Have you sued your HOA to get Documents?

LisaS:
I have never heard of anyone in an HOA going to the extreme of a law suit to obtain HOA community documents.

Refer to your official documents (Bylaws) whereby it should state that financial reports (and minutes of community meetings?) must be made available to residents, either by mail or in person at the office of record, and with an appropriate appointment for the resident's review. There can also be a charge for copies of these as well.

Once you can cite the actual page and paragraph of the Bylaws which detail residents' rights to information with the process for reviewing, compose and mail another request letter with separate copies to all Board members. Since you are "well versed in the laws for our state (Illinois) and our covenants.." note the state law as well in your request.

Lisa:

What were the circumstances of your leaving the Board?

As a former VP was it YOUR decision to leave the Board?

I think you all missed her point. Lisa states that she is familar with the governing docs and the Atate law. What they are doing is illegal and against the governing documents. My suggestion would be to have an attorney simply write a formal letter to the board telling them to comply with law and governing docs or face a suit. Hopefully that won't cost too terribly much and they will probalby cave in before you have to actually file a suit. It's till going to cost you for the letter, but hopefully you will not have to go any further.

As far as the process, I admit little knowledge of that. They have usually caved in before it got very far. At least in my Assn. I know it can take months, years, depending and cost five figures + easy.

I'm not familar with Ill. law.

In CA not turning over documents can go to the State Attorney General, so I don't have any probs getting documents.

Hope this helps
Jane

Lisa, have you checked your controlling documents and state statutes? At the least, if you are incorporated, that there is a requirement that corporation records must be made available to the members. If you find any such requirement then provide it to the Board with your request to review.

It seems ridiculus to me that any Board would not full fill your request unless it relates to a current legal action. Prior to considering suing I would wage a campaign to remove such poor Board members.

Lisa, use the legal approach without using an attorney. Quote the legal requirement and if that doesn't educate your Board sufficiently then add the fact they can be personally liable for wrongdoing after they have been made aware. Tracy stated "I'm all for the community support approach. I hope it works better for you than it did for me." Community support only works when trying to recall Board members.

Michele,
It is my understanding that Lisa is not aware of the laws requiring access to view her association's records. Is so she has not "done all that". So the next step is to make the Board aware of their rules and/or state statute requirements. After that those Board members refusing to provide access may be held liable for knowingly refuses to provide access to view the records. This is the wrongdoing.

The suspected wrongdoing related to landscaping could not be evaluated until the records are reviewed. However,any homeowner of an individual lot can hire the same landscaper as is used by their HOA. That is often done and is acceptable.

Lisa, if sent a certified letter to the BOD and explained your rights to the doc's requested, that is all you can do with the BOD. If they refuse the request: Before you institute any legal action, do you know who the attorney of record is for the HOA? The attorney can be last one whom the BOD consulted with. Call his/her office, and tell him the situation. State that you are a member of --HOA. Tell him the papers you requested and they are refusing to give them to you under the law of ILL. I am sure you will get the papers or a reply shortly after. The attorney knows this is a clear violation of the state statute.

Joe, the attorney will not even accept the call. If she leaves a detailed message with the secretary, the attorney will most likely call the BOD.

If you request anything from the Board of Directors in writing; they need to reply within 10 days. If on the11th day you do not get what you requested. send it again with a 10 letter. The you take them to small claim court. hey need to pay you $50 a da up t 10 days. I believe it is out of their own pockets. Then tend to rake you seriously once you do that. Good luck--they all need a watchful eye

hmmm. "Suing your HOA is suing yourself."

Gosh, I hear that so much, and I still don't understand the point. Obviously one wouldn't just jump on a frivolous lawsuit band wagon, but sometimes you have to do what it takes.

Suing your spouse for divorce is suing yourself, too, since your funds and your spouse's are from the same pool, pretty much out of each other's pockets, until you are legally separated and the marriage dissolved.

Sometimes you just gotta do what you gotta do.

Melissa,
Clearly you have never had to deal with a board of directors that refuses to obey the law. Often it is the only way to “get the BOD's attention.” The “other options” you mention are likely to be ignored/discredited by an out-of-control board. These boards AND management companies do exist and unfortunately, often there is no choice except to sue. I do agree it is the LAST option. But, as MicheleD said, “Sometimes you just gotta do what you gotta do.”

There is something very, very wrong with a system when your only remedy is to “sue yourself.”
Jane

Here's a big reveal: I DID attempt to sue my HOA BOD for NOT playing by the rules once. I hired the attorney, paid the retainer fee, and had him draft a letter/attend a meeting. The new BOD that had replaced me (Which I was still on technically) didn't understand a thing about running a HOA. They decided to do a "One-time" special assessment of $125 to cover a pool repair cost without getting a majority vote of the membership. This didn't sit too well with the members that KNEW what the rules were. So I got them together and hired an attorney to represent us 13 or so members who knew the rules. It ultimately taught the board a lesson and they did abide by the rules after one letter.

