Board forged signatures on proxies

JohnS111 (New York)
Posts: 228

Posted:

The HOA where I own a rental property has had problems getting a quorum at annual meetings. The HOA was recently sued, and as one thing that came up in the suit was that the board hadn't been validly elected for years, not getting a quorum at annual meetings has been a problem.

The board's solution? Forging owners' signatures on proxies. One owner demanded copies of proxies after the board was recently (allegedly) re-elected and passed a dues increase. The owner then scanned all of the copies and emailed them to the whole community. A signature was shown above my name on a proxy, but it definitely was not my signature.

I'm not looking for legal advice, but I am kind of just venting. The owner who sued the HOA before is now suing the board members individually and is getting law enforcement involved. This is really unreal.

JeanneH3 (North Carolina)
Posts: 158

Posted:

Insist that an audit of the finances be done because I wager there is hanky panky going on there as well.

MichaelS56 (Minnesota)
Posts: 858

Posted:

The repercussions of this mess may cause you and others to have to pay for attorneys as the issue you have described, could take a lot of time and money, as more is discovered.

ElleN (Idaho)
Posts: 4,420

Posted:

Quote:

Posted By JohnS111 on 03/05/2023 3:15 AM
A signature was shown above my name on a proxy, but it definitely was not my signature.

I'm not looking for legal advice, but I am kind of just venting. The owner who sued the HOA before is now suing the board members individually and is getting law enforcement involved. This is really unreal.

Given the hard evidence you have and I am sure your willingness to testify as a witness, suing and getting law enforcement involved sound like a good start to me.

I just hope everyone either wanting to sue or actually suing has people willing to step up and serve on the board. Receivership will cost you all an arm and a leg.

JohnS111 (New York)
Posts: 228

Posted:

UPDATE

The owner who originally sued the HOA, as part of that lawsuit, obtained an email from the HOA's lawyer during discovery:

"it is my legal opinion that the BOARDD is allowed to attach OWNER signatures tothese proxies pursuant to proxies that OWNER signed within the prior 11 months. A JUDGE will agree with me."

The owner and I took a look at the earlier proxies and this is nonsense. So the lawyer told the board that it's OK to use old proxies to sign new proxies in owners' names. Unreal.

ElleN (Idaho)
Posts: 4,420

Posted:

If the proxy does not have an expiration date printed on it, then I would do more homework, because what the attorney said may very well be true. From https://lawshelf.com/coursewarecontentview/voting-by-proxy:

"Most states automatically limit proxy duration to a period of eleven months or less. The logic here is that they presume that while the shareholder may wish to have her vote cast for her at one year’s meeting, she may not wish to give away her voting power indefinitely. At the same time, many states do allow shareholders to issue proxies that will last for successive years."

Your HOA is in New Hampshire, right? The applicable NH statutes are no fun to parse. Consider hiring a real estate lawyer.

ElleN (Idaho)
Posts: 4,420

Posted:

From New Hampshire statutes:

"An appointment of a proxy is effective when a signed appointment form or an electronic transmission of the appointment is received by the inspector of election or the officer or agent of the corporation authorized to tabulate votes. An appointment is valid for 11 months unless a longer period is expressly provided in the appointment form."

See https://law.justia.com/codes/new-hampshire/2022/title-xxvii/title-293-a/section-293-a-7-22/

JohnS111 (New York)
Posts: 228

Posted:

Quote:

Posted By ElleN on 03/05/2023 5:10 PM
If the proxy does not have an expiration date printed on it, then I would do more homework, because what the attorney said may very well be true. From https://lawshelf.com/coursewarecontentview/voting-by-proxy:

"Most states automatically limit proxy duration to a period of eleven months or less. The logic here is that they presume that while the shareholder may wish to have her vote cast for her at one year’s meeting, she may not wish to give away her voting power indefinitely. At the same time, many states do allow shareholders to issue proxies that will last for successive years."

Your HOA is in New Hampshire, right? The applicable NH statutes are no fun to parse. Consider hiring a real estate lawyer.

Thanks. I appreciate your posts.

The original proxy "authorizes the holder to vote in person on behalf of the grantor with respect to any matter at any annual meeting of the [___] Association, and for no other purpose".

It doesn't allow the holder (a board member) to sign other proxies, particularly after the annual meeting.

WendyM5 (North Carolina)
Posts: 1,522

Posted:

Lawyers are just creating more future business lol

vis ta vie

ElleN (Idaho)
Posts: 4,420

Posted:

Quote:

Posted By JohnS111 on 03/05/2023 5:36 PM
The original proxy "authorizes the holder to vote in person on behalf of the grantor with respect to any matter at any annual meeting of the [___] Association, and for no other purpose".

