Get 1 year of free community web site hosting from Community123.com!
Wednesday, February 26, 2020











HOATalk is a free service of Community123.com:

Get 1 free year community website and email newsletter hosting from Community123.com!
Only members have access to all features.
Click here to join HOATalk for Free! Members click here to login and access all features.
Subject: Suggestion on handling 3, out 5, Board members refusing to recognize a vote at a General Meeting
Prev Next
Please login to post a reply (click Member Login on the menu).
Author Messages
RogerJ1
(Texas)

Posts:78


02/01/2020 6:26 AM  
This happened this week to a property association in Texas.

We had a Annual General Meeting this week. The Board formed a committee to look at some fencing issues. The chairman of that committee in presentation, while she had the floor, called for a vote that would amend the deed restrictions. The motion was seconded and then discussed, then called for a vote. It passed. After passing, the Board President, who resigned and his Board member spot, not presidency, was replaced by a newly elected Board member, announced that "the amendment was now in effect."

Now three Board members, out of five, are refusing to recognize the vote and refusing to have the amendment filed with our County.

First two aspect of the law on this.

In the AGM announcement, made by the Board, it was indicated that "A vote will need to be taken at the AGM to change the Deed Restrictions to support these findings." So the Board announced there would be a vote before the meeting.

Also, our POA's By-laws state that a majority of a quorum can vote on any subject at a gathering of the Membership and that vote will be binding. I bring this up because the Texas Property Code calls for a 67% vote by the whole membership to amend restrictions but the Texas Property Code adds that if any of the Association's declaratory documents call for a lower percentage that lower percentage prevails over the State requirement. The vote was 34 to 14 in favor of the amendment - 38 would hit the 67% of whole membership but again the Texas Property Code defers to the declaratory documents of an Association if they call for a lower percentage which ours do.

I assume the disgruntled Board members are trying to argue one or both of those things but we do not know because they offer no explanation other than saying they will not recognize the vote. Also the Secretary is refusing to let a newly elected Board member even see the ballots, when our By-laws state that any member has a right to inspect all records and a Board officer, which the new officer is, has an "absolute right" to inspect records. We are concerned they might doctor the ballots over the next few days - although it was announced at the meeting that the vote was 34 to 14, so I do not know how they would explain such a turn around if they doctored the ballots to reverse a 2.5 to 1 margin.

Does anyone have any advise how to handle this? I think our only options are 1) get a majority to remove those Board Members, which would entail calling a special meeting, 2) living with it, or 3) legal action which would be costly and risky. Hopefully someone know of some other option.
RogerJ1
(Texas)

Posts:78


02/01/2020 6:40 AM  
For clarification to the above: The committee was formed last year and was presenting its conclusions and the Board announcement of this year's annual meeting stated that that committee's conclusions would be presented at this AGM and that presentation would conclude with a vote to amend the deed restrictions.
AugustinD


Posts:2657


02/01/2020 6:51 AM  
Posted By RogerJ1 on 02/01/2020 6:26 AM
Also, our POA's By-laws state that a majority of a quorum can vote on any subject at a gathering of the Membership and that vote will be binding. I bring this up because the Texas Property Code calls for a 67% vote by the whole membership to amend restrictions but the Texas Property Code adds that if any of the Association's declaratory documents call for a lower percentage that lower percentage prevails over the State requirement.
Are you referring to Texas Property Code section 209.0041 (h) thru (i)? See https://statutes.capitol.texas.gov/Docs/PR/htm/PR.209.htm. This section states:
-----------
"209.0041 ADOPTION OR AMENDMENT OF CERTAIN DEDICATORY INSTRUMENTS.
...
(h) Except as provided by Subsection (h-1) or (h-2), a declaration may be amended only by a vote of 67 percent of the total votes allocated to property owners entitled to vote on the amendment of the declaration, in addition to any governmental approval required by law.

(h-1) If the declaration contains a lower percentage than prescribed by Subsection (h), the percentage in the declaration controls.

(h-2) If the declaration is silent as to voting rights for an amendment, the declaration may be amended by a vote of owners owning 67 percent of the lots subject to the declaration.

(i) A bylaw may not be amended to conflict with the declaration"
-------------

Roger, you say your HOA's "By-laws state that a majority of a quorum can vote on any subject at a gathering of the Membership and that vote will be binding."

By-laws are different from the Declaration. In the hierarchy of governing documents, my understanding is that the general legal rule is that the Declaration trumps the By-laws. Also the general legal rule is that it should be hard to amend the Declaration. A majority of a quorum is typically a pretty low number. What is your quorum requirement, anyway?

Right now, I think the board majority is correct to reject the vote as a legitimate amendment to the Declaration.

MarkW18
(Florida)

Posts:556


02/01/2020 7:07 AM  
You need 67% of the owners, no ifs, ands, or buts.
RogerJ1
(Texas)

Posts:78


02/01/2020 7:15 AM  
Posted By AugustinD on 02/01/2020 6:51 AM
Posted By RogerJ1 on 02/01/2020 6:26 AM
Also, our POA's By-laws state that a majority of a quorum can vote on any subject at a gathering of the Membership and that vote will be binding. I bring this up because the Texas Property Code calls for a 67% vote by the whole membership to amend restrictions but the Texas Property Code adds that if any of the Association's declaratory documents call for a lower percentage that lower percentage prevails over the State requirement.
Are you referring to Texas Property Code section 209.0041 (h) thru (i)? See https://statutes.capitol.texas.gov/Docs/PR/htm/PR.209.htm. This section states:
-----------
"209.0041 ADOPTION OR AMENDMENT OF CERTAIN DEDICATORY INSTRUMENTS.
...
(h) Except as provided by Subsection (h-1) or (h-2), a declaration may be amended only by a vote of 67 percent of the total votes allocated to property owners entitled to vote on the amendment of the declaration, in addition to any governmental approval required by law.

(h-1) If the declaration contains a lower percentage than prescribed by Subsection (h), the percentage in the declaration controls.

(h-2) If the declaration is silent as to voting rights for an amendment, the declaration may be amended by a vote of owners owning 67 percent of the lots subject to the declaration.

(i) A bylaw may not be amended to conflict with the declaration"
-------------

Roger, you say your HOA's "By-laws state that a majority of a quorum can vote on any subject at a gathering of the Membership and that vote will be binding."

By-laws are different from the Declaration. In the hierarchy of governing documents, my understanding is that the general legal rule is that the Declaration trumps the By-laws. Also the general legal rule is that it should be hard to amend the Declaration. A majority of a quorum is typically a pretty low number. What is your quorum requirement, anyway?

Right now, I think the board majority is correct to reject the vote as a legitimate amendment to the Declaration.





Its in the associations's By-laws and CCR.

Texas property code section 209 defines: "Declaration" means an instrument filed in the real property records of a county that includes restrictive covenants governing a residential subdivision.

Our By-laws and CCRs, both of which call for a majority quorum vote on any subject, are filed with the county.
AugustinD


Posts:2657


02/01/2020 7:27 AM  
Posted By RogerJ1 on 02/01/2020 7:15 AM
Its in the associations's By-laws and CCR.

Texas property code section 209 defines: "Declaration" means an instrument filed in the real property records of a county that includes restrictive covenants governing a residential subdivision.