Unfornately, all but ONE of the members I was representing PAID me back for my legal costs. Which were about $1500. The good news is that it was considered a tax deduction since it involved my investment property. The bad news was that I was taught a BIG lesson. You can't represent anyone but yourself. You may have supporters to your face, but not when it comes to having your back. I hear you wanting to force the BOD into following the rules, but you have to realize that's ONLY at "face value" until you yourself follow the rules to make that happen. You can't come in wearing a "fire suit" screaming "Fire" and then run out with everyone and wonder why no one put out the fire. It takes one to make a change. Especially one willing to wear the fire suit and put out the flames.

Follow up on our BOD. They were EXTREMELY upset with me when I got the attorney as you can imagine. One of the board members actually physically chased me out of the meeting and attacked me! They later complied with my attorney's letter and did the assessment properly. (However, it was later revealed they had lied to each member on what the assessment truly was. Each getting a different story to fit their needs.) Almost a year later, I got a phone call from the President. It was an apology for the most part. Turns out, my "lawsuit" did teach them a lesson after all. It just took them some time to figure things out. Once they did. Things did start following the rules. It just takes about a year for a BOD to figure out what they are doing. It's NOT an easy job to do and it's got a HUGE learning curve. You ahould run for your BOD and see for yourself!

Robert, I understand your frustrations. However, your looking at the wrong place for answers. The answer is NOT outside an HOA, it is INSIDE!!! That's what the Attorney General's office is trying to tell you. If you want something resolved in a HOA, it's got to be done by you and your neighbors. Hence, why it is called a "Homeowner's Association". You say your not a board member but you know what they do. I have to say, it is different when doing the job than know HOW they should do their job. I wish you would run for a BOD position. You have the education and knowledge needed, you just have to see how practicing it is. It's YOU and YOUR neighbors making up the rules that you and your neighbors want to follow. No one else can govern that except you and your neighbors. The HOA government is YOUR government. It's all your money and your neighbors, you just vote for representative out of your group to best represent how that money should be spent.

Geesh, ya are making me sound like a die-hard HOA supporter here! Stop it!!! Please!!! I don't even live in a HOA anymore!!! Although I do miss my yard being mowed! !

GlenL, you may want to rethink the contacting the media angle here. You don't need to bring unwanted attention to an internal problem. Bringing HOA's issue to the Public light is NOT a good idea. Remember, the purpose of a HOA is to maintain property values and promote good resale values. Having the issue broadcasted could put home resale values at risk including your own.

Who's going to want to buy in a community that was featured on the late night news? How many people have gone on an bought in a those HOA's that were featured on CNN or other national news programs? Media coverage brings a bad name onto HOA's. I know when I am going to sell my home, it's going to be all "puppies and sunshine", NOT a CNN truck parked outside broadcasting images of my protest in my front yard over records turnover from my HOA.

Yes, it's your right to review HOA's records. However, the actual reality of viewing those records isn't as easy as you may think. Requesting copies is nearly impossible to produce. The best option is to arrange a time to meet with the party that has the records and go through them. If you want copies of specific documents then expect to pay for those copies. You also can't expect the records to be in order or not damaged in some way.

My experience with our own records is that over the years MANY people were responsible for them. They spent time in either someone's garage, attic, or the clubhouse closet. Part of the records were at the Bookkeeper's office and the others were located at a board members home. It took me months to track them down myself. I had the extreme displeasure of having to search through 20 years of records to find a contract with a landscaper. It took about 2 days. This was JUST for ONE issue.

I say if you request any records of your HOA, be reasonable and specific. Know the area that you have an issue with and request information in that area. You don't need to know about the history of the pool if your issue is with the lawncare. Honestly, you already know the what your issue is with the HOA. Producing records may not help much. You may be better off in requesting a third party audit of the records if you want. However, audit's will ONLY tell you where the issues may lie, they will NOT fix the problems. That's still up to the members to fix the issues.

Wow! It seems this questions brings a whole lot of controversy.

To answer some questions:
1.Yes, I have sent the Board a certified letter requesting dosumenst and citing the state law and CCR including copies of same
2. No, the Board will not give them to me.
3. Our HOA maintains only 1 large common area (we are single family homes). They are specifically prohibted in our CCR's from paying to mainatin a private lot
4. Further, they have no authority per our CCR's to trespass on a private lot and maintain it. They may only fine the owner for non-maintanence
5. Our municipality has the authority to mow the lawn at that property and charge the owner. Our Board did not even pursue that option.
6. We have had 1 open meeting this year (january). No one has a clue what this Board is doing as no minutes are available either.
7. Our CCR's have no method for removing a Board member(s).
8. Our state has no governing authority for HOA's.

