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No Officers

Started by LauraD • 35 replies • 3442 views

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LauraD (Arizona)
Posts: 18
Posted:
Potentially this coming January we'll have no President & VP officers for our HOA as :
1 - no one wants to keep banging their head against the wall
2 - burned out from nothing but complaints & no help
3 - time it takes & no one appreciates but thinks they are inteferring

What happens next??

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

We had the same situation and let ALL owners know that in that case a person would have to be hired to oversee the association at a large salary and their assessments would go up. We ended up with a board.
MarianneG (Indiana)
Posts: 170
Posted:
Laura, We had the same situation at our annual meeting last week -- no nominees prior to the meeting and no one wanted to step up to the plate AT the meeting. When we announced the assoc would probably have to hire a management company, people came forward to fill the slots. In addition to higher fees to pay managers, we also noted that possibly a mangement company might not be as responsive to the community needs as is an in-house board.

The following idea came from this forum (I think MicheleD): We had sign-up sheets at the meeting for Decorating Cmte, Activity Comte, etc. I was quite surprised to see the number of residents who were willing to sign up to help. I guess it's more attractive to help on committees, which are somewhat limited in responsibilities, than to serve for a term on the board. Maybe it would help your community to break up some of the work into committees, overseen by the board.
EllenS1 (Florida)
Posts: 1,148
Posted:
Marianne.

Great idea. Committee members often turn into board members.
DonnaS (Tennessee)
Posts: 5,671
Posted:

Ellen,

The receivership is always a great threat to members who refuse to step up to Board positions. Reading the Florida Statutes on going under the State appointed caretaker would be a last straw for me. But as we have known and discussed for years on this site, owner apathy is just so prevalent with no sure answers on how to cure it. In life, there are shakers and there are takers. Too bad that we cannot have an even balance.
SusanW1 (Michigan)
Posts: 5,202
Posted:
So where are your Nominating Comittees?
That committee finds qualified, willing people to run for office.

They can make the case to these people that if they don't step up, the HOA i in danger of being taken over by outside entities.

MarianneG (Indiana)
Posts: 170
Posted:
Quote:
Posted By SusanW1 on 10/12/2009 4:18 AM
So where are your Nominating Comittees?
That committee finds qualified, willing people to run for office.

They can make the case to these people that if they don't step up, the HOA i in danger of being taken over by outside entities.


We do not have a nominating committee. IAW our bylaws, we have an election committe whose sole responsibilities are to put out a notice of the meeting, a CALL for nominations (no other action required), and to count the ballots at the annual meeting. That is probably something that should be addressed when we review bylaws and CCRs this coming year.

Before our annual meeting, board members contacted some potential residents about running for the board, but no one came forward. It is, as Donna says, homeowner apathy.
BonnieE (Illinois)
Posts: 338
Posted:
Hi Marianne,

I can certainly relate to your issue as we have the same problem with on-going owner apathy. Several years ago we did the “warning letter that the HOA would go to a receivership if HOs would not step forward” approach, and emphasized that this would be costly. That worked for that year, but not since (you can cry wolf but once! :-) )

We have the (fortunate or unfortunate, depending on your point of view) situation in that the same 3 directors have remained on our BOD (over the years5 slots). So…no one steps forward.

I think that as long as they continue to serve on the Board, no one else will step up – especially since our proposed 2010 budget shows a decrease in assessments (see my other thread on this) – or, at least until a special assessment is done.

I agree with the suggestions from others to form committees to get your members involved. I would add the suggestions from other postings – increase communications with the homeowners (newsletters, web site, community bulletin board, whatever fits your HOA), social gatherings (for ex., a let’s get out and meet our neighbors block party where everyone contributes something - not HOA paid for).

Wishing you success in this,
Bonnie
BonnieE (Illinois)
Posts: 338
Posted:
oops, I meant to address to original poster, Laura

but also applies to Marianne's situation....
MaryA1 (Arizona)
Posts: 7,043
Posted:
Laura,

Posted below is the applicable state statute (from the nonprofit corp act)that addresses your situation, specifically Sub-section E. I interpret this to mean that if no candidates come forward the board has 3 choices:

1) reduce the size of the board, if allowed in the bylaws, or
2) appoint 2 members to fill the 2 vacancies, or
3) the Pres & VP must remain in office until their successors are elected

If the "choice" becomes #3, then the board may be faced with the same problem next year when other directors' terms are up. The members need to be made aware that, even if the assn contracts with a mgmt co, a board of directors is required. It is probably impossible to dissolve the assn so that is not an option. With a manager to take care of the day-to-day operations of the assn, the workload of the board members is not as great. On the other hand, if your assn is self-managed, perhaps a mgmt co should be hired. A special meeting of the members should be called to discuss this problem. The members must realize that they have obligations too!

