President’s election tricks

Inspectors for HOA elections is not a requirement in many states and generally over reach by the state legislature. A large percentage of HOAs across the US struggle to get candidates and the elections are unopposed, yet they have to pay an inspector an unopposed election. It’s wasteful.

How does your President allowed to enter into Association contracts without board approval? That person is only one vote.

Great that your Board voided the contract.. Your Board voted at an. open meeting to void it, right? And your Board voted (again?) for a correct contact? Or?

When is your election?

Dean: there is no requirement for a California HOA to hire an inspectors of election firm. We do not as we have a few owners who volunteer every year ( we need 3 instpaictors) and who are overseen by our HOA attorney who attends every annual meeting.

How do type plan to list his removal from office on the agenda? You do not have to name the office or person if you don't want to. It can be: "Possible Reelection of Officers," or similar.

I think it takes all parties to a contract to void it.

I suggest that the board agree to contact the Election Inspector; explain that the board did not vote on the contract; explain that the President did not have authority to sign; and ask the Election Inspector to agree to cancel the contract.

Hopefully the Election Inspector will see the legal messiness (especially since he/she is presumably experienced in those matters having to do with elections) and say, "Sure. Call me if the board changes its mind and wants to sign a contract with me."

I believe it just takes a majority of a Board vote in an open Meeting in Calif. to cancel a contract. The next motion would be to hire this inspector of elections firm at whatever the Board wishes and knows will be accepted by the EOE firm.

I'm not sure what Terri means by her last question.

My question referred to what would others do about the president who deceived the board?

Kick him off as an officer so he is just a board member then find someone to run for president at next board meeting.

I will check.

Jeff, just after a cursory check, there are several violations including action outside a meeting civil code 4910, not on notice and agenda civil code 4920, director shall performing duties in good faith corp code 7231. Hen there are our Bylaws and CC&Rs, president can only sign contracts approved by the board, only the board can contract for services.

Good progress with existing board.

Well said. This is a pattern. No legal elections were held until I took him to small claims court a few years ago. No election rules, no call for candidates, no ballots, no verification of membership. It was just whoever would show up at "annual meeting" would raise hand for a vote and two owners of same property would be counted as two. The year he tried to omit even that imitation election is when I went to court. He was about to adjourn the meeting and one neighbor said "don't we have to re-vote you in?"

Maybe on Mars very few crooks find their way into an HOA and onto a board.

Dean, Maybe my using "Crooks" was misleading? "Nefarious" might be more appropriate...but they both point to wicked/criminal activity and intentional!!
My only surprise here is attaching this action to poorer/low income neighborhoods. My hood is 140 SFHs in a high income community ('86-87). The questionable(suspicious), disruptive behavior I have witnessed came from well established, high income owners (Directors). Let's agree to disagree.
Jackie

Is it not fraud to hide for six weeks an election contract from the rest of the board, sign it in secret then deliver it to company running the election, instructing them to hold an acclamation election at association expense and not even give directors a copy? Then call up association’s lawyer for personal advice using association funds to pay for it. It’s all fraud.

When I posted this topic, I was not thinking "crime." But...here are a couple of paragraphs from a legal website:

"Recognizing Criminal Breach of Fiduciary Duty

When we talk about a criminal breach of fiduciary duty, we’re entering into more serious territory. This occurs when someone who is in a position of trust, such as an accountant, financial advisor, or trustee, deliberately acts in a way that violates the obligation to act in the best interest of the person for whom that person of trust is responsible.

A key question is the intention behind the actions. In a criminal breach, there is evidence that the fiduciary knowingly and willfully committed an act that was directly harmful to the beneficiary. This could involve actions such as embezzling funds, tampering with financial records, or engaging in deceitful transactions to benefit himself at the expense of those meant to be protected.

Criminal breaches may also involve fraudulent activity targeting an elderly person or a disabled adult. Such deliberate exploitation is subject to specific laws in many states, which treat these cases with heightened severity due to the victims’ vulnerability and need for protection.
Penalties and Consequences

The consequences for criminal breach of fiduciary duty can be severe, depending on the nature and extent of the actions of the fiduciary. In Florida, penalties for financial abuse of elderly people range from five years in prison and five years of probation to 30 years in prison and 30 years of probation, along with hefty fines based on the amount lost due to the breach.

