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JeffT (Maryland)
Posts: 83
Posted:
If you community and board have not followed the rules, by-laws, ccr's for for an extended period of time do they become null and void and the process that they have followed become the new standard.

IE: Annual meeting election to the board. The BY-laws say that there should be a nominating committee, term of 2 years, secret ballot. The usual way of doing it ( years) is asking for volunteers each year and asking scream out yes or no and asking to keep the current board yes or no.

There are a lot more examples. I for one want it to go by the book. Can I force this issue?

If so what would be a general time period for such cases?
DonnaS (Tennessee)
Posts: 5,671
Posted:

Jeff,
Well you certainly do have a casual association and Roberts Rules must be just something unheard of. But you have a Board, you have elections and probably many other required means of running the association. Kind of relaxed I would say. How long has it been running this way?

Do you enforce rules, covenants, architectural issues, meetings with minutes and other bylaws that are followed? It might be just a matter of getting back to more formal behaviors in following the bylaws that you already have.
MicheleD (Kentucky)
Posts: 4,491
Posted:
I don't know about Maryland laws, but here just because the CC&Rs weren't enforced for a number of years, does not necessarily void them.

So the answer would be (my standard): It depends.

For one thing, our CC&Rs also say this:

ARTICLE V - GENERAL PROVISIONS

Section 1. Enforcement. Enforcement of these restrictions shall be proceeding of law or in equity, brought by an owner or by Developer against any party violating or attempting to violate any covenant or restriction, either to restrain violation, to direct restoration and/or to recover damages, failure of any owner or Developer to demand or insist upon observance of any of these restrictions, or to proceed for restraint of violations, shall not be deemed a waiver of the violation, or the right to seek enforcement of these restrictions.

BrianB (California)
Posts: 2,820
Posted:
in general, they are still valid, you just have a very hard row to how to enforce them.. failure to to business by your by-laws doesn't typically invalidate them. there is a doctrine of Laches that can be applied to some laws (ie, if you don't enforce for X time, you can't enforce), but even then, you can still "re-invigorate" your rules, and start enforcing them GOING FORWARD. You may have lost the rights to do anything about what has already occured, but.. you can renew the rules, and apply them from Point X forward.

In general, by-laws can be studied and enforced "anew" going forward without much trouble. Covenants will take more work, and cause more grief, but usually, they can be too.

IANAL, of course... YMMV. BNI.
SusanW1 (Michigan)
Posts: 5,202
Posted:
If there are no nominations to the board positions and the current board agrees to run, then the "election" can be declared by acclamation. Those agreeing to fill the positions are elected.

Your scenario sounds like what just happened at my last annual meeting. Very disruptive and confusing.

I am watching the mintues to see if the end result is accurate.
EverettC (Maryland)
Posts: 90
Posted:
It seems to me that with respect to your example the election is probably valid but agree with the prior comment that "it depends". If there were more candidates than open slots, there would be more of a question, but probably waiver by those in attendance at the meeting.

In general, failing to follow the rules for a while does not mean there is no way to overcome the past and get back on track. It may require a "new day" approach - publicly stating that "while we may have previosuly approved chain link fences in the past, henceforth this advises the members that we will no longer approve new chain link fence applications. Additionally, existing chain link fences cannot be replaced except with [whatever the new requirement is]." It may take 30 years in my example to get rid of chain link fences, but you can take stop the expansion of the problem and slowly get back on track.

Back to your example of elections, it gets really interesting when you analyze the next level - if their election is invalid, are action takens by a board consisting in whole or in part of those directors invalid? (including setting of dues, covenant enforcement actions...)

We have a somewhat similar situation in our HOA where the CCR's require annual meetings to be "on the same day of the same month" as the first annual meeting following developer turnover, which was, say, Jan 20 many years ago. I objected to a proposed annual meeting date in Feb. since I believe, after researching the question but finding no Maryland cases on the question, that a homeowner could successfully challenge any action taken by a board elected at a Feb meeting. In any event, why take the risk? (The board's explanation that there less chance of snow in Feb than in Jan 20 was unpersuasive to me but they finally relented some and agreed to hold the meeting in January but not on the designated date, but it is still an unresolved issue).

I would be interested in other examples.

FYI, if you are in Montgomery County, it has set up a Commission on Common Ownership Communities (CCOC) within the Office of Consumer Protection - see www.montgomerycountymd.gov/ccoc. Not sure if other counties have established similar agencies.

Everett
(current board member and retired attorney)
JeffT (Maryland)
Posts: 83
Posted:
Everett, while reading I thought you may be a member of my community since we have the same clause in our docs and nobody can tell me the date of the first meeting. Then you stated you were in Montgomery Co.

