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Condo association board and management transition is a mess

Posted on Thu, Feb 24, 2011 @ 12:24 PM
  
  
  
  
  
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Our sponsor sold all 40 units in one year but he had not tried to elect a new board of managers. Then some unit owners held a meeting without informing the sponsor. The meeting was on very short notice (only a few days), but majority unit owners did attend. The organizer appointed themselves as new board of managers. Now they hired their own property management company and begin to collect maintenance fees. How can I find who is the current legitimate board of managers? Also, most unit owners have not paid maintenance fee to the sponsor in the first year (he did not tried to collect before he sold most the units) so he should have lots of related debts, how is that debts affect us. How do I know if the sponsor has incorporated our condo association? The new board also registered a company. Can they just register a company and assume it's incorporated from the condo association? If the sponsor has incorporated the association, do we inherit the debt of th e company?
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Comments

As a member of Community Associations Institute, I served on a committee that wrote a handbook on transition. It is still available through CAI and has much valuable information.  
 
The current question did not provide location information. What insurance company is listed on your documents provided at settlement as carrying the insurance for the condo? This is one of the first items to review and is essential to your financial welfare.  
 
It is not unusual for developers to "blow" management and transition of a residential project. However, there are many many legal issues to resolve. Assessments are incurred from the date of settlement; for developers, usually from the date of filing the legal documents.  
 
An attorney with experience in condominium law is absolutely essential to retain. The authority for any party to enter into a contract (for management, etc) must be clarified. Otherwise, all of the contracts can be overturned. The question of leadership will become apparent the first time any legal issue arises, whether it is to enforce collection of assessments, obtain mortgage financing for the resale of a unit, or for any insurance dispute, etc.  
 
A response with location will enable responders to provide appropriate information. You may also contact me by email at nancy@cpwi.com for a no-charge initial limited provision of additional information.
Posted @ Thursday, February 24, 2011 5:04 PM by Nancy Jacobsen
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