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Subject: Annual Meeting No Quorum Subsequent Reduced Quorum Met
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EdwardD4
(California)

Posts:42


05/19/2021 12:48 AM  
Hello everyone,

Need help with a issues regarding our annual meeting. This is a complicated one where there’s is impropriety amongst our board members and property management company. We had our annual meeting on August 3, 2020 and failed to meet our quorum of 109 ballots and had only 61 turned in. Here’s what happened;

During annual election no board members were present on August 3, 2020. Required quorum of 109 was not met due to only 61 ballots being turned in. Bylaws state, if quorum is not met then the subsequent meeting shall be one-half (1/2) of the required quorum the following month to 55 ballots which was met. Our association manager would not allow the representative from the election company answer concerns, and simply stated the current board members will remain in place without any of them being present. September meeting cancelled every year due to Labor Day falling on the first Monday of the month. Petition was signed by members regarding the election and the board members failed to address it and abide by our CC&Rs and our association manager simply re-elected them on August 3, 2020.

I have a court hearing regarding the unlawful election in July and we need to take our community back due to the impropriety amongst the board and management company which also appear to be mismanaging and misappropriating our corporate assets. Here are our concerns below on why this election was so important:

- 2 board members are partners residing under the same unit and serving on the board which is a conflict of interest in our 212 unit community. In addition, our previous association manager assisted these board members buy 2 additional short sale properties in the complex while current association manager stated their management company manages their rental properties.
- Not unlawful but 2 board members (Treasurer) & (Vice President) live offsite and are unable to do their fiduciary right in overseeing day to day occurrences.
- Failed to allow the inspection of records and went to small claims court on July 27, 2020. HOA and Management Company failed to allow the inspection of records and a judgement was ordered.
- Our Association Manager minimized and deflected concerns after discovering a guest space was changed to a private parking spot for several years. The President of our HOA denied any wrongdoing and used a scapegoat to hide the egregious act, stated the stencil to change the sign was stolen, and would not comment any further on these concerns stating it was an honest mistake.
- Unlicensed vendors and plumbers doing repairs in our community with a significant increase in plumbing expenses, general maitenance and consecutive annual deficits year after year.
- During small claims court hearing on July 27, 2020, association manager stated that unlicensed plumber did not do plumbing repairs costing over $500 while unlicensed, and it was due to marital affairs. Have invoice while unlicensed for over $3000.
- Confirmed by a resident that the electrician for the Association is the tenants son in law of the (President) & (Member at Large) rental unit. The board members nor association manager would not confirm or deny these allegations during a monthly meeting, and association manager stated that the board members would not know this because the management company manages their rental unit.

Please reply regarding our annual meeting. Attorney helped me prepare my small claims courts hearing pursuant to SB323, however would like more input,

Thank you!
CathyA3
(Ohio)

Posts:2599


05/19/2021 6:21 AM  
You have a lot of conflated issues here, some of which don't violate anything. General observations:

* Going to court is good for single, large issues: Fair Housing violations, assessment/fine/foreclosure issues, and the like. Courts don't do as well with lots of small things lumped together. Going to court also costs money for both parties involved, takes lots of time, and if expenses are a concern then it's probably counterproductive.

* The solution to boards that aren't doing their jobs is to remove them. The court won't do that for you. You need to organize enough like-minded neighbors to get better qualified directors elected. This takes time, effort, and the cooperation of enough neighbors. Many HOA residents rail against their current boards until it's time for them to step up and actually do some work, and then they're nowhere to be found. Many recall election efforts fail at this point.

* Standard advice for disgruntled HOA members: live with it, fix it, or leave. It really is that simple - the hard part is figuring out what you're willing to do or not do.
EdwardD4
(California)

Posts:42


05/19/2021 7:00 AM  
I was able to rally up some neighbors to run for the board, however what about the annual meeting? That is my main concern here. Did they violate the law regarding out annual meeting and not dropping the quorum. Technically, they shouldn’t be on the board if there was no election and we did meet the quorum if the dropped it no less than 5 nor more than 30 days as described in our bylaws.

Thanks for your reply!
MaxB4
(California)

Posts:1601


05/19/2021 7:37 AM  
As this is a annual meeting, there must be a presiding officer, either the president, a board member, or, if no board members are present them one of the members.

