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Board Members in financial hurt. Foreclosure

Started by NicoleO4 ā€¢ 19 replies ā€¢ 1369 views

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NicoleO4 (California)
Posts: 160
Posted:
We have a board member who is in a world of hurt. He is behind on his dues 2 mos... never has been late once prior.. and he says he is listing his home to "test the waters". Truth be told he is nearing foreclosure.

He is a thorn in our sides. Many nasty emails, poor conduct and personal attacks during meetings.

He knows we know about his personal issues... he won't admit to it.. which is his business.

At what point can we ask him to step off the board.. or does he serve until the bank takes over?
GlenL (Ohio)
Posts: 5,491
Posted:
What do your documents and CA law say on this matter? In our documents this person would be a member not in good standing and therefore ineligible to serve on the Board.
Studies show that 5 out of 4 people have problems with fractions
CharlesW1 (Georgia)
Posts: 826
Posted:
NicoleO4,

I too would suggest reviewing your governing documents. I concur with what GlenL has previously posted. In my association this board member would NOT be in good standings also. Therefore, wouldnā€™t be eligible to be a board member, he would be relieve from his current position, immediately.

I know everyone has their financial troubles. However, he should be ashamed of himself, especially being a board member. I highly doubt he can continue to be a board member with his current financial statues. If your covenant are silent on that particular issue then that needs to be addressed.

Best of luck on future endeavors.

Chuck W.
Charles E. Wafer Jr.
SusanW1 (Michigan)
Posts: 5,202
Posted:
Have the president talk privately to him about his past due assessments and his threatened elegibility on the board because of it. Give him a final due date to make good.

His other behaviors have nothing to do with the issue. If you put up with him all this time and haven't taken action before, those reasons are not the ones that are going to take him off the board.

Why did your board put up with all his actions BEFORE he became default?

NicoleO4 (California)
Posts: 160
Posted:
The past behaviors were actually supported by the prior board. This man was "freinds" with the past president and a couple of others that were vote off this last year. I myself will be focusing on reading out cc*rs.. and getting a clue on the matter.
RogerB (Colorado)
Posts: 5,067
Posted:
Nicole, check your By-laws. Usually they allow the Board to remove of an officer who remains a Board member; ut require the members at a duly called meeting to remove him from the Board.
BradP (Kansas)
Posts: 2,640
Posted:
Nicole:

In the end he is just another resident and should be treated as such. If he is late he should get notices, should have privileges suspended and hopefully your documents speak to a protocol for how to handle board members in this situation.
BrianB (California)
Posts: 2,820
Posted:
great advice from everyone...

Being late with your dues was an automatic removal from the board in My FHOA. Check your by-laws to see what they say about board members being in good standing, late, etc..
EricS7 (Georgia)
Posts: 6
Posted:
Nicole,
If the past-due board member is not kicked off by the bylaws, I would definitely make sure he does not have access to the HOA bank accounts. People do crazy things when they are in trouble financially and facing foreclosure.
NicoleO4 (California)
Posts: 160
Posted:
He is our vice president.. who NO power over money. He is an odd fellow who really needs a home all his own.. or an apt. Condo living never agreed with this guy from the get go.
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Nicole,
I uspect, it he was voted on by the council (owners) he has to be voted off (recalled). If the board voted him a position, the Board has to vote to rescind. Also agree, being a board member has no real bearing on any action taken. The documents have to be satified.
JaneK (California)
Posts: 175
Posted:
Yes, definitely check your by laws. Most docs require board members to be ā€œmembers in good standing,ā€ that means dues paid up. The board cannot remove him, but they can remove him from the Vice Presidency and bump him down to member at large. Only the members can remove him and CA law required removing the entire board.

Iā€™d consult an attorney about the ā€œmember in good standingā€ part.
Jane
MaryA1 (Arizona)
Posts: 7,043
Posted:
Nicole,

Ordinarily a board member can only be removed by a vote of the members; however, oftentimes different rules apply if the board member is delinquent in payment of assessments. Many assn docs state a board member cannot serve if delinquent. Mine state "no member shall continue to serve as dierector if more than 30 days delinquent. . .and such delinquency shall automatically constitute a resignation by such delinquent director on the 31st day of delinquency." If your docs have no such clause then I would say the delinquent board member would have to be removed by a vote of the members. In the meantime, he should be recieving notices of delinquency and applicable fines. He should be treated the same as any other delinquent member of the assn.
RobertR1 (South Carolina)
Posts: 5,164
Posted:
MaryA,
I could be wrong but I suspect your deliquent director may, by covenants be declared not eligeible to perform directors duties or have directors authority, but the members voted him in, the members have to either recall him or not re-elect him. Of course if he moves he is no longer an owner and can't hold office as a director.
TonyM3 (Arizona)
Posts: 170
Posted:
Tell him the board is calling a special meeting of the members to have him removed. He'll probably resign to avoid the bad publicity.
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Tony,
Might work but keep in mind how much has to be expened in time, resources and money to call a Special Recall, not an easy task. This member just should not be given any credibility or uthority at the Board level. That's no big deal, I bet more than half of all the association rule and govern with at least one or two board members that don't even bother to show up at meetings and if they do, it only makes matters worse.
TonyM3 (Arizona)
Posts: 170
Posted:
Quote:
Posted By RobertR1 on 07/13/2008 7:08 PM
Tony,
Might work but keep in mind how much has to be expened in time, resources and money to call a Special Recall, not an easy task.

Yeah, I realize that. Just throwin' an option out there and hopefully the guy will just resign when he realizes the board is serious.
MaryA1 (Arizona)
Posts: 7,043
Posted:
Quote:
Posted By RobertR1 on 07/13/2008 4:29 PM
MaryA,
I could be wrong but I suspect your deliquent director may, by covenants be declared not eligeible to perform directors duties or have directors authority, but the members voted him in, the members have to either recall him or not re-elect him. Of course if he moves he is no longer an owner and can't hold office as a director.

Robert,

Wrong! My bylaws are very explicit. "No member shall continue to serve as a director if more than 30 days delinquent in the payment of any assessment, and such delinquency shall automatically constitute a resignation by such delinquent director on the 31st day of the delinquency." As you can see, the director does not even have to formally resign. If delinquent on the 31st day, he is automatically off the board! It's quite clear the intent of the developer was that no director has the right to serve on the board if he is delinquent in payment of assessments. Notice the article does not say "officer", it says "director"; therein lies the difference. If it said officer it would mean he could still remain on the board as a director.

Nicole needs to thoroughly read her bylaws -- and state law -- and determine what action can be taken against this delinquent board member. There is no AZ state law addressing this, so in my assn the above posted bylaws article would apply.
NicoleO4 (California)
Posts: 160
Posted:
Well, the news is that this man who listed his home as a short sale in May is still here. I can only hope and pray to allah, god, buddah, any hindu gods and godesses that this man is in the middle or escrow. I will never know as will nobody else.. but I am going to pour a glass of chapagne once this hypocrite is packing.
KirkW1 (Texas)
Posts: 1,665
Posted:
Actually, you can probably find out about the sale of his unit fairly easily. Just contact your local realtor. Or, find a site allowing you to do a MLS search and find the property. Then just check back every so often.

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