Ask the HOA Expert
Take Action Against Suspect President
by Richard L. Thompson
Q I suspect our president of embezzlement. He is also acting
as the secretary and treasurer and claims he has over half the owners’ proxies so
no one can stop him. Help!
A You have legitimate concerns and have the right to
reasonable answers to those concerns. Make a written request for access to
financial information (checking accounts, financial reports, etc.). If you are
ignored or don't receive reasonable answers, you have the right to call a
special owners meeting usually with a small percentage of owners requesting it
to discuss the concerns. Also, convince the other owners to vote for you in the
next election and ask them to give you their proxy if they aren't attending the
annual meeting. Ask other concerned owners to run as well. Only if you displace
this individual will you have a chance for change.
Q Can a HOA offer its members the option to pay higher fees
in lieu of participating in maintenance activities? We have always tried to
keep our fees low by sharing many of those tasks. And is there a way to ensure
that prospective buyers understand that our HOA involves a commitment to make
regular contributions of time and effort?
A An underlying
principle of owning property in a HOA is that the members get discounts through
group buying power. But there is no obligation that any member has to do the
work themselves. So, members cannot be surcharged for lack of participation.
While it's nice that there are those that want to cut costs by doing the work, getting
sustained cooperation and consistent results from all members is next to
impossible. Encourage volunteers by asking each member to complete a small but
meaningful task rather than volunteering for long-term commitment. By year end,
many small projects can be completed and, when combined, represent an
impressive accomplishment. Recognize those that participate in the newsletter
and board and annual meetings. Give awards and certificates. This will
encourage others to step forward.
Q Our board has been missing a secretary for months. I serve
on the Architectural Control Committee and the board wants me to take the
secretary's job. I don't want it since it is a lot of work if done properly.
Can the president force me to take the job?
A It sounds like your HOA is overdue for professional
management, which can provide this service and many others. Barring that, the
board could appoint or hire anyone to do the secretary's job. The board can't
force anyone to do anything.
Q I’ve just completed my first year managing the largest
condominium association in the area. The property spent much of the last ten
years under maintained and what work was done was substandard at best. Until
recently, the majority of board members represented investors, and many board
decisions were made in the best interest of those investors rather than the
HOA. For example, insurance claims were paid through the HOA’s policy that
should not have been. Those investor board members have since been replaced by
owner occupant directors, but the investors are posturing to retake the board.
They have been engaged in door-to-door campaigns and other aggressive tactics.
Many of the current board members are so frustrated with the barrage of
communication and additional work this group is causing that they are ready to
throw in the towel. I’m at a loss as to what I can or should do in this
situation. My gut reaction is to suggest that all directors be required to sign
a conflict of interest agreement. This would help rein in some of the
self-serving behavior. Thoughts?
A Investor owners have the right to serve on the board if
they can get elected. The current board members need to understand if they
don't encourage conscientious and non-conflicted candidates and general members
to vote for them, candidates with not-so-hidden agendas will get elected and do
things that will negatively impact the value of the units. Signing a conflict
of interest statement may be appropriate since it can be used to intercede when
self-serving board actions are being contemplated. You, as manager, need to be
candid about what the board should and shouldn't be doing and the consequences.
For example, filing inappropriate insurance claims against the HOA's policy
could result in higher premiums or loss of the insurance altogether. If a board
member proposes something at a board meeting that conflicts with the governing
documents, good business practice or common sense, say so in no uncertain
terms. If the board votes in favor of it anyway, insist that the minutes
reflect that the manager advised otherwise. This tactic may cause the board to
recant its foolish ways. The manager walks a fine line with changing boards. If
the hidden agenda folks take over again, you will have a choice to make: quit
or try to make it work.
One of any homeowner association’s challenges is helping neighbors
“make nice.” The board is frequently called on to mediate disputes and fine
neighbors for doing bad things. Actually, it’s not the board’s job, and in most
cases, these “opportunities” should be bounced back to the complainer to
What exactly is a good neighbor? To be one, you don’t need
to be friends or hang out together. Being a good neighbor is an attitude. A
good neighbor attitude allows you to live as privately or as sociably as you
wish. Here’s how to cultivate and nurture it:
Meet Them. While
marching up to their door with hand extended is great, the chance encounter
works well too. Introduce yourself at the mailbox, while walking the dog or
when you take out the trash. Learn their names and offer a cordial
"Hello" or "Good Morning" when you see them.
Keep Them Informed.
Contact them before undertaking something that might affect them, such as
hosting a big party, building a fence, or cutting down a tree.
Be Aware of
Differences. Age, faith, ethnic background, and marital status can
drastically affect lifestyles. Be aware of the differences between you, but hone
in on what you have in common.
Point of View.
From your neighbor’s viewpoint, how does your compost pile, swing set, or junk
car look? Would you like that view? (If you do, refer to your neighbor’s
If a neighbor does something you like, tell them! They’ll be pleased that you
noticed the new awning, patio furniture, plants, etc.
Assume the Best.
Most people don't intentionally create problems. Assume the neighbor doesn’t
know about the annoyance when you speak to them. Your delivery will be
dramatically kinder. And assume they will be cooperative.
Be Candid. If
your neighbors do something that bothers you, let them know as soon as
Be Calm. When
discussing a point of contention, speak calmly, listen carefully, and thank
them for telling you how they feel. You don’t have to agree or justify your
behavior. If you don’t react defensively, anger usually subsides, lines of
communication remain open, and resolution is possible.
Take Your Time. If
caught in angry confrontation, take a break to reflect and finish the discussion
when cooler heads prevail. Don’t leave it hanging. Time and lack of resolution
will intensify hostilities.
Best Advice of All.
Treat others as you would like to be treated. This attitude will pave the way
for good neighborliness. Love your neighbor as yourself.
Richard L. Thompson,
PRA is the Owner of Regenesis, Inc. For more information, visit www.regenesis.net.