Back peddling on approved contract at board meeting ...

Started by LoriE • 10 replies • 1188 views

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LoriE (Indiana)
Posts: 34

Posted:

Last month our board voted on a contract that was approved. A few weeks later a new RFP was sent because the board claims they did not follow their procedures, when in fact, the procedures were followed in 2007. This RFP was completely different than last year's because of a change in board.

Since the original contract was approved at the last board meeting and entered into the minutes, is it binding?

SusanW1 (Michigan)
Posts: 5,202

Posted:

Any motion can be amended or recinded (as long as work has not been done, then it gets complicated for recinding (withdrawing or cancelling)the motion)

LoriE (Indiana)
Posts: 34

Posted:

They didn't amend or rescind the motion. That just did it.

LoriE (Indiana)
Posts: 34

Posted:

So what are the options?

SusanW1 (Michigan)
Posts: 5,202

Posted:

If this was a motion to do an act, and the motion passed, then the Board is bound to it.

You need to revisit the ORIGINAL motion and read it again for the Board. They ARE bound to it. Then someone can either amend it or recind it - but you can't bend, disregard, or change it outside of a proper motion.

LoriE (Indiana)
Posts: 34

Posted:

I would agree with you; however, our board doesn't follow the rules only when it is to their advantage. Currently, they have approved 2 lawn care services. One will get the signed contract, Company 2, and the other won't, Company 1. Company had the contract last year.

We suspect collusion between the board and Company 2. Company 2, who won this year's bid, was $600 over Company 1's bid last year. Company 1 submitted a bid in January. It was voted on at the March meeting and approved. All of a sudden, a new RFP and an amended RFP come out 2 weeks after the approval. Company 2 is now just under the bid submitted by Company 1 in January. Now Company 2 is $200+ below the bid they submitted last year and fertilizer prices have jumped a tremendous amount this year.

Suspicious, you bet. Any suggestions? Thanks!

WardellD (Washington)
Posts: 64

Posted:

If our By-laws say that a board member can not be awarded a contract, can the board still do it anyway if they give a reason because this person has the lowest bid and is willing to save the HOA money.

Wardell

http://www.cp2hoa-info.com

SusanW1 (Michigan)
Posts: 5,202

Posted:

If your bylaws actually say that Board members cannot do work (contract) with the Association, then that's it.

However, that's not the point in most cases.

Usually, there are at least 3 bids accepted for the job. If there is a perceived "conflict", then that Board member can abstain from the voting to decide which company to hire.

The company names should be taken off the bidding process, so only the numbers are seen.

MaryA1 (Arizona)
Posts: 7,043

Posted:

One other point to consider. The lowest bid is not always the best company to go with. Although the bid amount should be considered very carefully, the company you feel will do the best job is the company you want to hire.

LoriE (Indiana)
Posts: 34

Posted:

The reason of the new RFPs is because I work for Company 1 and the board member who was not at the board meeting in March, but did present the contract, does not like. It's his way of getting back at me and hiding behind the Board of Directors, because he can and will.

BradP (Kansas)
Posts: 2,640

Posted:

Lori:

Was the contract that was approved signed and executed by the board? If so it is a binding contract no matter how it arrived where it arrived and the termination clause in it should be executed if you want out of it. If the contract hasn't been signed and executed then the board should have leeway if it wants to explore other options.

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