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Community Living: Dissolving a homeowners association is not easy

Dissolving an HOA is very difficult

Q: Is there a way to dissolve a homeowners association? If so, how?

A: You can dissolve an HOA, but it is almost impossible. You not only need the approval of the members, but most documents also require the approval of the mortgage holders. If you have common areas, you must seek someone or some agency to accept the deed and title to these areas. It is not just a simple matter to say "we quit." You need the guidance of an attorney. More than likely the deed for each home must be amended and recorded. In such a situation, I am not sure how the property tax appraiser will look at the new values. My guess is that the legal costs would exceed $10,000, depending on the size. If you have deed restrictions, they will be passed on to the county or state for enforcement.

Replace loose cannon of a president

Q: Our president has taken a position that he is absolute ruler and the final authority. The other directors have instructed the president to not proceed with his action to bind the association in a contract. The president says that he does not need to listen to the board and will obligate the association to the service. What is our next step to stop the president?

A: Notify the vendor that the president acted without the board of directors' approval and that the association will not honor the contract that was improperly signed by the president. You may want to have the association attorney send the notice. Immediately call a board meeting and elect a new president. At the same time, strip all powers from the former president such as signing checks, etc. Notify the bank not to accept his signature. If the president paid funds to the vendor, ask that the check be returned or the funds reimbursed to the association. While the board cannot remove a director, the directors can remove an officer and any powers that officer had. To remove him as a director requires a recall by the members.

Plan ahead if directors will be absent for vote

Q: I serve as a director for a large condominium. Is there a specified or recommended procedure for handling tie votes on motions made during a board meeting? During the summer months, directors take vacations and it leaves only some of the directors to vote on issues.

A: Motions need a majority vote to be approved; a tie vote is not a majority. You need to plan ahead if you expect that some directors will be absent. While directors cannot vote by proxy, the motion can be tabled and brought to a vote at the next meeting. The statutes do allow an absent director to be connected by a speaker phone and be counted as present; their vote in this situation will count.

Clarify with attorney how unit is defined

Q: I live in a condominium and the board has an interpretation problem with the documents. It says the owner's responsibility is from the ceiling to the floor. Does this mean the ceiling in the unit or the ceiling in the attic?

A: This is a title question and may need an attorney's interpretation. Normally, a unit is defined as the area inside the unfinished walls, unfinished ceilings and the unfinished floors. The condominium would have responsibility to the unfinished drywalls and unfinished floor. The owner would have responsibility to paint, wallpaper, popcorn or apply other ceilings, carpet, or apply other decorative coverings. There may be exceptions to these responsibilities that would vary from condominium to condominium.

Only items on agenda can be put to a vote

Q: Will you please answer the question as to whether or not members may make motions and vote at the annual membership meeting?

A: Before an annual meeting, an agenda must be produced and only those items on the agenda can be put to a vote. The agenda is produced days, if not weeks, before the meeting; any item to be included must be presented to the board in advance. Any motion made must be made by a member. The directors serve only as members and not as officers at the annual meeting. As such, they may make motions as well. Otherwise, the directors have no control or voting rights over the members and no duties at the meeting except to produce the required notices and necessary meeting documents and call the meeting to order. If a member stands and makes a motion that is not on the agenda, that would be an improper motion.

Condo association should have registry of renters

Q: Can the condominium association require tenants or owners to give them a copy of the lease for a rental unit? Is that privileged information? There is nothing in the documents about this.

A: If your documents do not require that a copy of the lease be provided, then I suggest you not require it. You can require other information, however. You should, for example, have the names of the residents for the association records. If anyone questions it, there are several reasons to require this registration. One of the most important is safety. You want to have a list of residents for the fire department in the event of an emergency; some security systems also require names for all the occupants. You also may have common areas that are limited to residents and their guests. You don't need a copy of the lease agreement, but a registry of names is a must.

Richard White is a licensed community associations manager. Write to him at 6039 Cypress Gardens Blvd., No. 201, Winter Haven, FL 33884-4115. Please include your name and city.


Community Living: Dissolving a homeowners association is not easy 07/30/10 [Last modified: Wednesday, July 28, 2010 3:54pm]
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