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ScottT5
Posts: 63
Posted:
All... I am back.. Jeesh

so firstly I do appreciate your knowledge and advice more that I can express. Your expertise in HOA matters are pretty amazing... years of knowledge and pain I suspect.

So we are in the midst of some insane politics for a development with 10 homes all on 1.5 acre wooded lots.

I have read our Declarations and Bi-laws and studied them. Homes that are to be built have requirements written in the declarations

(e) All exteriors will be rustic in appearance, composed only of natural wood (with redwood, cedar or logs preferred); the use of vinyl siding may be permitted with the prior written approval of the Committee. Colors will be natural, rustic, earth-tone hues with flat finishes preferred (white exteriors, except for trim, are prohibited). No aluminum siding will be allowed except for such uses as gutters, trim and soffits.

There are no provisions for variances or exceptions. The Developer is also acting President and is a majority lot owner, still owning 23 lots. Voting power is determined by the number of lots. He is also, per the bi-Laws is an acting member of the ACC committee. This development will never be turned over to a property management company. There is a new home that was built recently and it is a young couple with children The home is beautiful and secluded by woods for the most part, so there is only a small area that is visible (not that it matters, but it provides context)

The new owners provided the build plans and color options which were approved by the ACC prior to breaking ground. The owners made some changes and submitted them to the Developer who resides on the ACC. Those changes included a build out family room on the side of the home, not readily visible from the road except in winter. That room is white, which is in violation of the CC&Rs, but the Developer approved it in writing after review.

There is an acting member of the ACC, that has a history of being unreasonable and threatening foreclosures and litigation for many of the residents. He is not very well liked. He is the one who, if you recall, sent a letter for a vote, stating that no reply is considered a yes vote. thanks to you all I looked it up in State condo law and that is illegal.

He is now threatening to sue the couple. His wording in the email is that he is starting the fining process, followed by litigation as they have had 45 days to resolve the issue and failed to do so. He also stated in his email that their home looks hideous and unsightly ($800k custom home)

Not sure the legal aspect, but this seems to be a matter to be resolved within the HOA, as the resident in good faith applied and was granted approval

Verbal conversations were that the ACC member may try to implement an emergency assessment to pay for the replacement of the color, so that could happen without a vote. The Developer is siding with the homeowner...

so thoughts??? how might this play out? I am assisting the homeowners if I am able and per the next board meeting, I am going to volunteer or run for a position. The Developer stated he would like to appoint me as board member position... I think he has the power to remove this person, and we have had some conversations about changes to the Declarations.

a mess in paradise for sure. and thanks in advance...

ElleN (Idaho)
Posts: 4,420
Posted:
Quote:
Posted By ScottT5 on 07/14/2024 10:04 AM
He is the one who, if you recall, sent a letter for a vote, stating that no reply is considered a yes vote. thanks to you all I looked it up in State condo law and that is illegal.
No. This it not at all what the thread said. Not one bit. Per the state nonprofit corp statute, you were directed to look at your Articles of Incorporation. You never got back to the thread with what you found.

See https://www.hoatalk.com/Forum/tabid/55/forumid/1/postid/372324/view/topic/Default.aspx

Furthermore I can almost guarantee you that the Michigan Condo statute does //not// apply to your subdivision of single family homes.
CathyA3 (Ohio)
Posts: 6,299
Posted:
If this person is a blowhard with a history of threatening to sue, I think he will do nothing. Lots of people threaten to sue, until they talk to a lawyer and find out how much it will cost and what they're chances are.

That said, anyone can sue anyone else for anything.

Take a look at your governing documents. In many HOAs, individual owners have the right to enforce the provisions in the documents by filing a lawsuit against the offending owner. If your documents have a similar provision, then Mr. Blowhard is within his rights. If he goes ahead with it, the owners of the home need only provide a copy of the approval they received, and the suit will be dismissed. (For those reading along, this is why you need to get ACC approvals in writing.)