Our By-laws and CCRs, both of which call for a majority quorum vote on any subject, are filed with the county.
Please feel free to send me a digital copy of your HOA's CC&Rs at [email protected], with permission to quote here the pertinent section. Else I cannot comment further with confidence on this.


GeorgeS21
(Florida)

Posts:2095


02/01/2020 7:29 AM  
Roger,

Since we have access to Texas statute, we need to see the actual language in your Bylaws and CCRs dealing with this.
MarkW18
(Florida)

Posts:556


02/01/2020 7:49 AM  
The specific language to amend the CCRs would be in the CCRs, toward the end of the document. It would NEVER be in the Bylaws.

Below is a link to a HOA in Texas.Page 31 tells the association how the CCRs can be amended.
http://www.homesteadhoa.com/wp-content/uploads/2014/12/Master-Declaration.pdf


Below is the link to their Bylaws. Page 4 tells how a topic can be voted on at a meeting of the members.
http://www.homesteadhoa.com/wp-content/uploads/2014/12/Bylaws.pdf

Maybe it should be YOU and the other board member that the members should be recalling.
KerryL1
(California)

Posts:6911


02/01/2020 8:41 AM  
Just checking, Roger. You do know that the deed restrictions and CC&R are the same thing?
RogerJ1
(Texas)

Posts:78


02/01/2020 9:08 AM  
Posted By AugustinD on 02/01/2020 7:27 AM
Posted By RogerJ1 on 02/01/2020 7:15 AM
Its in the associations's By-laws and CCR.

Texas property code section 209 defines: "Declaration" means an instrument filed in the real property records of a county that includes restrictive covenants governing a residential subdivision.

Our By-laws and CCRs, both of which call for a majority quorum vote on any subject, are filed with the county.
Please feel free to send me a digital copy of your HOA's CC&Rs at [email protected], with permission to quote here the pertinent section. Else I cannot comment further with confidence on this.






Sent
RogerJ1
(Texas)

Posts:78


02/01/2020 9:10 AM  
Posted By KerryL1 on 02/01/2020 8:41 AM
Just checking, Roger. You do know that the deed restrictions and CC&R are the same thing?




Yes I sent a scan of the relevant two pages that cover termination and amendment within the CCRs to the person who requested it. I do not send anymore so as not to identify the association.
RogerJ1
(Texas)

Posts:78


02/01/2020 9:15 AM  
Posted By KerryL1 on 02/01/2020 8:41 AM
Just checking, Roger. You do know that the deed restrictions and CC&R are the same thing?




Here is the relevant portion of the currently filed CCRs


"8.02 AMENDMENT OR TERMINATION

These covenants and restrictions may be terminated or amended by the execution and recordation in the real property records of XXXXXXXXXXXXX (xxxxxxxxx = the county name, Texas), of a written instrument executed by the Tract Owners of a majority of the Tracts within the Subdivision. In voting under these restrictions, each Tract shall be entitled to one vote, regardless of the number of persons or entities owning said Tract. All such Owners or entities owning interests in such Tract shall determine among themselves how such single vote shall be cast."
RogerJ1
(Texas)

Posts:78


02/01/2020 9:19 AM  
Posted By RogerJ1 on 02/01/2020 9:15 AM
Posted By KerryL1 on 02/01/2020 8:41 AM
Just checking, Roger. You do know that the deed restrictions and CC&R are the same thing?




Here is the relevant portion of the currently filed CCRs


"8.02 AMENDMENT OR TERMINATION

These covenants and restrictions may be terminated or amended by the execution and recordation in the real property records of XXXXXXXXXXXXX (xxxxxxxxx = the county name, Texas), of a written instrument executed by the Tract Owners of a majority of the Tracts within the Subdivision. In voting under these restrictions, each Tract shall be entitled to one vote, regardless of the number of persons or entities owning said Tract. All such Owners or entities owning interests in such Tract shall determine among themselves how such single vote shall be cast."




Added note on the above, since I mention a quorum earlier. The ballots in favor of the change were 34 votes. There are 56 tracts. So it was a clear majority of the total tract votes. All ballots and proxies that represented some of the ballots were signed. The Secretary has all those and I assume is why she is refusing to show them to a newly elected Board members because she knows he could take them to the County with the current filed CCR to record the amendment.
JohnC46
(South Carolina)

Posts:9145


02/01/2020 9:26 AM  
Roger

34 of 54 is not 2/3rds. You would need 38 yeses for a 2/3rds majority of 54 and you only had 34 yeses. If do, I say the amendment failed.
RogerJ1
(Texas)

Posts:78


02/01/2020 9:41 AM  
Posted By JohnC46 on 02/01/2020 9:26 AM
Roger

34 of 54 is not 2/3rds. You would need 38 yeses for a 2/3rds majority of 54 and you only had 34 yeses. If do, I say the amendment failed.





What about the CCR stating, "executed by the Tract Owners of a majority of the Tracts"?

Texas Property Code defers to the Declaration document if it calls for a lower percentage. The Declaration document, in question as quoted above, calls for a "majority" which would be 50%, so that lower percentage would prevail according to the Texas Property Code, no?

The legal definition of a majority is "The greater number. The number greater than half of any total." https://legal-dictionary.thefreedictionary.com/majority
AugustinD


Posts:2657


02/01/2020 9:53 AM  
RogerJ1, thank you for sending the two pages from your CC&Rs. If you have checked with the county to ensure there is no pertinent governmental restriction, and since proper legal notice appears to have been done, then based on the Texas Property Code and your HOA's CC&Rs, I think you are correct.

Do you have the Minutes from this meeting? Is there any documentation of the vote count other than multiple witnesses heard that 34 voted for the amendment?

To address this situation, I think I would start with what I call a "demand letter lite." I suggest sending something like the following to the registered agent for the HOA, certified mail, return receipt requested. The registered agent is most likely the manager.

-----------------------
Dear HOA Board,

Section 8.02 of the HOA's CC&Rs states:

"These covenants and restrictions may be terminated or amended by the execution and recordation in the real property records of XXXXXXXXXXXXX (xxxxxxxxx = the county name, Texas), of a written instrument executed by the Tract Owners of a majority of the Tracts within the Subdivision. In voting under these restrictions, each Tract shall be entitled to one vote, regardless of the number of persons or entities owning said Tract. All such Owners or entities owning interests in such Tract shall determine among themselves how such single vote shall be cast."

At the recent annual meeting, multiple members witnessed the announcement of the vote count in favor of the amendment to fence restrictions. Thirty-four members voted in favor. This is a majority of the tracts. Pursuant to CC&R 8.02 and Texas Property Code 209.0041, I believe this amendment should now be recorded with the County. Many members, including myself, are dismayed that the Board so far refuses to do so. The Board also refuses to explain why it will not record the amendment. We members are obliged to try to obtain an explanation before proceeding with other lawful steps to record this amendment. By February 22, would the Board please explain why it is refusing to record the amendment?

Thank you,

Roger ____
[address]

Jane ____
[address]

[as many others should sign as possible, for one, to make it clear there are multiple witnesses to the vote count]
--------------
RogerJ1
(Texas)

Posts:78


02/01/2020 10:04 AM  
Posted By AugustinD on 02/01/2020 9:53 AM
RogerJ1, thank you for sending the two pages from your CC&Rs. If you have checked with the county to ensure there is no pertinent governmental restriction, and since proper legal notice appears to have been done, then based on the Texas Property Code and your HOA's CC&Rs, I think you are correct.

