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| Author |
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MikeS10
(Florida)
Posts:1
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| 07/20/2008 3:46 AM |
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| Recently a majority of homeowners in our community recalled our board president with ballots, and he naturally is fighting the process and going to arbitration. He has retained a high priced lawyer using the association funds without any concern or permission from the home owners or the other baord memebers. Is that legal? |
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AnnaD2
(Florida)
Posts:338
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| 07/20/2008 6:40 AM |
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| I thought it was the arbitrator's job to try to resolve this problem. I was unaware that a single board member could use association funds to hire a lawyer to represent them individually. Do you have an association attorney??? If so, he/she needs to be contacted quickly. I hope Donna reads your post and responds. She's much more educated about this than I. Good luck! |
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JeanneK3
(Maryland)
Posts:129
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| 07/20/2008 6:46 AM |
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| No, the President may not use association funds without the approval of a majority of the board members as recorded in a board meeting's minutes. Your president is misappropriating funds and should be asked to return these funds to the association. I agree that you should contact the association's attorney and manager immediately. |
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GlenL
(Ohio)
Posts:1377
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| 07/20/2008 7:00 AM |
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| If all things are as you represented and he somehow accessed the funds without BOD approval I would notify the attorney that he was paid with fraudulently obtained funds and ask for there return. If he refuses I would first notify the police and see if charges can be filed against him (the ex-president) and notify the Florida Bar Association on the attorney. But before you do any of that make sure the ex-presidents access to Association funds has been curtailed. I would also ask your attorney if you need to make a public notice severing all ties with this individual. |
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DonnaS
(Tennessee)
Posts:2855
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| 07/20/2008 7:39 AM |
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You are correct, he may NOT use association funds for his attorney fees. It is up to the association lawyer to make this known and he should inform the arbitrator. How did he access the funds? His high powered lawyer should also know this and do his duty to inform his client that this cannot be done. |
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BruceF1
(Connecticut)
Posts:594
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| 07/20/2008 8:51 AM |
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No, the ousted president may not use association funds for personal use for anything, including retaining a lawyer for his personal claim against the HOA.
That said, there are some assumptions here.
MikeS, the original poster, obviously believes the ex-president is using association funds, but is there any evidence that this is actually being done, such as association checks signed by the president that have cleared the bank? Is the ex-president using the association's lawyer who may already be on retainer from the association?
Did the ousted president tell his lawyer that he was going to use association funds? Probably not, so the lawyer may not know.
Has the ousted president's lawyer even been paid yet? Who signs the checks to pay the lawyer? The president? The treasurer? If the treasurer signed any such checks, he/she was wrong to do so without board approval.
Unless the bylaws or state law provide otherwise, the rule under accepted parliamentary procedure is that the vice president takes over the duties of president. Actually, he/she becomes president unless your governing documents or state law provide otherwise. You then elect a new vice president.
The first step would be for the vice president and/or the treasurer to notify the bank to remove the ousted president's name as an authorized signature on the account (or to notify the management company to notify the bank that this be done). This should have been done within 24 hours of the president's removal.
Another thing we don't know is whether or not the president was "removed" properly in accordance with the governing documents. MikeS said it was done by ballot, but was it by a vote taken at a properly noticed meeting? Was there a quorum? Do the governing documents even provide for such a removal? With or without cause? But, even if the president has a case, this doesn't mean it's OK to use association funds for his lawyer. He still can't do that, and if he does, he might be criminally liable. |
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SusanW1
(Michigan)
Posts:2184
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| 07/20/2008 9:06 AM |
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Bruce's last paragraph is at the center point of the issue!
IF the ballot to remove him from office was conducted wrongly, the results of the vote is null and void - thus, he is STILL the president!
He may have asked the HOA attorney to look over the process and confirm the accuracy of the "removal" procedure. In that case, HOA funds could be used.
(A parliamentarian could also confirm the procedure, and I'd bet it would be a lot cheaper)
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DonnaS
(Tennessee)
Posts:2855
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| 07/20/2008 11:18 AM |
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Mike,
A recall is one of those things that are simple to do but complicated to follow directions on how to do it. Hopefully your association and Board followed the directions from the Statute 720:303. (10) on recalling. If you did follow thru, then the former President is going to not get anywhere with the arbritation process. Below is the first sentence from that Statute.
(10) RECALL OF DIRECTORS.--
(a)1. Regardless of any provision to the contrary contained in the governing documents, subject to the provisions of s. 720.307 regarding transition of association control, any member of the board of directors may be recalled and removed from office with or without cause by a majority of the total voting interests.
So lets hope that you did this properly
Susan,
The State is a stickler on recalling and even if this association had a parlimentarian look at what they did, apparently it has gotten as far as the mediators docket already. It costs $250.00 to file and hopefully the "ex" did the original filing. But if her used association funds, I want to know how he got his hands on them and who allowed that. Is not the Treasurer or the P.M. , the keeper of the checkbook? |
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