My purpose for requesting the documents is that no one knows what is going on with this Board- from the financials I have seen, I know that funds are 'missing'. Money for dues is either not being collected, or being diverted. Our members are paying for private landscaping at a lot behind one Board members home! Checks are being issues to Board members families, with no apparent documentation for the expense. Our Not for Profit HOA paid $300 in taxes this year (although we should have paid $0) due to incompetence. The list goes on.

I did run for office last year after 2 years on the Board. Basically, it all came down to to non-deeded voters and fraudelent proxies as to why I lost by one vote. The 'winner' refused to participate in a run off election, and I let it go rather than cost our association a whole lot of money in attorney fees. Yes, I was angry. But this is not about that.

The previous Board was run according to the CCR's and the law. This Board appears to have no regard or knowledge of either. Anyone who knows the laws knows the liability for EVERY homeowner in our HOA under these circumstances.

Most people in our sleepy little HOA have no idea what goes on, and simply pays their dues each year. I am a Realtor, and I see where this is taking our community in one short year. I care, so I am involved.

Thanks for all the repsonses!

A HOA does NOT need an attorney. An attorney is ONLY needed when a HOA has to appear in court. It's a convenience to have an attorney but NOT a necessity. I only hired the attorney to handle things such as liens, foreclosures, or to update/change the CC&R's/By-laws. Otherwise, I handled the issues myself.

Our HOA also did NOT have a MC. We had a bookkeeper. They were responsible for collecting the dues and making out checks. We had a 2 signature requirement to cash checks so they had to sign and either myself or an assigned board member had to sign to cash any checks. It provided a checks and balances. The bookkeeper also provided us with a financial report of expenditures and collections. The collection report was the ONLY document kept amongst the Board members and NOT discussed openly. We paid the bookkeeper about $250 a month plus any additional expenses such as stamps, checks, or letterheads. So it is possible to run a HOA without a MC. Who is a paid contractor of the HOA.

You mentioned paying a $300 tax bill to the IRS. Just because your a Non-Profit doesn't make you exempt to paying taxes. A Non-profit means that whatever money the HOA collects through dues a year MUST be spent on the maintenance and operation of the HOA in that year. Whatever comes in has to be paid out equally. You can have a reserves fund to a certain amount. If there is money left in the HOA funds at the end of the year, it can be subject to IRS taxes. So the $300 could be a result of this. It's very hard to manage the HOA budget since it doesn't operate like your home budget. At home, you don't need to spend what you make by the end of the year.

I think being a board member will be a good thing for you to do one day. It is a different view on expenditures than you have now. What often makes sense to you, doesn't work in a HOA when it comes to budgeting. If you have board members spending money like it's their "home budget" your going to run into issues. The BIGGEST piece of advice I ever got when I ran my HOA is that the money in the HOA bank is NOT my money but EVERYONE's money. It's HARD to lose that control when your in charge of the HOA's budget, but you have to realize you have to open the checkbook to everyone. I am sure if someone came up to you and asked you to open your checkbook, you wouldn't do it. That's private and personal to you. In a HOA, if someone comes up and asks for the financials, it's pretty much saying "Open the checkbook and let me take a look. I promise to question and criticize each line because I am owed that. Please justify everything NOW or I will vote you out and expose everything". Now you wonder why a HOA BOD is a little hesitant to open up the financials for review so easily?

Lisa:

In your situation this is what I would do. I would send each board member a copy of the statutes and laws that permit members to request and view minues, etc. along with penalties for not doing so, via certified mail. I would then inform them that you are willing to pay costs established by your state for copying these records.

See if you get a response, if you don't then you have to weigh several options, do you send them another letter threatening a lawsuit pointing out that if they knowingly violate their duty they are personally liable, do you call the media in, or do you contact a lawyer and proceed.

I would suggest trying to get your neighbors to join the crusade, they may be viewing you as a squeaky trouble maker, but if more and more people come forward it may help.

I would discount Melissa's notion not to sue. Their is a time and place for everything, if you feel strongly about it don't be discouraged because you have an obvious easy case to win. As someone said D&O insurance probably won't defend them. I don't like court because there should be simpler ways to get things done, but I think sometimes it is a necessary evil in life.

One Associations faced with this problem have simply sold the "park" to the owners that abut it. Of course, that resolution would depend on its location. I don't know if your 1 large common area qualifies for that type of treatment. (Then the Association was dissolved.)

