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Subject: Owner with Outstanding Fine Run for the Board
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Author Messages
NpB
(Arizona)

Posts:293


05/08/2020 11:50 AM  
Our CC&Rs indicate that voting privileges may be suspended if an owner is behind on payment of assessments. In the last election, the management company also stated that owners who are behind on payment of fines will not receive a ballot as well.

Can an owner who has an outstanding fine be a qualified candidate for the Board and can his/her name appear on the ballot?
MarkW18


Posts:1071


05/08/2020 11:56 AM  
What do your governing documents state?
NpB
(Arizona)

Posts:293


05/08/2020 12:14 PM  
They are silent on the matter of an owner who has outstanding assessments/fines running for the Board.
MarkW18


Posts:1071


05/08/2020 12:20 PM  
Do you feel you should be able to disqualify even if your governing documents do not authorize as such.
SheliaH
(Indiana)

Posts:3229


05/08/2020 12:57 PM  
Seems to me you've answered your own question - if homeowners are ineligible to vote if they're behind on paying assessments, why on earth should they run? I would think voting privileges apply to running for a spot as well as making decisions as a board member (that's what they do).

If for some weird reason this person won, what sense would it make to serve on the board where decisions are made as to how assessments should be budgeted and spent? Sometimes, things don't have to spelled out, but should be plain if common sense is applied.
MarkW18


Posts:1071


05/08/2020 12:59 PM  
Posted By SheliaH on 05/08/2020 12:57 PM
Seems to me you've answered your own question - if homeowners are ineligible to vote if they're behind on paying assessments, why on earth should they run? I would think voting privileges apply to running for a spot as well as making decisions as a board member (that's what they do).

If for some weird reason this person won, what sense would it make to serve on the board where decisions are made as to how assessments should be budgeted and spent? Sometimes, things don't have to spelled out, but should be plain if common sense is applied.



Because many Bylaws don't spell that out. And we are all about spelling things out.
SheliaH
(Indiana)

Posts:3229


05/08/2020 1:08 PM  
In that case, it may be enough for the board to simply pass a resolution to this effect - I don't see where this would contradict the Bylaws, although it wouldn't hurt to run it past the association attorney.

I understand and agree with spelling some things out, but sometimes people on this website get too heavy-handed - a few things should be clear, even to Captain Obvious. Or Ray Charles. If you had to spell out half the stuff that people ask about (some of which Captain Obvious or Ray Charles could see), you'd end up with an encyclopedia sized set of documents (remember encyclopedias) that no one would read. They don't even read the stuff that's already there anyway.
MarkW18


Posts:1071


05/08/2020 1:12 PM  
Posted By SheliaH on 05/08/2020 1:08 PM
In that case, it may be enough for the board to simply pass a resolution to this effect - I don't see where this would contradict the Bylaws, although it wouldn't hurt to run it past the association attorney.

I understand and agree with spelling some things out, but sometimes people on this website get too heavy-handed - a few things should be clear, even to Captain Obvious. Or Ray Charles. If you had to spell out half the stuff that people ask about (some of which Captain Obvious or Ray Charles could see), you'd end up with an encyclopedia sized set of documents (remember encyclopedias) that no one would read. They don't even read the stuff that's already there anyway.



I have no clue to what you just said. You lost me at Ray Charles.
MarkW18


Posts:1071


05/08/2020 1:14 PM  
Is should be obvious because, what, other HOA's do it? Hopefully, governing docs are not one size fits all, because community specific.
SueW6
(Michigan)

Posts:693


05/08/2020 1:25 PM  
NpB
Double check your bylaws. It should define what a “member” is their and voting rights.
SheliaH
(Indiana)

Posts:3229


05/08/2020 1:28 PM  
Ok, see if this makes more sense.

A delinquent homeowner loses his/her voting privileges, right? The OP also said delinquent homeowners don't get a ballot, so it should follow he/she can't run for a spot because he/she doesn't even have the right to cast a vote for him/herself. If you're on the board and become delinquent, you have to step down until the delinquency is corrected. At least this is how it works in my community.

