Recall Chaos

Started by DebbieK3 • 28 replies • 1852 views

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DebbieK3 (Florida)
Posts: 8

Posted:

Our HOA, 3 years ago, was in shambles. A 4 person board turned the situation around and at the time of our last election things were stable. There was a takeover of the Board at the election with proxies being given to a very unbalanced person who brought with him 2 more very unbalanced and certifiable people, in addition to a prior board member and someone else. Now there were 5. The prior board member was so angry and the takeover he verbally said he would not serve. Nothing was given in writing. He changed his mind when he realized that the 3 unstable members would do more harm. They would not allow him to attend the meeting and threw him out. Our attorney had to inform them he was still a board member as he had not resigned in writing. But wait, it gets better. This new 3 person board (although there are 2 more members they are never included) began to negotiate with a person who has been in a lawsuit with the HOA for 5 years and has cost us thousands to "settle" his lawsuit. These 3 people have slandered the old board and spread lies about money being hidden away. It's pretty bad.

There has been a legal recall with the oversight of one of our attorney's and the required number of signatures have been gotten and the new board did not hold the required meeting and so, according to our attorney, they are out and the new board is in. But the recalled board does not acknowledge this situation and refuses to remove themselves. They have now hired an attorney, with the HOA's money, to fight this. The attorney is friends with the person in the lawsuit.

The bank has frozen our account (I am the old Treasurer and work with the bookkeeper so the bank and I have a relationship). We cannot pay our bills. This ousted board is using all the attorney's and the bills are enormous.

What can we do? The HOA attorney of record (our legal agent) says he cannot represent the community as there is no Board that is recognized. We are in Florida. The Board that was ousted does not have control of the bank account as they were not able to produce the proper papers to have the signatures changed and when they threatened the bank they were thrown out.

The association is in CHAOS .. is there someone in Tallahassee we can call? The ousted Board members are very dangerous and some of us feel threatened with physical harm .. and the HOA is going down the drain very quickly.

Thank you for any help on this.

SusannaM (Florida)
Posts: 366

Posted:

WOW Debbie, what a mess. First of is yours a condo or SF HOA ??
For HOAs under FL Statutes 720 you can ask the DBPR (Dept. of Business of Professional Regulation) to initiate a "mandatory binding arbitration" process. The filing of such cost $200 but you must be represented by an attorney who belongs to the FL Bar. Otherwise they won't even listen to you. Where in FL are you ??
FL Condos are governed by FL Statutes 718. 718.5011 covers everything about the Office of Condominium Ombudsman, which provides mediators to condo disputes. You can look all of these up on the internet.

BruceF1 (Connecticut)
Posts: 2,535

Posted:

Debbie,

I'm confused.

You say that your attorney says that the old board is out and the new board is in. Then you say that the HOA attorney claims he can't represent the community because there is no recognized board. Then there is the attorney for the ousted board members. Who is represnting whom? Are there three separate attorneys?

You said that the bank account is frozen and you can't pay the bills. Also, the ousted board can't use the HOA money because the bank won't let them access the account. So, they can't pay their attorney either; at least, not with HOA funds.

It would seem to me that if the old board has been legally recalled, there is no way they can engage an attorney with HOA funds. Even if they try, if a court upholds their recall, they will be left footing the bill on their own.

I would think that if your attorney believes the new board is in, there should be something he should be able to do, perhaps through the courts, to at least get a temporary order to free up the HOA funds and at least allow the association to function until the mess can be legally sorted out, which could take months, or maybe years.

DebbieK3 (Florida)
Posts: 8

Posted:

I'm so sorry for the confusion. I wasn't sure if anyone would respond so I didn't want to get too long winded. Let me try and explain a little better. We are a "PUD" association. I am not totally savvy on the technical stuff but I did send this site to the President of the New Board to check out. Thank you for the suggestions on who to contact as far as mediators are concerned. Insofar as the legal situation ... the association has an attorney who is our legal agent and was involved with us on collections, document consultation and other legal advice. Then there is an attorney who was the litigation attorney for the past 5 years with this homeowner that now seems very cozy with members of the board that was elected in October via the lies and collection of blank proxy's that they filled out and submitted. I was out of town for that meeting and only heard about it after. As far as I'm concerned it was an illegal election as 2 members were added to the ballot and they were never nominated from the floor. Regardless, the litigation attorney is the one who reviewed the recall ballots and deemed the service of the recall package and subsequent non response from the insane board that is causing this mess. The third attorney is this new guy, who we understand actually represents the person in the lawsuit, that this insane board supposedly hired to fight this recall.