In addition, this really isn't the HOA's fight, nor is it the fight of any other owners. I understand others may have an interest in the outcome, but that's not the same as having standing. You don't want to take on liability where none exists. If you want to provide real assistance, encourage the owners of the home to consult with a competent attorney and follow that person's guidance.

As for what the Developer can do, while it's true that developers call the shots while they're still in control of the association, they're still required to abide by the governing documents. Generally the board can't remove a board member. Trying to remember back to my community's developer stage, homeowner board members were elected at the annual meeting and only the membership could have removed them. Depending on how many votes the developer has and what weight they have (eg. 1 developer vote = 3 homeowner votes), he may or may not control the vote. (If he truly has the power to remove a board member, I wonder what he's waiting for.)
TimB4 (Tennessee)
Posts: 21,062
Posted:
Typically, The board is the final say.

The developer, has one vote on the board.

All of this said, the Developer, typically, has the authority to amend covenants at any time.

Now, for the specific issue:

You point out that the member did get approval.
If the board desired to remove the approval, then that member would have grounds to be made whole.

Meaning, if the item was installed, the Association would have to pay to remove the item and return it to the condition it was prior to approval being granted.
It would likely take legal action to make that happen.

Side note: being single family homes, the condominium statute would not apply.
An HOA statute may apply (depends on applicability).
If incorporated, the States non-profit/not for profit statute would also apply.
CathyA3 (Ohio)
Posts: 6,299
Posted:
I misspoke. If Mr. Blowhard is only a committee member and not a board member, the Developer can indeed remove him. What is he waiting for? It's in his interest to corral this person before he drives people away from the community.

A committee member has no authority to foreclose or sue on behalf of the HOA unless your governing documents are very unusual. That authority belongs to the board only.

KerryL1 (California)
Posts: 14,550
Posted:
Ah, I see replies emerged while I, in my typically slow fashion, typed a response. I'll quibble with Cathy and say that the developer canNOT kick JF off of the ACC. Assuming the developer DOES have a Board, the Board votes, etc., see my below.. Soctt's Bylaws aor state statutes probably required that, as a corporation, the developer have a Board.

I do not know, per Tim, if the developer has the sole authority to amend the CC&Rs? Scott will need to look at the CC&Rs to see the steps necessary to amending the CCRs, I doubt the prez on his own can announce at a board meeting that he's amending the CC&rs to state.... It may require owners' votes and, of course, he'd win that vote due to owning so many lots.

Since you’ll be on the Board, Scott, please make it your business to learn the basis language of corporations & HOAs. Corporations have “bylaws,” sometime spelled “by-laws.”

The name of your HOA's MOST important “governing document” is The Covenants, Conditions & Restrictions, aka “CC&Rs.” Another word for it is “the declaration” (no s). Another is “the covenants.”
Unless he somehow is calling himself “acting” president, your developer is the president of the Board.

Yours also serves on the ACC. As simply an ACC member, the Committee should have voted on the proposed changes. He alone did NOT have the authority to approve, and should never have approved the owner’s proposed changes to the original approved application. BUT, the owner probably thought that the president’s approval was good.

You wrote that the jerkface ACC member may try to “implement an emergency assessment.” But he has NO authority to do so. Your Bylaws may tell you something about committees and their authority. Your declaration probably tells you about the ACC too. Non-profit corps code also very likely has some info about committees.

Typically, the board of directors must vote at an open meeting on any assessment against any owner or against all. See your CC&Rs section that discusses assessments and special assessments, including “fines.” There may be something in the no-profit corp codes. (NOT condo codes; your HOA is not condos).

To try to call it an “emergency” assessment (paint color???)is ludicrous and Jerkface is making stuff up again.

Nothing happens “without a vote,” Scott, so I don’t know what your phrase refers to. Please clarify.

WHAT SHOULD happen next is that the ACC votes at a meeting to send this additional app to the Board for its review & final decision via its vote at. Pretty simple. The only reason there’s a “mess” is because NO ONE in Scott’s HOA seems to comprehend the correct and (mainly) legal roles for persons and a committee.

