Financial Mgt Co. Wants the power to do anything necessary to carry out the agreement?

Started by WendyM5 • 8 replies • 259 views

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WendyM5 (North Carolina)
Posts: 1,522

Posted:

Contract states:
8. Financial Mgt Company (FMC) is and shall have general authority and powers necessary to carry out the intent of this Agreement and to act therefore on behalf of the Association. The Association authorizes FMC, on behalf of the Association, to perform any act or do anything necessary or desirable in order to carry out FMC’s agreements contained herein.

Am I being paranoid or is this just way too vague to be in a contract? This company is the sister company of the full service Mgt company we are currently using. They are waving all setup fees and have the best price by far. But this contract clause bugs me.

I've emailed 7 lawyers about reviewing the 3 pg contract and only one responded and they wanted to set up a consultation appt of $150 first. Which is lame, just give me a price and bill me. current HOA lawyer dumped us when I complainted about a previously undisclosed digital storage fee of $80 to store two pdf files on thier system.

redacted contract attached in case anyone wants to really read the whole thing.

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📄161817429471.pdf(161 KB)

vis ta vie

CathyA3 (Ohio)
Posts: 6,299

Posted:

i wouldn't like it, but here's where I see the issue:

A manager needs to be able to do their work without unnecessary interference from the board or homeowners BUT the board is the ultimate authority (and ultimately responsible) for what happens in their communities.

Most of the bylaws I've seen list the duties of the board, along with a statement that the board has the right to delegate certain tasks as they see fit. These delegated tasks are what the manager is doing. So the bylaws are clear whose job these things really are. No management contract can alter that.

So I think that I see where they are coming from. Hopefully one of the managers on this site will have some suggestions as to how that language should be worded so that the manager can do their job without unreasonable interference but also without usurping authority that belongs by law to the board.

CathyA3 (Ohio)
Posts: 6,299

Posted:

Also, no lawyer is going to quote a price without a clear definition of exactly what work they're going to be doing. General info can maybe be quoted by the hour, but legal work about specific a contract (which is what you're asking for) is too open-ended.

If some lawyer did quote a price in this situation, I'd estimate the likely usefulness of their opinion as a result and give them a miss.

ElleN (Idaho)
Posts: 4,420

Posted:

Objections to paragraph 8 suggest to me a tiny bit of a desire to micro-manage. So yes, I think maybe there is just a tiny touch of paranoia here. On the other hand at least you checked in with the forum. That's brave and admirable.

To alleviate concerns all around, maybe ask the board to ask that a single sentence be added to paragraph 8? E.g.

"In the event the HOA Board objects to an action that the FSM takes pursuant to this paragraph, the board shall promptly request a meeting with FSM to see if the board and FSM can agree on a different action. A failure to agree shall result in FSM either (1) doing as the board directs; or (2) having the right to terminate this contract."

Or propose this addition, then see if FSM can improve on the language so all are happy?

I admit for you or myself to be adding language like this scares me.

WendyM5 (North Carolina)
Posts: 1,522

Posted:

Quote:

Posted By CathyA3 on 06/18/2023 12:08 PM
Also, no lawyer is going to quote a price without a clear definition of exactly what work they're going to be doing. General info can maybe be quoted by the hour, but legal work about specific a contract (which is what you're asking for) is too open-ended.

If some lawyer did quote a price in this situation, I'd estimate the likely usefulness of their opinion as a result and give them a miss.

you gotta be kidding me. reviewing the contract and advising the BOD of any issues is not specific enough?

What should I write? read the contract and see if it has any issues with the HOA governing documents, the NC non profit act, and the NC Planned community act? If they dont' know that already they are worthless.

laywers have no problme quoting me $1200 for foreclosing (max allowed under NC law)
or quoting me $300/hour for revising/ameding our docs, so I dont' see the differnce.

vis ta vie

WendyM5 (North Carolina)
Posts: 1,522

Posted:

Quote:

Posted By CathyA3 on 06/18/2023 11:59 AM
i wouldn't like it, but here's where I see the issue:

A manager needs to be able to do their work without unnecessary interference from the board or homeowners BUT the board is the ultimate authority (and ultimately responsible) for what happens in their communities.

all a financial manager needs to do is give us a spreadsheet of who has paid and who has not paid twice a year, WTF do they need a clause that give them complete control in order to do something so freaking simple? we have zero ability to even access our working account with this financial manager, what exactly can the board do that would obstruct their ability to collect money? not send out invoices?

vis ta vie

MarkM19 (Texas)
Posts: 1,459

Posted:

Wendy,
Any contract that is written by someone else is for the benefit of that company. That is to be expected IMO. You need to pick an attorney that will be able to round the corners and make it fit both sides.

I think you need to pay for the services you want now or pay to get out of the contract you didn't want later.

WendyM5 (North Carolina)
Posts: 1,522

Posted:

Quote:

Posted By MarkM19 on 06/18/2023 6:29 PM
Wendy,
Any contract that is written by someone else is for the benefit of that company. That is to be expected IMO. You need to pick an attorney that will be able to round the corners and make it fit both sides.

I think you need to pay for the services you want now or pay to get out of the contract you didn't want later.

Well we have reduced the termination fee from $975 to $325 already, so less painfull to leave also negotiated the following
onbaording fee from $325 to zero.
closign doc fee from $200 to $150
Any expense over $800 requires board approval.
per door cost from $2.30 to $2.11, They did this by mistake, but I'm not gonna point it out.

vis ta vie

WendyM5 (North Carolina)
Posts: 1,522

Posted:

got 3 lawyers to reply via email
1st wants $380/hr. estimates 1 hr
2nd wants $1500 retainer first
3rd told us the contract states it will follow Wyoming law and suggested we hire an attourney from WY.
Emailed sesveral WY lawyers, no response.

vis ta vie

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