Effective directors do their homework
By RICHARD WHITE, Special to the Times
Published May 26, 2007
Q: At a meeting of our homeowners association board, a member abstained from voting to approve the minutes of the previous meeting because he did not attend that meeting. I recall that you said a director must vote unless he or she has a stated conflict of interest. No one challenged him. It seems to me that often we vote on matters without personal knowledge i.e., we were not there, but we do so because others present persuasive information (another director recommends a course of action because he has investigated the problem, consulted with experts, or sought bids from vendors). If we feel confident voting on those matters on the basis of information supplied by others, should not this director vote to approve the minutes even though he didn't attend the meeting?
A: If your abstaining director was that concerned about the accuracy of the minutes, he could have discussed them with a member who did attend the meeting to confirm their accuracy.
As long as no quorum is present, directors can discuss matters on the agenda among themselves before they get to the meeting. To do their jobs properly, they should review the agenda and support documents, ask questions and do their research. My experience is that most directors come to the meeting unprepared and therefore are not in a position to make good decisions. Effective leadership doesn't begin and end at the meeting table.
Lien can't bar facilities
Q: An owner has not paid his maintenance fees for five quarters and apparently hasn't paid his mortgage either. Our lawyer and the bank have filed liens, and foreclosure is progressing. This owner and his guests continue to use our community privileges, such as the pool, gym, fax and computers. I think these privileges should be denied and his access card to these areas canceled. Our documents are silent on this. Can we take this step?
A: Condominiums have no right to restrict delinquent owners from using the facilities. Homeowners associations may restrict use of the common areas if their documents give them this authority (FS 720.305).
My question to you is: Why did you wait so long? I recommend a policy to lien and foreclose within 60 to 90 days of a delinquency. You stand to lose much of the money that is due you because you stand in second position to the mortgage lender.
Condominiums cannot file for delinquent collections that are more than a year old. The board has seriously breached its duty to the members by not starting legal action sooner.
Strictly a social affair
Q: As a new member of the board I plan to have a dinner party for past and present board members. This would be a "thanks and appreciation" dinner for those who have served. Is this considered a meeting that requires a 48-hour notice and must be open to the members?
A: A clearly social occasion such as this does not require notice, nor must it be open to the members. Board members are human beings who are entitled to have a social life and attend functions like anyone else. No doubt some of the conversation will deal with "remember when" actions of past boards. As long as current board members do not start to discuss future plans or pending issues, you should be fine. Have a nice evening!
Insurance issues exist
Q: I live in a nonprofit condominium community of single-family homes. One board member allows his girlfriend to conduct paid exercise classes for nonmembers in the clubhouse. Could the county revoke our nonprofit status and increase the taxes on our recreational property? What is our exposure should an outside class member be injured during these classes? Could the board be held legally responsible for allowing this class?
A: Relax. Your association is very likely established as a corporation not for profit, not a nonprofit corporation. You will not lose any tax base.
However, this situation does raise other issues of concern for the association, the members and the board. The board should consult with your attorney and insurance agent to determine whether you need specific coverage. If the board declines to do this, your lack of action could be viewed as consent to the activity; that would be a poor defense if you were sued. In that situation I doubt that the insurance company would cover damages or injury, leaving the association and members exposed.
Q: You often quote the statutes that say "a meeting of the board of directors occurs whenever a quorum of the board gathers to conduct association business." Where can I find a definition of "conducting association business"?
A: A brief search of the statutes and administrative codes turns up no specific definition. I think the answer would be: when the association's operations, duties, documents, statutes and other dealings are discussed.
You might find a quorum of directors gathered at a social event such as a Christmas or Super Bowl party, a golf match, a barbecue. Board members have the right to entertain and be entertained. As long as a quorum does not discuss association business or operations, no problem exists.
Richard White is a licensed community associations manager. Write to him c/o Community Living, St. Petersburg Times, P.O. Box 1121, St. Petersburg, FL 33731. Sorry, he can't take phone calls or provide personal replies by mail, but you can e-mail him at CAMquestions@cfl.rr.com Please include your name and city.
[Last modified May 26, 2007, 11:39:09]
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