Changing CCR, Articles, Bylaws

Started by EdieL • 8 replies • 1900 views

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EdieL (Virginia)
Posts: 86

Posted:

Our CCR's, Articles of Incorp., Bylaws, all state that the
Declarent (developer) has one vote for every lot until the
development is sold out or at the option of the developer gives
up their vote. Our BOD decided when the developer was down to one
lot left for sale, they (the BOD) would reject the developers votes.
They are now in the process of changing all CCR's, Bylaws, Articles.
What gives the BOD the right?
Edie

TamaraW (Ohio)
Posts: 193

Posted:

I am in Ohio, we have 151 Single Family Homes in a Condo environment. We have Rules and Regulations, Declarations and Bylaws. Decs and Bylaws are legal papers. Regulations can be changed by the BOD only if they do not state something that goes against the Decs and bylaws. Our decs and bylaws can be changed with only 75% of the community vote on each change. Now our bylaws can be updated by state regulated changes to condo law, but not by just the BOD itself.

Example our bylaws state clearly NO WOOD DECKS - so we cannot put into our guidelines WOOD DECKS ARE OK without 75% of the community voting yes on that issue.

It may say in your bylaws if they can do this or not. My guess would be no they cannot change them, only bring them up to date with condo law.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Quote:

Posted By EdieL on 09/03/2008 6:16 AM
Our CCR's, Articles of Incorp., Bylaws, all state that the
Declarent (developer) has one vote for every lot until the
development is sold out or at the option of the developer gives
up their vote. Our BOD decided when the developer was down to one
lot left for sale, they (the BOD) would reject the developers votes.
They are now in the process of changing all CCR's, Bylaws, Articles.
What gives the BOD the right?
Edie

Edie,

The powers of the board should be outlined in the bylaws and/or CCRs. I would look very closely at the "amendment" article. In many instances, the declarant reserves the right to approve any amendments to the CCRs/bylaws as long as he owns at least one lot. But, I'm curious to know why the board is concerned with the declarant having only one vote? One vote isn't much influence; why the concern? Have they approached him to ask is he would be willing to give up this one vote?

SusanW1 (Michigan)
Posts: 5,202

Posted:

What is the reason for the one vote to be rejected?

If he has a legitimate vote, it must be treated as any other vote AND there should be a very good reason for the Board to declare ANY vote invalid.

(I'm not even sure the Board can declare any vote invalid)

Can you give us a scenario where this would happen?

JosephW (Michigan)
Posts: 882

Posted:

This is the problem when we don't get items quoted verbatim (in the future it might be helpful to include quotes around anything that IS quoted verbatim), because if you read what she wrote, the developer still has one vote for every lot, even those sold, so it might make sense (not necessarily legal) for the board to try and object to the developer having votes equal to the total number of lots. Some clarification is needed.

Joe

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KirkW1 (Texas)
Posts: 1,665

Posted:

I doubt the board has the right to strip the developer of his/her votes. And they need to consider the cost should the developer decide to force the issue. Has the developer even bother to exercise the votes? I know that at our turnover the developers stated they were abstaining the votes they had through property ownership and only voting the proxies sent in.

EdieL (Virginia)
Posts: 86

Posted:

The reason for the one vote retained by the developer is:
There are still roads under the developer's Bonds/responsibilities.
For the last 2 years(annual members meeting) the developer has cast
their votes and the BOD would not count them.
The BOD wants to ignore the developers votes because the BOD is
in the process of changing covenants, bylaws, articles. The BOD
knows that the developers votes would not vote these changes in.
ie. - not reckonings the votes.
Edie

MaryA1 (Arizona)
Posts: 7,043

Posted:

Edie,

You still haven't told us why the board doesn't want to count the developer's one vote. If this is tactic to get the developer to finish the roads, it apparently isn't working. Even amending the gov. docs. to eliminate his vote isn't going to correct the road problem. Frankly, nothing that you've written makes sense to me.

KirkW1 (Texas)
Posts: 1,665

Posted:

The BOD is going to find itself in a pickle. They better hope their D&O insurance comes through when the stuff hits the fan. Any changes they make can be thrown out should the developer cooperate with any upset person to challenge the changes. (Or the developer may choose to challenge them.)

Further, the developer could choose to vote all of them out of office and when they fail to leave sue the HOA for breach of contract. I would recommend you get a group together to recall these people before the association ends up on a legal battle.

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