It’s crucial to know that boards govern HOAs (non-profits), NOT presidents. The prez is NOT “El Jefe,” or The Decider. Some HOA boards DO make the huge mistake of deferring to the president. At Board meetings, the prez like every director, has one vote per topic. And decisions are made at Board meetings.

Scott wrote: The Developer stated he would like to appoint me as “board member position.” There is no such thing as that. There is the Board. You would be appointed as a director with no “position.” And ONLY the Board may vote to appoint directors to fill vacancies. The prez has NO such authority on his own (unless your Bylaws are incredibly unique).

Similarly, the prez may NOT remove JF from the ACC. ONLY the Board has the authority to approve or remove committee members (or form or disband committees) with its vote at a board meeting.

When you use the word “positions,” Scott, it appears that you think that the prez could appoint you as an “officer.” But, again he may not appoint officers either. The Board votes to appoint officers and your Bylaws probably tell you which ones your HOA must have. The Board elects/appoints officers usually form among the directors — never owners or the president.

Scott wrote: “This development will never be turned over to a property management company.” That is incorrect anyway. What happens is the HOA is turned over to the Board of of directors of owners once some goal has been achieved.

I think I too asked about your Articles of Incorporation, Scott. Can you not find them?

Cory on, you have a lot to learn, but you seem willing and that's very good. As recommended elsewhere recently, CAIonline.org can teach everything you need to know in it s"Toolkit for New Board Members." I somehow got it free, but can't remeber how.
KerryL1 (California)
Posts: 14,550
Posted:
Say Scott in noticing your subject line again, a "discrepancy, "perhaps "disagreemen"t is more accurate? between those two individuals does not matter one bit. The Board directors make decisions about such squabbling. Neither person has the "power" to do anything -- only the Board does. (Unless the prez has somehow given himself dictatorial powers."
ScottT5
Posts: 63
Posted:
Sorry if the subject was misleading.. and yes I have lots to learn about this

This is a condominium project - interesting the last sentence in C.

LEGAL DOCUMENTATION

A. General. ----- was established as a condominium project pursuant to a Master Deed recorded in the office of the ---- County Register of Deeds. A copy of the Master Deed has been provided to you with this Disclosure Statement. The Master Deed includes the Condominium Bylaws as Exhibit "A" and the Condominium Subdivision Plan as Exhibit "B". All of these documents should be reviewed carefully by prospective purchasers.

B. Master Deed. The Master Deed contains a definition of terms used within the condominium project, the percentage of value assigned to each unit in the condominium project, a general description of the units and general and limited common elements included in the project, and a statement regarding the relative responsibilities for maintaining the common elements.

C. Condominium Bylaws. The Condominium Bylaws contain provisions relating to the operation, management and fiscal affairs of the condominium and, in particular, set forth the provisions. relating to assessments of the Association members for the purpose of paying the costs of operation of the condominium project. Articles VI and VII contain certain restrictions upon the ownership, occupancy and use of the condominium project. Article VII also contains provisions permitting the adoption of rules and regulations governing the common elements. At the present time no rules and regulations have been adopted by the Board of Directors of the Association.

D. Condominium Subdivision Plan. The Condominium Subdivision Plan is a two-dimensional survey depicting the physical location and boundaries of each of the units and all of the common elements in the project.
ScottT5
Posts: 63
Posted:
ElleN - it is registered as a condominium

it is still under developer control. He still holds 23 votes although thee second and tird pase will expand up to 90 home sites.

Control of ----- will be turned over to the ----- Condominium Association as an independent entity at the transitional control date. The transitional control date is the dates on which a Board of Directors, including at least two
(2) directors who are unaffiliated with the Developer, takes office. Until the transitional control date, the condominium will be managed by the ---- Condominium Association, although the Association will be controlled by the Developer. Even after the transitional control date, the Developer is entitled to participate, through voting and through appointment of directors, in the affairs of the condominium to the extent it owns units in the condominium.
CathyA3 (Ohio)
Posts: 6,299
Posted:
Quote:
Posted By KerryL1 on 07/14/2024 12:15 PM
Ah, I see replies emerged while I, in my typically slow fashion, typed a response. I'll quibble with Cathy and say that the developer canNOT kick JF off of the ACC. Assuming the developer DOES have a Board, the Board votes, etc., see my below.. Soctt's Bylaws aor state statutes probably required that, as a corporation, the developer have a Board.
*** snip ***

After I posted the reply, I realized that I'd phrased it badly.