It is the association attorney who has told me that he represents the association and the board that runs the association and since no one knows who is running the association right now, he has removed himself from the situation by saying until he knows who is in charge he'd rather not be involved. Am I annoyed at that? You betcha .. since I'm the one that brought him into the association to begin with .. although I do understand his sentiments.

Yes it's true that with the frozen accounts no one is paying anyone anything. My concern tho, having been Treasurer and now bookkeeper, is that the bills that are being incurred for these legal fees with the litigation attorney, whom I understand has been visited a number of times by the 3 insane members, will still be owed even after they become history. They were actually escorted out of the bank by security because of their behavior. They tried to go to the bank with typed up minutes from the election meeting, that they typed, without any resolution and wanted the bank to give them access to the bank accounts.

Each of them separately have been sending emails to the community spewing misinformation and even I have asked an attorney if I have cause for a defamation of character case again one of them. I too have distanced myself now from being involved in the emails and spewing .. but my heart hurts because I worked very hard these past 3 years to get this community, with 3 other board members, out of the hole and back to having money in the bank, vendors that will work here again and a multimillion dollar insurance case pending .. yes with yet another attorney (lol)..from Hurricane Wilma which will also go down the tubes because the one board member who is more mentally unbalanced than any of the others doesn't think we should pursue the case and has actually been in touch with the insurance company attorney telling them that we are lying .. if you can believe that.

This situation is very bad and very sad and I guess I'm just reaching out for some sense of does this go on elsewhere (and from what I'm reading on the message boards I can see it does), and how do we get around this. The newly elected Board from the recall are working diligently to figure this mess out as well.

Thank you for your input .. I hope I didn't talk too much here and appreciate your care and concern.

SusanW1 (Michigan)
Posts: 5,202

Posted:

Well, there's a saying in Russia - "Retreat, retreat, and wait for winter."

I'd suggest you step back and let things flesh out. This is very confusing.

In the meantime, the COLLECTIVE Membership has the most power of any entity in an HOA. You can always call a Special Meeting of the Members.

Aren't other people as upset as you are?

DebbieK3 (Florida)
Posts: 8

Posted:

Ah yes .. Susan .. you are so right and that is what I have done. Yes, there are very upset homeowners. Like every other association that I know of, this community has apathy oozing out of its pores. One of my missions was to create a community when I got on the Board .. no matter how I tried .. it never happened.

There is alot going on behind the scenes. I am just someone that likes to have knowledge and not just emotion. I am a very spiritual person and believe in what goes around comes around (actually the name of my accounting company - lol), and I hate the negativity and energy imbalance .. so I have retreated.

Thank you for your input. Happy Holidays to all ...

Debbie

RobertR1 (South Carolina)
Posts: 5,164

Posted:

Debbie,
And Susan and rest. First, your suggestions are valid, worthy, accurate and should be considered seriously. So good for you all.

I would like to know since when was a PUD (Planned Unit Development) considered to be an HOA. Certainly not all are and doubtful if any are. A PUD is a concept to build a developement. A HOA is the creation of this developement. I guess you could say all HOA's were PUDS at one time but I doubt that is right also.
Anyhow, how are you referencing any State or Local regulations as PUD Laws.
You were advised what chapters and verse your state regulations applied for HOA and Condos.
This may be just semantics but it also could mean someone better start hitting the books before they have to present some testimony to a judge to clear all this up.
Call your special meeting as proscribed by you documents, chair the meeting and set the agenda as you and hopefully some more concerned members want to accomplish. Prime it seems to me is to get a lawyer that can get you before a judge before matters get worse.

