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TammyL2 (New Mexico)
Posts: 26
Posted:
I'm a former board member, still responsible for the HOA's website.
I've been requested by Board to update website with 'something like': "NO Return Receipts requiring signature will be accepted" or "ALL Certified Mail requiring a signature will be refused and returned to sender.".

I'd like to honor their request, but I'm struggling with doing it politely (or legally?). I agree with the Board, that the practice of requiring a signature for a payment made by check is retaliatory in nature. I'm searching for advice on the achieving the Board's goal without creating a tidal wave from a ripple.

Our New Mexico subdivision is in the frontier. Annual budget is $6000.00. Post office is 36 miles round trip to town. 'Town' has no grocery store, no convenience store, no gas station, no feed store, no mechanic, no hardware store and is the complete opposite direction of any and all. During inclement weather, traveling our roads requires a 4WD (in docs). There is no requirement for Directors to own a 4 WD, or a phone. A locked HOA mailbox and resident mailboxes are located on a county road, 2 miles from my door, 4 miles from other's doors. Mail runs 3 times a week. There are stretches of time when we can't make it 2 miles to our mailbox, much less all the way to town. How bad can it be?

Last week, Fed Ex went into the ditch on the road at the end of our drive. Neighbor #1, HOA's Secretary (that pulled Fed Ex out two weeks ago) came to assist (again), and he got stuck. Calls (via landline, no cell service here) were made & neighbor #2 came to the rescue. Hours passed. While Fed Ex and neighbor #1 were being pulled out by neighbor #2, neighbor #3 walked over to tell his tale of getting stuck in a ditch on the way to the mailboxes. If you don't have a 4WD, you travel 'on the freeze' (dawn and dusk). Every single rut created will be there until the road grader guy comes in June. Such is life.

I've considered:
"Inclement weather severely restricts the Board's ability to respond to Return Receipts Requests requiring a signature."
"Proof of Delivery requiring a signature will be refused and returned to sender within 3 days of notice if travel is prohibitive."
- Adopting - "cost to member for mileage expense"?

Regardless of whether this is added to the website or not, Directors will refuse and return all Proof of Delivery requiring a signature. They've had it. The mailman has had it. What is the best avenue of approach? What fallout could result?

All advice, guidance and gentle admonitions are greatly appreciated.
CathyA3 (Ohio)
Posts: 6,299
Posted:
I don't know that requiring a signature is necessarily retaliatory. It's likely that the board's opinion is the result of actions by specific, adversarial owners. But wanting a signature could also be the result of owners getting caught by issues with mail delivery and having to deal with late fees, contacting the board to explain why they actually weren't late, and a lot of other aggravating rigamarole. This wastes everybody's time.

As for whether refusing to honor the signature requirement for everyone, I'm not a lawyer but I'm guessing that it's not legal to do so and will probably have unintended consequences. It may be legal to do so for a particular owner who is in the middle of a dispute with the HOA (collection actions, etc.) - but those sorts of things usually require that payments/communications be sent directly to the HOA's attorney, so this should not be an issue.

But you'll need to ask a real lawyer on this.

If I were on the board, rather than fighting over the signature issue, I would be making every effort to encourage use of electronic payments and discourage use of physical checks. My community charges owners $10 per year for use of physical checks (to cover printing costs and the like). Most financial institutions offer some version of bill payment, many of them for free to their customers. I don't understand why anyone would want to use paper unless they don't have secure internet access.

MichaelT21 (Arkansas)
Posts: 200
Posted:
So if someone serves the association for a lawsuit via certified mail, will it get returned?
LoriM15 (Florida)
Posts: 1,009
Posted:
Is there a mailbox place in the closest bigger town, or can you rent a PO box at the closest post office? I understand that would probably limit mail pickup to once or twice a month, but you could get signatures that way.

However, how many times in a month do you get anything that requires a signature?
ElleN (Idaho)
Posts: 4,420
Posted:
Quote:
Posted By CathyA3 on 03/29/2023 9:41 AM
As for whether refusing to honor the signature requirement for everyone, I'm not a lawyer but I'm guessing that it's not legal to do so and will probably have unintended consequences.
I agree with Cathy and MichaelT21. New Mexico statutes require New Mexico HOA corporations to have a registered agent. The main purpose of the registered agent is to accept legal documents, with the latter often being sent registered mail, return receipt requested.