10-3805. Terms of directors generally

A. The terms of the initial directors of a corporation expire at the first election, appointment or designation of directors as provided in section 10-3804.

B. The articles of incorporation or bylaws shall specify the terms of directors. In the absence of any term specified in the articles of incorporation or bylaws, the term of each director is one year. Unless otherwise provided in the articles of incorporation or bylaws, directors may be elected for successive terms.

C. A decrease in the number of directors or term of office does not shorten the term of any incumbent director.

D. Except as provided in the articles of incorporation or bylaws:

1. The term of a director elected to fill a vacancy in the office of a director elected by members expires at the next election of directors by members.

2. The term of a director elected to fill any other vacancy expires at the end of the unexpired term that the director is filling.

E. Despite the expiration of a director's term, a director shall continue to hold office until the director's successor is elected, designated or appointed and qualifies, until the director's resignation or removal or until there is a decrease in the number of directors.
LauraD (Arizona)
Posts: 18
Posted:
Thanks - I could not find the ARS thaat applied!!!
MaryA1 (Arizona)
Posts: 7,043
Posted:
Laura,

No problem! I think a lot of people forget to look for the nonprofit corp act which is in Title 10.
EllenS1 (Florida)
Posts: 1,148
Posted:
Donna,

You are so right..this should be a last straw. I wasn't sure how it would turn out but did pass out info on a receivership. At the meeting we had nobody running for the board but left with 5 volunteers. Apathy is bad enough but owners have no clue on what an HOA is may be even worse. Education for owners is really needed.
EllenS1 (Florida)
Posts: 1,148
Posted:
MaryA,

Regardless of what State law says I doubt a president and vp MUST remain until new ones take office. If they want to resign there is no way to enforce this requirment. More gobbly gook made up by our legislators...some simply do not have common sense.
MaryA1 (Arizona)
Posts: 7,043
Posted:
Ellen,

I only quoted the law. If anyone chooses to disregard it they may find themselves in a court of law for violating the law. Never underestimate what some people might do!
EllenS1 (Florida)
Posts: 1,148
Posted:
MaryA,

Oooh! This is too scary..a court of law enforcing a person to volunteer. Are you serious that someone will pay an attorney to take legal action against a volunteer?
MaryA1 (Arizona)
Posts: 7,043
Posted:
Ellen,

I can't believe you've never heard of board members being sued by their own assn members! Being a volunteer has nothing to do with it. If you break the law you run that risk. Don't ever think someone won't spend that kind of money on such an inconsequential matter. I know of one person who spent upwards to 1 Million (YES 1 MILLION) suing her board over an HOA election.
EllenS1 (Florida)
Posts: 1,148
Posted:
MaryA,

Would you care to share the case number of the person who spent upwards of a million dollars who sued her board over an HOA election? In my wildest dreams I can't see an attorney taking on such a frivilous case. The easiest way out of staying on as an officer is to claim illness, perhaps the strain of being on the board or who knows? Even if being forced to serve (which I doubt would ever happen) remember "you can lead a horse to water but you can't make him drink". Who would want a pres or vp who doesn't want to contribute? It makes no sense. I resigned from the board and it would be a cold day in hell that anyone could force me to serve.
GlenL (Ohio)
Posts: 5,491
Posted:
Yes Mary they would continue as directors however they could resign their posts at any time. What if they heard that they would be forced to continue if no one was elected in their stead and resigned the day before the annual meeting? Send the police to grab them and force them to accept re-appointment?
Studies show that 5 out of 4 people have problems with fractions
EllenS1 (Florida)
Posts: 1,148
Posted:
I don't want to beat a dead horse but it is difficult enough to get anyone to serve on the board. Now if they could be sued for not staying after their term was up nobody would volunteer.

Mary,

We are still waiting to get specifics on that million dollar lawsuit you told us about. What was it about, where was the lawsuit filed, what was the case number so we can all check it out? Or was it a figment of your imagination?
MicheleD (Kentucky)
Posts: 4,491
Posted:
Quote:
Posted By EllenS1 on 10/12/2009 6:23 PM
We are still waiting to get specifics on that million dollar lawsuit you told us about. What was it about, where was the lawsuit filed, what was the case number so we can all check it out? Or was it a figment of your imagination?

