ByLaw change & covenant enforcement

Started by RobertM17 • 13 replies • 2780 views

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RobertM17 (Oklahoma)
Posts: 13

Posted:

In our Bylaws the members can change them by a majority vote of the members present for a legally called meeting for that includes that specific purpose.
HOWEVER: Our Board of 5 Directors may change them by their selves without input from the members or prior notice to the members
What is your position on this?

Also in our covenants if a court or arbitrator finds a member quilty of a violation and he/she has not corrected it within 30 days the Board can levy a reasonable daily or monthly fine until the violation is corrected. This covenant section also gives the board the right to not levy the fine even though the court or arbitrator has found the member guilty.
What is your position on allowing the board to be selective in whether they levy the fine?

JohnB26 (South Carolina)
Posts: 1,569

Posted:

The old time name for this system was :Fascism:

Is the HOA incorporated?

I doubt if this system would hold up in court.

Perhaps, just perhaps, you are misinterpreting the procedure(s)?

MicheleD (Kentucky)
Posts: 4,491

Posted:

Quote:

Posted By JohnB26 on 08/09/2009 5:23 AM
The old time name for this system was :Fascism:

Good grief. No it isn't. Hyperbole much??

MichaelK11 (Texas)
Posts: 432

Posted:

Quote:

Posted By RobertM17 on 08/08/2009 5:17 PM
In our Bylaws the members can change them by a majority vote of the members present for a legally called meeting for that includes that specific purpose.
HOWEVER: Our Board of 5 Directors may change them by their selves without input from the members or prior notice to the members
What is your position on this?

Also in our covenants if a court or arbitrator finds a member quilty of a violation and he/she has not corrected it within 30 days the Board can levy a reasonable daily or monthly fine until the violation is corrected. This covenant section also gives the board the right to not levy the fine even though the court or arbitrator has found the member guilty.
What is your position on allowing the board to be selective in whether they levy the fine?

The more important thing is not what we think about these issues, but what your governing documents say about them.

Do you have your Bylaws and/or your declarations as on-line documents that you can attach to a post, here? If not, could you quote the relevant passages?

I suspect most HOA's have provisions in their Bylaws requiring some sort of Membership approval for amendment; mine does.

My HOA's Declarations of CE&Rs specifically give our BoD discretion in enforcing any provision, which some of us quote at them when they insist they have no choice in this stupid lawsuit. I think it's a good thing to give a BoD this much latitude, since the authors cannot predict every situation. (Our Declarations do not require bringing anything to a court or arbitrator to determine if there is a violation -- our BoD has that discretion as well. I think this is the more usual set-up; this is the first I have heard of an HOA requiring a court ruling to enforce violations.)

Anyway, if your BoD engages in selective enforcement (i.e., penalizing or benefitting one Member distinctly different from how they treat others) in levying of fines, that could get them in trouble. More likely to be a problem if they single one out for punishment than if they single one out for non-punishment, but I think either is unfair. However, if they decide on some policy about when to levy fines and when not, and apply that consistently across violations, then they are probably OK. Selective enforcement probably must be based on deviating from a pattern -- if there has only been one instance where they could levy a fine, then they should probably state the reasons for whatever they decide, but I don't see how their conduct in one case could exhibit any pattern or deviation therefrom.

RobertM17 (Oklahoma)
Posts: 13

Posted:

Our association is incorporated.
In Oklahoma the State Laws do give a hoa the right in their bylaws to be changed by either the members or directors as long as the vote is just a simple majority of the members or directors attending a legally called meeting for that purpose. The members do not have to be notified of the agenda to change the bylaws at a directors meeting.

I know this is true as I had an issue on proxies for a annual meeting and consulted an a hoa attorney for his opinion and he concured the directors could change the bylaws by theirselves .

The directors proceeded to act as I expected and had planned on changing the bylaws in regard to a proxy making a proxy legal ONLY if it was on a form issued by the directors and making the change retroactive to my proxies. They did consult the associations attorney and he told them NOT to change the bylaws as they would be opening their selves to civil suits from every one who signed a proxy to me.

I had campaigned for proxies as we assessed dues for a rebuild of the pool cabana and replacement of the fence that would total over $90,000.00 and the board appointed a pool committee of 5 people, included were the board president and a director, and they were to make the entire decision for the cabana/fence project. They refused to allow for competitive plans to be submitted by members and voted upon by the membership so my proxies were to force them to accept competitive plans and a vote by the membership.

MichaelK11 (Texas)
Posts: 432

Posted:

I'm sure such State laws allow any Association's Bylaws to specify more restrictive provisions for amendment. I'm sure you have checked to see if your Bylaws have their own amendment provision.

If I were you, I would campaign for amending your Bylaws and Declarations with a few common provisions:

Bylaws should require consent of the Membership for amendment -- perhaps 50% of all Members eligible to vote (not just those at a meeting).

The Declarations should require consent of the Membership for Budgeting or approving expenditures over some set amount -- perhaps 50% of eligible Members and proxies at a duly called meeting for amounts over $15,000.

Normally the Board distributes and collects proxies, but as you suggested, I think any Member should be permitted to do so. Keeps things more democratic (and less fascist). I think you implied that is how your Bylaws are currently constituted.

Nice that you have direct access to your HOA's attorney. In my case (and I think often) only the Board has such access.

How large is your HOA, please?

RobertM17 (Oklahoma)
Posts: 13

Posted:

Sorry if this is a repeat reply but I might have sent the first in error to someone else.