As a practical matter, I DO NOT WANT A DELINQUENT OWNER TO SERVE ON THE BOARD BECAUSE HE/SHE WILL BE IN A POSITION TO MAKE DECISIONS THAT ULTIMATELY AFFECT ME. That would also include what to do about other homeowners who become delinquent. I don't expect board members to be perfect, but I do expect them to set an example. If you can't or won't pay your share of association expenses, how dare you o tell me I have to pay mine or else?

Do you really need to spell that out in the governing documents if they already say delinquent homeowners can't vote????
GeorgeS21
(Florida)

Posts:2693


05/08/2020 1:28 PM  
NpB,

I'm stuck here -

"Our CC&Rs indicate that voting privileges may be suspended if an owner is behind on payment of assessments."

Question - What do your governing documents state? "They are silent on the matter of an owner who has outstanding assessments/fines running for the Board."

Your first post says voting privs suspended if behind on payment of assessments, but your next post says they are silent?

I think what you mean is they are silent on "fines?"

If silent on "fines" and state law does not address this in some manner - then, I would say your management company is wrong.
MarkW18


Posts:1071


05/08/2020 1:30 PM  
Posted By SheliaH on 05/08/2020 1:28 PM
Ok, see if this makes more sense.

A delinquent homeowner loses his/her voting privileges, right? The OP also said delinquent homeowners don't get a ballot, so it should follow he/she can't run for a spot because he/she doesn't even have the right to cast a vote for him/herself. If you're on the board and become delinquent, you have to step down until the delinquency is corrected. At least this is how it works in my community.

As a practical matter, I DO NOT WANT A DELINQUENT OWNER TO SERVE ON THE BOARD BECAUSE HE/SHE WILL BE IN A POSITION TO MAKE DECISIONS THAT ULTIMATELY AFFECT ME. That would also include what to do about other homeowners who become delinquent. I don't expect board members to be perfect, but I do expect them to set an example. If you can't or won't pay your share of association expenses, how dare you o tell me I have to pay mine or else?

Do you really need to spell that out in the governing documents if they already say delinquent homeowners can't vote????



YEP

Sorry
MelissaP1
(Alabama)

Posts:9314


05/08/2020 2:47 PM  
You can lose your ability to cast a vote if you are "not in good standing". Which needs to be defined if it's not up to date with dues and/or includes fines. Unpaid fines don't necessarily mean your "not in good standing". They are "extra" charges and not Dues that are required to be paid.

So you can run for a board position all you want. Just can't vote for yourself or others. However, how many people are going to vote for a board member that is behind in dues or in clear violation? Unless they have a good reason to be "protesting" and that is why running, most will say "nope pay up first".

Former HOA President
MarkW18


Posts:1071


05/08/2020 2:55 PM  
Posted By MelissaP1 on 05/08/2020 2:47 PM
You can lose your ability to cast a vote if you are "not in good standing". Which needs to be defined if it's not up to date with dues and/or includes fines. Unpaid fines don't necessarily mean your "not in good standing". They are "extra" charges and not Dues that are required to be paid.

So you can run for a board position all you want. Just can't vote for yourself or others. However, how many people are going to vote for a board member that is behind in dues or in clear violation? Unless they have a good reason to be "protesting" and that is why running, most will say "nope pay up first".



Generally, not in good standing could mean fine, but for this purpose it should be defined in the qualification of a Board member.
NpB
(Arizona)

Posts:293


05/08/2020 3:01 PM  
A homeowner is not going to know unless he/she requests association financial documents whether or not a candidate is behind in paying dues or a fine. Moreover, I don't know if personal financial information (i.e behind on dues) about an owner can be shared with owners.
MelissaP1
(Alabama)

Posts:9314


05/08/2020 3:09 PM  
Our HOA discusses these things at every meeting. The Collection report is ONLY for Board members only. Owners are referred to by Lot # ONLY. So we give an OVERALL collections rate/amount but not individual unless your that individual. So it's not that much of a secret.

