Conflict of Interest?

Started by DebraA • 8 replies • 1358 views

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DebraA (Arizona)
Posts: 5

Posted:

Homeowners are paying high HOA fees in a community of over 18 high rise buildings. Each building has their own agenda and regime (aka HOA) as they are called.

The president of a Regime is also now the president of the Management group that over sees the property.

Is this a conflict of interest in the community?

thank you.

DonnaS (Tennessee)
Posts: 5,671

Posted:

Debra,
In my humble opinion, just as clear as can be--a conflict of interest. check with Arizona HOA laws to see if they have it written out in them.

From your post, you are NOT a Board member, property manager or committee member because of the "Regime" comment (twice). What exactly is your position?

DebraA (Arizona)
Posts: 5

Posted:

Donna - I am full time resident,property owner and volunteer. Your response is appreciated. Thank you for direction. Conflicts of interest and concerns go way beyond this matter.

DebraA (Arizona)
Posts: 5

Posted:

Donna...Whht is your postion on your HOA? Also to be clear, the REGIME is the NAME of the HOA's in the area. We have 8 separate REGIMES. It is not called an HOA but a Regime. Please know was notintendeding to be sarcastic or brash in description. What a horrid name for a community board. Regards.

DonnaS (Tennessee)
Posts: 5,671

Posted:

Debra,
Well, that sounds better and who is the brain that named them so. I am a Board member where I live in a single 565 home developement. I also own 3 rentals in the area and am Documents chairperson on 1 and a docs. committee member on another. Lots of Docs work which is what I specialize in--in Florida.
Donna

SusanW1 (Michigan)
Posts: 5,202

Posted:

How did the president of the management company get to be your board president?

YES, this is a conflict. (He has potential financial gain in the decisions made by the board. It would be imposssible for him to abstain on the motions, since most of them would involve actions of the MC)

RobertG (Arizona)
Posts: 505

Posted:

Debra - have you looked at the AZ law on conflict of interest? It is an interesting law. It merely states that all a board member has to do is say they have a conflict (no reason necessary) and they meet the obligation. At that point they can vote if they want without violation HOA laws. Seems like a wide open law, but that is the way it is.

Deciding if it is a good thing to not vote, is a whole different matter.

DebraA (Arizona)
Posts: 5

Posted:

Susan: Was and is still regime president for 2 buildings. As matter of fact he is president of building I live in. He recently "volunteered" for position as President of on site management company for entire community (which is a paying position but says he does volunteer, and is also President of Board for all Regimes. Dicatorship, venture capitalist? Also managed to get an office on the property to conduct Regime business. I realize this all sounds too out of hand to be true but is fact and quite frankly sound illegal.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Debra,

AZ does have conflict of interest statutes which govern non-profit corps. If your HOA is a non-profit corp these statutes would apply. Check out ARS 10-3860, 10-3861, 10-3862, 10-3863 & 10-3864. ARS 10-3862 states the director must inform the BOD of ". . .the existence and nature of the conflicting interest" and must inform them ". . .of the character and limitations imposed by that duty before their vote on the transaction." The director must "play no part, directly or indirectly in their deliberations or vote."

Yes, I do agree this is a conflict of interest and, IMO, it's also highly unethical. IMO, if he really wanted to volunteer his services as a manager he could do so without being associated with a management company, right? Sorry, but something smells fishy in Denmark!

Mary

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