Board wishes to leave management co.

Hello,

I am the Secretary of an HOA in Texas. Our BOD is compiled of three members--Pres., Treas., and Sec. The Treas. and I are the two newest. He was voted in in Jan., and was invited to be Sec. in July until the election this coming July.

Since the Treasurer has had the position, he has found many errors by the management company which has caused the HOA thousands of dollars. There have been other issues, (non-monetary), that the Board has had since April, as well.

In July, the contract with the management company was up for renewal for one year. The President of the manage. co., at that time, said that if the BOD wasn't happy with the performance of the new Account Manager, the HOA would be released from the contract with the management co. The Account Manager hasn't helped things to improve.

In early Oct., the former President stepped down due to personal issues, but may return at a later date. The original Pres., (and owner), of the company is now in charge. We approached her about the promise made by the former Pres. The owner refuses to say if she will honor the promise made to the BOD and release the HOA from the contract.

Instead, she wanted a list of grievances for which the BOD wants to be released. We provided that list and sent it to the office by Certified Mail. It was signed for on Nov. 14, 2007. Along with the list, we stated that we wish to be released from the contract effective Jan. 1, 2008. However, if she chose not to honor the words of her former employee then we definitely wouldn't be renewing on July 1, 2008.

The President/owner e-mailed me and said that she would respond to our list in 5-10 business days. I then wrote and told her that 10 business days from Nov. 14th, (allowing for the Thanksgiving holiday), would mean that we will expect her answer, to our request for release, on Friday, Nov. 30th, 2007.

She then wrote back and said that she would do the best that she could because she is busy. I, in turn, wrote back and stated that I understand that she is busy, but that we still expect a response on Nov. 30, 2007, at the latest.

Today, she responded. She wrote that the research that she has accumulated, thus far, does not press her, however, to put everything else aside and right wrongs that have been done by her company.

I was stunned by her response.

Would you say that it's time to enlist the help of an attorney?? I would call this "Breach of Contract". We have met with one management company and will be meeting with another one soon to determine who we want to take over, when the time comes.

Thank you for sharing your knowledge.

Bonnie

It states:

"The contract term shall be one year and automatically renew for additional one year terms unless either party shall terminate, with or without cause, in writing by certified mail return receipt requested, giving thirty (30) days notice prior to renewal."

Bonnie

Bonnie, ask to amend the management Agreement to read that either party may terminate this Agreement without cause upon 30 days written notice. Otherwise, if you have provided the MC evidence that their actions cost the HOA thousands of dollars isn't that sufficient to terminate the Agreement due to failure to perform as per the Agreement?

Your three member Board better get a backbone!!!

You are responsible for the financial integrity of your organization, yet you allow a company to jerk you around - one who has not performed according to a contract!

End the contract - effective immediately!! No negotiations about it. Any court would see things in your favor.

P.S> Think about expanding the number of board members. You guys need some help on that board . . .

BonnieK, if you contract reads "with our without cause" = thirty days notice, you can provide notice to the MC and be done with them in thirty days. The key here is that your recital/section which id's the "term or termination" must be the section followed. If the MC has a "cure" period in the contract (usually states that notice must be given of defect, and MC has the time/ability to cure... etc) does not trump termination with or without cause.

Seek an attorney's advice on this, the HOA should have one anyway. If you do not find one on your own and not be dependent on the MC to provide.

Absent your full MC contract/agreement, and just working from the section you quoted, you do have a thirty day out requirement.

Thank you Joe. How can I get a copy of the even limited Florida management company regulations? Or of any other state that does regulate management companies? Maybe a separate thread for this request would be better? Thanks. Harold

Harold, 468;431 Sorry, I forgot the second half of the number.