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By-laws....to have or not to have

Started by JeanC • 25 replies • 1885 views

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JeanC (North Carolina)
Posts: 13
Posted:
We recently purchase property in a mountain community and discoverd
our HOA has no by-laws....and owners are fighting the board not to adopt.
The BOD is frustrated. How can I help get it across to property owners
that CCR are the 'what' and ByLaws are the 'how' HOA is operated?
Jackie, in North Carolina
EllenS1 (Florida)
Posts: 1,148
Posted:
Jean,

This sounds so weird to me..doesn't your state have guidelines on how an HOA should be run. I thought Articles of Incorporation, By-laws and covenants are what make an HOA. Is your HOA registered with the state or just a bunch of owners who say they are an HOA when in reality they aren't?
MicheleD (Kentucky)
Posts: 4,491
Posted:
Ellen, that was going to be my question.

I'm not sure what they actually are??
DonnaS (Tennessee)
Posts: 5,671
Posted:

Jean,
What documents do you have in hand. From your post, I am assuming that you have protective covenants. Yes, those are the "whats" of the association but you need incorporation papers which will deal with voting and the operation of the Board and system. The bylaws are indeed the " hows" to follow the covenants and articles. Then after that, you need rules and regs and architectural guidelines and maybe board policies. Why do the owners who are fighting the board, not want bylaws? I believe that N. Carolina does have some HOA laws to use as a guide
JeanC (North Carolina)
Posts: 13
Posted:
We recently got a copy of the Articles of Incorporation from the State of NC and have CCR, but, no by-laws. Everything is a battle. The goal of the HOA President is bring harmony to our small HOA (less than 20). There have been a few issues between the Declarant & members that have been going on long before we purchased our property. They won't let go of the past and a few are fighting the board on putting things in order. Having sat on several non-profit boards, I was shocked to find out that are no by-laws. And, they wonder why they've had so many problems over the years. Short of taking a baseball to the next meeting, what do you suggest?
DonnaS (Tennessee)
Posts: 5,671
Posted:

Jean,

I would bet very good money that either your Articles of Inc. OR the North Carolina Non Profit laws require a HOA corporation to have bylaws. This is something that the members have no say on. It's a requirement.
MicheleD (Kentucky)
Posts: 4,491
Posted:
You mean, short of taking a baseball bat?!

Hehe.

They seem stuck on old wounds.

Perhaps if you brought a copy of a sample set of By-laws, you could focus them on drafting a set for your group.

You know, focus on forward thinking tasks, as opposed to clutching backward-thinking anchors?
DonnaS (Tennessee)
Posts: 5,671
Posted:

Jean,
What you really need is me, with the big mouth and Michelle, with the big baseball bat. I'll bet that we could straighten them out. How bout it Michelle?
JeanC (North Carolina)
Posts: 13
Posted:
LOL
Thanks for your help & advise!
SusanW1 (Michigan)
Posts: 5,202
Posted:
Jean - HOW does your board know its powers if there are no bylaws? HOW does the board get elected and lhow does it know its terms of service? HOW are things decided, the budget developed and passed?
JeanC (North Carolina)
Posts: 13
Posted:
You hit the nail on the head!
We are so frustrated at trying to put the HOA on solid ground.
I'm being to wonder if this part of North Carolina is governed
by mountain law.
SusanW1 (Michigan)
Posts: 5,202
Posted:
Your state has a non profit law. Go to:

http://law.justia.com/northcarolina/codes/chapter_55a/chapter_55a.html

Scroll down to "bylaws" where it says that the corporation must have bylaws.

MaryA1 (Arizona)
Posts: 7,043
Posted:
Contrary to what some think, not all states require bylaws to be a part of the incorp. package. AZ only requires articles of inc. However, state law does require the BOD to adopt initial bylaws for the corp. If this is also a require of NC state law, then I would say the developer erred as he would have been the initial BOD for the corp.
ChuckR (Texas)
Posts: 8
Posted:
If your Articles of Incorporation mention the homeowners as being members, and therein state that the power of the corporation/association is vested in its members (rather than the board) then you may have a cause of action against whoever got you into a corporation which hasn't complied with state law governing how they are to be structured and maintained.

I would check to see if the Attorney General of the state will invetigate into the issue (since they typically are charged with the duty of watching over how state chartered corporations are run and comply with law) and if they will not or cannot do it by statute, then check with the County Attorney of the County the property is located in.

There appears to have been some State laws broken.