Do you have the Minutes from this meeting? Is there any documentation of the vote count other than multiple witnesses heard that 34 voted for the amendment?

To address this situation, I think I would start with what I call a "demand letter lite." I suggest sending something like the following to the registered agent for the HOA, certified mail, return receipt requested. The registered agent is most likely the manager.

-----------------------
Dear HOA Board,

Section 8.02 of the HOA's CC&Rs states:

"These covenants and restrictions may be terminated or amended by the execution and recordation in the real property records of XXXXXXXXXXXXX (xxxxxxxxx = the county name, Texas), of a written instrument executed by the Tract Owners of a majority of the Tracts within the Subdivision. In voting under these restrictions, each Tract shall be entitled to one vote, regardless of the number of persons or entities owning said Tract. All such Owners or entities owning interests in such Tract shall determine among themselves how such single vote shall be cast."

At the recent annual meeting, multiple members witnessed the announcement of the vote count in favor of the amendment to fence restrictions. Thirty-four members voted in favor. This is a majority of the tracts. Pursuant to CC&R 8.02 and Texas Property Code 209.0041, I believe this amendment should now be recorded with the County. Many members, including myself, are dismayed that the Board so far refuses to do so. The Board also refuses to explain why it will not record the amendment. We members are obliged to try to obtain an explanation before proceeding with other lawful steps to record this amendment. By February 22, would the Board please explain why it is refusing to record the amendment?

Thank you,

Roger ____
[address]

Jane ____
[address]

[as many others should sign as possible, for one, to make it clear there are multiple witnesses to the vote count]
--------------





Wow this is great. Thank you very much.

On the minutes, that might be tricky because the Secretary controls the minutes and she is one of the ones fighting it. So is refusing to show any documents to any general member and now an elected Board officer also.

Also, two points on minutes to show what we are up against. There was a special meeting about 6 months ago. The secretary is refusing to accept the minutes to it. She refused to attend the special minutes and claims she is the one one who can record minutes and she will not listen to a recording of that special meeting.

And at the AGM this week, there was a very important floor discussion where the then current President gave the Board's interruption of a rule. I wanted to make sure his/Board interpretation got recorded in the minutes but I noticed the Secretary had her head buried in some documents, not paying attention to the floor discussion. I pointed this out to the President. He then had to call her name 3 or 4 times, each time louder and stener than before, to get her to look up. He asked if she was paying attention and she admitted no. He then requested her to please pay attention while another Board member iterated what was just discussed on the floor so that she would make sure to record the discussion in the minutes. As soon as the other Board member began to iterated the discussion, she buried her head in documents again not paying attention.
AugustinD


Posts:2657


02/01/2020 10:27 AM  
-- Regarding the Secretary's actions at the Special Meeting six months ago and the recent AGM meeting: Was there an official vote on anything? Were there any motions made? If yes, then the motion, who seconded it, and the vote on the motion must be recorded. If not, then it is not the Secretary's job to record anything other than whether quorum was met; the time the meeting started; and the time the meeting ended.

-- If anyone does not like the board's interpretation of a rule or covenant, then when the rule is applied in a way that someone does not like, he or she should send another demand letter lite (for starters).

-- I see Texas Property Code 209.0058 has some exacting requirements for ballots, including requiring that voting be done by secret ballot. Did your HOA satisfy all of Section 2090058's requirements?

-- I think Texas Property Code 209.00594 makes it impossible to see the ballots without a court order.

-- Texas Property Code 209.0057 appears to allow members to ask for a recount. The member will have to pay some money. But with less than 50 ballots to count, I think this should not be much. Since this has to be done within 15 days of the election, I think you'd best read this section and go ahead and make the request, following precisely what the statute says, just in case you land in court. Keep your letter polite and to the point. Why? Because it may end up as evidence in court, and you want the judge to look favorably upon your communications and efforts to get the board to follow the law.
BillH10
(Texas)

Posts:432


02/01/2020 11:12 AM  
First, I second Augustine's thoughts regarding meeting notes and the processes in Section 209.

Secondly, in my experience the language sent owners in the notice of the AGM is not adequate to amend your documents. When we have done this in the past, our attorney has told us the notice package must contain word for word the proposed amendment. An example might be:

The following proposed amendment to the declaration reads as follows:

Paragraph X, Section Y is amended to read Yada, Yada, Yada.

It is that language which is being voted upon, not a generic statement the documents will be amended as you stated: "A vote will need to be taken at the AGM to change the Deed Restrictions to support these findings."

I would not vote to approve the language you cited in a million years, even if I agreed to it. I would like to see the exact wording which is being proposed to be approved and filed. Redlines would be better.

Finally, are you certain there is not language in your documents which states something like: "This Declaration may be amended by NN% of the owners of property in the Association" or some such?
RogerJ1
(Texas)

Posts:78


02/01/2020 11:13 AM  
Posted By AugustinD on 02/01/2020 10:27 AM
-- Regarding the Secretary's actions at the Special Meeting six months ago and the recent AGM meeting: Was there an official vote on anything? Were there any motions made? If yes, then the motion, who seconded it, and the vote on the motion must be recorded. If not, then it is not the Secretary's job to record anything other than whether quorum was met; the time the meeting started; and the time the meeting ended.

-- If anyone does not like the board's interpretation of a rule or covenant, then when the rule is applied in a way that someone does not like, he or she should send another demand letter lite (for starters).

-- I see Texas Property Code 209.0058 has some exacting requirements for ballots, including requiring that voting be done by secret ballot. Did your HOA satisfy all of Section 2090058's requirements?

-- I think Texas Property Code 209.00594 makes it impossible to see the ballots without a court order.

-- Texas Property Code 209.0057 appears to allow members to ask for a recount. The member will have to pay some money. But with less than 50 ballots to count, I think this should not be much. Since this has to be done within 15 days of the election, I think you'd best read this section and go ahead and make the request, following precisely what the statute says, just in case you land in court. Keep your letter polite and to the point. Why? Because it may end up as evidence in court, and you want the judge to look favorably upon your communications and efforts to get the board to follow the law.




On special meeting vote: Yes, I cannot find the exact motion now but it was very general: It was amendment to the By-laws, which are usual easier to amend than CCR and only takes a majority, which we the vote had, stating something along the line that the Board was to follow the By-laws and Deed Restrictions. The Special Meeting was called because the Board was not following the By-Laws and CCR in a growing number of cases - for example, it was not running building and improvement plan requests through the Architectural Control Committee when it is required to do so by those documents and some other similar actions.

I was wondering about 209.0058 also. The Ballots and Proxies were signed and given to the Secretary - the proxies were given to her as people checked/signed into the meeting as they arrived and the ballots were given to her by the tract owners casting a ballot. I assume that is secret but I do not know for sure. The Ballots for the deed restrictions amendment had tract owner names on them. The ballots for a new Board member had Roman numerals identifying them with the Secretary having a list of what tract owner was what Roman numeral.