Former HOA President
GeorgeS21
(Florida)

Posts:2693


05/08/2020 3:31 PM  
Is the lot number not linked in county records to the address and hence to the owner or record?
CathyA3
(Ohio)

Posts:964


05/09/2020 8:41 AM  
Our CC&Rs say that the board must suspend voting rights of any homeowner whose balance is not $0 - you owe a buck, you can't vote. In my state, late fees and fines are treated as assessments, so an outstanding fine means you can't vote.

However, neither the CC&Rs nor our bylaws say anything about limitations on who may run for a board position. The only qualification is that you must be a homeowner. There would be no justification to disqualify someone with an outstanding fine.

Like others, I think you can make a good argument that a person with outstanding fines should not serve on the board. I would question whether that person would enforce the provisions of our governing docs, which is one of the stated duties of a board member. What sort of message does this send to the membership?

On the other hand, it's possible that a person could be unjustly fined by a board that is abusing its power. Should that person be prevented from serving and helping to straighten out a rogue board?

So, our governing docs leave it up to the voters to determine whether someone with an outstanding fine has valid reasons to be in that position and should be elected, or not.

GeorgeS21
(Florida)

Posts:2693


05/09/2020 8:43 AM  
NpB,

"Moreover, I don't know if personal financial information (i.e behind on dues) about an owner can be shared with owners."

How long has this been a question for you?

This is per statute, right?
CathyA3
(Ohio)

Posts:964


05/09/2020 9:06 AM  
One caution about adding a disqualification for serving on the board based on outstanding fines:

It would be very easy to misuse this to keep people off the board. A rogue board wants to maintain its power? Just impose a fine on anyone who is making noise about unseating them, and do it close enough to the election that the dispute process doesn't have time to play out. "Oops, sorry, our bad."

The membership could still get rid of the bad actors, but they would have to go through the recall process rather than a normal election.

NpB
(Arizona)

Posts:293


05/10/2020 10:33 PM  
Personal or financial information about a member can be discussed in Executive Session, hence I don't think it is permitted to be shared with owners.
MelissaP1
(Alabama)

Posts:9314


05/11/2020 4:51 AM  
I don't see why not IMO. The HOA members have a right to know if there is a lawsuit. Seems to me need a committee that approves candidates. Atleast the board should approve those candidates that can be eligible. Don't have to say why but just say "Not eligible" to run. If you read the CC&R's or By-laws then you would know what qualifies and disqualifies a candidate.

Former HOA President
GeorgeS21
(Florida)

Posts:2693


05/11/2020 6:01 AM  
NpB ... again, things like "I don't think it can be shared ..." leads me to believe you don't have an understanding of your docs and statute.

What do they say?
CathyA3
(Ohio)

Posts:964


05/11/2020 6:06 AM  
Posted By NpB on 05/10/2020 10:33 PM
Personal or financial information about a member can be discussed in Executive Session, hence I don't think it is permitted to be shared with owners.




Same states allow it, others don't.
BenA2
(Texas)

Posts:709


05/11/2020 7:23 AM  
There are a lot of opinions on what should be but the bottom line is you can't prohibit someone from serving on the board if it isn't in your governing documents or state law. If there is nothing preventing them from running, let the membership decide with their vote.
AugustinD


Posts:3382


05/11/2020 8:52 AM  
Posted By SheliaH on 05/08/2020 1:28 PM
A delinquent homeowner loses his/her voting privileges, right? The OP also said delinquent homeowners don't get a ballot, so it should follow he/she can't run for a spot because he/she doesn't even have the right to cast a vote for him/herself.
I do not see how this logically follows. California statute now prohibits HOAs from denying HOA members the right to run and serve on the board when they are delinquent.
Posted By BenA2 on 05/11/2020 7:23 AM
you can't prohibit someone from serving on the board if it isn't in your governing documents or state law. If there is nothing preventing them from running, let the membership decide with their vote.
I agree. If the person who is delinquent in paying her or his assessment or fines wins a seat on the board, then she or he must recuse himself or herself from board discussions of and votes on her or his situation.
MarkW18