Yes, one of the first steps in developing a new community is filing the legal documents that create the association and incorporate it.

I agree that the board would remove the problem committee member, but at this stage the developer controls the board. It would require a formal vote, but what he wants, he gets. (I mentioned earlier that it's not unusual for a developer's vote to carry more weight - for example, his one vote may count as three homeowner/director votes. So on a three-person board with two homeowner directors, the developer's single vote would outweigh the homeowners' two votes.)

If there are two phases still to be developed in the Scott's community, homeowners are a long way from being able to override the developer's decisions.

This is why it makes no sense to me that the developer hasn't yet done something about the committee member if he's that problematic. Put it on the agenda for the next board meeting, vote, put it in the minutes, and be done with it.
ElleN (Idaho)
Posts: 4,420
Posted:
Quote:
Posted By ElleN on 07/14/2024 10:18 AM
Posted By ScottT5 on 07/14/2024 10:04 AM
He is the one who, if you recall, sent a letter for a vote, stating that no reply is considered a yes vote. thanks to you all I looked it up in State condo law and that is illegal.
No. This it not at all what the thread said. Not one bit. Per the state nonprofit corp statute, you were directed to look at your Articles of Incorporation. You never got back to the thread with what you found.

See https://www.hoatalk.com/Forum/tabid/55/forumid/1/postid/372324/view/topic/Default.aspx

Furthermore I can almost guarantee you that the Michigan Condo statute does //not// apply to your subdivision of single family homes.
The OP has provided evidence that the HOA is subject to the Michigan Condo Act. I reviewed the Michigan Condo Act. My conclusion is not changed. The OP needs to read this HOA's articles of incorporation. See this thread: https://www.hoatalk.com/Forum/tabid/55/forumid/1/postid/372324/view/topic/Default.aspx
ElleN (Idaho)
Posts: 4,420
Posted:
Quote:
Posted By ScottT5 on 07/14/2024 10:04 AM

I have read our Declarations and Bi-laws and studied them. Homes that are to be built have requirements written in the declarations

(e) All exteriors will be rustic in appearance, composed only of natural wood (with redwood, cedar or logs preferred); the use of vinyl siding may be permitted with the prior written approval of the Committee. Colors will be natural, rustic, earth-tone hues with flat finishes preferred (white exteriors, except for trim, are prohibited). No aluminum siding will be allowed except for such uses as gutters, trim and soffits.

There are no provisions for variances or exceptions. The Developer is also acting President and is a majority lot owner, still owning 23 lots. ... There is a new home that was built recently and it is a young couple with children The home is beautiful and secluded by woods for the most part, so there is only a small area that is visible (not that it matters, but it provides context)

The new owners provided the build plans and color options which were approved by the ACC prior to breaking ground. The owners made some changes and submitted them to the Developer who resides on the ACC. Those changes included a build out family room on the side of the home, not readily visible from the road except in winter. That room is white, which is in violation of the CC&Rs, but the Developer approved it in writing after review.
...

He is now threatening to sue the couple. His wording in the email is that he is starting the fining process, followed by litigation as they have had 45 days to resolve the issue and failed to do so. He also stated in his email that their home looks hideous and unsightly ($800k custom home)

Not sure the legal aspect, but this seems to be a matter to be resolved within the HOA, as the resident in good faith applied and was granted approval

Verbal conversations were that the ACC member may try to implement an emergency assessment to pay for the replacement of the color, so that could happen without a vote. The Developer is siding with the homeowner...
From general case law, my take is this:

As long as the HOA pays for the replacement of the color, then I think the owners' wisest move would be to agree to the correct, covenant required color.

