Ownership isn't board prerequisite
Q: Who is considered a unit owner for the purposes of voting on association business or serving on the board of directors? We placed our condominium unit in a trust naming our daughter as trustee. The trust names us as having a life estate that will revert to our daughter after our deaths. Our manager says our daughter as trustee must vote and not us. Our condo has a problem because members are not volunteering to serve on the board. We would like to be a candidate, but it seems that our trust prevents us from serving. Any insight would be appreciated.
A: The question of qualification to serve on the board is simple. Any person of legal age, current on their fees and not a convicted criminal can serve. You do not need to be an owner to serve on the board. Neither ownership nor residency is a qualification requirement unless your documents have other restrictions.
As for voting, your daughter must vote the ballot but any other voting can be transferred to you by a proxy. At meetings, you should have the right to voice your opinion with certain limits. If you want to volunteer to be a candidate, then put your name on the intent to be a candidate sheet and return it within the proper time.
Item must be on agenda for action
Q: Our board approved a donation to a charity. The item was approved at a board meeting, but it was not an agenda item but added at the last minute. Although I think it was a good and noble gesture, I question if the action was proper. Can you point me to any document that covers this action?
A: The condominium act does not exclude contribution, but it does list acceptable expenses. An interpretation of this section indicates that the board cannot properly make a charitable donation with member funds. The HOA act is not as restrictive, but boards should use caution and not make donations to charities.
Your board members must understand they cannot take action if it is not an agenda item. If they do, it must be understood as an emergency and ratified as such at the next board meeting. In such situations, I suggest that the board ask for contributions from members to be used as the donation.
Covering for delinquent owners
Q: Our board wants to increase our fees to cover for members who are not paying. Basically we are lending them money to live in our community free. Someday the fees will be paid; thus, the fees will be paid twice. When I asked the board if we can get our fees back, the board said we would not be refunded the extra fees. Can the board do this?
A: I hope the board is not sleeping on its responsibility to take action against delinquent owners. By that I mean liens and foreclosure action.
In today's economy more and more owners are not paying their fees. In many of these cases, the association will never recover the shortages and must write them off as uncollectible funds.
Looking at your situation, the board is obligated to maintain and operate the association. Expenses to maintain and operate should be part of the budget and divided among the units. If some owners do not pay and the board takes legal collection action, the shortage must then be divided by the other owners to pay. If the delinquent owners pay, then the funds should be reflected in future budgets that could reduce fees. It will not be a case of double paying; it is a situation that future fees will be reduced. It would be my hope that your delinquent owners will pay, but with today's economic conditions, it is possible that they will walk. In that situation, you must consider that the shortage will never be paid.
Creating a grievance committee
Q: Is our condominium association required to have a grievance committee if they issue fines for violations of the written rules and regulations?
A: Your board of directors is responsible for the operations and maintenance of the association. Enforcement of the documents and the rules and regulations is part of this responsibility. The board has a right to engage management or establish committees to assist in this responsibility.
The statute, corporation law for the not-for-profit act (FS 617), defines committees. Your documents may also require the establishment of committees. If your documents do not establish committees, then the board may create committees. In doing so, the board must approve the duties and operations of the committee.
If the committee discusses finances or makes final decisions, the meetings must be noticed and open to members. If your board uses a grievance committee, the board should establish the guidelines and scope of work the committee must follow.
As to fines, the statute is very strict and requires a rule enforcement committee to review the process. If the board does not create a committee that is an independent rule-enforcement committee, the fine may not be enforceable.
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.