Board of Directors actions during suspended License

Started by SusanS31 • 3 replies • 214 views

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SusanS31 (California)
Posts: 5

Posted:

I live in a gated CID Mobile Home Park. Our license has been suspended since 2021 yet the BOD have been conducting business as usual, collecting dues, contracting road and tennis court resurfacing. There had been an office manager supposedly taking care of submitting proper paper work, paying taxes, collecting dues. However residents have been complaining their dues payments were not being deducted from their checking accounts. As far as i know this had been going on for a year. The president and another office from the board went to manager to try to identify what going on and they found funds missing. The manager was let go but the president did not want to fire her but to lay her off so she could get unemployment. Also once the other officer started going thru the finances, she found definite theft not only by office manager but possibly by other board members. This other officer from the board has been working her tail off trying to get access to computer, access all docs and files and has not had any assistance from the BOD.
Also the pres of the board has been taking paper files from file room and wants to pull hard drive from computer.
We have been having monthly meetings and the president out right lies when asked what status of license, insurance, and funds are.
What can and should we as homeowners do.

TimB4 (Tennessee)
Posts: 21,059

Posted:

When you say license, I expect you mean the corporation status.

With this expectation, the board can (and should) continue to do business.
They are simply an unincorporated Association.

Typically, Corporate status is suspended or lost due to failure to file annual reports.
Often, filing of those missed reports (along with a penalty perhaps) restores corporate status.
If too much time has elapsed, the Association may need to start the incorporation process over.

Honestly, if it were me, I would do one of the following:

1) Contact an attorney and get a legal order to stop the removal of records, hard drives, etc.
2) Gather support and remove that one individual (perhaps the whole board)

Other option, bring your concerns to an attorney and have the court place the Association under receivership to straighten the mess out.

None of these are good options.
All will cost time, energy and money.
It's best to have a group vs. trying it alone.

ElleN (Idaho)
Posts: 4,420

Posted:

I agree with TimB4 that what you probably mean is that the corporation's status is "suspended." However, this absolutely does //not// terminate the corporation. Read this:
https://www.davis-stirling.com/HOME/S/Suspended-Corporation

As for any suspected theft going on, your best option is to either recall the board or elect new directors at the next annual election. Have an audit done. If the audit shows theft, pursue with the attorney general or in a civil suit, per the advice of a HOA attorney.

DeanJ
Posts: 1,786

Posted:

Quote:

Posted By SusanS31 on 01/24/2024 12:24 PM
I live in a gated CID Mobile Home Park. Our license has been suspended since 2021 yet the BOD have been conducting business as usual, collecting dues, contracting road and tennis court resurfacing. There had been an office manager supposedly taking care of submitting proper paper work, paying taxes, collecting dues. However residents have been complaining their dues payments were not being deducted from their checking accounts. As far as i know this had been going on for a year. The president and another office from the board went to manager to try to identify what going on and they found funds missing. The manager was let go but the president did not want to fire her but to lay her off so she could get unemployment. Also once the other officer started going thru the finances, she found definite theft not only by office manager but possibly by other board members. This other officer from the board has been working her tail off trying to get access to computer, access all docs and files and has not had any assistance from the BOD.
Also the pres of the board has been taking paper files from file room and wants to pull hard drive from computer.
We have been having monthly meetings and the president out right lies when asked what status of license, insurance, and funds are.
What can and should we as homeowners do.

You need to get the person who has records of the theft to go to your local prosecutor with the evidence. It seems likely the president is involved in the theft, destruction of evidence, witness tampering, and unemployment fraud.

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