An inspector of elections, if knowledgeable, would know the proper procedure to adjourn a meeting to a later date where quorum would have been met. A management company, while not allowed to be an inspector, kif present, could have given direction.

Any member who was present at the meeting could have made a motion to adjourn to a new date., at which time quorum would have been reduced to 25% and you had enough. A candidate running for the Board should know the proper procedure, especially as California has the best resources in the country in obtaining the proper guidance.
JohnC46
(South Carolina)

Posts:11665


05/19/2021 11:42 AM  
I say let them go to court and may the chips fall where they fall.
EdwardD4
(California)

Posts:42


05/19/2021 11:45 AM  
That’s where we are heading. The members need to take the community back. The impropriety and conflict of interests needs to change. Hoping the judge sees how egregious their actions were in not abiding by our bylaws
MaxB4
(California)

Posts:1601


05/19/2021 12:04 PM  
Based on experience in California, if this went to Small Claims, you will find a glass of cold water in hell before you will get a judge or commissioner that knows what they're doing.

1) No law was broken in regards to not holding a second meeting where quorum would be reduced. That's is on the members themselves.
2) If the association has no election rules, or the property manager conducted the election, then California Civil Code was violated.
3) If the association ignored a proper petition, then the members were legally allowed to call and run their own meeting.
EdwardD4
(California)

Posts:42


05/19/2021 1:47 PM  
The board failed to abide by our bylaws which specifically state:

Section 7. Quorum Requirements for Association Meetings .

At all meetings of owners, a quorum for the transaction of business through the presence in person or by proxy of such members, shall be established fifty-one (51%) percent of the total voting power of the Association which shall be sufficient for the paaaage of any motion or adoption of any resolution, except in connection with amendment or alpeal of this Declaration; as hereinafter set forth under Articles X or XVI. . If the required quorum is not present, another meeting may be called subject to the written notice requirements sent to all members at least ten (10) days in advance of such meeting, and the required quorum at the subsequent meeting, shall be one-half (1/2) of the required quorum for the preceding meeting. In the absence of a quorum at a meeting of members, a majority of those present in person or by proxy may adjourn the meeting to another time, but may not transact any other business. An adjournment for lact of a quorum shall be to a date not less than five (5) nor more than thirty (30) days from the original meeting date.
MaxB4
(California)

Posts:1601


05/19/2021 2:10 PM  
Sorry, as you stated, there were no board members present, so this unfortunately falls on the owners.

Since the Board wasn't there, who ran the meeting?
MaxB4
(California)

Posts:1601


05/19/2021 2:13 PM  
Posted By EdwardD4 on 05/19/2021 1:47 PM
The board failed to abide by our bylaws which specifically state:

Section 7. Quorum Requirements for Association Meetings .

At all meetings of owners, a quorum for the transaction of business through the presence in person or by proxy of such members, shall be established fifty-one (51%) percent of the total voting power of the Association which shall be sufficient for the paaaage of any motion or adoption of any resolution, except in connection with amendment or alpeal of this Declaration; as hereinafter set forth under Articles X or XVI. . If the required quorum is not present, another meeting may be called subject to the written notice requirements sent to all members at least ten (10) days in advance of such meeting, and the required quorum at the subsequent meeting, shall be one-half (1/2) of the required quorum for the preceding meeting. In the absence of a quorum at a meeting of members, a majority of those present in person or by proxy may adjourn the meeting to another time, but may not transact any other business. An adjournment for lact of a quorum shall be to a date not less than five (5) nor more than thirty (30) days from the original meeting date.



FYI, I am a property manager in California and I also conduct elections for associations I am not under contract with.
KerryL1
(California)

Posts:8729


05/19/2021 2:58 PM  
In CA, Edward, since 2006, the Davis-Stirling Act, which governs all types of CA HOAs permits voting by mail. This law supersedes your Bylaws. When voting my mail is done, it's far easier to reach quorum.

Visit davis-stirling.com, index, Elections. Some of your complaints are valid, some are not. For example, unless your Bylaws state that directors must reside on the premises, they simply do not need to. With SB 323, non resident directors are OK so you cannot make a Bylaw precluding them.

sorry, no more time
EdwardD4
(California)

Posts:42


05/19/2021 4:00 PM  
The association manager who appears to be in collusion with the board members
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