Why would you allow it to continue, based on what some "board" members may want. I'd have them shut down by suing to dissolve the "corporation" if it is chartered as a non-profit corporation if there was a statute which allowed it. (And there well may be, as Texas has one, but I am not sure)

After all, how can they be "authorized" by the state to exist under their corporate law, if the corporation does not act lawfully in order to conduct business?
EverettC1 (Maryland)
Posts: 3
Posted:
If the HOA was formed by a developer prior to turnonver to homeowner control, maybe the by-laws were adopted but have been lost, and a call to the developer or attorney will turn them up.

Under the NC non-profit corporation law, by-laws are required:

"§ 55A-2-06. Bylaws.
(a) The incorporators or board of directors of a corporation shall adopt initial bylaws for the corporation.
(b) The bylaws may contain any provision for regulating and managing the affairs of the corporation that is not inconsistent with law or the articles of incorporation. (1955, c. 1230; 1993, c. 398, s. 1.)"

Having said that, there are times when "shall" in a statute doesn't mean it seems, or that there are penalties for not complying.
KirkW1 (Texas)
Posts: 1,665
Posted:
I think there was a whole thread about the meaning of shall. I would suggest any discussion skip this and move directly to that thread.
LeeM3 (Florida)
Posts: 7
Posted:
How would one go about obtaining a historical account of the development, and the creation of an HOA. I'm particulary interested in Holley by the Sea, Navarre FL. . .it made big news back in the 70s.
DonnaS (Tennessee)
Posts: 5,671
Posted:

Lee,

The Florida Not For Profit Corp listings will have the year that the original Corp papers were filed. But they will not have any history of it and searching the history of the developement might take a trip to a newspaper archive.
DonnaS (Tennessee)
Posts: 5,671
Posted:

Lee,
Your association is called "HOLLEY BY THE SEA IMPROVEMENT CORPORATION"

Look at www.sunbiz.org. It was originally filed in Jan. 1972
JuanB (Florida)
Posts: 38
Posted:
Quote:
Posted By JeanC on 01/18/2009 1:42 PM
We recently purchase property in a mountain community and discoverd
our HOA has no by-laws....and owners are fighting the board not to adopt.
The BOD is frustrated. How can I help get it across to property owners
that CCR are the 'what' and ByLaws are the 'how' HOA is operated?
Jackie, in North Carolina

Hello Jackie

Look to the bite site if you have the Bylaw it could be over rules by the HOA Statutes of your Federal State.

Use the HOA statutes as Bylaw

One set of rules and all should be supported by your Federal Gov. and keep an open eye that all are aware of the situation.

Print the HOA Fedearl Statutes and give the Members "Owners" the chance of evaluation with "Ballots" for approval.

AnneH2 (Florida)
Posts: 82
Posted:
What federal statute? What are you talking about?
JuanB (Florida)
Posts: 38
Posted:
Quote:
Posted By AnneH2 on 02/24/2009 3:01 PM
What federal statute? What are you talking about?

The 2008 Florida Statutes
http://www.flsenate.gov/Statutes/index.cfm?Mode=View%20Statutes&Submenu=1&Tab=statutes&CFID=111137374&CFTOKEN=49458453
JuanB (Florida)
Posts: 38
Posted:
Quote:
Posted By JuanB on 02/24/2009 3:39 PM
Posted By AnneH2 on 02/24/2009 3:01 PM
What federal statute? What are you talking about?


The 2008 Florida Statutes
http://www.flsenate.gov/Statutes/index.cfm?Mode=View%20Statutes&Submenu=1&Tab=statutes&CFID=111137374&CFTOKEN=49458453

North Caroline should have something like it
DonnaS (Tennessee)
Posts: 5,671
Posted:

Juan,

I occasionally post this list for newcomers to see. It might help you to remember how the laws are in importance. We call it the "Heirarchy of Documents and Laws.
They go in the order of top, being the most important, etc.

#1 ALL FEDERAL LAWS AND STATUTES AND CODES, (including FCC, HUD, ADA, etc)

#2 ALL STATE STATUTES AND LAWS

#3 COUNTY, CITY & MUNICIPLE LAWS, CODES AND ORDINANCES.

#4 THE ASSOCIATIONS CC&Rs, (protective covenants and restrictions.

#5 THE ASSOCIATIONS ARTICLES OF INCORPORATION(sometimes called charters, and are filed with the State Non Profit Corps)

#6 THE ASSOCIATIONS BYLAWS

#7RULES AND REGULATIONS (ARC restrictions also but are written from the CC&Rs)

LeeM3 (Florida)
Posts: 7
Posted:
Thanks Donna. We have serious problems with lack of accountability and busybodies here in northwest FL.
DonnaS (Tennessee)
Posts: 5,671
Posted:

Lee,

I'd like to correct you,it's rampant all over and not just the folks in Florida. I lived in Southeast Fl. near Palm Beach for 7 years. OH MY GOD!!! It's not like that up here in the hills of Tn.

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