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Subject: Have you sued your HOA to get Documents?

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RogerB
(Colorado)

Posts:4686

09/04/2007 7:47 AM
Posted By MelissaP1 on 09/03/2007 9:11 PM .... You mentioned paying a $300 tax bill to the IRS. Just because your a Non-Profit doesn't make you exempt to paying taxes. A Non-profit means that whatever money the HOA collects through dues a year MUST be spent on the maintenance and operation of the HOA in that year. Whatever comes in has to be paid out equally. You can have a reserves fund to a certain amount. If there is money left in the HOA funds at the end of the year, it can be subject to IRS taxes. So the $300 could be a result of this. It's very hard to manage the HOA budget since it doesn't operate like your home budget. At home, you don't need to spend what you make by the end of the year. Melissa, based on IRS form 1120-H this information in not correct. Apparently you are not familiar with IRS regulations for HOAs. Please quit posting these erroneous tax related statements. For example the money from assessments does not have to be spent on the maintenance and operation of the HOA in that year. Whatever comes in has to be does not have to be paid out equally. Taxes are due, not on assessments but, on income from outside sources such as interest on investments. The HOA does't need to spend by the end of the year; and if they don't they would seldom, if ever, owe any taxes on that income. I have advised you on this several times, yet you continue to post this erroneous information. Why?

BradP
(Kansas)

Posts:2491

09/04/2007 7:53 AM
Lisa: In your situation this is what I would do. I would send each board member a copy of the statutes and laws that permit members to request and view minues, etc. along with penalties for not doing so, via certified mail. I would then inform them that you are willing to pay costs established by your state for copying these records. See if you get a response, if you don't then you have to weigh several options, do you send them another letter threatening a lawsuit pointing out that if they knowingly violate their duty they are personally liable, do you call the media in, or do you contact a lawyer and proceed. I would suggest trying to get your neighbors to join the crusade, they may be viewing you as a squeaky trouble maker, but if more and more people come forward it may help. I would discount Melissa's notion not to sue. Their is a time and place for everything, if you feel strongly about it don't be discouraged because you have an obvious easy case to win. As someone said D&O insurance probably won't defend them. I don't like court because there should be simpler ways to get things done, but I think sometimes it is a necessary evil in life.

RobertR1
(South Carolina)

Posts:5164

09/04/2007 8:33 AM
Lisa, Just a shot in the dark here. I noticed in one of your posts you mentioned that the municipality has the authority to come into your HOA and mow grass on unsightly property. Have you investigated what control your city has over your HOA. I could be that the city laws might be used to get the information you are requesting. If your board elects to stonewall you, they have all the chips to play the game. Community pressure will lossen them up if they feel too much heat. Sometimes you can crack the board with the help of a single board member. If conditions exist as you imagine and there is a concerted effort to do mischief, they also have to be in this for the long run. You absolutely need some support, call a town hall meeting, distribute flyers to get attendence. Invite the Board. Your organizational skills will be tested and the trip will take at least until the next annual meeting. You will want to present your issues in an clear, unbiased manner, and if done at a Town Hall Meeting don't expect immediate results but leave all doors open and see what you come up with. Keep good records of course and maybe take your problems to the county level also. Their seems to be a consenus here that any dissention in associations is looked upon negatively by prospective buyers. I feel to the contrary, if there is no movement in the associations there is no interest by the owners. One thing about being the opposing target is you get to learn a lot and you will make a difference. There will be no Park Benches with your name on them, but you can make a change for the better.