I advise that the HOA find someone near a mailbox who can accept and sign for registered mail and who is willing to serve as the "registered agent." The registered agent is typically one of the directors, a manager or the HOA attorney. Or you can pay a small fee for a registered agent like this one:

https://www.newmexicoregisteredagent.com/?gclid=EAIaIQobChMI2JTd_PCB_gIV5GpvBB2waAchEAAYASAAEgKv_vD_BwE
TammyL2 (New Mexico)
Posts: 26
Posted:
Thank you very much for your informative and educated response.

In an attempt to prevent said rigamarole, our docs provide that the Annual Dues of $50 per lot are due on January 31 each year and must be postmarked on or before March 1st of each year to avoid late fee of $25, and $1 per day thereafter. This allows time for late notice warnings to be sent.

I think electronic payments are a great idea! Currently the HOA reimburses for mileage on 'trips to town'. I researched using the web hosting service's payment portal options and the yearly cost ($300 if I recall) was in excess of monies spent on mileage and was not well received by the board. I also worried that even with an electronic payment option, some would continue to snail mail with request for signature. Your suggestion to charge for use of physical checks when electronic options are available is brilliant! Thank you! I can't wait to show this thread to the Board!

A significant reason for some when buying land out here is to be cut off from 'digital' & 'electronic'. 2 of our 5 Directors do not have internet or a landline phone. There's a little spot on the mountain over there called 'the phone booth' where you can receive a cell signal! Sometimes you can look out and see 3 or 4 cars parked at 'the phone booth'! These folk don't mind shuffling paper. They're using pencils and ledger sheets from the stationary store to keep records! Really, a step back in time. And all the technically advanced young people can't wait to move away from here and closer to a Starbucks! But we hang on .....

Sincerest appreciation for your excellent input. If your ears burn, rest assured it's our BoD discussing your reply.
Thank you again.

TammyL2 (New Mexico)
Posts: 26
Posted:
Thank you very much for your informative and educated response.

In an attempt to prevent said rigamarole, our docs provide that the Annual Dues of $50 per lot are due on January 31 each year and must be postmarked on or before March 1st of each year to avoid late fee of $25, and $1 per day thereafter. This allows time for late notice warnings to be sent.

I think electronic payments are a great idea! Currently the HOA reimburses for mileage on 'trips to town'. I researched using the web hosting service's payment portal options and the yearly cost ($300 if I recall) was in excess of monies spent on mileage and was not well received by the board. I also worried that even with an electronic payment option, some would continue to snail mail with request for signature. Your suggestion to charge for use of physical checks when electronic options are available is brilliant! Thank you! I can't wait to show this thread to the Board!

A significant reason for some when buying land out here is to be cut off from 'digital' & 'electronic'. 2 of our 5 Directors do not have internet or a landline phone. There's a little spot on the mountain over there called 'the phone booth' where you can receive a cell signal! Sometimes you can look out and see 3 or 4 cars parked at 'the phone booth'! These folk don't mind shuffling paper. They're using pencils and ledger sheets from the stationary store to keep records! Really, a step back in time. And all the technically advanced young people can't wait to move away from here and closer to a Starbucks! But we hang on .....

Sincerest appreciation for your excellent input. If your ears burn, rest assured it's our BoD discussing your reply.
Thank you again.
TammyL2 (New Mexico)
Posts: 26
Posted:
Great question Michael. This has been discussed. Short answer: Yes. It will be refused.
Please don't kill the messenger!

The BoD considers NM Article 8, Non-profit Corporations 53-8-10 - Service of Process upon Corporation: "The registered agent appointed by a corporation shall be an agent of the corporation upon whom any process, notice or demand required or permitted by law to be served upon the corporation may be served."

In this instance, the Board takes the position that our registered agent has no legal requirement to sign for Certified Mail to facilitate someone's lawsuit. The Board maintains they have a right of refusal, and any process, notice or demand can be served to the Registered Agent in person, at the Registered Agent's physical address as listed with the State.

In the process, if they get stuck out here, we'll call the mechanic shop in town and they'll send a tow truck. For a price. Eventually.

*insert banjo music here!!*

TammyL2 (New Mexico)
Posts: 26
Posted:
Thank you for your informative reply.

I agree with your assessment of the purpose of the registered agent but point out that you recognize that registered mail requiring signature is "often" used. Not "always" used. There are other methods of service.