Otherwise IMO the HOA would be legally foolish to require the owners to pay for the color change.
ScottT5
Posts: 63
Posted:
Thank you Cathy,

The developer has 23 votes per the guidelines. if he expands the development he will have more. some owners have 2-3 lots and they receive 1 vote per lot.

interesting dynamics... the developer is not very business savvy.. his father started the development at his death passed it to two brothers. shortly after, the second brother passed. The developer does not even have internet or a computer... so it is somewhat of a challenge. The Declarations and bi-laws were created some time ago

so not sure if he understands what can or can;t be done. he was smart enough to name a successor who is independent and not a property owner, but a very smart person.. he is not involved per his choice as he is not an owner.

The developer does a great job of keeping up the property but there is a conflict with the ACC member who is trying to call the shots... a sad state of affairs, but there are new blood and young smart owners that are willing to step up...

KerryL1 (California)
Posts: 14,550
Posted:
Scott, what do you BYLAWS say about the size of the board of directors? Does your HOA have a board? How many are on it?

Yes, for votes of the membership, i.e., owners, the delver get extra wine. But for Board decisions, the developer/president has, to repeat my above, one. And, according to Scott, the developer/prez DOES want to remove Mr. JerkFAce.

With Cathy, why doesn't th developer/his board remove JF with their vote at a board meeting??????? New directs would b good, but he/his board can easily dump the guy off the Committee.

It does not matter how old the CC&Rs and the Bylaws are; they rule!

What do you mean the developer named a "successor, Scott?" Is that within his development firm? Or, somehow within the HOA??? (why does that make him "smart?")

JohnC46 (South Carolina)
Posts: 14,265
Posted:
Quote:
Posted By CathyA3 on 07/14/2024 11:25 AM
I misspoke. If Mr. Blowhard is only a committee member and not a board member, the Developer can indeed remove him. What is he waiting for? It's in his interest to corral this person before he drives people away from the community.

A committee member has no authority to foreclose or sue on behalf of the HOA unless your governing documents are very unusual. That authority belongs to the board only.


I agree. Have the developer remove the fellow from the ACC.
ScottT5
Posts: 63
Posted:
So he named a succesor... not sure how or what the legalities are. but he is a sole proprietor, or majority owner so in the event that he were to pass... there would be nothing ???

His company takes care of common grounds... mowing, tree removal snow plowing etc and maintains the private roads.
KerryL1 (California)
Posts: 14,550
Posted:
Please define what "named a successor" means. What would be the job of "the successor?" Are there papers he signed of some sort? involving the HOA? Is this s successor's name on a deed of any HOA lots?

Do your Bylaws require that board member be owners??

In your post above, Scott, what is the document that "LEGAL DOCUMENTATION" Is a part of? The Master Deed (usually another name for declaration or CC&Rs)? The Bylaws? Or is it a separate document and not governing document at all? It's sort of a cover letter to your true governing documents? It includes "Article VII also contains provisions permitting the adoption of rules and regulations governing the common elements. At the present time no rules and regulations have been adopted by the Board of Directors of the Association." This is very typical of HOAs though usually, I think, found in the declaration.. Not sure why you find it "interesting," Scott?

What document is THIS from? It's very, very import to always name the document that's cited. "Control of ----- will be turned over to the..." And yet, "Even after the transitional control date, the Developer is entitled to participate, through voting and, in the affairs of the condominium to the extent it owns units in the condominium. I'm only guessing that " through appointment of directors" means he may, like any other owner vote for directors.

TimB4 (Tennessee)
Posts: 21,062
Posted:
To properly name a successor, you need to put it in writing and record it at the courthouse.

If the individual were to die without a successor, the estate would inherit the developer rights.
CathyA3 (Ohio)
Posts: 6,299
Posted:
To add to what Tim said, it's important for business owners to name one or more successors. Otherwise the business will be in limbo while the estate winds its way through probate - and it won't be able to conduct business without someone with the authority to do so.

A successor is a good thing.

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