis ta vie

MamiE (Texas)
Posts: 12

Posted:

Thank you for your reply.
Ours says anything more than $1000 needs our approval.
But they have used much much much more than that.
I have contacted some attorney's office but no reply.
So I assumed it was difficult to proceed.

MamiE (Texas)
Posts: 12

Posted:

Quote:

Posted By MamiE on 01/25/2023 10:07 PM
Thank you for your reply.
Ours says anything more than $1000 needs our approval.
But they have used much much much more than that.
I have contacted some attorney's offices but no reply.
So I assumed it was difficult to proceed.

WendyM5 (North Carolina)
Posts: 1,522

Posted:

most HOA attourneys dont' want to sue a MC because the MC gives them a lot of business in the form of fines, liens, foreclosures, etc.
no reply doesn't mean it's hard to sue, it might not be a lot of money for them as well.

vis ta vie

MelissaP1 (Alabama)
Posts: 13,836

Posted:

First are you still developer owned? Need more details before jumping to advice.

Former HOA President

TimB4 (Tennessee)
Posts: 21,061

Posted:

Quote:

Posted By MamiE on 01/25/2023 10:11 PM

Posted By MamiE on 01/25/2023 10:07 PM
Thank you for your reply.
Ours says anything more than $1000 needs our approval.
But they have used much much much more than that.
.

The amount isn't cumulative, it's per contract.

This means that if each contract is $1,000 the PM can make the call.

JohnT38 (South Carolina)
Posts: 1,631

Posted:

Something is really missing here. Where was the board while all this was going on? Why aren't you asking about how to remove a board that isn't capable of reigning in the management company and keeping a better eye on the HOA's finances?

KerryL1 (California)
Posts: 14,550

Posted:

Concurring with JohnT. Are you on the Board, MamiE?

MamiE (Texas)
Posts: 12

Posted:

Sorry for the late reply.
Yes, I am,
There is a long story. It cannot be described here. It was my fault. I do not know how to delete my post.
I am looking for an attorney specializing in HOA.
If you know the sites I can get that info.
Thank you very much.

JohnT38 (South Carolina)
Posts: 1,631

Posted:

Quote:

Posted By MamiE on 01/27/2023 3:27 AM
Sorry for the late reply.
Yes, I am,
There is a long story. It cannot be described here. It was my fault. I do not know how to delete my post.
I am looking for an attorney specializing in HOA.
If you know the sites I can get that info.
Thank you very much.

Many people come here to prep for a meeting with a lawyer. You may want to reconsider opening up about what happened and others here may help get you up to speed with what the laws are in your state and help you organize your thoughts for the meeting.

MamiE (Texas)
Posts: 12

Posted:

Thank you for your reply.
We reside outside the US and invested in the US real estate.
That is why it is difficult to go there to see if our commumity is managed well.
Someday a guy popped up and set the owners meeting, then manipulated us to switch the management company.
This is how it started.
They renovated some buildings without our approval. Half of the entire HOA budget was used for the renovation. It was reported after the job was completed.
I would like to know what legal options we have.

MamiE (Texas)
Posts: 12

Posted:

Quote:

Posted By MamiE on 01/27/2023 4:38 AM
Thank you for your reply.
We reside outside the US and invested in the US real estate.
That is why it is difficult to go there to see if our commumity is managed well.
Oneday a guy popped up and set the owners meeting, then manipulated us to switch the management company.
This is how it started.
They renovated some buildings without our approval. Half of the entire HOA budget was used for the renovation. All of his clients are the owners of those buildings. It was reported after the job was completed.
I would like to know what legal options we have.

MamiE (Texas)
Posts: 12

Posted:

Quote:

Posted By MamiE on 01/27/2023 4:40 AM

Posted By MamiE on 01/27/2023 4:38 AM
Thank you for your reply.
We reside outside the US and invested in the US real estate.
That is why it is difficult to go there to see if our commumity is managed well.
Oneday a guy popped up and set the owners meeting, then manipulated us to switch the management company.
This is how it started.
They renovated some buildings without our approval. Half of the entire HOA budget was used for the renovation. All of his clients are the owners of the units in those buildings. It was reported after the job was completed.
I would like to know what legal options we have.

MamiE (Texas)
Posts: 12

Posted:

Thank you for your reply.
We reside outside the US and invested in US real estate.
That is why it is difficult to go there to see if our community is managed well.
One day a guy popped up and set the owners meeting, then manipulated us to switch the management company.
This is how it started.
They renovated some buildings without our approval. Half of the entire HOA budget was used for the renovation. All of his clients are the owners of the units in those buildings. It was reported after the job was completed.
I would like to know what legal options we have.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

Suing your HOA is suing yourself and your neighbors. I am not sure it sounds like anything wrong has happened. Are the building owners not also HOA members? It is possible to have houses/apartments/businesses together in a HOA. Sometimes there are "For Profit" HOA's.

There are some lack of details to get a full picture of what happened. Which means not sure if what happened is fully illegal or not a good thing. You don't live there. How do you know?

Former HOA President

MamiE (Texas)
Posts: 12

Posted:

All of the board members including me want to sue the management company.
Probably it is difficult to explain in an open message board.
I am sorry that I confused you.
I know the infomation is not enough for you to give accurate advice, but there are things that can not be told here.
Thank you for trying to help me. I appreciate that.
I will try my best to solve the issue.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

So you are on the board. The MC should be a hired contractor to your HOA. How they got access to your HOA money is what is in question. Did the MC own these as part of their company or are they part of the HOA?

The choice is either criminal charges or civil.

Former HOA President

MarshallT (New York)
Posts: 414

Posted:

It is probably harder to sue a management company than you may think. Check the contract thoroughly to see if the company has explicitly broken any agreements.

Have you taken steps to terminate the relationship with this company? If not, get started on that as well.

CathyA3 (Ohio)
Posts: 6,299

Posted:

Quote:

Posted By MarshallT on 01/30/2023 7:18 AM
It is probably harder to sue a management company than you may think. Check the contract thoroughly to see if the company has explicitly broken any agreements.

Have you taken steps to terminate the relationship with this company? If not, get started on that as well.

I agree with this. Many management contracts have provisions for either party terminating the contract early - for example, with two months' notice. If your contract has something like this, I think it's smarter to go that route rather than trying to terminate for cause. If you do the latter, the manager is likely to fight you legally until the contract's actual termination date - you'll be stuck with them longer and will pay for the privilege.

MamiE (Texas)
Posts: 12

Posted:

Thank you for all the advice. I appreciate it.
It is stated on the agreement that they are supposed to get the board's approval for anything that cost more than $1000 but they didn't.
I may give up on suing. I have no more power.

TristaJ (Texas)
Posts: 96

Posted:

MamiE

if you want to e-mail me, I can maybe give you some attorney names. [email protected]

MelissaP1 (Alabama)
Posts: 13,836

Posted:

The HOA would be the one suing. It would be a violation of the contract between the HOA and MC.

Former HOA President

MamiE (Texas)
Posts: 12

Posted:

Thank you very much.
I appreciate.
I will email you.

MamiE (Texas)
Posts: 12

Posted:

Thank you for your comment.
I learned a lot from this experience.

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