A service of:
Community123.com
Professional websites for HOAs & condos, since 2004
🎁 1st year FREE for HOATalk members! →
← Return to Topics List

Members' Rights

Started by EllenS1 • 29 replies • 1619 views

💬 Join us to post & get advice from 50,000 HOA & Condo leaders.

Create Free Account →

⚡ Takes 30 seconds

Already a member? Log in

EllenS1 (Florida)
Posts: 1,148
Posted:
Our HOA has a large judgment against an owner. The final judgment has been recorded so is of public record. There has been some discussion re collecting on the judgment and I have received mail from the PM saying legal matters cannot be discussed by anyone not on the board. I disagree. This may be true of ongoing legal matters and discussions between the attorney and the board but once it is in the public records I believe members can have suggestions on how to collect the monies covered by the final judgment and are entitled to know what steps are being taken to recoup instead of being kept in the dark.
JonD1
Posts: 2,350
Posted:
Ellen:

So then the owner who has a judgement against them would also have the right to know what is being done to collect????

IMO the owners should play NO role in this. For just one reason any attempt to collect on the judgement may be revealed to the owner beforehand.

Sounds to me like the Board and PM have handled this matter in a way beneficial to your property.

Why not allow them to take whatever actions they and their legal advisors feel neccessary to attmept collection.
EllenS1 (Florida)
Posts: 1,148
Posted:
Jon,

I understand what you are saying and do not think this needs to be brought up at an open board meeting. This owner is not friendly with any that I know of in the community so I doubt would learn anything. The judgment was recorded at the beginning of January and so far we know nothing about what actions have taken place, if any. In fact I made a suggestion to one board member last month and they say they will act on it so here's hoping it works. The judgment was recorded but not against the property. I have suggested that a lien in this amount be recorded against the property in the event title changes hands. My only concern is that the association recoup all it's expenses and legal fees. But my original question was can a PM under what Florida Statue tell members they are not allowed to discuss this matter?
SusanW1 (Michigan)
Posts: 5,202
Posted:
Discussing this lawsuit with WHOM? At a cocktail party? At a board meeting? With the lawyer?

Who is Speaking for the HOA should be of more concern. No one, except the president, should be making announcments about the lawsuite. Board members should not attempt to speak for the HOA. Everyone should button their lips, IMHO. Everything else is gossiping.

JohnO6 (Georgia)
Posts: 424
Posted:
Ellen -

Although I'm certainly not an expert in FL HOA law, it's almost universally true that both (a) the lawsuit which formed the basis for the judicial judgement, and (b) the judgement itself are "matters of public record". However any methods/strategies used to enforce the judgement are not.

To your point about a lien on the property, I would be very surprised if that had not already been done by the association well before the suit was even filed (assuming your CCRs permit liens - which most do).
EverettC (Maryland)
Posts: 90
Posted:
Ellen,

If the judgment was properly recorded (recording a certified copy of the judgment in the official records of the county where the property is located), it becomes a judgment lien against all real property owned by the defendant in that county, and is valid for 10 years, hbut is renewable. In addition, if it is properly filed with the FL Sec of State's office, it becomes a lien against most personal property owned by the defendant and located in Florida.

Since the case is ongoing in that the judgment debt has not been collected, the PM's advice seems to me to be proper. It is the Board's job to collect the judgment and discussion of ongoing litigation should be in executive session, not in open forum.
JonD1
Posts: 2,350
Posted:
Ellen:

Trust me, strange things happen with information which was not supposed to be given to certain folks. Good plan but in reality it sometimes fails.

I would suggest the PM was in fact doing their job by not relating details as to the plans to collect on the judgement.

We had a judgement against a former PM. To save money we did the leg work ourselves. Filed the judgement, obtained a lien, did the asset search with a private service, filed the lien with the county sherriff, and waited for them to freeze the bank accounts of the PM in the name of his company. Not his personal accounts.