RobertR1 (South Carolina)
Posts: 5,164

Posted:

Debbie,
Be smart and retreat if you must but do NOT come on any public electronic talk site and start calling people crazy.......bad move.

DebbieK3 (Florida)
Posts: 8

Posted:

Ah .. probably very right. At first I thought I had insulted someone on the this board saying that .. but now I realize it's the people on the takover board that you're speaking of .. yes you are absolutely right and I apologize to them.

They have been called that to their face tho so does that still count? lol .. kidding of course.

It's an interesting process and my purpose was to research some meaningful ways for this new board to proceed, who they should call, who's in charge, who's on first and I have received that .. and again, I thank you.

Debbie

GlenL (Ohio)
Posts: 5,491

Posted:

Debbie, I understand your frustration but please be careful throwing around words like "mentally unbalanced, certifiable and crazy", the defamation thing works both ways and unless you have proof to back up your allegations your words could come around to hurt you. I would let the members know that if they can't get together and elect a Board then eventually someone will end up petitioning the courts to appoint a conservator to oversee your Association without any input from the homeowners. Not only will this person be in charge of paying the bills; they will have to be paid to do it which might mean a hefty raise in dues.

Studies show that 5 out of 4 people have problems with fractions

DebbieK3 (Florida)
Posts: 8

Posted:

Lesson learned ... sometimes as evolved as I believe I am to rise above and be an observer I am humbled in all that I do not know. I have done my part and what I chuckle about is that one of the platforms that the recalled board ran on was that our dues were too high and the board I sat on had hundreds of thousands hidden that wasn't being used and they could reduce the dues.

I continue to watch and learn. Thank you, all, again and who knows, I have made members of the new board aware of your site and the valuable information I have learned, not only in what I wrote but in what I've read here.

Thank you too all that voluntary participate in communication such as this.

RobertR1 (South Carolina)
Posts: 5,164

Posted:

Debbie,
Don't worry about insulting any of us here, we are not a board, just a bunch of sweet lovable folks trying to save the world. Also that most are certifiable doesn't harm.

Let us know how you make out.

DebbieK3 (Florida)
Posts: 8

Posted:

and thank you for that chuckle .. I needed it..now back to football !!

I always say .. of all the things I miss the most .. I miss my mind

Thanks again and yes, I will keep you guys posted. I have a small accounting company that does nonprofit and 4profit accounting, as well as individuals. I have enough experience to be dangerous ... lol .. I've been reading some of the other theads and trying to help there .. as a loyal servant as well.

Happy holidays...

Debbie

GlenL (Ohio)
Posts: 5,491

Posted:

Quote:

Posted By GlenL on 12/21/2008 12:16 PM
I would let the members know that if they can't get together and elect a Board then eventually someone will end up petitioning the courts to appoint a conservator to oversee your Association without any input from the homeowners. Not only will this person be in charge of paying the bills; they will have to be paid to do it which might mean a hefty raise in dues.

Debbie, I meant receiver not conservator, pay attention to number 5, this could be very costly to everyone:

720.3053 Failure to fill vacancies on board of directors sufficient to constitute a quorum; appointment of receiver upon petition of member.--

(1) If an association fails to fill vacancies on the board of directors sufficient to constitute a quorum in accordance with the bylaws, any member may give notice of the member's intent to apply to the circuit court within whose jurisdiction the association lies for the appointment of a receiver to manage the affairs of the association. The form of the notice shall be as follows:

NOTICE OF INTENT TO APPLY FOR RECEIVERSHIP

YOU ARE HEREBY NOTIFIED that the undersigned member of (name of homeowners' association) intends to file a petition in the circuit court for appointment of a receiver to manage the affairs of the association on the grounds that the association has failed to fill vacancies on the board of directors sufficient to constitute a quorum. This petition will not be filed if the vacancies are filled within 30 days after the date on which this notice was sent or posted, whichever is later. If a receiver is appointed, the receiver shall have all of the powers of the board and shall be entitled to receive a salary and reimbursement of all costs and attorney's fees payable from association funds.