Posts:1071


05/11/2020 9:08 AM  
Posted By AugustinD on 05/11/2020 8:52 AM
Posted By SheliaH on 05/08/2020 1:28 PM
A delinquent homeowner loses his/her voting privileges, right? The OP also said delinquent homeowners don't get a ballot, so it should follow he/she can't run for a spot because he/she doesn't even have the right to cast a vote for him/herself.
I do not see how this logically follows. California statute now prohibits HOAs from denying HOA members the right to run and serve on the board when they are delinquent.
Posted By BenA2 on 05/11/2020 7:23 AM
you can't prohibit someone from serving on the board if it isn't in your governing documents or state law. If there is nothing preventing them from running, let the membership decide with their vote.
I agree. If the person who is delinquent in paying her or his assessment or fines wins a seat on the board, then she or he must recuse himself or herself from board discussions of and votes on her or his situation.



California statue allows an association to deny nomination if a Owner is delinquent on their assessments.
AugustinD


Posts:3382


05/11/2020 9:25 AM  
Posted By AugustinD on 05/11/2020 8:52 AM
California statute now prohibits HOAs from denying HOA members the right to run and serve on the board when they are delinquent.
Correction: In California, this is so only if the delinquency is for failure to pay fines. For delinquency in paying fines or assessments, from California Civil Code 5100:

"An association may not disqualify a nominee for nonpayment of fines, fines renamed as assessments, collection charges, late charges, or costs levied by a third party. An association shall not disqualify a nominee for failure to be current in payment of regular and special assessments if any of the following circumstances are true:
(I) The nominee has paid the regular assessment or special assessment under protest pursuant to Section 5658.

(II) The nominee has entered into a payment plan pursuant to Section 5665.

(III) The nominee has not been provided the opportunity to engage in internal dispute resolution pursuant to Article 2 (commencing with Section 5900) of Chapter 10."

See https://www.davis-stirling.com/HOME/Statutes/Civil-Code-5100
KerryL1
(California)

Posts:7230


05/11/2020 11:54 AM  
Thanks for the accurate citation, Augustine. This is exactly how it is in CA eff. 1/20. Our HOA attorney send us a template and, as board sec'y, and the only director interested in such detail, I integrated our Bylaws into our new Election Rules (required in CA). Back with our attorney now to vet it to make sure I didn't eliminate anything that I shouldn't have, etc.

The only basic permitted qualification for the Board is membership in the HOA.

but it boils down to what NB's Bylaws say and AZ statutes, per Ben.

JohnC46
(South Carolina)

Posts:9471


05/11/2020 12:06 PM  
Our docs refer to a member must be "a member in good standing" to be able to run for the BOD and vote. We would interpret this that if not in good standing, they cannot run for office nor vote. We quietly took one owner aside at our last Annual Meeting and informed him he could not run for the BOD as he was behind in his dues thus not "a member in good standing". He withdrew from consideration.

I myself can see the same for those that owe fines but I can also see where fining could be misused to eliminate some for running. In the end, I would say fines cannot be used to eliminate one from running nor voting.
MarkW18


Posts:1071


05/11/2020 12:25 PM  
Posted By JohnC46 on 05/11/2020 12:06 PM
Our docs refer to a member must be "a member in good standing" to be able to run for the BOD and vote. We would interpret this that if not in good standing, they cannot run for office nor vote. We quietly took one owner aside at our last Annual Meeting and informed him he could not run for the BOD as he was behind in his dues thus not "a member in good standing". He withdrew from consideration.