It is important to note that breaching one’s fiduciary duty can lead to not just civil lawsuits but also criminal charges. The potential for substantial prison time and steep financial penalties highlights the seriousness of these offenses.

Consider a situation where a financial advisor purposefully resorted to forging documents and diverting client funds into her personal accounts. In such a case, not only does the affected party have grounds for civil litigation seeking restitution, but law enforcement may pursue criminal charges resulting in imprisonment and financial penalties for the advisor if found guilty.

Recognizing a criminal breach of fiduciary duty entails understanding the deliberate nature of the actions of the fiduciary and the significant detrimental impact on the beneficiary. It is crucial to be aware of these violations as they not only pose serious legal consequences for the perpetrator but also jeopardize the well-being and security of those whose interests were under the fiduciaries were entrusted to safeguard."

More than the election contract deceit, the greater problem has been his spending tens of thousands of dollars on attorneys fees without board approval for his own personal advice.

You've indicated, Terri, that there might now be a Board majority vote to remove the president from that office. I'm basing this on two other directors calling a social meeting of the Board for various reasons.

Why doesn't the Board majorority order the HOA attorney to stop paying th prez????

Terri, you do not need some let of "legal" rain to remove the president. Your do to need to present "evidence" of some sort of fiduciary wrong doing. HOA presidents can be removed without cause so far as I know. It might be a simple as a posted Agenda Item: Possible Reelection of Officers."

During the discussion of this item at the open meeting, a director can say something as simple as. "Chad make us all uncomfortable in his role as president. I move we remove him form that office. (per Robert's Rules can be done by secret ballot.). After that the Board nominates someone as a replacement--maybe you. Terri?

Sorry about all my typos, Terri. I meant to write you need NO "evidence" of, say, fiduciary wrongdoing to vote the prez ouT of that office. "Personality mismatches" even can be in th motion.

Getting "as far as a second" means nothing in a Board of five if 3 are opposed to you. So.... was the person who resigned aligned with you & one other ? Or with the prez?? Have you or others found a good replacement for the one who resigned?

Terri wrote:: "I've "asked" for new officer election after new director is appointed." WHO did you "ask?" WHEN will this new director be appointed? Date? special mtg.of the Board, which you might need again? Does this ask" mean it'll be on an agenda? When ? Seems like too many loose ends?

Until your Board votes to "cancel" the atty .contract, a majority of the Board can vote that it takes a Board majority vote for thE atty to do ANYTHING that costs your HOA $$$. What the heck does it say in your HOA's contact with the atty.?????

Your corporation--your HOA -- IS the client, Terri. The Board as a whole is elected by owners to represent the corporation. NO individual director or officer is "the client." The client, repped by your HOA's Board, only is authorized to "initiate the need for services." It must do this with a vote at a Board meeting. Sometimes with legal matters this would be in executive session.

Terri, you've learned SOOOOO much about CA HOA statutes but seem unable to operationalize them into agenda item actions.

What was "huge progress" was when two directors called a special meting of the Board. This meant a certain type of majority was with you. Was the resignee one of those 2?

What do you mean your send your agenda ask to "the Board?" Did you set a date too? How can something be "postponed" if no meeting date has been set?

How can the prez "take over" the meeting? The Board as a whole MUST, by statute, address each published agenda item in Cali. OR it must VOTE not to!!!

I think you need to visit the basics, Terri: The Board Members Tool Kit by CAI. Some of the 2 minutes webnivars at D-S.com, etc.

No you don't. Your BOARD needs to VOTE on a POLICY about when agenda items are due for the 2025 board meeting and what your agenda item must include. This often is about 10 days before a meeting. leave plenty of time for the required 4-day posting for open meetings. Why won't you read the D-S. opinion on this topic, Terri?

Do you have someone lined up to be on the Board??? What do your Bylaws say bout vacancies???

Will your only you Board approve costs to the atty with Board approval/vote since the HOA Board IS the client NOT the prez? Are you aware that the entire BOARD is potentiantly liable for the President's illegitimate payments to the attorney for the prez' personal services??? Yes, YOU are.

I'm seeing too much equivocating nd non-answers on your part, Terri, and am done for now.

The president did not cancel the contract and is proceeding with the contract the board never saw.

Vacancies are filled in an open meeting in Calif. Directotros are NOT prersonnel

Neither is an “emerg3ncY” as your know.

For all the reasons given, time for a showdown.