past pres sold HOA property!

Started by IngridH • 4 replies • 1770 views

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IngridH (Florida)
Posts: 2

Posted:

I just became the VP of our HOA. The board just found out that the past president sold a garage unit that the HOA owned and used as an office. The quit claim deed was signed also by the past treasurer. No other past board members knew anything about this. I live in FL and the garage was sold over a year ago!!!!

The new president as well as another board member are trying to contact attorneys -- as we think the old one was ini cahoots if you will, with the past president. I am desparately trying to find out some info, but can't!

Help!

RogerB (Colorado)
Posts: 5,067

Posted:

Ingrid, was the past President and Treasurer contact and asked to explain this apparently illegal action? Each should be sent a certified letter and in the letter the Board should also advise what actions the Board is requesting by them to correct this.

IngridH (Florida)
Posts: 2

Posted:

Roger, apparently a man that was on the old board as well as the new one, contacted the treasurer re: the quit claim deed that has her signature on it! Previously she denied any knowledge of the sale. She still is "playing dumb." Nobody has talked with the past pres to my knowledge.

We have a board meeting this Wed and I will know more then I hope. I have looked over my copy of the Protective Covenants - the only paper work given to me when I purchased here - and there's no mention of the president's ability to sell off HOA owned property. I have also skimmed a book The Law of FL HOAs, to no avail.

The real kicker is that the pres sold his personal garage unit to the same man at the same time for $2,000. more than he sold the HOA's for!

Thanks for any advice.

BrianB (California)
Posts: 2,820

Posted:

I would tend to think it illegal of any HOA board to sell HOA assetts without proper process, which in the case of real property, would include a vote of the membership. I also wonder how the deed was written, because the land was not owned by the president, it was owned by the HOA.

heaven knows, if I could sell our common areas to someone for $10, i would in a heartbeat!

JosephW (Michigan)
Posts: 882

Posted:

Ingrid,

You're about to walk into a legal mess, so before it goes any further, have the association counsel get involved. If you don't have one, find one that is knowledgable in community association law. Unless the douments gave the president the authority to do this (and I've never seen documents that did)the past president is possibly looking at breach of fiduciary duty, conflict of interest, fraud, etc. I don't know if the sale could be voided, but if it can, then the purchaser might institute an action against the association. This isn't going to be pretty, but you really don't have a choice. If an owner were to institute an action against the association and the board for failing to correct (or deal with) this, you could all be tied up in legal issues for a while.

By the way, how's your Director's & Officer liability insurance policy?

Joe

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