On the topic of "I think Texas Property Code 209.00594 makes it impossible to see the ballots without a court order", would that also apply to a Board Director? Our By-laws state, "9.02 Right of Inspection by Directors. Every Director shall have the absolute right at any reasonable time to inspect all books, records, and documents of the Association. The right of inspection by a Director includes the right to make extracts and copies of the documents."
RogerJ1
(Texas)

Posts:78


02/01/2020 11:19 AM  
Posted By BillH10 on 02/01/2020 11:12 AM


Secondly, in my experience the language sent owners in the notice of the AGM is not adequate to amend your documents. When we have done this in the past, our attorney has told us the notice package must contain word for word the proposed amendment. An example might be:

The following proposed amendment to the declaration reads as follows:

Paragraph X, Section Y is amended to read Yada, Yada, Yada.

It is that language which is being voted upon, not a generic statement the documents will be amended as you stated: "A vote will need to be taken at the AGM to change the Deed Restrictions to support these findings."

I would not vote to approve the language you cited in a million years, even if I agreed to it. I would like to see the exact wording which is being proposed to be approved and filed. Redlines would be better.

Finally, are you certain there is not language in your documents which states something like: "This Declaration may be amended by NN% of the owners of property in the Association" or some such?




I was thinking this might be the objection also - again they will not say why they are objecting. I do not know if this requirement was met - I do not have the expertise but personally, I am leaning toward your point of view.

How can we determine if it is a valid argument? And again, I do not know if it is their argument.
AugustinD


Posts:2657


02/01/2020 11:32 AM  
In my experience in another state, BillH10 is correct that proper legal notice of a vote to amend must be formal and highly specific.

Regarding the board's refusing to tell you why the board refuses to record the (alleged) amendment: In my experience, the directors may be claiming they have a fiduciary duty not to tell the members this. They want to force the members to hire an attorney and possibly even take them to court. Why are the directors justified in doing this? Maybe because the directors believe the alleged amendment was not lawfully voted on, and they believe the alleged amendment is harmful to the corporation. The directors are not obliged to make this happen.

I think my answer applies to both meetings.

Now the question I have is why the board apparently did not bother with proper legal notice at the recent AGM and Special Meeting some months ago. Did the directors change?
RogerJ1
(Texas)

Posts:78


02/01/2020 12:24 PM  
Posted By AugustinD on 02/01/2020 11:32 AM
In my experience in another state, BillH10 is correct that proper legal notice of a vote to amend must be formal and highly specific.

Regarding the board's refusing to tell you why the board refuses to record the (alleged) amendment: In my experience, the directors may be claiming they have a fiduciary duty not to tell the members this. They want to force the members to hire an attorney and possibly even take them to court. Why are the directors justified in doing this? Maybe because the directors believe the alleged amendment was not lawfully voted on, and they believe the alleged amendment is harmful to the corporation. The directors are not obliged to make this happen.

I think my answer applies to both meetings.

Now the question I have is why the board apparently did not bother with proper legal notice at the recent AGM and Special Meeting some months ago. Did the directors change?




First some background: There was an almost complete turn-over of the Board last year. Four of the five Board members were newly elected last year and the 5th one, who stayed, is extremely shy and timid - he probably would not speak up about anything, so there was basically no continuity. That scenario itself would likely lead to problems because of the inexperience. Add to it that one of the Board members likely got onto the Board to accomplish something for his property that is not allowed. He is an extremely forceful person, who yells and screams at people at Board meetings, one time literally in the ear of a lady in her 70s or 80s. He had only lived in the subdivision less than a month at the time of the AGM where he was elected, and he nominated himself to be on the Board, which is perfectly legal but in my opinion, borderline uncouth. Our subdivision is fairly small and there is usually a problem to get people on the Board when Board members get off - no to few people want to be on it. So usually anytime someone announces interest that person will get elected unopposed. Because of his commanding personality he has two other board members that seems to be in lock-step with anything he wants.

With that scenario painted, the new Board has done a lot of changes, some good, some bad, over the last year but likely more stuff done, including legal expense, which we still do not know why the counsel was thought, and some mickey-mouse additional monthly expenses that had never been done before. Those can be overlooked but they began to grant variances on building/improvement that was changing the style of the subdivision. They did those variances without going through the proper process. So a group of concerned tract owners got together enough people on a petition to call for a Special Meeting. Enough people attended and/or gave proxies to have a quorum. Four of the five Board members refused to attend, giving excuses that might or might not have been legitimate (e.g. claimed to be out of town but we knew they were home) while behind the scenes saying we would never get a quorum and they were not going to attend to add to one. Our group followed the law, mailing an announcement, with the single agenda item clearly given with exact wording of what was going to be voted, to every tract owner within the prescribed time period by the Texas Property Code on calling Special Meetings. So the Board did not announce it. They now refuse to acknowledge it nor accept its minutes (to which everyone in attendance agreed were correct) nor listen to a recording of it to take their own minutes.

On the announcement for the recent AGM, for which the Board did give notice, I cannot answer how they did it. I do know some on the Board have said that they have completely studied the Texas Property Code and they are often citing it but they seem to do so in their favor but ignore it if it pointed out to them when it is against them - for example, they refuse to give proper notice of their Board meetings citing they are concerned members might attend unannounced and even though they acknowledge the Texas Property Code Open Meeting requirements allows that, they say they do not want to deal with people showing up. They also tend to put much of their Board meeting discussion into executive session even though per their minutes summaries of the executive sessions, much of it is normal business.
GeorgeS21
(Florida)

Posts:2095


02/01/2020 12:45 PM  
Hmmm.

The Special Meeting perhaps should have been a simple recall and replacement of the Board members.

The reason for significant specificity in changing CCRs, is that it is a BIG deal.

This sounds messed up enough to call for another Special Meeting to dump the current board.

Once the Board is replaced, the new Board can determine if there is interest in terminating or modifying the CCRs, then move forward, with suitable legal assistance, to do so.

Roger- are you on the Board? A Committee?
RogerJ1
(Texas)

Posts:78


02/01/2020 1:04 PM  
Posted By GeorgeS21 on 02/01/2020 12:45 PM
Hmmm.

The Special Meeting perhaps should have been a simple recall and replacement of the Board members.

The reason for significant specificity in changing CCRs, is that it is a BIG deal.

This sounds messed up enough to call for another Special Meeting to dump the current board.

Once the Board is replaced, the new Board can determine if there is interest in terminating or modifying the CCRs, then move forward, with suitable legal assistance, to do so.

Roger- are you on the Board? A Committee?




I am neither on the Board nor a committee. I agree with the CCR, its is double edge sword and I think it should be hard to change.

The idea of a Special Meeting last year started with the agenda of removing the main troublemaker off the Board - it is firmly thought that act would solve everything and our subdivision would revert to the tranquil place it had been for decades.After talking with other tract owners early while getting a petition, it was quickly demonstrated that there was no appetite for doing that, so the agenda was changed to requiring the Board to follow the By-laws and CCRs.

I think removing the bad apple is warranted and should be done, but I am more of a research person versus someone who can successfully do grass-root persuasion that would need. The ones more attuned to do that and who know more of tract owners still think it would be a no go.
GeorgeS21
(Florida)

Posts:2095


02/01/2020 1:18 PM  
So, given the circumstances, this seems straightforward.

Are you willing to be a Board member?
RogerJ1
(Texas)

Posts:78


02/01/2020 1:19 PM  
Since this discussion went past the initial post, I want to bring up what most concerns me.

