Missouri HOA Rules & Laws

Started by RamiroG1 • 8 replies • 14705 views

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RamiroG1 (Missouri)
Posts: 4

Posted:

We are living in a development north of Kansas City. The developer had Declarations and Restrictions notarized and these were issued at the time of closing. Since the inception of this community in 2003, the developer has never provided any financial information as to assessments collected or money spent. We as neighbors are having difficulty getting this information. Now it appears the developer will not open the pool that was supposed to be a benefit to buyers as part of the "common area". I am having a great deal of difficulty finding information to address this with the developer. First, where can I find legal requirements for HOA's? I have checked the Missouri Revised Statutes, but can find nothing. Second, what makes the HOA legal to begin with? Simply having a document titled Declaration of Restrictions notarized? Is there a State or County agency that Not for Profit Status or any other documentation must be registered with? The neighbors here are clamoring for transparancy with our HOA financials or to get the developer to really do anything. The list of complaints is too long to post here, but we are trying to get hold of this situation without hiring a lawyer. The developer is in financial straights. If we sue, it will be money out of our pocket to chase money that we believe will not be there. (We believe he's used the HOA money for his failing business.) Can anyone point me to where I can find resources to educate ourselves on our rights as home owners, the developers rights and responsibilities as the HOA before it's turned over, and how we can check the legal status of our HOA as it currently exists? Thanks in advance....

HaroldS1 (Arizona)
Posts: 314

Posted:

Ramiro - Do you have a Registrar of Contractors in your state? If he is still building and controlling your HOA, you could try them to see if they will intervene since he is not providing what his contract promised and is collecting assessments for. Otherwise, I think you will have to sue to get what you are paying for. HOA agreements are considered civil contracts and as such there are very few state laws yet with teeth that could help you. If he is so short of funds that he is robbing Peter to pay Paul, he needs to be forced into acknowledging the problem and possible bankruptcy, so that you could gain control of your HOA. At least if you can get control you will have the dues to use yourself to maintain your common area including pool. Good luck. Harold

RamiroG1 (Missouri)
Posts: 4

Posted:

Harold, I just googled MO Registrar of Contractors. Looks like there is one here. Thanks for the advise! Right now we are trying to avoid a lawyer. Payment would come from our pocket to chase money we don't believe is there, but we may have to do so just to wrestle control. Thanks again. Ramiro

JM2 (Oregon)
Posts: 439

Posted:

Hi Ramiro:

If the developer is the BOD, he should either have Directors & Officers or Errors & Omissions insurance for his company (and therefore for his actions as BOD of the HOA) or possibly have D&O for the HOA. If that's the case, then a lawsuit might be in order, if the insurance company will pick up for any wrongdoing.

Check with your Secretary of State's office to see if the HOA is legally incorporated. If so, look for "agent," if it's the builder or a management company (also, where are you sending assessment checks?).

If it's incorporated, there should be a filing each year with the secretary of state's office.

J. Patrick Moore, CMCA

JosephW (Michigan)
Posts: 882

Posted:

Missouri does not have a lw governing homeowner or property owner associations, only condominiums

hese Acts may bear some relation to your issues: (http://www.moga.state.mo.us/STATUTES/STATUTES.HTM#T23_
Chapter 23 - Subchapter 355 Non-profit corporation law
Chapter 28 - Contracts and contractual Relations
Chapter 29 - Subchapter 442 Titles and conveyance of real estate

You're probably going to end up talking to an attorney anyhow, so don't put it off too long.

Joe

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RamiroG1 (Missouri)
Posts: 4

Posted:

Mr. Moore, I appreciate the advise. My gut feeling is that there is no insurance. We've found this individual to be less than professional in his business dealings and have learned that he has filed bankruptcy in other home developments. Since no information at all regarding any HOA business or documents has been forthcoming for 3 years, I doubt he's been paying for any insurance, but I will certainly check this avenue. I've drafted a document that is being sent around the neighborhood for signatures that we will notarize and submit to him. Specifically, we've asked for all financials, any copies of insurance, and his commitment to open the pool this summer and fix the falling fence around it. We'll find out soon if he will offer any insurance documents. I'll check during the week to see if the HOA is incorporated. If not, we may simply be able to create our own HOA I would think. The checks having been written by neighbors directly to him. I"ve only sent checks written to Rollins Landing HOA. They've been cashed, so there could be a bank account for that. IF the HOA is not legally incorporated, does that make the whole situation null and void? I believe we will be needing a lawyer here soon.

RamiroG1 (Missouri)
Posts: 4

Posted:

Joe, thank you very much. This gives us a great place to start researching our rights as well as our developer's responsibilities. I think you are right. At some point soon, we will need to find a lawyer. Unfortunately, the costs will be out of pocket. Thanks again though for the direction. I have some reading to do now.

AnneT (Washington)
Posts: 35

Posted:

If there is no law then why are we required to pay dues? I'm just getting into this and trying to "feel" my way around.

Missouri has strange laws / no laws / And it seems to me that the Legislators who run things want it that way so that no one can call them on anything. Missouri is very clannish. They don't want any federal laws or outside agencies influencing state laws.

Example - By voter referendum we managed to get on the ballot and then passed by a majority of citizens, a Puppy Mill Protection Act. The purpose was to try to provide some relief to unfortunate puppies and breeder dogs housed in horrible, squalid, inhumane condition without proper medical care, nutrition or water. The legislator failed time and again to do it so the people did it. Due to complaints from rural sections where puppy mill owners reside our legally passed resolution was overturned, in essence our vote/voice taken from us. A long and contentious story. Anyway during a news conference the primary legislator behind the replacement "do nothing" ordinance they enacted just to say they took care of it so ours wasn't necessary, said that the feeling is people from Missouri don't want any outside ANYBODY telling us what to do. He skipped the part of what the residents/voters voted on.

Anyway that's background for the pathetic excuse for a legislature (and the Governor who sold us out by not upholding the law we passed).

With that in mind I don't expect much help from the laws of Missouri just as there are no consumer protection laws, its all oriented to businesses and I am moving out ASAP yesterday.

But so my question remains if there are no laws then by what authority are we charged paying homeowners dues? Is it a federal law and/or financing requirement?

Incidentally, this is no fancy subdivision, its an area that saw its day in the 50's 60's when an Air Force Base was located nearby. Now jobs are gone, economy's shot and its a struggling neighborhood. You probably wonder why I "care" about annual dues of $44 - I care because its the principal of the thing.

I need to start my own thread on this, sorry to intervene here but the statement about no laws in Missouri about HOA raised a question.

TimB4 (Tennessee)
Posts: 21,046

Posted:

Ann,

It's typically better to start a new topic rather than reactivate an old thread. This is because laws change and what might have been good advice in one year might not be good advice several years later.

With that said, the answer to your question of "If there is no law then why are we required to pay dues? " is a simple one.

When you purchased your property in a coveted community, you entered into a contract with all your neighbors to abide by various rules. This contract is your Declaration of Covenants, Conditions and Restrictions (CC&Rs). Typically the CC&Rs specify that an Association be formed to manage the common area and enforce the conditions of the contract. Additionally, the CC&Rs typically state that the members will pay assessments so the Association has the financial resources to meet this obligation.

Therefore, you are paying dues/fees/assessments because you contractually said that you would and you are bound to the terms of the contract (as written or amended) until you sell the property.

Hope this helps.

If you have more questions, feel free to post them in a new topic.

Tim

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