changing the name of the subdivision

Started by JillV • 9 replies • 2182 views

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JillV (North Carolina)
Posts: 5

Posted:

We have a new section being added to our existing subdivision. The streets have been paved and utilities are in place, but no homes have gone up in this new phase yet. The builder, who is good buddies with the developer and current president of our HOA, is communicating in a threatening manner that he wants to change the name of our entire subdivision to "Wiggins Farms" (his last name is Wiggins)or he will refuse to build in our neighborhood, and feels he can stand this ground because we need the added revenue that new homes will bring. A public meeting is being arranged to vote on the matter. Our current name is Brookfield, which to me sounds a lot nicer. I am just wondering if this is a legal course of action. We have a very low turn out to public meetings, and I am concerned that this egocentric person just might convince the few that come to give him what he wants.

BradP (Kansas)
Posts: 2,640

Posted:

Jill:

I am curious why he would think that you need the extra revenue from the new homes? In most cases the common areas aren't turned over to HOA control under a certain percent of the home are complete, so any additional expense with new common areas shouldn't be yours just yet. Plus, you always have the ability to go to your current members and ask to raise dues, even if only temporary.

Sounds like a great guy that I would like to build my house!! I don't have any advice other than to seek the advice of an attorney on that one.

RogerB (Colorado)
Posts: 5,067

Posted:

Check your Declaration. If all lots are required to pay maintenance whether or not a house has been built then this Builder would not be adding any revenue and therefore has no leverage except business leverage with the Developer. If the new section is not currently in the HOA and the vote is required to annex in the new section then you could organized the current homeowners and try to override the vote of the Developer. If the Developer has sufficient control or if there is apathy on the part of the homeowners then I think the Developer will do what ever they please.

JillV (North Carolina)
Posts: 5

Posted:

All lots are required to pay maintenance. Our last president resigned and moved away within the last couple of months, and for now the developer has resumed that position, as none of the other board members were willing to fill it.

The developer and builder are good friends and will work together to accomplish each other's goals. It doesn't seem that either of them have our interests as a priority.

This is a small neighborhood, approx. 60 homes, the new section is not currently in the HOA. The builder has stated that if we do not change the name of the existing subdivision, he will not include/annex the new section in with the old and will form a new HOA with just the new section(s) under a new name.

I do not like or agree with the way the builder is trying to manipulate us for his vain, personal interest, and wish I had a legal discourse to vocalize at a public meeting.

HaroldS (Arizona)
Posts: 906

Posted:

Jill - I'm confused: If your 60 lots are built out, and this other section is not now a part of your HOA, why is this developer still a part of your board - and president yet? Your documents should state when the developer is to turn over control to the owners, and if you're all built out he has no business being involved. Let him go ahead and name this new section whatever he wants, and establish it as a separate HOA. Will this new area have their own common area? IF so, you will be sharing expenses for maintenace of that area in addition to yours, so I can't see how adding those lots to your HOA will spread the expenses thinner. Does your documents say you have to annex that section? I can't see why, if you're built out, that he is still trying to control you. Harold

JillV (North Carolina)
Posts: 5

Posted:

I believe there are about 3 lots left in his name, one is currently under construction. I'm not sure why he was named president after our former president moved, except that no other board member would assume that position. He had previously turned control over to the residents, except to remain on the arc committee. There is talk of shifting some positions, and I may assume that of vice president in the near future. I am not currently serving, but am a concerned resident trying to stay up do date on what is happening. I agree that he can do what he pleases with the new phase, and keep it separate if he likes, but he would like for it to all be under one HOA, and along with the builder is trying to swing a vote for that along with a name change to the whole subdivision, which I strongly disagree with. He is trying to find reasons for doing so, and has resorted to threats such as creating a separate HOA and name for the new phase(s). My concern is that he will persuade with his rhetoric enough residents to vote his way.

BrianB (California)
Posts: 2,820

Posted:

not sure how it is in your state, but here, HOA's are registered with the sec of state as a not for profit business. And as a business, you can change your name anytime you want, if you pay a minor fee and file the papers with the state.

First, fight the guy. The others are right, it sounds like he has no leverage, so let him threaten. Second, let him name hte other side what he wants, and create a separate HOA. HOA's don't "need" more houses to generate revenue, they project costs for the year and divide that by homes.... so literally, 2 houses or 2000, the HOA budget is (roughly) the same, it just hits those 2 poor folks a lot worse than the 2000 when it's spread out.

Finally, give up and let the guy name it whatever he wants. in a year, you can go change the name to anything you want, all it takes is voting and paperwork being filed with the state.

GeraldT1 (<Not Specified>)
Posts: 519

Posted:

JillV,

Check your governing documents and see if it provides appointing procedures when a vacancy occurs on the Board, and who chooses officership (President, Vice Pres., Treasuer, Secretary). This may explain why or how the Developer was named president. In my HOA vacancies are filled by the decision of the remaining board members.

One HOA instead of two could be a benefit, this you must weigh. But the name Brookfield has a much better ring than Wiggins. You'll need a very strong voting contingency on your side, and perhaps an attorney to gain some leverage to accomplish what you want.

I suspect the Developer will not build the 3 lots left in the current HOA until he gets what he wants in creating a bigger HOA. Typcially, the Developer remains on the Board until the last unit is constructed. Developers are usually eager to get off the board the minute they get on, many do not get involved in the day to day board/resident issues, even though the Developer's have rights of veto. that your Developer was named again should tell you there is a reason. The "Wiggins" name is probably just a concession of some sort on the Developer's part.

GeraldT1

BradP (Kansas)
Posts: 2,640

Posted:

I like the school of thought about letting him put the name he wants, then changing it, however, he may be building for a couple years in the new subdivision and things have a tendency to be difficult to change once they have been there for a while, plus if he puts up entry signs that is an added expense to replace later.

I don't know how your CC&R's are set up, but our Developer had six votes for each vacant lot compared to the homeowners one vote per lot. Therefore until he was pretty much complete he had a lot of voting power in our subdivision, but to his credit when things were about 50% complete he turned it over and stayed out of the way.

Unless you can get some people together and vote out the Developer as president I don't know how far you will get. I think an attorney needs to be consulted and have your options layed out on the table. I like the idea of your subdivision as is being its own entity, if they want to create a new subdivision that is going to be added expenses on their part to file appropriate documents, etc. Good luck.

JillV (North Carolina)
Posts: 5

Posted:

Thank you all for your feedback. I will do some leg-work, and speak to as many neighbors as I can before we vote, and then, if that is not enough, it's good to know it's possible to change the name again in the future fairly easily, if we all so choose.

I'm sure I'll have more questions in the near future, it's good to know there are people here that can provide some answers! Thanks!

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