Our POA is small and owns no common property, and has no paid services provided to tract owners, so its budget is pretty small and our assessments are modest compared to the values of the properties - although I would argue that they are too high because ongoing expenses are under 1/2 of the total assessments every year, so the surplus just grows and grows, tempting misuse.

What concerns me is the current Board's attitude toward the funds. Either the By-laws or CCR, I forgot which at this time and have neither handy, only allow the Board to make $3000 in expenditures without Membership approval. Some on the Board have seriously argued at Board meetings that they can spend well over $3000 if that want to do so without membership approval by just paying it in under $3000 allotments. For example, they argued they could spend $60K just allotting $2000 for the expenditure every day for 30 days into another pool of money to pay the $60K. Without common property and with no ability to do eminent domain, I see no way they could spend so much money but supposedly they are pushing for "beautification" program that could run into those amounts.
BenA2
(Texas)

Posts:573


02/01/2020 1:22 PM  
To be clear on the Texas Property Code, you can have lower than 67 percentage if your covenants state that but it still has to be the percentage of "total votes allocated to property owners entitled to vote on the amendment of the declaration." In other words, it is the percentage of all owners, not just voting members or members at a meeting.

For example, if your declarations say you need 51%, then it is 51% of all owners entitled to vote, not just voting owners or owners at the meeting.
AugustinD


Posts:2657


02/01/2020 1:27 PM  
Posted By RogerJ1 on 02/01/2020 1:04 PM
After talking with other tract owners early while getting a petition, it was quickly demonstrated that there was no appetite for doing that, so the agenda was changed to requiring the Board to follow the By-laws and CCRs.
Respectfully, at this point do you realize that such a requirement is superfluous? Your HOA's governing documents, state statute and case law all require the board to follow the By-laws and CCRs. I suspect the minutes for this special meeting have virtually no value, except to document that a group of amateurs was running the meeting.

RogerJ1 if you think people will have no appetite for removing board members, and nor will they step up themselves to run for the board, then the alternative is to start pursuing legal action with the courts, starting with demand letters. On the other hand, if you and your like-minded friends are not willing to serve on the board, then I personally do not think it's the least bit fair to start threatening lawsuits, all so you can tell this all-volunteer board what to do when you are not willing to do it yourselves. I hope I am misunderstanding you. If not, maybe this is the start of a huge educational process.

Nationwide any competent HOA attorney will tell you that by far the easiest way to remedy HOA problems is to run for the board with a like-minded group of people to win majority control.
RogerJ1
(Texas)

Posts:78


02/01/2020 1:27 PM  
Posted By BenA2 on 02/01/2020 1:22 PM
To be clear on the Texas Property Code, you can have lower than 67 percentage if your covenants state that but it still has to be the percentage of "total votes allocated to property owners entitled to vote on the amendment of the declaration." In other words, it is the percentage of all owners, not just voting members or members at a meeting.

For example, if your declarations say you need 51%, then it is 51% of all owners entitled to vote, not just voting owners or owners at the meeting.




34 affirmative votes on it. Total POA tracts are 56. So the approval was over 60% of total possible votes of the whole POA.
JohnC46
(South Carolina)

Posts:9145


02/01/2020 1:32 PM  
Roger

A motion/vote requiring the Board to follow the By-laws and CCRs is, in my opinion, is a waste of time and effort.

If they are not following the Bylaw and CCRs, either recall them or take their a$$ to court. Anything else is a waste.
GeorgeS21
(Florida)

Posts:2095


02/01/2020 1:33 PM  
And, the vote was likely irrelevant because:
- amendment change was not exact and in writing?
- process inappropriate as there was no documentation?
RogerJ1
(Texas)

Posts:78


02/01/2020 1:34 PM  
Posted By AugustinD on 02/01/2020 1:27 PM
Posted By RogerJ1 on 02/01/2020 1:04 PM
After talking with other tract owners early while getting a petition, it was quickly demonstrated that there was no appetite for doing that, so the agenda was changed to requiring the Board to follow the By-laws and CCRs.
Respectfully, at this point do you realize that such a requirement is superfluous? Your HOA's governing documents, state statute and case law all require the board to follow the By-laws and CCRs. I suspect the minutes for this special meeting have virtually no value, except to document that a group of amateurs was running the meeting.

RogerJ1 if you think people will have no appetite for removing board members, and nor will they step up themselves to run for the board, then the alternative is to start pursuing legal action with the courts, starting with demand letters. On the other hand, if you and your like-minded friends are not willing to serve on the board, then I personally do not think it's the least bit fair to start threatening lawsuits, all so you can tell this all-volunteer board what to do when you are not willing to do it yourselves. I hope I am misunderstanding you. If not, maybe this is the start of a huge educational process.

Nationwide any competent HOA attorney will tell you that by far the easiest way to remedy HOA problems is to run for the board with a like-minded group of people to win majority control.




I completely agree. I found no value and in the outcome of the Special Meeting - purely redundant just saying, "you have to do what you have to do" in my opinion.

On getting on the Board. I am a resident but not a tract owner. So I would not qualify to be on the Board. One active person did get onto the Board last week and that person had been on the Board in other years. Also, I think everyone in what I call "our group" had been on the Board at one time or another and one was on the Board as recent as the year before last and had been in years previous to that too.
RogerJ1
(Texas)

Posts:78


02/01/2020 1:37 PM  
Posted By GeorgeS21 on 02/01/2020 1:33 PM
And, the vote was likely irrelevant because:
- amendment change was not exact and in writing?
- process inappropriate as there was no documentation?




100% agreement. I assume the intent was to "sober up" the Board and at the time, perhaps a bit optimistic but attainable.
JohnC46
(South Carolina)

Posts:9145


02/01/2020 1:37 PM  
Posted By RogerJ1 on 02/01/2020 1:34 PM
Posted By AugustinD on 02/01/2020 1:27 PM
Posted By RogerJ1 on 02/01/2020 1:04 PM
After talking with other tract owners early while getting a petition, it was quickly demonstrated that there was no appetite for doing that, so the agenda was changed to requiring the Board to follow the By-laws and CCRs.
Respectfully, at this point do you realize that such a requirement is superfluous? Your HOA's governing documents, state statute and case law all require the board to follow the By-laws and CCRs. I suspect the minutes for this special meeting have virtually no value, except to document that a group of amateurs was running the meeting.

RogerJ1 if you think people will have no appetite for removing board members, and nor will they step up themselves to run for the board, then the alternative is to start pursuing legal action with the courts, starting with demand letters. On the other hand, if you and your like-minded friends are not willing to serve on the board, then I personally do not think it's the least bit fair to start threatening lawsuits, all so you can tell this all-volunteer board what to do when you are not willing to do it yourselves. I hope I am misunderstanding you. If not, maybe this is the start of a huge educational process.

Nationwide any competent HOA attorney will tell you that by far the easiest way to remedy HOA problems is to run for the board with a like-minded group of people to win majority control.




I completely agree. I found no value and in the outcome of the Special Meeting - purely redundant just saying, "you have to do what you have to do" in my opinion.

On getting on the Board. I am a resident but not a tract owner. So I would not qualify to be on the Board. One active person did get onto the Board last week and that person had been on the Board in other years. Also, I think everyone in what I call "our group" had been on the Board at one time or another and one was on the Board as recent as the year before last and had been in years previous to that too.




Does not being a tract owner mean you are a renter?