DaneC
(California)

Posts:210

09/04/2007 10:14 AM
Posted By LisaS on 09/03/2007 8:36 AM 3. Our HOA maintains only 1 large common area (we are single family homes). They are specifically prohibted in our CCR's from paying to mainatin a private lot 7. Our CCR's have no method for removing a Board member(s). Our Not for Profit HOA paid $300 in taxes this year (although we should have paid $0) due to incompetence. The list goes on. One Associations faced with this problem have simply sold the "park" to the owners that abut it. Of course, that resolution would depend on its location. I don't know if your 1 large common area qualifies for that type of treatment. (Then the Association was dissolved.) As far as your HOA is concerned, is would seem to be governed by BUSINESS ORGANIZATIONS (805 ILCS 105/) General Not For Profit Corporation Act of 1986 The following two sections may be what you need - (805 ILCS 105/108.35) (from Ch. 32, par. 108.35) Sec. 108.35. Removal of directors. (805 ILCS 105/Art. 12 heading) ARTICLE 12. DISSOLUTION Tax exemption relates to what the IRS considers "function income", i.e. assessments. "Notprofit" DOES NOT MEAN "tax-exempt" is actually the subtitle of a publication by the CA FTB. Perhaps you may wish to browse - http://www.ftb.ca.gov/forms/misc/927.pdf

DaneC
(California)

Posts:210

09/04/2007 12:37 PM
Posted By PaulM on 08/28/2007 2:45 PM LisaS: I have never heard of anyone in an HOA going to the extreme of a law suit to obtain HOA community documents. Seems like another case surfaced today - The Apple Valley Property Owners Association has now spent in excess of $300,000 from association dues and insurance payments in their efforts to hide financial documents from its membership and silence its critics. The association and its supporters have also used the association member newsletter and local internet forums to attack and disparage the Pullins and Elliott families, longtime residents and members of the Apple Valley Property Owners Association. Today, Ohio's Fifth District Court of Appeals unanimously affirmed a landmark ruling issued in Pullins' favor in December 2006. The trial court had ordered that Kathryn Elliott Pullins must be reinstated to the board of directors of the Apple Valley Property Owners Association. It had also ruled that the association must provide any financial information requested, including employee salaries. It provided for a $200 per day civil fine against the association for failure to comply with this order. http://www.pullinslaw.com/uploads/AVPOA_APPEAL_DECISION.pdf

NancyE

Posts:3

09/04/2007 3:57 PM
Hi LisaS Our Board of Directors refused to provide documents pertaining to the election of the Board. We gathered up a collection from "some"members" and two of our friends prepared a law suit against the Board by way of a Show Cause Court Action. The matter did not proceed to court because they provided the documents before the documents were filed with the Court house. However there were legal fees in the amount of approximately $1,300 incurred to get to the point of ready to file in court. Since the Board provided the documents, there was no need to proceed to court. The Board refused to pay our legal fees and the two friends sued the Board in Small Claims Court for the repayment of funds. There was a small trial and the Judge checked the RCW's for the State of Washington, and he granted the costs of the $1,300 to be paid by the Board to us. WE WON. I can get you more details if you wish, but this was Latitude 49 in the Whatcom county, Washington. NancyE

MicheleD
(Kentucky)

Posts:4491

09/04/2007 6:22 PM
I don't know which poster mentioned something about selling the common land that abuts certain residents to them....whoever would try that in our community would definitely be conducting an illegal sale. Not only do our governing documents not allow the sale, lease, or rent of any common area owned by "the association" (all members in deed), but the binding elements of the subdivision disallow it, too, as recorded by the Zoning and Planning and Land Use Commission. Please be very careful when mentioning plans of action such as this. There could be enormous consequences if it isn't handled properly.

RobertR1
(South Carolina)

Posts:5164

09/04/2007 6:49 PM
Michele, I don't know who posted the blurb you are referring to, nor do I care. Please remember the folks who post here are not telling others what to do as much as defining the options for different situations. Posters should not be reckless in what they post but anything said is advice, not orders. This is a discussion forum much like a discussion at a Town Hall Meeting. Go, speak and listen but do not act except from your own conviction and personal logic. If you act solely on the advice of what is posted here, it is neither fair or just to condemn the poster here. Likewise if you take advice and collect $1,000,000, you don't have to give any of it to the one that posted such terrific advice.