He never knew what hit him till he went to the bank and found out his accounts were frozen.

In New York we were able to add the legal costs of collecting onto the original judgement amount.

Lots of work, aggravation but is was so worth the effort in the end.

This PM deserved it!
DonnaS (Tennessee)
Posts: 5,671
Posted:

Ellen,

NO!, members have no business having official input on this matter. Off the record, if some member is privy to what has happened, then the Board can take note of it. But, you have had an attorney involved in this process and you must continue to use his judgement and services. This is not a matter for the membership to handle. Imagine if you would open this up for ideas on how to collect. Yikes, 50 different ideas and some of them would certainle not be ideal. Yes the judgement is now public record but collection still falls under lawyer/client(the HOA) privledge and is still considered "closed"
MaryA1 (Arizona)
Posts: 7,043
Posted:
Ellen,

I get the impression your biggest gripe is that you want the board to listen to your opinion regarding what should be done. The board is in charge and, on the advice of their attorney, will make the decision as to what the best steps to take should be. If you want to be a party to the decision making then I suggest you run for a board position. The board can't be listening to every member's "opinions" before making their decision. These are matters for ES because they involve attorney advice whether a particular member has had a lien recorded or not. As long as the delinquency exists the BOD is speaking to their attorney and obtaining legal advice.
EllenS1 (Florida)
Posts: 1,148
Posted:
Jon,

Good work on collecting your judgment. Actually, our PM does next to nothing and we expect to replace them soon. The debtor does not work so we can't garnish wages and it would be cost prohibitive to use the attorney to do an asset search. What sort of private service did you use? Our assessments are collected quarterly and some time ago I asked the pres if he would notify the management company to flag the owner's account and make a copy of the check so we would have the bank and account number (with the expectation that we forward this to the attorney to freeze the account(s). One would think the PM would have thought of this but they say "we are not in the collection business". They did copy the check after the pres requested it so we'll see what happens.

EllenS1 (Florida)
Posts: 1,148
Posted:
Mary,

Your impression is wrong. I don't care what method the board or PM take to collect on the judgment. When nothing has been done in six months since the judgment was recorded I think it is time to provide some input. I've served on the board for 3 years and in fact this legal matter has been going on for a very long time. No need for you to be snarky saying "I suggest you run for the board".

At a board meeting last night the president said he was going into our reserve account to pay for normal expenses. Owners were sent a letter indicating we had a shortfall and the board could either use reserve funds or do a special assessment. I emailed the pres and copied board members a few weeks prior that either had to be voted on by the members. Even after this he said he would be using reserve funds and our PM sat there mute........so I spoke up even though I am at present just a lowly owner.
JohnO6 (Georgia)
Posts: 424
Posted:
Ellen -

Don't you hate it when a poster here "just has to be right"? And in an effort to put "the proverbial cherry on top of the sundae" follows up their argument on one topic with a description of another item that is actually procedurally unrelated - don't you just hate that?

I know I do .. .. .. but I'm afraid that's what you've done

So let's take the separate issues and address them separately as they should be:

Judgement enforcement - this is, as many others have mentioned, a legal proceeding that is (a) subject to attorney-client privilege and hence confidential, and (b) usually addressed in most govening documents as a topic to be discussed in executive session of the Board. As an non-Board member you're not entitled to participate. Of course no one can stop you from bringing forth suggestions, but conversely the Board isn't obligated to even hear them much less act on them. What IS a reasonable expectation or line of questioning from an owner to the Board on such a matter is:

1). Is enforcement of this judgement being actively undertaken?
2). Have these efforts been successful - fully or partially?
3). If not, are other options being considered?
4). When will the Board make a decision on those options?
5). When will the Board implement action on that decision?

That's all you're entitled to .. .. period.

Raiding the Reserve - if your governing documents prohibit such Board action and require a vote of the membership, then you're fully within your rights (and duties as an active member) to remind the Board of such requirememnts. If the Board proceeeds anyway in violation of the covenants, then you should file written notice with the Board of their unlawful actions and ask for a prompt response.