RogerJ1
(Texas)

Posts:78


02/01/2020 1:40 PM  
Posted By GeorgeS21 on 02/01/2020 1:33 PM
And, the vote was likely irrelevant because:
- amendment change was not exact and in writing?
- process inappropriate as there was no documentation?




The first point above likely has merit and is the case but on the second point: ballots and proxies were all signed - the secretary is just refusing to let anyone see them but the do exist unless they destroyed them, which I would put at very low odds but would not be shocked if it happened.
RogerJ1
(Texas)

Posts:78


02/01/2020 1:42 PM  
Posted By JohnC46 on 02/01/2020 1:37 PM
Posted By RogerJ1 on 02/01/2020 1:34 PM
Posted By AugustinD on 02/01/2020 1:27 PM
Posted By RogerJ1 on 02/01/2020 1:04 PM
After talking with other tract owners early while getting a petition, it was quickly demonstrated that there was no appetite for doing that, so the agenda was changed to requiring the Board to follow the By-laws and CCRs.
Respectfully, at this point do you realize that such a requirement is superfluous? Your HOA's governing documents, state statute and case law all require the board to follow the By-laws and CCRs. I suspect the minutes for this special meeting have virtually no value, except to document that a group of amateurs was running the meeting.

RogerJ1 if you think people will have no appetite for removing board members, and nor will they step up themselves to run for the board, then the alternative is to start pursuing legal action with the courts, starting with demand letters. On the other hand, if you and your like-minded friends are not willing to serve on the board, then I personally do not think it's the least bit fair to start threatening lawsuits, all so you can tell this all-volunteer board what to do when you are not willing to do it yourselves. I hope I am misunderstanding you. If not, maybe this is the start of a huge educational process.

Nationwide any competent HOA attorney will tell you that by far the easiest way to remedy HOA problems is to run for the board with a like-minded group of people to win majority control.




I completely agree. I found no value and in the outcome of the Special Meeting - purely redundant just saying, "you have to do what you have to do" in my opinion.

On getting on the Board. I am a resident but not a tract owner. So I would not qualify to be on the Board. One active person did get onto the Board last week and that person had been on the Board in other years. Also, I think everyone in what I call "our group" had been on the Board at one time or another and one was on the Board as recent as the year before last and had been in years previous to that too.




Does not being a tract owner mean you are a renter?





No I live with and care for my mother, who is the tract owner. Also ironically, she wrote most of the earlier documents in question.
RogerJ1
(Texas)

Posts:78


02/01/2020 3:33 PM  
I cannot find anything in the Texas Property Code that requires restriction amendments to be presented before the meeting, as some have suggested in this thread. It might be there but I cannot find it. The closest so far that I have found is - please see below.

It seems from this list any single one of this methods or a combination of them can be done to modify the restrictions. I would argue that #2 was satisfied. #2 requires notice of the purpose - it has no requirement of exact wording of the amendment. As show earlier in this thread, the AGM notice stated it may conclude with a vote to amend the restrictions, which it did. Opinions?

Sec.A204.008. METHOD OF ADOPTION. An extension, addition
to, or modification of restrictions proposed by a property owners ’
association may be adopted:
(1)by a written ballot that states the substance of
the amendment and specifies the date by which a ballot must be
received to be counted;
(2)at a meeting of the members represented by the
property owners ’ association if written notice of the meeting
stating the purpose of the meeting is delivered to each owner of
property in the subdivision;
(3)by door-to-door circulation of a petition by the
property owners ’ association or a person authorized by the property
owners ’ association;
(4)by a method permitted by the existing
restrictions; or
(5)by a combination of the methods described by this
section.
Added by Acts 1995, 74th Leg., ch. 1040, Sec. 2, eff. Aug. 28, 1995.

From the above
RogerJ1
(Texas)

Posts:78


02/01/2020 3:51 PM  
Also the post and conclusion above make logical sense.

If people are voting on something without a meeting, an example being a mail ballot, they needed to know the exact wording on what they are voting. Hence the method titled #1 - and note, even it states the substance of the amendment as opposed to a verbatim amendment.

But if as the method titled #2, which is another method that could be used, there is gathering then the amendment could be discussed and changed during the motion at the gathering. In fact this makes logical sense. If there was a meeting to make an amendment, which again our AGM announcement stated was on the agenda, and the exact wording were given before the meeting, what happens if during the meeting someone noticed a material typo that completely resulted in the wrong intent - for example a "can" versus "cannot" when it was intended to be the other. If only pre-meeting exact language can be voted, then the meeting, for that subject, would be a waste. The typo would have to be corrected then resubmitted and a second meeting called to vote one the corrected language. That would be impractical. Instead I would think that during the floor discussion, at a gathering, the typo could be corrected then a vote on the corrected wording done. And if you had to live be exact language before the meeting that would not be possible making the whole process impractical in my opinion.

Law is often very logical in what it is doing, and with the Texas Property Code, that I cited above this post, offering many choices of methods to change restrictions, that intent of flexibility to fit the method would make sense, no? Why else all the method choices?
RogerJ1
(Texas)

Posts:78


02/01/2020 4:14 PM  
Scratch the two above post - that just applies to POAs/HOAs in counties with 3.3 million or more people or adjacent to one and also has a national forest in it.

So I can find nothing in the Texas Property Code requiring the actual amendment be given prior to a meeting where it is voted, and in our case a possible vote on a restriction amendment was on the agenda provided in the meeting announcement. It could be there, and if anyone spots it or knows about it, please reply.
AugustinD


Posts:2657


02/01/2020 5:23 PM  
Posted By RogerJ1 on 02/01/2020 4:14 PM
So I can find nothing in the Texas Property Code requiring the actual amendment be given prior to a meeting where it is voted, and in our case a possible vote on a restriction amendment was on the agenda provided in the meeting announcement. It could be there, and if anyone spots it or knows about it, please reply.
Anything in the statute or your governing documents that uses the word "notice" with regard to meetings translates in case law yada to mean that the agenda needs to be pretty precise. The point is to give people enough information to decide whether they want to attend or participate by proxy. "Notice" is a legal term of art. If you have doubts about this, ask an attorney or maybe google. It's a part of "sunshine statutes" that seek to ensure operations of a governing body are reasonably transparent. Nationwide improper notice can and has invalidated major decisions.
RogerJ1
(Texas)

Posts:78


02/01/2020 5:37 PM  
Posted By AugustinD on 02/01/2020 5:23 PM
Posted By RogerJ1 on 02/01/2020 4:14 PM
So I can find nothing in the Texas Property Code requiring the actual amendment be given prior to a meeting where it is voted, and in our case a possible vote on a restriction amendment was on the agenda provided in the meeting announcement. It could be there, and if anyone spots it or knows about it, please reply.
Anything in the statute or your governing documents that uses the word "notice" with regard to meetings translates in case law yada to mean that the agenda needs to be pretty precise. The point is to give people enough information to decide whether they want to attend or participate by proxy. "Notice" is a legal term of art. If you have doubts about this, ask an attorney or maybe google. It's a part of "sunshine statutes" that seek to ensure operations of a governing body are reasonably transparent. Nationwide improper notice can and has invalidated major decisions.