(name and address of petitioning member)

(2) The notice required by subsection (1) must be provided by the member to the association by certified mail or personal delivery, must be posted in a conspicuous place within the homeowners' association, and must be provided to every member of the association by certified mail or personal delivery. The notice must be posted and mailed or delivered at least 30 days prior to the filing of a petition seeking receivership. Notice by mail to a member shall be sent to the address used by the county property appraiser for notice to the member.

(3) If the association fails to fill the vacancies within 30 days after the notice required by subsection (1) is posted and mailed or delivered, the member may proceed with the petition.

(4) If a receiver is appointed, all members shall be given written notice of such appointment as provided in s. 720.313.

(5) The association shall be responsible for the salary of the receiver, court costs, and attorney's fees. The receiver shall have all powers and duties of a duly constituted board of directors and shall serve until the association fills vacancies on the board sufficient to constitute a quorum and the court relieves the receiver of the appointment.

Studies show that 5 out of 4 people have problems with fractions

AnnaD2 (Florida)
Posts: 960

Posted:

Debbie I understand the "names" you were calling those people. We have some of their relatives living at my condo association. It certainly gave me a clear picture of the types of personalities you're trying to deal with.

The previous responses are quite helpful and I can't add anything more to what they've said. Welcome to the forum. Everyone here gives lots of expert opinions. I've learned more from all these people, during the last two years than I've learned from other board members for the last five years.

MicheleD (Kentucky)
Posts: 4,491

Posted:

Quote:

Posted By AnnaD2 on 12/21/2008 1:57 PM
Debbie I understand the "names" you were calling those people. We have some of their relatives living at my condo association. It certainly gave me a clear picture of the types of personalities you're trying to deal with.

The previous responses are quite helpful and I can't add anything more to what they've said. Welcome to the forum. Everyone here gives lots of expert opinions. I've learned more from all these people, during the last two years than I've learned from other board members for the last five years.

I just wanna clarify something, except for those who are HOA Talk people, I think "expert" opinions is a little bit of overkill.

Many of us who respond DO have lots of experience in our own HOAs, and may have expertise in some form or another, but most of our opinions should be tempered with a disclaimer regarding certain limitations and caveats.

While we may be able to offer some insight that is a tad better than a random person on the street, our opinions should always be treated as opinions with the aforementioned disclaimer!

SusannaM (Florida)
Posts: 366

Posted:

Glen, FL 720 may not be worth the paper is written on. You need a savvy attorney to guide through the "fog." It makes good reading but the reality is that it's hard to find an attorney willing and ready to represent homeowners (not the HOA) in general.

AnnaD2 (Florida)
Posts: 960

Posted:

Michelle---which is exactly why I said expert OPINIONS! People who have been through these things before. I didn't say expert legal advise; nor expert knowledge; nor expert quoting of statutes or laws. I DID choose my wording carefully.

Please don't think I'm knocking you in ANY way! I love reading your posts here and have always taken your words to heart! I wasn't trying to imply that what I wrote was "legal" in any sense.

RobertR1 (South Carolina)
Posts: 5,164

Posted:

Susanna,
Don't know about the paper it is written on but I have heard your sentiments about the difficulty with lawyers in Florida before. If I recall correctly it is happening in some sections of Florida and not in others. I read that the new legislation is also likely to be Lawyer heavy, but there are some forces trying to change this, and make the changes Owner friendly.

SusannaM (Florida)
Posts: 366

Posted:

Robert, you may be right when you say the difficulties may be greater in some FL counties and not in others. From Orlando down to Miami you can find a lot more attorneys and legal firms that specialize in Condo and HOA Law. That's not the case in NE FL where I live.

MicheleD (Kentucky)
Posts: 4,491

Posted:

Quote:

Posted By AnnaD2 on 12/21/2008 4:06 PM
Michelle---which is exactly why I said expert OPINIONS! People who have been through these things before. I didn't say expert legal advise; nor expert knowledge; nor expert quoting of statutes or laws. I DID choose my wording carefully.

Please don't think I'm knocking you in ANY way! I love reading your posts here and have always taken your words to heart! I wasn't trying to imply that what I wrote was "legal" in any sense.

