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Small condo association developer over-charging other owners

  
  
  
  
  

I am a member of a condo association with 6 members. One member is the developer and still owns 2 units. He is in charge of the association, is the only one in charge, does not abide by the by-laws, has changed the assessment split without an amendment, and is now threatening to file an order of possession against my unit for not paying the new split percentage (which is not in keeping with our by-laws). How to you protect your rights if there is only one person in charge of the association and he doesn't abide by the by-laws that he issued at the time you purchased your condo?

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Comments

You state condominium act will give you the info you need. Download it and read.
Posted @ Thursday, August 11, 2011 7:35 AM by Scott
If he is violating the bylaws get the other unit owners and yourself and take him to court.
Posted @ Thursday, August 11, 2011 7:57 AM by Victor
So he still owns 1/3 of the units. Does he own them as the declarant or does he personally own them. He technically is not a member unless he owns units privately. What do your CCRs say about turnover of the assn to the members? Seems to me it should be happening now. 
 
Not knowing what state you are in it's hard to say what recourse you may have. A few states do have a govt agency that oversees HOAs. If there is one in your state you can put in a claim to them. Otherwise, since he is violating the gov docs you and the other 3 members can take him to court, of course the cost will be on your shoulders and it could be quite costly. I suggest you pay the new assessment, under protest, until this whole matter is resolved. Otherwise you may find yourself in even deeper trouble, he may be able to start foreclosure proceedings against you if you continue to be delinquent. It is never wise to withhold paying assessments when in dispute with the board. 
 
Posted @ Thursday, August 11, 2011 8:42 AM by Mary
Does the developer own remaining two units as a developer or as a private owner? If he owns them privately you may have an issue because he has 1/3 of votes in your association. If however he is a developer he has no voting power at all. Other 4 owners can call an election meeting, elect the new board, and after that make changes to CC&Rs and Bylaws to protect the association. 
 
Also I believe the assessment split cannot be changed without amending Bylaws. I would definitely recommend talking to an attorney because it looks like you are not under any obligation to pay the new split.
Posted @ Thursday, August 11, 2011 10:39 AM by Jeff Ross
Jeff Ross, 
 
 
 
Sorry but you are incorrect in saying the developer (declarant) has no voting power at all. As long as he owns lots he has a right to vote -- one vote for each lot he owns. If he is still in control of the assn he may have more than one vote per lot. In reading the OPs message I'm of the opinion he is still in control since he is the sole member of the board of directors. The members do not have the authority to call a meeting and elect a board as long as the declarant is in control. 
 
Also, even if the new assessment was calculated incorrectly all members have an obligation to pay it, otherwise they will be delinquent and subject to whatever remedies the CCRs call for.
Posted @ Thursday, August 11, 2011 6:26 PM by mary
Mary, I respectfully disagree with you on both points. Well actually the first point is up for questioning. If the developer turned over the association to homeowners he has no voting power as a developer.  
 
He could chose to keep two units for rental etc. In that case he has the same voting power as any other member of the board. 
 
Just because the developer is the sole director on the board doesn't mean it's right. He could've simply not followed the right process. We won't know until we know all the details. 
 
As far as collecting fees that contradict bylaws - that's not collectible. 
 
Think of it. If it was collectable what's there to prevent some rogue board from simply saying that one owner owes money and proceeding with collection activities.
Posted @ Thursday, August 11, 2011 6:38 PM by Jeff Ross
Mostly the developer is happy to turn over control to the members and can't wait to get out. Even if he still has unsold lots he doesn't bother to exercise his right to vote at member elections. However there are some who want to stay in control even after transition. I know such an HOA here in Glendale,AZ. At the annual meeting to elect the first member board, the developer wrote in 2 candidates names (2 of his cronies, 1 does not even own a lot in the s/d which is against the CCRs) then cast 230 votes (the number of unsold lots) and got them elected. Write-ins are against state law but the mgr and attorney are saying Fed election laws override the state law. This is hogwash as, IMO, Fed election laws only pertain to Fed elections not elections in private corps. It will be interesting to see how this one turns out as I believe it will be going to our state agency for adjudication. 
 
The CCRs should state when transition shall occur, but some do leave it up to the developer by sticking in "or at the discretion of the declarant", or something to that nature.
Posted @ Friday, August 12, 2011 11:46 AM by mary
Follow Scott's advice before anything else.
Posted @ Monday, August 15, 2011 2:43 PM by Jules
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