While I'm sensitive to the reality that these two items may be related in the general sense of HOA finances, they are separate and disctince procedural issues, and "tacking one on the end" of the other, doesn't strengthen your argument.
EllenS1 (Florida)
Posts: 1,148
Posted:
John,

Oops, here I go again. Questions 1 "we are working on it". 3, 4 and 5 have been asked by several people and while some vague answers were made we have heard nothing definitive. We know the answer to #2 is no since our financials show nothing being received.

Re the reserve, we wanted to make sure that the board and PM were put on notice prior to the reserve being depleted rather than reacting when it was really too late to do anything.

Now I will throw in another problem to further weaken whatever I have said. At last night's meeting the board said it would be foreclosing on two properties (one that hasn't paid assessments in two years. Both are severly in arrears. Several owners asked when suits would be started and though there was discussion we never received a date. So it goes.
AnnaD2 (Florida)
Posts: 960
Posted:
Ellen, you really, REALLY need to run and get back on your board!!!!

You were such a valuable member and I can see that since you quit you don't like what is going on.

Run, baby run! Enjoy your year off and get back on ASAP
EllenS1 (Florida)
Posts: 1,148
Posted:
Anna,

Thanks so much but I am hoping the do nothing management company we have will be gone soon. We have a 30 day out in their contract and a few board members have expressed an interest in having them replaced. Part of our problem is the PM offers either no or incorrect advice to the board. Questions to the PM re our financials were told "we don't have that information at this time" even though they were well aware this would be the major topic on the agenda.

At the meeting the other night the board voted to form a finance committee and if I get on I think I could have more impact there. Even though we have been told we are in a serious situation re delinquencies and the board voted to form a financial committee no action was taken to ask for volunteers or suggestions to name anyone for the committee so I guess it will be another month before we learn who will be on the committee. There were some really good ideas from an owner on how to cut expenses so a committee to brainstorm on savings is most important.

Let's see how that goes.

Thanks again.
MaryA1 (Arizona)
Posts: 7,043
Posted:
Ellen,

Sorry you felt I was being "snarky" by suggesting you run for the board. I know exactly what you are going through -- been there, done that. IMO, the only way your suggestions are going to be put to use is if you are on the board. From what you are saying, there haven't been any changes in their modus operandi and you probably come home from each board meeting full of frustration. I wouldn't be surprised that the board members don't regard you as a trouble maker. Hopefully I'm wrong on that. But, in order to save your sanity, IMO, you should either get back on the board or just back away from the board meetings.
EllenS1 (Florida)
Posts: 1,148
Posted:
Mary,

Sorry that I said you were being "snarky" but it just came at a bad time. Did you mean the board thought I was a trouble maker? I doubt it since in the past I have worked with some good people on the board. I have also worked with some who didn't have a clue and I don't blame them, I blame PMs who want to be paid but don't deliver. My sanity will be saved when we get a new PM and, hopefully, get on the finance committee. The PM has said members are not allowed to view financials, etc. WRONG but many owners believe this. I have had about 30 years as a paralegal specializing in corporate and real property law so not because I have an ego but I do think I have something to offer.

I will not back away but will keep an eye on what is happening with the owners' money. I moved here for peace and quiet..LOL. I am 77 and while I do not want to get on the board would be willing to serve on a committee. I am currently on the landscaping committee and have put in time pulling weeds, etc, getting bids from landscapers, etc and if I can get on the financial commitee that would be enough for this old gal.

As an aside the association has about $900 in a bank account and we have been told there is no way to acess these funds since the original officers are not in place. This is the type of "advice" we get from our PM.
AnnaD2 (Florida)
Posts: 960
Posted:
Ellen, I remember how you were TOTALLY BURNED OUT during the last year you had with your association (as a board member) and how relieved you sounded on your last day.

