Rentals

Well Maureen this ought to spark a lively debate.

First, I assume the association has not accepted control of the development.......right or wrong?

Either way your governing documents must be read completely to try and understand what can be done. On the face of it, if this developer is trying to attach his legal bills, that resulted it his business of apartment renting, I would immediately gather your homeowners together and hold a meeting to resist this involvement. I expect he has not turned over control to the association and from where I stand, even if he has, the association is not involved with his rental problems. I doubt he could convince a Judge that the Association Corporation is responsible in any way. If you all have had turnover, the associations problems are with the developer (owner) for renting to undesirable renters.

This is not to say he may have something in the covenants that binds the owners before turn-over, but IMO, if he does, it is suspect and should be contested.

From you post, he is trying to push you all around and I don't think your position on the Developers Board means squat legally. If it does, resign, who would want anyone else to have that kind of control over them.

Just an opinion but it will be interesting to read the replies.

Maureen,

Well just think about it. If you rented your home and had a problem renter which resulted in a lawsuit, what would this have to do with the HOA? NOTHING, is the answer. However, are you certain this property is owned outright by the developer and not the developer's company? Would the lawsuit be against the developer as a private individual or against the HOA? Sometimes other parties are attached to a lawsuit even though those parties may not be directly involved in the dispute. Since you are meeting with an attorney I would certainly ask him about this. But, make certain you have all the facts regarding who owns this property. You could check that out on the Co. Recorder's website or just ask the builder who the owner of record is. In fact, I would have asked him why he thinks the HOA would be liable for his legal fees.

Thank you so much for your advice. No, I didn't think that our development would become a RENTAL development nor did the owners who paid 300,000 to 350,000 for their homes. When I purchased my home the sales office told me (and all the other purchasers) that the builder/developer did not want this development to turn into a rental community, however, it does state in our CCR's that the builder can rent as many units he cannot sell. He is the only one renting. All the owners moved here due to downsizing their homes, however, three are fed up and are selling their homes.

Having said that, this does not mean that he should. I have several owners who would be right by my side if this ever went to court. We were all told the same thing.

The builder's rental person stated in the newspaper in January that there is a "Rent to Own Program" instituted by the builder. However, when I asked for the paperwork on it, I never got a response. The only response was from the builder who said I have NO RIGHT asking for it and it was a "harrassment policy" since I was insisting on getting this informaiton. I don't believe there is any such program.

I am hoping an attorney will straighen this out, however, I don't want to spend all my assets fighting this builder.

Maureen,
Once again and you have probably covered it somehwere, "Has there been a turnover to the owners," Last chance for me.

I write too long anyway and when I have to answer questions from two different sides it takes three times as long.

We all understand your situation as far as how difficult it is to take care of stuff like this. As far as the Board you are on that the developer controls, what is the difference of the minority. Do you all make policy and vote and run elections and set agendas? Have you ever made any positive changes with your presence on the Board. Is your saving grace that things could be a lot worse if you all weren't there? That's a guess isn't it? As a minority member of a majority appointed by the developer board, what can be worse? If you think you all are making a difference then by all means stick with it, but don't expect for him to be nice and change......he won't.

And you made several references to the cost of the lawyer. Well, your group is going to have to sit down and decide how much you all want to spend for what. You should be able to get a slice of quality time from a good association attorney, first vist, no contracts, for around 350- 500. But spend your money wisely and know exactly what you want him to answer and why. If you can get five or ten good direct questions answered, the rest of your time is gravy. You all must be prepared and stay on your toes if you are going to tussle with this guy. I suggested you canvas your members and anywhere else for written adverts that your developer has used to sell the property. I asked because I am personally aware of litigation that hinged on some 20 year old brouchures about a golf community. You said you checked property records out-------finally,have you found your filed papers for the development and have you been to the planning office? You need to know more stuff and you can't know too much and any request you make to him make it in a meeting, get it in the records as being asked. Any written correspondence and I would stay away from that, make it registered.

I really am receiving mixed signals but on the other hand you are not obligated to even acknowledge I exist, you would not be the first and the possibility always exists I don't have a clue to what I am talking about.

Maureen,
Now, that's settled.

