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Condo association board member under fire for hiring contractor

Posted on Thu, Apr 14, 2011 @ 07:34 AM
  
  
  
  
I have an association board member that met with a contractor.  This is a contractor that works with her husband and she told this contractor that she has the authority to just give him the contract for the repairs. She never went through the Board for this meeting or decision and the President wants to tell her to stop & tell the contractor that she mis-spoke on the Boards behalf. My condo building's new Board is under the microscope on contractors they hire because the old Board was accused of getting kickbacks from some contractors. He feels that because of this history it would be in bad taste to have this contractor do the job because of his relationship w/ this Board member & her husband, not to mention that no other bids were collected. He does not want to confront her without something in writing to back up him up. I have looked though 514B but cannot find anything that addresses this specific issue. Maybe an ethics violation?

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COMMENTS

The Board needs to set a firm policy resolution outling procedures for procuring bids, award of work, etc. From what you desccribe, this board member has acted outside the scope of their fiduciary responsibilities and she should be sent, along with contractor, a cease and desist notice ASAP.  
 
Board also should consider adopting a Board Code of Ethics Policy which elevates each board members responsibilities to the association and community members. Where is your managing agent during all this activity?

posted @ Thursday, April 14, 2011 8:00 AM by Edward S. Frank


Usually you will find words on "contracting" in your bylaws.

posted @ Thursday, April 14, 2011 8:13 AM by


Our property manager was not here on this particular day so I am not sure he is aware. Not only is he new to this building he is also a very quiet, passive, non-confrentaional person.

posted @ Thursday, April 14, 2011 12:10 PM by Heather


As always, begin with the Bylaws. Under Officers description may be found President - authorized to sign contracts.  
 
Remind board first and then send a letter to contractor stating that the board has not finalized approval of this contract and the insurance D&O insurance requires contracts be approved in an open meeting of the board. (This at least temporarily shields the offending director from personal embarrassment.) The manager may need to contact the vendor to clarify that a contract, along with vendor proof of insurance, must be submitted for board action.  
 
The entire board and the new manager may benefit from a session on proper procedures, etc. Approval for the expenditure of funds should always be a resolution of the board in an open meeting and should designate either that the funds are for a Reserve Fund expense or from the Operating Budget. A reminder too that this is a business and must operate in a business-like manner to ensure protection from any insurance claim or litigation being filed by the vendor at a later date. These steps, including the suggestion above, about a procedure for contracts should be helpful.  
 
Good luck.  
 

posted @ Thursday, April 14, 2011 12:49 PM by Nancy Jacobsen


It seems logical that in light you do have a board, which should consist of an uneven number of members, that it takes a vote before work can be approved. That vote should also be in the minutes which are recorded for meetings. It should also be the duty of the board to have competing bids, and should compel the board to check the credentials of those bidding, to include, insurance, quality of work, and references. Finally, your board President must take the bull by the horns and insist that awarding contracts be done properly.

posted @ Thursday, April 14, 2011 1:20 PM by Larry


Very good post. Most of the time people don't understand what HOA's do and how they run. If you would like to learn more about HOA and how they work. I made a video: http://www.youtube.com/watch?v=WjV00Mtm0bU

posted @ Friday, April 15, 2011 8:07 AM by Tom massa


I am in a stressful situation with Trustees at my condo. association. I am having new windows installed and because there is brick, repointing might need to be done. I have hired a contractor and the Board is insisting that someone they use inspect the brick. In fact, one Trustee suggested I have the windows pulled out before my contractor arrives to do the work. I was told that, "It's no big deal", which is a bunch of baloney. This Trustee/spokesperson went from telling me that my contract could bid on it to hers would have to do it because "We can't just have someone off of the street, we don't know the their work, etc." This is funny as her contract subs out all his work. It would seem she has promised her contractor something as she is insisting he do some work. This contractor has submitted 2 bids. One was off by $6K and the other is still unclear. I cannot imagine the quality of his work. She insists he is coming and claims I have no say in the matter. It is much more detailed than this. I feel the Board is acting inappropriately and unethically. Do you have an opinon on this and what recourse to I have, if any?

posted @ Friday, September 09, 2011 11:14 AM by Marilyn Regan


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