SuzyS
(Arizona)

Posts:10

09/04/2007 9:56 PM
I have experienced the same if not worse treatment with my HOA in Tucson AZ. Any issues I address at an open forum are swept under the rug and everyone on the Board makes a face like " we never heard about this before" . They refuse to writ up complete minutes and pick and choose what they want the other homeowners to know about. They screen topics. I have followed up with letters to the board members and at the last meeting I was told that all of my letters are unread and returned by the president. I could not believe what I heard from this guy who is to be representing the homeowners. They do want any problems being noted down. They refuse to acknowledge vandalism and do not want security cameras or motion sensor security lighting. One of the Board members even installed a permanent fence that blocks our second way out of the community in case of a flood or emergency. This new board has done illegal things. They have gone in the face of the CCR's , the Plat dedication and F.E. M.A. They have blocked overland water flow and have created a haven for west nile. The town says that the Board is in charge. It sounds like they don't want to get involved. They ignore all of these important issues and yet, to get me to back down send me letters of harassment because I have 3 birdhouses in my back yard. I found out that my only recourse is to get an attorney and that will cost us anywhere from 10,000to 50,000 with no guarantee to what a judge would reward us. We have no financial loss only several years of aggravation and harassment. They have ruined a very nice small community. jd - tucson

RobertR1
(South Carolina)

Posts:5164

09/05/2007 5:33 AM
Suzy, Good morning. The people posting on this site don't take defeat kindly. I would imagine that if you have read some of the topics and considered how there seems to be no end at getting to problems such as yours. It is not unusual for someone to start out contacting the BOD over some small matter and it turns into world war 3. The differences are quickly replaced with a personal issue and a power struggle with the Board. Not a fight you want to get into because over the short term, you will lose. When that happens sometimes you can spread the blame around by getting your neighbors involved. Not to serve your persopnal agenda but to make things better for everyone. I know from long years fighting the board myself, you lose some and you win some, but the price is high. Too much effort for too little gain. I was never able to organize my support but I am not rock dumb and could see when an opportunity was presented I knew enough to join a group that was able to organize some of the owners. Now, rather than duking it out with the board we have a group of folks that the board will pay attention to. One excellent method to get the word out is by a Town Hall type meeting for your neighbors. Get your support together and mutually agree on how the meeting will be conducted and what your mission is. Then start putting out flyers and working the phones, etc. Just like a political election. You, personally have to become part of the group movement. If your board is acting dictatorial, let them know they are going to have to be "open" to the members. Get that point across and just continue the effort and if necessary, replace the lot of them. It can be done and it has been done.

MelissaP1
(Alabama)

Posts:2207

09/05/2007 5:43 AM
Suzy, I don't want to sound mean but I do want to play a little "Devil's advocate" of what you posted. You say that your HOA is sending you "Harrassment letters". May I ask what the difference is between sending a member a notice of a violation and harrassment? Your asking your board to send out letters or notify violating members but couldn't the member consider those letters harrassment? There's a fine line between harrassment and notification. Just because you get a notice from the HOA does NOT mean they are harrassing you. They are doing their job and acting on the behalf of other members who may have complained. Let's put the HOA letters into perspective here. Harrassment is much more serious and is dealt with the police and law. That would include threats and mulitple notices that are on a personal nature than official violation notice. Telling you to remove birdhouses or they will be removed for you is NOT harrassment. It's exactly what the HOA can do with a violation. The security systems and components you want are a gray area for a HOA. Who do you think buys and maintains this equipment? The HOA. Who provides the budget for the HOA? You and the members with your HOA dues. If the HOA doesn't have enough money or the majority doesn't want the security system, they aren't going to install it for you. Security cameras and equipment does NOT stop crime. They just record it for later prosecution proof. Then that can be tossed out on occassion by a good lawyer. The emergency route for exit is a great option for the HOA to have. I wish we had one. However, if it is on someone's property and it's NOT considered "common property" the owner may be able to do what they want with it. One would hope they would keep it an emergency exit but they may not have to if it's private property. Atleast the person is willing to consider freeing it up if necessary. Plus the fact that he's in a wheelchair is irrelevant. If your trying to get out in an emergency, I am sure some able body person will be there to rip the door/gate off the hinges! You may want to reconsider your approach with your HOA. I am sorry to say, but you may be coming across as "that annoying lady with all the ridicolous complaints". It happens. Maybe back down and put a new perspective on things. Write a few less letters for a bit. Not everything has to be addressed right then and right now. The HOA system takes time to get things addressed. For example: If your HOA has meetings once a month, it could take upwards to 3-6 months for a decision to get out of the pipe line. The first meeting the idea/suggestion would come up. The next meeting the results of finding out the costs of the idea and implementing could be discussed. The next meeting after more details were hammered out, the idea may get board approval. The idea may get implemented by then. The meeting after would measure the results of the idea and show the real costs of the idea. Then of course you could have the fallout and complaints that the idea was never needed or exceeded projected costs. Now you have other meetings to discuss overthrowing the board because they made a bad decision 5 months ago. The cycle keeps going and going and going...