First, establisht the TOTAL # of home platted in your association. This should be available at the court house and will appear on the original filing. The "Master Plan" of the county in most situations.

Then specualte when that 75% # will be reached. If the developer is or has made amendments to that Master Plan or his original filings, you need to see them.

All this I am talking about is for you all to really make a concentrated effort to find out where your association stands today. I would seriosly doubt that the developer would be allowed to publicaly sell the lots as a community (Association) and then stack the deck (intentionally or otherwise) and always hold majority vote or number of votes that would circumvent the free election of the owners to govern themselfs.

You need to find out about all the documents on record at your court house that pertain to the association. Don't be pushy about it and don't hide the fact you are doing this. Get your group to go to Board meetings and ask questions and get it on record and record if necessary. Just let the developer know and your association know that some of you are asking questions. I take for granted that the developer is not providing anything other than what he wants and is not responding to owners concerns. There is an economic crises right now and he will be touched by it the same as we all are. I would not enter into any deals with him or anyone to try and right your situation. You need information and you need support if you can make a case to better your position. It's a chess game probably and the game doesn't have all the pieces on the table.

Do you all have the right to do this? Of course and if you are lucky you can end up controlling your association at little cost and a lot of effort. Remember, this developer has a bottom line, he is in business to make money, he has apparently stacked the deck or it turned out that way. He is going to control the Board the way he set it up, he is not going to give that up. But, he needs the good will of the people that purchased these homes, he does not need bad press, it costs money, he has to follow state and federal laws. He can slip over and under the documents as long as he controls, he can't control forever, that costs money also. He needs to consider the owners in the development, make him do that. As I said be open, be fair, be cool, and be smart, he will recognize that.
IMHO

Maureen,
First, I think it is vital that you have copies of the documents the developer filed at the county office (Planning office for one. Most of these county employees are helpful and knowledgeable and will point you in the right direction. Your lawyer will need to know this, save yourself some money and do his preparatory work if you can. He may even agree to give you a list of documents he needs and will let you research them if he feels you can do the job or he has to pay someone else to do it. See if he will work with you, explain cost is a factor but you will pay what is necessary, as long as you stay away from long term commitment.

Read your documents and highlight very specific passages you don't understand. Don't pick and when you find something confusing write down what bothers you, don't rely on memory.

The lawyer is going to ask you want you want? He will probably say something like, "What do you want me to do for you?" Very, very important you have a clear concise answer to this. So list your concerns on paper discuss it with others if you deem necessary and refine it down to; "If he finds out this for me and clears up my doubts of the moment, where does that leave me? Articulate your conclusion to the lawyer and ask for his critique."

Maureen,
I want to handle this God awful position you and your fellow members seem to be in. I have to ask why are you all putting up with this. This is not criticizm of you, it is directed to all of you. All Board meetings are closed. What does State Law say and what does non-profit association law in your state. I doubt anything in your documents will make a difference as the developer still controls, IF he controls by statute. Keep in mind, this is not a battle between you and the builder. You are a member of a Homeowners Association and I certainly would keep copies of any messages from him or his attorney and reflect you are doing that. His accusations are also to the owners all.
Maureen, I and others have posted here many time about how important it is to understand where we, as owners, fall in the hierarchy of HOA associations. Certainly the Board is out front with action items and should be allowed to manage the business, end, the day to day operation. But we, as individuals must and have agreed to accept responsibility of the association. Fight, battle, scheme, make poor managements decisions, allow entrenched non-functioning Board and Management to ride roughshod, someday, sometime, the people have to speak, and they must speak as a member of the whole, like it or not. The sooner owners realize they are responsible, not to the developer and not to the Board, but to the association, progress will come. You will never get all owners on the bandwagon, but think for a moment: how many people are driving the train now? The minority is, be they owner or Board or management. The Holy Grail is to find those owners that understand where their responsibility lies and will make that commitment to the whole. They really are the power. It's not easy but there are thousand of HOA's that operate like a private business and they get the job done.

Robert,

I hope with all the advice you have given me, and after I meet with an attorney who specializes in HOA law I will have
a better understanding of all of this and will be better equipped to do something about it.

In addition,
Check FHA, and others common providers of mortgages and see if they don't have some sort of cap on the # of rental properties in an association above which they will not provide mortgage money.