Our Treasurer lives in the subdivision, is also our Registered Agent and houses the ' principal office'; his name, mailing and physical addresses are on file with the State.

Ironically, the retaliatory nature I described in original topic manifested due to this topic. After discovering accounting irregularities, it was discovered that the previous 'registered agent' (also the Treasurer) only vacationed here (from another state) a few weeks each year. While her address in the subdivision was used to comply with 'registered agent' and principal office requirements, all documents and records were stored at her home .... out of state! Other Directors couldn't look at bank records, see a membership list, view outstanding accounts or determine why income had fallen below what was required by law at turnover. Someone who lives here year-round would periodically 'check' her mailbox and then mail the contents to her at her residence ... in another state! Now that I think about it .... I wonder how she would have handled a Certified Letter requiring a signature!! Over $10,000 lost due to her malfeasance. It took over a year to wrestle the records back to their lawful place.

Guess who sends their annual payment with a requirement for signature.

This is a hill our Board is prepared to die on.

MaxB4
Posts: 3,513
Posted:
Since this has to do with payments, hired an offsite bookkeeper or management management company that does financials only and the problem is solved. Yes, your dues may need to be increased, but it also solved your problem.
ElleN (Idaho)
Posts: 4,420
Posted:
Quote:
Posted By TammyL2 on 03/29/2023 4:18 PM

The BoD considers NM Article 8, Non-profit Corporations 53-8-10 - Service of Process upon Corporation: "The registered agent appointed by a corporation shall be an agent of the corporation upon whom any process, notice or demand required or permitted by law to be served upon the corporation may be served."

In this instance, the Board takes the position that our registered agent has no legal requirement to sign for Certified Mail to facilitate someone's lawsuit.
Ma'am, in New Mexico a refusal to accept service on a corporation constitutes proper service. The plaintiff now need only proceed to court with proof that service was sent via registered mail, return receipt requested and the service was rejected; inform the court that the corporation has advertised it will refuse such service; and proceed to a motion for judgment in its favor. Since your HOA will not even know this is happening, they won't be in the court to defend itself.

I recommend hiring an attorney to advise you all.

In your posts, would you please consider naming the person whom you are addressing?
CathyA3 (Ohio)
Posts: 6,299
Posted:
Quote:
Posted By ElleN on 03/30/2023 6:53 AM
Posted By TammyL2 on 03/29/2023 4:18 PM

The BoD considers NM Article 8, Non-profit Corporations 53-8-10 - Service of Process upon Corporation: "The registered agent appointed by a corporation shall be an agent of the corporation upon whom any process, notice or demand required or permitted by law to be served upon the corporation may be served."

In this instance, the Board takes the position that our registered agent has no legal requirement to sign for Certified Mail to facilitate someone's lawsuit.
Ma'am, in New Mexico a refusal to accept service on a corporation constitutes proper service. The plaintiff now need only proceed to court with proof that service was sent via registered mail, return receipt requested and the service was rejected; inform the court that the corporation has advertised it will refuse such service; and proceed to a motion for judgment in its favor. Since your HOA will not even know this is happening, they won't be in the court to defend itself.

I recommend hiring an attorney to advise you all.

In your posts, would you please consider naming the person whom you are addressing?

I strongly recommend that the board reconsider whether this is a hill they want to die on. I believe that accepting and signing for legal documents is an essential part of the job of being a registered agent for a corporation. Refusing to do this is akin to an employee's refusal to perform an essential job function. This is a firing offense for an employee, and it should be a firing offense for a registered agent as well.

I also believe it should be a "firing offense" for the board members who voted for this nonsense. These folks are gonna get the association into trouble - and there will be far more trouble and expense than they would have had if they'd just signed for the danged pieces of mail.

I second ElleN's recommendation about hiring a lawyer and listening to that person before the community has to learn things the hard way.
GuyM1 (Ohio)
Posts: 318
Posted:
There are several ways to handle this. One is to have everyone that can do direct deposits which will be proof of delivery and date of payment. Second, you do not need to have a signature on a registered letter as the tracking number will provide proof of delivery and the date. Third, hand deliver and get a receipt with the date included.

I think a board refusing to accept mail with a signature would be a breach of duty as this is for assessments that pay the bills. I'm sure there are issues with ledger dates on when the payments were paid. Most people don't understand the date you receive the payment is the date that should be logged into the ledger.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
$50 per year dues. I spill that much at the bar on a night out.

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