Wow. Ellen, with all due respect, in all the posts that Mary has ever made, I have never found her to be a liar. And, point in fact, I'm considerably more hyperbolic than she has ever been, so I don't think the was employing that device in this thread. This statement might have been a little uncalled for.
JackE1 (Indiana)
Posts: 26
Posted:
Quote:
Posted By MaryA1 on 10/12/2009 1:59 PM
Ellen,

I only quoted the law. If anyone chooses to disregard it they may find themselves in a court of law for violating the law. Never underestimate what some people might do!

Mary, Ellen & Glen it was in what Mary posted:
E. Despite the expiration of a director's term, a director shall continue to hold office until the director's successor is elected, designated or appointed and qualifies, until the director's resignation or removal or until there is a decrease in the number of directors.

Could you stop bickering and get back to the posters question; what happens if there are no directors?

If nominated, I will not run; if elected, I will not serve.
William Tecumseh Sherman
GlenL (Ohio)
Posts: 5,491
Posted:
Sorry Jack sometimes we see one phrase and worry it to death.

Laura when a vendor ceases to be paid they will file a lawsuit and when the court finds out no one is in charge the judge will appoint a receiver to oversee the HOA. In addition to paying your assessments for the day to day stuff as you do now; you will have to pay the receiver's salary. In addition to assessments going up this one outsider will have control of everything including all of the funds. The HOA won't be allowed to fart without the receiver's permission. The receiver will stay in charge until someone from the HOA can prove they are willing to take over but since that will mean a cut in the receiver's salary they tend to fight to stay in charge.
Studies show that 5 out of 4 people have problems with fractions
MaryA1 (Arizona)
Posts: 7,043
Posted:
Ellen,

The lawsuit of which I spoke is definitely NOT a figment of my imagination. I don't have the case #, but it did occur in AZ. A member of an HOA filed suit against the BOD of her assn because they would not honor the outcome of a recall election in which she was one of the members elected to replace several recalled board members. Frankly I don't care if you believe me or not and I shouldn't even waste my time to give you any more info about the case. I do want you to know that I certainly do take exception to your implication that I am a liar.

As I mentioned earlier, I only quoted the state law -- I didn't write it. And, everyone should be aware of what the consequences of violating a state law can be. People should also be aware of the fact the some people have money to throw away and won't hesitate to bring suit even if it means spending tens of thousands of dollars -- even over issues that may seem petty to most people. If you don't believe this then I must say you have somewhat of a pollyanna attitude. The plaintiff in the lawsuit of which I spoke not only spent a huge amount of money but she also was faced with foreclosure on the 7 or 8 properties she owned in the assn because she stopped paying her assessments while in litigation.

Ellen, don't expect any further info from me on this topic.

MaryA1 (Arizona)
Posts: 7,043
Posted:
Glen,

Different states have different laws. There is no statute in the nonprofit corp act or the HOA specific statutes about appointing a receiver if an HOA fails to pay their bills. There are statutes pertaining to administrative and judicial dissolution of an HOA but none of the requirements pertain to this issue.

Frankly, it's doubtful anyone would file a lawsuit against anyone who violated the statute I quoted. IMO, it may be used as a good scare tactic. I also would be very surprised to learn of an assn that is w/o a BOD because the terms of office of all the board members expired and no one chose to run to replace them. I like to never say never, but this really sounds a bit far-fetched.
MaryA1 (Arizona)
Posts: 7,043
Posted:
Jack,

In posting the applicable AZ state statute, I believe I did answer Laura's question. Ellen has chosen to not believe me and Glen has chosen to poke fun at it. So be it! I don't believe I'm bickering with anyone; only posting the facts!
LauraD (Arizona)
Posts: 18
Posted:
Yes, Mary, you did answer my question. And I deeply appreciate the reference to the AZ law. The facts based upon written law help clarify what the officers can & can not do. Or should & should not do. It is a touchy situation.
We even have had several occasions of residents calling wanting us to call the fire department (neighbor burning weeds) or the Sheriff (suspicious character wandering about) or Border (illegals getting dropped off in our park or picked up in our park)....they won't do it!!! Talk about apathy. I even put all the numbers in our monthly newsletter! Someone said to me "There's too much information in it. People do not read it." Send me an email if you want to see a copy then tell me: Is there too much in it? Because the next issue will deal with the "no officers running" topic & what can happen.
SusanW1 (Michigan)
Posts: 5,202
Posted:
Bylaws give the board power to fill vacancies. So fill them!!