It doesn't allow the holder (a board member) to sign other proxies, particularly after the annual meeting.

John, I am homed in on the proxy form's phrase "with respect to any matter at any annual meeting... " You said the directors were re-elected using the proxies in question. It sounds like an annual meeting.

So far, I do not see enough evidence to warrant threats of lawsuits on this point. So far, I think the HOA's attorney may very well be correct.

JohnS111 (New York)
Posts: 228

Posted:

Quote:

Posted By ElleN on 03/06/2023 5:38 AM

Posted By JohnS111 on 03/05/2023 5:36 PM
The original proxy "authorizes the holder to vote in person on behalf of the grantor with respect to any matter at any annual meeting of the [___] Association, and for no other purpose".

It doesn't allow the holder (a board member) to sign other proxies, particularly after the annual meeting.

John, I am homed in on the proxy form's phrase "with respect to any matter at any annual meeting... " You said the directors were re-elected using the proxies in question. It sounds like an annual meeting.

So far, I do not see enough evidence to warrant threats of lawsuits on this point. So far, I think the HOA's attorney may very well be correct.

Sorry, I wasn't clear.

Proxies were collected before the 2022 annual meeting. Those proxies were used at the 2022 annual meeting.

For the 2023 annual meeting, which recently took place, the board used the 2022 proxies as justification for signing new 2023 proxies in owners' names.

The proxies, by their terms, were only for use at the 2022 annual meeting. They weren't to be used for anything else.

Maybe at the 2022 annual meeting a resolution was passed granting the board the power to attach owner signatures to proxies in the future, but there are no minutes of the 2022 annual meeting so we don't know.

ElleN (Idaho)
Posts: 4,420

Posted:

Quote:

Posted By JohnS111 on 03/06/2023 5:47 AM

The proxies, by their terms, were only for use at the 2022 annual meeting.

The wording you quoted as being on the proxy does not seem to say this.

Anyway, I presented what I found on this point. The HOA attorney's email (obtained during discovery) seems to explain what happened. Of course I do not like a board signing a proxy as if they were the owner, perhaps committing some kind of fraud. But the 11 month rule seems to throw a wrench into things.

I really do not want to fight either. If you had made your case with me, I'd say it. No big deal that I do not understand your reasoning.

JohnS111 (New York)
Posts: 228

Posted:

Quote:

Posted By ElleN on 03/06/2023 6:09 AM

Posted By JohnS111 on 03/06/2023 5:47 AM

The proxies, by their terms, were only for use at the 2022 annual meeting.

The wording you quoted as being on the proxy does not seem to say this.

Anyway, I presented what I found on this point. The HOA attorney's email (obtained during discovery) seems to explain what happened. Of course I do not like a board signing a proxy as if they were the owner, perhaps committing some kind of fraud. But the 11 month rule seems to throw a wrench into things.

I really do not want to fight either. If you had made your case with me, I'd say it. No big deal that I do not understand your reasoning.

ElleN, thanks-- your posts are very helpful and well-thought out.

There is other language in the proxy stating that it expires on the date 11 months after the execution date. So I read that as saying that it's only for use during any annual meeting that occurs during the 11 month period after the proxy was signed. But not for any future annual meeting after the proxy expires.

ElleN (Idaho)
Posts: 4,420

Posted:

Quote:

Posted By JohnS111 on 03/06/2023 7:14 AM
There is other language in the proxy stating that it expires on the date 11 months after the execution date. So I read that as saying that it's only for use during any annual meeting that occurs during the 11 month period after the proxy was signed. But not for any future annual meeting after the proxy expires.

If 11 months have passed since execution, I agree the proxy appointment has expired.

I am confused at this point about what you presented and the order you presented it. Probably a lot of the problem is that trying have an efficient and fruitful exchange in an online forum with strangers, while in the legal weeds of a situation, is a tall order. I think you know what to do (or not do).

JohnS111 (New York)
Posts: 228

Posted:

Quote:

Posted By ElleN on 03/06/2023 7:22 AM

Posted By JohnS111 on 03/06/2023 7:14 AM
There is other language in the proxy stating that it expires on the date 11 months after the execution date. So I read that as saying that it's only for use during any annual meeting that occurs during the 11 month period after the proxy was signed. But not for any future annual meeting after the proxy expires.

If 11 months have passed since execution, I agree the proxy appointment has expired.

I am confused at this point about what you presented and the order you presented it. Probably a lot of the problem is that trying have an efficient and fruitful exchange in an online forum with strangers, while in the legal weeds of a situation, is a tall order. I think you know what to do (or not do).

Thanks. Call the cops, as another owner did.

[Your posts are really first-rate, and helpful; thanks!\