Thanks. So it looks like the CCR's simple majority vote requirement is fine since the Texas law defers to the CCR if it addresses it which ours does. So the only other question is what wording of the amendment had to be disclosed in the meeting notice and it appears that question would have to be answered by an attorney and if pushed for a judge to adjudicate. Although the ones on the Board refusing have, as to my knowledge, not said why they reject it, so it is only a guess that is a reason. I assume if the new Board member can get copies of the ballots, he can take the amendment, the ballots and our CCR showing it takes a majority of tract owners to amend the CCR, to the county for recordation.

Also, I think the new Board member, if he ever learns of the reason for the rejection, can suggest that the Board have the Board's attorneys review the reason. I suspect, if it is a flimsy argument, the disgruntled Board members would reject having their attorneys review it out of fear that their own attorneys would tell them it was not a valid argument. So it would be request to get them to tip their hands about their comfort level. Also, if they accepted, it would get an attorney, specializing in HOAs, to legally opine on it.
AugustinD


Posts:2657


02/01/2020 5:51 PM  
Posted By RogerJ1 on 02/01/2020 5:37 PM
I assume if the new Board member can get copies of the ballots, he can take the amendment, the ballots and our CCR showing it takes a majority of tract owners to amend the CCR, to the county for recordation.
He can try to record whatever, but without proof that the one director speaks for the HOA, it is not going to be a lawfully recorded amendment. In fact if this one director does what you propose, then he would be committing an act of ultra vires and so a violation of the law. Also "executing" typically means that duly elected/appointed officials of the HOA sign a statement saying they swear xyz. The ballots themselves are not turned over to the County Clerk for recording. There's a lot of legal vocabulary for something like this. It's going to take awhile to get a handle on it all.
GeorgeS21
(Florida)

Posts:2095


02/01/2020 5:58 PM  
I'm thinking someone would be foolish to take anything other than a duly signed out letter by the President, attached to signatures with witnesses (and perhaps notary) for each and every person - including some certainty of that person - i.e. the purpose of the notary or officer of the court - acceptable photo IDs.

Run-on a bit, but you get the point.

Anyone doing what Roger says is gonna get whacked - or, incur massive court costs - or, they could get lucky. Until this nonsense was challenged.
RogerJ1
(Texas)

Posts:78


02/01/2020 6:01 PM  
Posted By GeorgeS21 on 02/01/2020 5:58 PM
I'm thinking someone would be foolish to take anything other than a duly signed out letter by the President, attached to signatures with witnesses (and perhaps notary) for each and every person - including some certainty of that person - i.e. the purpose of the notary or officer of the court - acceptable photo IDs.

Run-on a bit, but you get the point.

Anyone doing what Roger says is gonna get whacked - or, incur massive court costs - or, they could get lucky. Until this nonsense was challenged.





Thanks, I was just writing/thinking out loud which is probably not prudent. I think the most straightforward solution is drum up enough support to remove one Board member. The other two are just marching to his orders and normalcy would return if that happened.
RogerJ1
(Texas)

Posts:78


02/01/2020 6:09 PM  
Posted By AugustinD on 02/01/2020 5:51 PM
Posted By RogerJ1 on 02/01/2020 5:37 PM
I assume if the new Board member can get copies of the ballots, he can take the amendment, the ballots and our CCR showing it takes a majority of tract owners to amend the CCR, to the county for recordation.
He can try to record whatever, but without proof that the one director speaks for the HOA, it is not going to be a lawfully recorded amendment. In fact if this one director does what you propose, then he would be committing an act of ultra vires and so a violation of the law. Also "executing" typically means that duly elected/appointed officials of the HOA sign a statement saying they swear xyz. The ballots themselves are not turned over to the County Clerk for recording. There's a lot of legal vocabulary for something like this. It's going to take awhile to get a handle on it all.




On "In fact if this one director does what you propose, then he would be committing an act of ultra vires and so a violation of the law." I am wondering if the following would be committing an act of ultra vires.

The previous Board President resigned I am pretty sure effective the night of the AGM. He Board spot was newly elected. AS I understand it the new Board has not formally met, yet the bad apple has announced he is the new President and again, I am fairly sure there has been no Board vote on that. The first thing he did was go to the bank, of the POA, to register signature authority as the President.

If he did that, register with bank as President, but was not really elected, would that be an act of ultra vires?
AugustinD


Posts:2657


02/01/2020 6:24 PM  
Posted By RogerJ1 on 02/01/2020 6:09 PM
On "In fact if this one director does what you propose, then he would be committing an act of ultra vires and so a violation of the law." I am wondering if the following would be committing an act of ultra vires.

The previous Board President resigned I am pretty sure effective the night of the AGM.


What do your Bylaws say about what is required for resigning from the President's job? Resigning from being a Director? (In some HOAs, the President does not have to be a director.)

Posted By RogerJ1 on 02/01/2020 6:09 PM
He Board spot was newly elected.
Are you saying he resigned as President and director, and he had only recently been elected to both?
Posted By RogerJ1 on 02/01/2020 6:09 PM
AS I understand it the new Board has not formally met, yet the bad apple has announced he is the new President and again, I am fairly sure there has been no Board vote on that.
If your Bylaws say the Board elects the President, and the guy was not elected President by the Board, then yes, this is an act of ultra vires.
Posted By RogerJ1 on 02/01/2020 6:09 PM
The first thing he did was go to the bank, of the POA, to register signature authority as the President. If he did that, register with bank as President, but was not really elected, would that be an act of ultra vires?
Yes. Banks are pretty strict about adding check signers to an account. Typically they require a copy of Minutes that indicate the person was properly appointed to xyz position , along with a number of other documents. I suspect you may need to gather more facts here. Also keep in mind that not having anyone to sign checks can freeze HOA operations.

Here's an example of the format a HOA would use to record an amendment in Texas: http://www.shuleram.com/resources/Legends-Park-HOA,-Proposed-Amended-and-Restated-Bylaws.pdf . The law firm that prepared this works in several states and exclusively with HOAs and condominiums.
RogerJ1
(Texas)

Posts:78


02/01/2020 6:28 PM  
Posted By AugustinD on 02/01/2020 6:24 PM
Posted By RogerJ1 on 02/01/2020 6:09 PM
On "In fact if this one director does what you propose, then he would be committing an act of ultra vires and so a violation of the law." I am wondering if the following would be committing an act of ultra vires.

The previous Board President resigned I am pretty sure effective the night of the AGM.


What do your Bylaws say about what is required for resigning from the President's job? Resigning from being a Director? (In some HOAs, the President does not have to be a director.)

Posted By RogerJ1 on 02/01/2020 6:09 PM
He Board spot was newly elected.
Are you saying he resigned as President and director, and he had only recently been elected to both?
Posted By RogerJ1 on 02/01/2020 6:09 PM
AS I understand it the new Board has not formally met, yet the bad apple has announced he is the new President and again, I am fairly sure there has been no Board vote on that.
If your Bylaws say the Board elects the President, and the guy was not elected President by the Board, then yes, this is an act of ultra vires.
Posted By RogerJ1 on 02/01/2020 6:09 PM
The first thing he did was go to the bank, of the POA, to register signature authority as the President. If he did that, register with bank as President, but was not really elected, would that be an act of ultra vires?
Yes. Banks are pretty strict about adding check signers to an account. Typically they require a copy of Minutes that indicate the person was properly appointed to xyz position , along with a number of other documents. I suspect you may need to gather more facts here. Also keep in mind that not having anyone to sign checks can freeze HOA operations.