As far as your HOA is concerned, is would seem to be governed by
BUSINESS ORGANIZATIONS
(805 ILCS 105/) General Not For Profit Corporation Act of 1986

The following two sections may be what you need -
(805 ILCS 105/108.35) (from Ch. 32, par. 108.35)
Sec. 108.35. Removal of directors.

(805 ILCS 105/Art. 12 heading)
ARTICLE 12. DISSOLUTION

Tax exemption relates to what the IRS considers "function income", i.e. assessments.
"Notprofit" DOES NOT MEAN "tax-exempt" is actually the subtitle of a publication by the CA FTB. Perhaps you may wish to browse -
http://www.ftb.ca.gov/forms/misc/927.pdf

Hi LisaS

Our Board of Directors refused to provide documents pertaining to the election of the Board. We gathered up a collection from "some"members" and two of our friends prepared a law suit against the Board by way of a Show Cause Court Action. The matter did not proceed to court because they provided the documents before the documents were filed with the Court house. However there were legal fees in the amount of approximately $1,300 incurred to get to the point of ready to file in court. Since the Board provided the documents, there was no need to proceed to court. The Board refused to pay our legal fees and the two friends sued the Board in Small Claims Court for the repayment of funds. There was a small trial and the Judge checked the RCW's for the State of Washington, and he granted the costs of the $1,300 to be paid by the Board to us. WE WON. I can get you more details if you wish, but this was Latitude 49 in the Whatcom county, Washington.
NancyE

Michele,
I don't know who posted the blurb you are referring to, nor do I care. Please remember the folks who post here are not telling others what to do as much as defining the options for different situations. Posters should not be reckless in what they post but anything said is advice, not orders. This is a discussion forum much like a discussion at a Town Hall Meeting. Go, speak and listen but do not act except from your own conviction and personal logic. If you act solely on the advice of what is posted here, it is neither fair or just to condemn the poster here. Likewise if you take advice and collect $1,000,000, you don't have to give any of it to the one that posted such terrific advice.

Suzy,
Good morning. The people posting on this site don't take defeat kindly. I would imagine that if you have read some of the topics and considered how there seems to be no end at getting to problems such as yours. It is not unusual for someone to start out contacting the BOD over some small matter and it turns into world war 3. The differences are quickly replaced with a personal issue and a power struggle with the Board. Not a fight you want to get into because over the short term, you will lose. When that happens sometimes you can spread the blame around by getting your neighbors involved. Not to serve your persopnal agenda but to make things better for everyone. I know from long years fighting the board myself, you lose some and you win some, but the price is high. Too much effort for too little gain. I was never able to organize my support but I am not rock dumb and could see when an opportunity was presented I knew enough to join a group that was able to organize some of the owners. Now, rather than duking it out with the board we have a group of folks that the board will pay attention to. One excellent method to get the word out is by a Town Hall type meeting for your neighbors. Get your support together and mutually agree on how the meeting will be conducted and what your mission is. Then start putting out flyers and working the phones, etc. Just like a political election. You, personally have to become part of the group movement. If your board is acting dictatorial, let them know they are going to have to be "open" to the members. Get that point across and just continue the effort and if necessary, replace the lot of them. It can be done and it has been done.

RobertR:

I'm completely aware of the purpose of this forum. Which is why I brought up a cautionary post as a heads up.

It seems to me that you are saying the exact same thing I was, only I used a specific example of where this would not be an option.

If you read my post, it was simply offering a cautionary note.

However, even given the nature of the board, I would still throw up an extra cautionary flag before anyone offering selling or leasing or even providing easement of common area.

People may have to did deeper than just the CC&Rs and look into local zoning restrictions for residential communities or even the original development plans, which often have binding elements on them not specifically mentioned in CC&Rs.

My response stands as a heads up.

First Melissa, I was on the Board. As a matter of fact, I was on our first Board and I basically set up the systems that got us off the ground. I am now a Director on a regional HOA Board and even there no one has seen a Board go to so much trouble to avoid complying with the law.

I am all for not having a management company when you only have 300 singles family houses to manage. It's easy (or it should be...)I am also not for hiring an 'HOA attorney' to be on call. I was just answering some of the questions posed to me.

My point was, the law and our CCR's state that the documents I requested be made available. It is very simple and clear. Our Board has refused,in violation of both. Why? If you have nothing to hide, then you have nothing to hide.

And, if you have something to hide and you screwed up, take responsibility. Like you said, it's not THEIR personal money it's OUR money. Our HOA paid taxes and they should not have (I am familiar with the applicable tax law). That's just one $300 mistake. The liability issues on some other items could lead to huge problems.

Please start a new thread. This one is way too old. When yoou do, can you make it clearer if it's only the open meting minutes you've requested? Or something else, too.?

Please start a new thread since the first 44 posts in this one were made over 10 years ago.

That part did make me smile too.