True, you cannot force a person to serve or make them stay, but the board number is protected with the power of vacancy filling. The officer situation may take more thought, but again, the VP moves up and then that spot is filled by appointment.

If everyone resigns except one person, that one person can build a board by appointing people to all positions.

Only if no one steps up will other authorities step in - probably a court ordered attorney.

Who said, "I'm in charge now" ?

That's what has to happen when people fall to the side.
MarianneG (Indiana)
Posts: 170
Posted:
steps up will other authorities step in - probably a court ordered attorney.

Who said, "I'm in charge now" ?

That's what has to happen when people fall to the side.

It was Alexander Haig, much to his later embarrassment and much criticism from others.

MarianneG (Indiana)
Posts: 170
Posted:
Quote:
Posted By MarianneG on 10/13/2009 10:27 AM
steps up will other authorities step in - probably a court ordered attorney.

Who said, "I'm in charge now" ?

That's what has to happen when people fall to the side.

It was Alexander Haig, much to his later embarrassment and much criticism from others.



I don't know why the quote didn't show up, but Susan asked who said, "I'm in charge now." and I answered that is was Alexander Haig.
EllenS1 (Florida)
Posts: 1,148
Posted:
Michele,

I never called Mary a liar. I simply asked her to provide facts for a statement she made here. We all know anyone can say anything and I was very interested that a homeowner would spend up to a million dollars to sue an association and would like to learn more about it.
EllenS1 (Florida)
Posts: 1,148
Posted:
Jack,

What happened if there are no board members is that the associaion will go into receivership and the association will be forced to pay a large amount to cover the cost. But this was stated earlier in this thread.
MaryA1 (Arizona)
Posts: 7,043
Posted:
Laura,

Glad I was able to help.

It's not uncommon for some members to think the board is resp. for everything that goes on in the neighborhood. All the incidents your mention should be handled by the fire or police dept.

Speaking about members not reading the newsletter; a board member in my former assn announced at a board meeting that she didn't bother to read the newsletter. I was flabbergasted! Were you asking me if I would like to read a copy of your newsletter? I don't have access to your email.
EllenS1 (Florida)
Posts: 1,148
Posted:
MaryA,

I did not call you a liar..I simply wanted more info on the million dollar case. It appears the plaintiff had some very bad lawyers who did not tell her no matter what ...do not stop paying your assessments. Even a lay person would know this is not the way to go. I don't expect to hear from you again but citing state law as a "scare tactic" to me seems very unproductive, especially since it would, in my opinion, be unenforceable in a court of law.

Case in point:

I served on the board for four years and resigned. I am now 78 years old with some health problems and no longer wish and/or am unable to serve. Are you telling me if the law says I must stay on I would be forced to continue that it would hold up in a lawsuit?

"Scare tactics" remind me of the old saying "if you can't baffle them with brilliance, baffle them with bulls---t".
MicheleD (Kentucky)
Posts: 4,491
Posted:
Quote:
Posted By EllenS1 on 10/12/2009 6:23 PM
Or was it a figment of your imagination?

I will take you at your word that you did not intend to call Mary a liar, but this statement right here is where I came to that deduction. When someone asks if something is a figment of one's imagination, it's usually a more politically correct way of saying, "I think you're making that up."

I'm glad you were not calling her a liar.


MicheleD (Kentucky)
Posts: 4,491
Posted:
Quote:
Posted By EllenS1 on 10/13/2009 3:41 PM
MaryA,

I did not call you a liar..I simply wanted more info on the million dollar case. It appears the plaintiff had some very bad lawyers who did not tell her no matter what ...do not stop paying your assessments. Even a lay person would know this is not the way to go. I don't expect to hear from you again but citing state law as a "scare tactic" to me seems very unproductive, especially since it would, in my opinion, be unenforceable in a court of law.

Case in point:

I served on the board for four years and resigned. I am now 78 years old with some health problems and no longer wish and/or am unable to serve. Are you telling me if the law says I must stay on I would be forced to continue that it would hold up in a lawsuit?

"Scare tactics" remind me of the old saying "if you can't baffle them with brilliance, baffle them with bulls---t".

I don't have a clue myself what the intent of a law like that would be, other than perhaps that it's intended to hold someone, anyone, accountable if things go south.

If I were the last officer or director of record, and something occurs to put the HOA at risk, perhaps this is a way to make someone accountable for that.

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