Oh no, I wasn't thinking that way at all! LOL!

I was just making sure that OTHER people didn't get the impression that we have "big head" syndrome or anything!

And if my post came across negative, that wasn't my intention either!

Just doing that "anal" thing again!

(wink)

RobertR1 (South Carolina)
Posts: 5,164

Posted:

Susanna,
Since I got one thing right, how about I try for two in a row.

It is also my understanding the in NE Florida the amount of dissension and court cases and problems is far less that those areas heavy with Lawyers. I am sure I read this somewhere. And really I believe the lawyer is necessary to protect the Homeowners and hope if I ever need one, he won't be a company man. I have spotted at least one in my area I would feel comfortable with.

SusannaM (Florida)
Posts: 366

Posted:

Robert, you are also right on your 2nd point. In the past 10 years NE FL has experienced a tremendous real estate boom and growth. The HOA and condo serious problems have begun to surface in the past 2 years.

EllenS1 (Florida)
Posts: 1,148

Posted:

Debbie,

While it may not be wise to name call I can understand your need to vent after all you have been through and I must say I don't blame you. Keep up the good work. It must be very frustrating.

EllenS1 (Florida)
Posts: 1,148

Posted:

Robert,

I am in a HOA in NE Florida and it seems a lot of the HOAS look to local attorneys or management companies while they could easily go outside their area and employ more competent people. I am not saying there are no competent attorneys or management companies here but it could be worth exploring other options. It's just that most board members don't take that avenue. With the internet there is no reason to be so limited. Right now there is an excellent NY management company who represents an HOA here in Jacksonville and also in Central Florida. I'm sure they have others but I haven't heard of them yet. I've lived in this HOA for 7 plus years and we have gone through three management companies that went from totally incompetent, to more competent and now okay. Some mangement companies know that some boards know very little and take advantage of them, others resent board members who question them and seem to know as much or more about HOAS. It is important to get a good fit between the board and the management company.

It's true that people in North Florida are less likely to sue..I lived in South Florida for over 25 years and they sue at the drop of a hat but I'm sure our day is coming.

SusannaM (Florida)
Posts: 366

Posted:

Ellen, would you please email me at [email protected]. I'm also in the JAX metro area, and would like to exchange some thoughts with you. Thanks.

DebbieK3 (Florida)
Posts: 8

Posted:

I am truly grateful for this lively discussion that we are having and it is indeed a pleasure to meet all of you .. virtually of course .. lol .. the legal firm for our HOA (and I have since validated that we are a member HOA although we started as a PUD) is actually my cousin's firm and I brought them into the association less than a year ago because the Board was dissatisfied with the attorney they were using. So you can imagine how disappointed I was when my own cousin said .. our firm has made a decision that we cannot get involved and suggest that you find another firm to represent you in this situation. Now I understand that he must have a reason and now that I read your posts it's probably because of the time involved, paperwork and possible non-payment of their invoice. I have learned that the recalled board has hired a lawyer that was involved in the lawsuit AGAINST us but not my problem. And I have found out that the President of the new board is calling a lawyer that he knows tomorrow. I'm sure with the caveat that this new attorney will get our future business, and my cousin's firm will be let go (they represent about 500 HOA's so I was very surprised at his decision) but, again, there is nothing I can do.

I have done all that I can do, with all of your input, and forwarded this information to the people directly involved. And now, as suggested, I retreat to enjoy the holidays. I appreciate the opportunity to vent ...

Happy Holidays to all of you.

Debbie

KevinK7 (Florida)
Posts: 1,343

Posted:

According to the state, who is the Registered Agent and who are the Officers/Directors as recognized by the state?

Who is the signatory on the HOA's bank account?

If this new board has not filed any changes with the state, then would they not be legal in the state's eyes? I would think that government recognition would be an easy way get your lawyer back, as well as help build any legal foothold you have in your HOA.

I would check www.sunbiz.org and see if they made any filings with the state.

EllenS1 (Florida)
Posts: 1,148

Posted:

I live in NE Florida and our board, after attorneys who we felt were unsatisfactory, have hired Becker & Poliakof.

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