Here's an example of the format a HOA would use to record an amendment in Texas: http://www.shuleram.com/resources/Legends-Park-HOA,-Proposed-Amended-and-Restated-Bylaws.pdf . The law firm that prepared this works in several states and exclusively with HOAs and condominiums.




I'll check some of that but the Treasurer stayed and he can cash checks up to $1000 and while $1000 does not sound like a lot, with the size of POA, with expenses around $12K or so a year, they rarely would write a check over $1000, in fact from my review of the financial statement I cannot recall a larger check than that in some time. So there was no reason to rush.
RogerJ1
(Texas)

Posts:78


02/01/2020 6:32 PM  
On the past President he resigned from the Board or stepped-down, I am not sure the exact language. Whatever it was he is completely off the Board. He announced it to the Board for the meeting and I think one other Board member was thinking about it. The Board announced a month or more ago that there would be at least one Board vacancy, his, any maybe two, that would need to be filled by an election of new Board member at the AGM, which took place.

I'll go check on what the By-laws and/or CCR states.
RogerJ1
(Texas)

Posts:78


02/01/2020 6:44 PM  
If your Bylaws say the Board elects the President, and the guy was not elected President by the Board, then yes, this is an act of ultra vires.





I just checked the By-laws.

7.01 Enumeration of Officers. The Officers of the Association shall be a President, a Vice-President, a Secretary, and a Treasurer, who shall at all times be members of the Board of Directors, and such other officers as the Board, from time time, ny resolution create.

7.02 Election of Officers. The election of Officers shall take place at the first meeting of the Board of Directors following each annual meeting of the Members.

I am pretty sure there has been no first meeting, so per both thing above, there could be no President right now.
TimB4
(Virginia)

Posts:16680


02/03/2020 8:10 AM  
Roger,

I agree with not filing it. Mainly because of notice.

If you did not have 100% physical attendance of members, then the issue was not properly noticed (if someone who did not attend or provided a proxy was notified of the amendment, they might have chosen to attend or not provide a proxy).

Do it right.
Do the proper notice.
Hold another meeting and have a vote.

If it passed once, it will pass again and be stronger if challenged.
GeorgeS21
(Florida)

Posts:2095


02/03/2020 1:17 PM  
Strongly agree with Tim - pushing forward will just make things worse.
RogerJ1
(Texas)

Posts:78


02/05/2020 3:39 PM  
Posted By AugustinD on 02/01/2020 6:24 PM
Posted By RogerJ1 on 02/01/2020 6:09 PM
AS I understand it the new Board has not formally met, yet the bad apple has announced he is the new President and again, I am fairly sure there has been no Board vote on that.
If your Bylaws say the Board elects the President, and the guy was not elected President by the Board, then yes, this is an act of ultra vires.
Posted By RogerJ1 on 02/01/2020 6:09 PM
The first thing he did was go to the bank, of the POA, to register signature authority as the President. If he did that, register with bank as President, but was not really elected, would that be an act of ultra vires?
Yes. Banks are pretty strict about adding check signers to an account. Typically they require a copy of Minutes that indicate the person was properly appointed to xyz position , along with a number of other documents. I suspect you may need to gather more facts here. Also keep in mind that not having anyone to sign checks can freeze HOA operations.




More of this has come to light. A director, without being elected President (per our Bylaws Officers are elected at the first Board meeting of the new Board after the annual general meeting and no such meeting has taken place), was listed was granted President check authority at the Bank. I assume the bank goofed on doing this also, either that or fabricated minutes were shown. I do not that the 2019 President, who resigned and is no longer even a Director, at the time this was done at the Bank, went with the other person and told the bank that the other person was now the President.

Question, if there is/are a person/people willing to give testimony to first hand knowledge of what I just wrote, is that information that would be taken seriously by a district attorney's office as far as investigating or would you have to wait until he spent money with that authority?
RogerJ1
(Texas)

Posts:78


02/06/2020 9:51 AM  
This matter seems to be over. The Board had its attorney look over this situation. The attorney, who is part of a a medium sized firm, with multiple attorneys, that specializes in HOA representation, said one or more directors had a right to file the amendment, which was done.

From what the attorney was told, the attorney, did not know that the majority, who voted for the amendment, had signed an acknowledgement of that vote gathered by the Director who filed - the Director had to do that because the Secretary refused to show him the signed ballots. That signatory notice was filed, notarized at the County Clerk's office, a business day later with the county also. Again, the attorney when asked about the filing did not know that.

The new President of the Board announced, at the first Board meeting, what I just said. The President at the time of the meeting did not know that the acknowledgement of the majority votes was signed - that notice was gathered over the weekend and filed Monday or Tuesday. He went on and on about how good the presentation of the amendment was at the annual meeting, and how it was right for the two directors to file it, as the Board's attorney confirmed. He basically agreed everything was correct but because signed votes of that majority were not filed, the filing was invalid.

Again, he did not know that was done at the time he said that - so he thought he had a big win and was showing he was being cooperative etc and everything about including the presentation at the AGM, the vote, initial filing were fine but still not valid because of that one "missing" thing. It was at that moment that he was told and shown that those votes were acknowledged by signature and that that notice was filed also. Therefore by his own admission it was now valid since that thing he thought was missing was not missing. It was also pointed out that the Secretary refused to let the Director, asking, to see those votes therefore that Director obtained those signatures over a Friday and weekend on his own and that was the reason those signature took extra days to file. The President was very upset realizing he had just hung himself. Happy ending in my opinion.
Please login to post a reply (click Member Login on the menu).
Forums > Homeowner Association > HOA Discussions > Suggestion on handling 3, out 5, Board members refusing to recognize a vote at a General Meeting



Get 1 year of free community web site hosting from Community123.com!

Only members have access to all features.
Click here to join HOATalk for Free! Members click here to login and access all features.







General Legal Notice:  The content of forum messages are from the posting member and have not been reviewed nor endorsed by HOATalk.com.  Messages posted by HOATalk or other members are for informational purposes only, are not legal or professional advice and do not constitute an attorney-client relationship.  Readers should not act upon this information without seeking professional counsel.  HOATalk is not a licensed attorney, CPA, tax advisor, financial advisor or any other licensed professional.  HOATalk accepts ads from sponsors but does not verify sponsor qualifications nor endorse/guarantee any sponsor's product or service.
Legal Notice For Messages Posted by Sponsoring Attorneys: This message has been prepared by the sponsoring attorney for informational purposes only and does not constitute legal advice. This information is not intended to create, and receipt of it does not constitute an attorney-client relationship. Readers of HOATalk.com should not act on this information without seeking professional counsel. Please do not send any sponsoring attorney confidential information unless you speak with the sponsoring attorney or an attorney from the sponsoring attorney’s firm and get authorization to send that information to them. If you wish to initiate possible representation, please contact an attorney in the firm of the sponsoring attorney. Sponsoring attorneys that post messages here are licensed to practice law in a specific state or states as indicated in their message signature or sponsor’s profile page. (NOTE: A ‘sponsoring attorney’ is an attorney that is a HOATalk.com official sponsor and is identified as such in the posted message or on our sponsor page.)

Copyright HOA Talk.com, A Service of Community123 LLC ( Homeowners Association Discussions )   Terms Of Use  Privacy Statement