I think being on that finance committee would be perfect for you. Yet I'd be ready to quote state statutes if this current board even THINKS of touching that reserve fund without the approval of the ENTIRE membership. Don't let that one slip by.
EllenS1 (Florida)
Posts: 1,148
Posted:
Anna,

Yes, we broke out a good bottle of wine when we resigned. Prior to the meeeting I emailed board members AND the management company and cited Florida law re reserve funds and special assessments. Still, at the meeting the president said they were going to invade the reserve, he said the "management company" told him they could. I responded that it wouldn't be the first time the management company was wrong. To say the least I was furious and told them there would be repercussions if this happened. I hate threatening people and not following through but I was more than upset. Someone on this board said if they did it I should complain in writing to the board. What a joke. After the money is spent you would accomplish nothing. However, if this should occur I will certainly contact the State to see if I can get this company's CAM license revoked. I do not blame the board that has owners willing to voluteer their time, I blame a company that is being paid to know what they are doing. Do email with the name of your current PM who you say is doing a good job.

It's time for a change.
BarbaraP3 (Maryland)
Posts: 90
Posted:
Quoted by Ellen...
Prior to the meeeting I emailed board members AND the management company and cited Florida law re reserve funds and special assessments. Still, at the meeting the president said they were going to invade the reserve, he said the "management company" told him they could.

How can a BOD read the CCr's, by-laws and state statutes that state that they can't do something but then say "the MC or our atty said we can?" I just don't understand why they would put their assn at risk by blatently violating the law(s)/rules. Do they really think because someone else told them it was OK that they are off the hook? No way....ultimately their decisions fall on their shoulders and they must answer to the members.

I have been in this type of situation with a board and they just either ignore your comment/letter or lie and say that the management or the atty said we can do so and so. These types of board members are self-serving and have their own personal agenda and not the best interest of the association.

Barb
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Such a shame that all fractions can't get together and settle their differences. I would make an observation that there have been numerous posts lately about P/M's seeming to be more hindrance than help. Taking on the issue I would suggest that when this occurs that some resolution could be formed without the presence of the PM in the conversation. Just say that when after understanding the value of the PM to the Board and the PM's are doing their job as far as providing support to the board, after all that is considered by the Board, and folks like Ellen are still not satisfied with process at a time in space, I think the Board should provide them with a forum to air their concerns without the presence of non-members. After all the Board rightly hires and fires and is supposed to control and direct the PM and it certainly is strongly enforced here that that relationship is not a matter for owners to be concerned with.

Wouldn't it follow that the relationship between the Board and the members be equally as strong or stronger. Can the PM's relationship with the Board be described as employee/employer? If so, what is the relationship description between the PM and the owners? I would point out that the annual meetings is normally described as an owners meeting, no mention of anyone else, would that mean the attendees would be owner controlled, or just controlled by the Board.
I think the Board has the right to have the PM attend Board meetings and expect PM input. if they so desire, and that includes ES. I also believe the owners have the right to be heard by their peers, if they so desire. I don't think this detracts from a PM performing their duties and it is easy to see that few, if any PM can please everyone. Owners having to go through the PM to confer with the Board seems to be a snag at times, especially if conflicts between the two are present. It also goes without saying that a PM skilled and interested enough in community relations to provide a consistent positive effect on the community is a very valuable resource.
Can all this be cast aside with, "It will never work and it is not the Boards job to waste their time on the same old dried up com paints?" That may be the answer, I don't know.
MaryA1 (Arizona)
Posts: 7,043
Posted:
Ellen,

Well, all I can say is that I hope I have your energy when I reach your age - and I'm not "that" far away. LOL

Good luck with getting on the finance committee, I'm sure you will be an asset.