My question really deals with how to handle, enforce, follow all rules that have been neglected. The election was just one of many. The board has a duty to abide by and enforce the docs. The prior boards have shirked that responsibility.

I asked to see the HOA docs (minutes) or anything available. We do not have an office so the president brought me over 4 milk crates of files. These files were only of the units (request, violations, etc.) and they were incomplete. My thought is, they were purged when new board took over. There are no minutes. The corporate seal has been kept by someone. No other legal papers anywhere. The legal address of the HOA where legal papers are delivered is someones house who was on the board 20 years ago. If a suit was filed he could throw the notices away and we could not even know.

Just about every architectural control rule has been violated and not enforced.
MicheleD (Kentucky)
Posts: 4,491
Posted:
Yeowch.

That is going to be hard . . . and messy.

This is why I try to stress that boards really need to be consistent in enforcing the restrictions. It's not fair to those who have to "bat cleanup" when things get out of control like this.

And, once the board voluntarily decides this or that restriction isn't worth enforcing, it's always so easy to add to that list until you are not enforcing any.

My first advice would be to sort through what you have; you're not going to find the minutes.

Scratch that, my first advice is to get the address of the corporation changed at the secretary of state level and make sure that a board member is receiving the documents. We don't have an "office" either, which is why we ultimately decided to have our attorney act as our registered agent. The address of our common area is the "main office" address (there is a locked mail box at that location, even though it's simply a sidewalk that is the entrance to our retention basin).

Then I would clean up the records. Even if the only ones you have are for the units.

Finally, I would walk the neighborhood and make a list of the "violations."

I would then sit down with the board and go over a priority list.

Go for the "low hanging fruit" first. Meaning, tackle the easy ones, like garbage-can placement, lawn maintenance, etc.

After that, I just don't know! It's not going to make many people very fond of you guys, that's for sure!
JeffT (Maryland)
Posts: 83
Posted:
I like the idea of the attorney being the resident agent. I was thinking the mgmt co. They just handle the collection of assessments and bookkeeping. I thought that making the mgmt co the office to hold the files also. We do not have a club house or anything. Suggest it of course.
EllenS1 (Florida)
Posts: 1,148
Posted:
Everet,

Contact your corporations department in your state to see who are registered as officers, etc for your association.
DanaB1 (Connecticut)
Posts: 319
Posted:
Jeff, mind if I ask how old your association is and how many homes/units there are? Your board just runs free and the management company collects the funds? Do you have any reserves?

Dana
DanaB1 (Connecticut)
Posts: 319
Posted:
Are you condos or single family homes?
EverettC (Maryland)
Posts: 90
Posted:
Michele,

I agree, and getting the HOA to the point where the rules can and are being enforced cannot be done by one person.

Jeff, can you get support from other homeowners? Are you a director? What about the other directors?

Even if you are a director, apparently the other directors don't share your concerns and high on your list of priorities should be to find other like-minded owners willing to serve on the board.

The resident agent should, in my opinion, be the attorney or (2nd choice) the management co. rather than a board member, although you can use their address as your office address. As you suggest, there are consequences (potentially, a default judgment) if the agent neglects to forward a lawsuit on to the HOA, and a board member serving as resident agent may not take the proper steps. The attorney probably has malpractice insurance. There are also companies that serve as registered agents for under $100/year.

You can get the resident agent online from the State Dept. of Assessments and Taxation at http://sdatcert3.resiusa.org/UCC-Charter/CharterSearch_f.aspx. It also includes a link to "get forms" to change the resident agent. The Board should adopt a resolution authorizing the change.

Have you checked with the attorney and the accountant? They may have copies of at least some of the minutes. At the very least, the accountant will have copies of the prior year's financial statements and tax returns.

Everett
JeffT (Maryland)
Posts: 83
Posted:
HOA for 25 years. 350 townhomes. About 1/3 are investment owners
JeffT (Maryland)
Posts: 83
Posted:
Yes there are reserves. About 50 owe money of some sort. Past dues or fines. The previous boards did pick and choose who were in violations and what is a violation is not consistant.
JeffT (Maryland)
Posts: 83
Posted:
I am currently a new board member and the board elect along with two other new board members. There are 4 old directors. We all want to make the changes. we created and standardized the rules. we went to the community via a meeting to get input before we adopt them. This was the chance for them to persuade us to make some changes before adopting them.

Well this meeting did nothing but bring out a lot of upset people. This was the end of April and the annual meeting is in June. They threatened to throw everyone off the board and reinstate the old people. The old group were the biggest complainers. The are intending to come out of retirement.
DanaB1 (Connecticut)
Posts: 319
Posted:
Jeff,

could you just clarify for me............... you have a board of seven? four old and 3 new (including you)?

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