Our association is incorporated and I had an attorney who specializes in hoa's review our bylaws and covenants with specific areas of interest and one was the right to change the bylaws by the directors their selves without ny notice to members until the change had been made. His written response was yes they could change them as stated.

The reason this came up was we had passed an assessment to rebuild our pool cabana and replace the fence. This ia a project of $90,000.00 plus and the board appointed a pool committe of 5, 2 of those were directors and 2 were spouses of directors, and they were planning on a single plan. The pool committe, the single exception being the person not connected to the board, and the board refused a request to allow for competitive plans to be submitted so I went door to door with a proxy that members could sign that allowed them to vote at the annual meeting either YEA or NEA for a resolution I had sent, as prescribed in our bylaws, calling for competitive plans and voting by the membership.

I had a private meeting with our board president and the main point of discussion was they were going to discuss changing the bylaws to read that a proxy could be legal ONLY if it was on a form issued by the board and making it retroactive to rule my proxies illegal. He wanted to know if I was planning further actions if they did this and I told him YES.

I attended their next board meeting and the president stated that they had decided not to pursue a bylaw change as their attorney told them they would be liable for civil liberty law suits from myself and every member who had signed a proxy to me

RobertM17 (Oklahoma)
Posts: 13

Posted:

ByLaws: Who May Ammend: These By-Laws may be amended, altered, changed or repealed by the affirmitive vote of a majority of the memberships, and entitled to vote thereat, at any regular or special meeting of the members if notice of the proposed amendment, alteration, change or repeal be contained in the notice of the meeting, or by the affirmative vote of the majority of the Board of Directors at any regular or special meeting of the Board of Directors; provided further, however, that the Board of Directors shall have no power to adopt, amend or alter any By-Laws fixing their number, qualifications, classifications, term of office or the right of the members to remove them from office.

CCR: General Obligations of Owner: Section 7.4: If a court or the arbitrator(s) as provided in Section 7.2 or 7.3 upholds the complaint, the owner shall be so notified in writing and shall promptly remedy the violation and if he fails to remedy such violation within (30) days after the date of such notice or in the time specified in any such proceeding, as appropiate, the Association may ( but shall not be obligated to ) remedy such violation and add the cost thereof, as a special assessment, to the normal assessment of such Owner. The Association, and its designees, shall have the right of entry upon the Lot Owned by such Owner for such purposes.
I don't think the unauthorized entry to a n Owner's Lot would be legal.

MichaelK11 (Texas)
Posts: 432

Posted:

Thanks, Robert.

If you have found an attorney who specializes in HOA's, I'd like to have someone like that review my situation. Would you be willing to refer, please? [email protected]

RobertM17 (Oklahoma)
Posts: 13

Posted:

His name is Mike Voorhees and is in Oklahoma City.
7701 South Western, Oklahoma City OK 73139
405-682-5800

SusanW1 (Michigan)
Posts: 5,202

Posted:

RobertM - please state what is in your bylaws about proxies.

I find it unusual that the procedure for proxies would be stated in the bylaws (permission to use them would, but not the how of their submission - that is ususally a board Rule & Regulation or something the election committee would fine-tune)

SusanW1 (Michigan)
Posts: 5,202

Posted:

MichaelK11 (Texas)
Posts: 432

Posted:

Our Bylaws provide a basic and probably common procedure for proxies:

"At all meetings of the Members, each Member may vote in person or by proxy. All proxies shall be in writing and filed with the Secretary. Every proxy shall be revocable and shall automatically cease upon conveyance by the Member of such Member's Lot."

So, the procedure is simply to deliver to the Secretary; if a Member executes a proxy and then decides to attend, their direct vote revokes and supersedes their proxy; a Member can also cancel their proxy if they change their mind. Proxies are normally distributed and received by the BoD, but any Member can distribute and collect their own proxy if sufficiently motivated and persuasive. This is one provision that I prefer exactly as it is.

The only real problem is when the BoD goes rogue with surprises in their meeting notice, leaving only ten to fourteen days for unhappy Members to figure this out, put materials together and canvass 300 homes. This time I intend to have everything ready to go, in case they do that.

RobertM17 (Oklahoma)
Posts: 13

Posted:

The heart, meat, of the Proxy requirementis in the first two sentence and is as follows:

"Any member entitled to vote may cast his votes in person or by proxy. The appointment of a proxy shall be in writing and signed by the member giving the proxy, but shall require no other attestation and shall be filed with the secretary of the corporation at or before the meetin, but in no case shall a proxy be appointed for a period of more than one year."

The "shall be in writing and signed by the member giving the proxy, but shall require no other attestation" is the ONLY physical description or requirement for the proxy to be legal. The rest is verbage as to duplicate proxies, length valid for, filing and other like issues.

The written proxies I received were ALL SPECIFIC TO 3 RESOLUTIONS AND HOW TO VOTE FOR BOARD CANIDATES. On the 3 resolutions they were printed in entirety and signers either voted YES or NO & if they did not check the YES or NO box I did not vote either way for them since I was obligated to vote ONLY as they instructed. On the Directors it listed the current directors by name I would or would not vote for on reelection and others by name that might run that I would not vote for and if the signer did not agree with my choices they had an area to tell me how to vote.
My proxy was worded where it could be used ONLY for the above issues ONLY at the annual meeting. YOU COULD NOT HAVE A PROXY THAT WAS MORE REPRESENTATIVE OF THE SIGNERS.

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