Regarding the bank account with only $900 in it. IMO, the BOD should take a letter to the branch manager showing who the officers of the HOA are and have the names changed on the account. If the HOA is required to submit an annual report to the Sec of State, a copy of that might be better. But why the board would just take the word of the PM that they cannot access the account is a mystery to me. Don't any of them know how to pick up a phone and make a phone call?
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Mary,
your questions are certainly direct, no doubt about it. But at least Ellen and Barbara and add me, has experienced this kind of posture from some BOD's.I have coined a word that I expect no one to adopt but several of my Board members may remember. I call this the "Boardish" reaction.
EllenS1 (Florida)
Posts: 1,148
Posted:
Mary,

After waiting and waiting for the PM to handle this and the pres at the last meeting saying we can't access the funds I emailed the treasurer the next day and proposed exactly what you recommend. I asked if he would get a copy of our annual state report and follow through. Two great minds think alike.
EllenS1 (Florida)
Posts: 1,148
Posted:
Barbara,

I really don't believe there is any personal agenda but just ignorance of our docs, which I'm sure they never read. They want to go the easy route but at least they volunteered to be on the board when nobody else would. When I was on the board with the current president I told him more than once that the reserve account was not intended to be a slush fund..quess it didn't sink in.
AnnaD2 (Florida)
Posts: 960
Posted:
Ellen, unfortunately (for you) our management company consists of only four people and they only work in our county. Our manage is good....but it would be one heck of a drive for him to run back and forth between Pinellas County and Jacksonville. Sorry.
MaryA1 (Arizona)
Posts: 7,043
Posted:
I don't know about the rest of you, but the word "fraud" always comes to mind when I hear of an HOA BOD who doesn't have access THEIR bank account!
RobertR1 (South Carolina)
Posts: 5,164
Posted:
I think we approach these associations with the premise that the operation of the whole may be a little skewed and someone just dropped the ball. We rarely get that perfect association that someone is complaining about. It seems to always start small and as posts come and go, a door opens that reveals things like a PM telling a Board they cannot look at the Bank account or manage it. Any scrutiny at all by an owner should immediately pick up on this kind of thing. And some of these association involve fairly large numbers.

Maybe it is just the desire to believe everything is all right. More likely it is the "let someone else do it for me, if I don't have to do anything then nothing can be going awry." The fact that we get questions primarily because someone smells smoke can not be discounted either and of course that narrows our sample range of all associations. You do wonder how this kind of stuff can happen and if you are unlucky you will find some crazy stuff in your own organization.
MaryA1 (Arizona)
Posts: 7,043
Posted:
Robert,

Right you are! And what you say reminds me of our brief discussion the other day about the "small stuff" and the "big stuff". IMO, it all boils down to what is thought to be "big stuff" and worthy of the attention of the BOD. But I firmly believe most members of HOAs don't worry about what is perceived to be "big stuff" because they really regard HOA business as "small stuff". Otherwise wouldn't more members get involved or at least attend a few board meetings to find out what's going on? A few members may think it's "big stuff" that the BOD violated the open meeting law by discussing something in closed session that should have been discussed in open session. But the majority of the members regard this as "small stuff" -- hell they don't even attend the meetings so why should they care what they discuss in an open or a closed session. Do you think those few members would have the support of the majority if they chose to file a law suit for this infraction? Bottom line: what's important to you may not be important to me.
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Mary,
You are on the money about the majority, but miss the mark when disregarding the few. If it wouldn't be for the few, they would not be a majority of anything to be a majority of. I like that last sentence.

The whole Association structure would just no longer exist.

The few rule..............good or bad, like it or not.

You will always be important to me. I know that is not the issue, just thought I would say that. I also have a fear of crossing swords with a certain poster from AZ.

🎯 You've read this entire discussion

Join the conversation with 50,000 HOA & Condo Leaders:

  • ✓ Ask follow-up questions
  • ✓ Share your experience
  • ✓ Get expert advice
  • ✓ Access 350,000 discussions
Create Free Account →

⚡ Takes 30 seconds

Already a member? Log in here

Terms of Use and Privacy Statement