Former HOA President

MicheleD
(Kentucky)

Posts:4491

09/05/2007 12:35 PM
RobertR: I'm completely aware of the purpose of this forum. Which is why I brought up a cautionary post as a heads up. It seems to me that you are saying the exact same thing I was, only I used a specific example of where this would not be an option. If you read my post, it was simply offering a cautionary note. However, even given the nature of the board, I would still throw up an extra cautionary flag before anyone offering selling or leasing or even providing easement of common area. People may have to did deeper than just the CC&Rs and look into local zoning restrictions for residential communities or even the original development plans, which often have binding elements on them not specifically mentioned in CC&Rs. My response stands as a heads up.

MicheleD
(Kentucky)

Posts:4491

09/05/2007 12:47 PM
Melissa said: "They are doing their job and acting on the behalf of other members who may have complained. " If they are, then it appears, according to the poster, as "selective enforcement," which is also another way that BODs have to reign in obnoxious members. Although I would love to see a CC&R that outlaws birdhouses, much less 3 of them. But that's really beside the point. This person is frustrated because the board isn't listening, not acting on things she believes it should act on and ignoring other potentially hazardous issues. I question the blocking of the emergency exit. I don't know that we can necessarily infer that the person who put up the fence did so legally, even if it is his own property. If there has been an egress designated as an emergency route, then how can it cross private property? I'm very curious as to what sort of emergency egress it was that a private resident could block it from his own property. Suzy, can you shed some light on that? And I know all about the "obnoxious complaining member" as we have one or two of our own. However, we STILL reply to each and every concern, regardless of how tedious it is. Most recently she sent a letter talking about people putting trash out for pick up in garbage bags. There are only about 3 people in the subdivision that do this and all of them are tied. Our CC&Rs do not prohibit them, so we have no restriction against people using them. Even so, she personally doesn't like them and wants them outlawed. We provided her with the procedure for getting an amendment change and the ball is in her court. Many times if BODs would just respond to a complaint, regardless of how annoying, the person will at least feel they have been listened to and they don't have to get into a tit-for-tat struggle.

LisaS
(Illinois)

Posts:341

09/05/2007 2:40 PM
First Melissa, I was on the Board. As a matter of fact, I was on our first Board and I basically set up the systems that got us off the ground. I am now a Director on a regional HOA Board and even there no one has seen a Board go to so much trouble to avoid complying with the law. I am all for not having a management company when you only have 300 singles family houses to manage. It's easy (or it should be...)I am also not for hiring an 'HOA attorney' to be on call. I was just answering some of the questions posed to me. My point was, the law and our CCR's state that the documents I requested be made available. It is very simple and clear. Our Board has refused,in violation of both. Why? If you have nothing to hide, then you have nothing to hide. And, if you have something to hide and you screwed up, take responsibility. Like you said, it's not THEIR personal money it's OUR money. Our HOA paid taxes and they should not have (I am familiar with the applicable tax law). That's just one $300 mistake. The liability issues on some other items could lead to huge problems.

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