I myself can see the same for those that owe fines but I can also see where fining could be misused to eliminate some for running. In the end, I would say fines cannot be used to eliminate one from running nor voting.



Good response
NpB
(Arizona)

Posts:293


05/11/2020 12:36 PM  
Bylaws are silent about an owner running for the Board with an outstanding fine.
KerryL1
(California)

Posts:7230


05/11/2020 12:43 PM  
What about AZ statutes, NB?
NpB
(Arizona)

Posts:293


05/11/2020 1:10 PM  
Posted By KerryL1 on 05/11/2020 12:43 PM
What about AZ statutes, NB?





They are silent on the matter too.
MarshallT
(New York)

Posts:60


05/11/2020 1:32 PM  
It sounds like this should be a no. However, the board may need to make this rule official by including it in the bylaws, just to avoid any confusion in the future.
GeorgeS21
(Florida)

Posts:2693


05/11/2020 3:09 PM  
So, NpB,

Your state doesn’t address this.
Your CCRs don’t address this.
Your Bylaws don’t address.

There is no mention of “in good standing?”
NpB
(Arizona)

Posts:293


05/11/2020 3:20 PM  
Posted By GeorgeS21 on 05/11/2020 3:09 PM
So, NpB,

Your state doesn’t address this.
Your CCRs don’t address this.
Your Bylaws don’t address.

There is no mention of “in good standing?”





Correct.
KerryL1
(California)

Posts:7230


05/11/2020 3:26 PM  
Do your Bylaws or any other docs, NpB, cite any qualifications to be a candidate for director or to remain as a director?

Btw, why not have the PM show you where something is written preventing such an owners from voting?
ShirleyC
(California)

Posts:111


05/12/2020 9:34 AM  
We have to declare a person as "a member not in good standing" then they can not vote or run for the Board
"we" meaning the the Board

MarkW18


Posts:1071


05/12/2020 9:52 AM  
Posted By ShirleyC on 05/12/2020 9:34 AM
We have to declare a person as "a member not in good standing" then they can not vote or run for the Board
"we" meaning the the Board




That has now changed, as of January 1, 2020
KerryL1
(California)

Posts:7230


05/12/2020 2:53 PM  
MarkW is right re: CA, Shirely. Your board needs to update its Election Rules, which might mean some verbiage in your Bylaws no longer applies, ie., "in good standing." And it was never correct that the board could simply say only those "in good standing" may serve or vote. It would have been in your governing docs, probably your Bylaws.

Hasn't your HOA attorney or management company alerted you to this big change in CA eff. 1/20?
KerryL1
(California)

Posts:7230


05/12/2020 2:55 PM  
Oh, I see NpB neglected my last question to him. Is it because it's another one of his "hypotheticals?"
NpB
(Arizona)

Posts:293


05/12/2020 7:51 PM  
Posted By KerryL1 on 05/11/2020 3:26 PM
Do your Bylaws or any other docs, NpB, cite any qualifications to be a candidate for director or to remain as a director?

Btw, why not have the PM show you where something is written preventing such an owners from voting?





Bylaws only state that Board member must be recorded owner or the spouse of a recorded owner.
GeorgeS21
(Florida)

Posts:2693


05/12/2020 8:29 PM  
Do the bylaws discuss nonsensical, repeated posts?
NpB
(Arizona)

Posts:293


05/12/2020 8:44 PM  
Posted By GeorgeS21 on 05/12/2020 8:29 PM
Do the bylaws discuss nonsensical, repeated posts?





Posters keep asking me questions and I respond. No forum rule against that.
KerryL1
(California)

Posts:7230


05/13/2020 8:09 AM  
Think you answered your own question, NpB.
GeorgeS21
(Florida)

Posts:2693


05/13/2020 11:01 AM  
Yep - time I won't get back.

More BS on the net.
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Forums > Homeowner Association > HOA Discussions > Owner with Outstanding Fine Run for the Board



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