Realty Times August 25, 2010

Ask the HOA Expert
by Richard Thompson

Question: We have an unmarried resident couple and only the woman is a legal owner. Does her partner qualify to run for the board or serve on a committee? And if they are legally married but he is not an owner, does that change things?

Answer: In most HOAs, only owners are allowed to serve on the board. You need to read your governing documents to see if that is the case in yours. On the other hand, committee members can be unmarried partners, renters and non-residents.

Question: What is the definition of an "executive session"? Can a meeting begin as an executive session, and end as an open session, or vice versa?

Answer: There may be a state statute that defines "executive session". If so, you need to follow it. If there is not a statute, the board generally is permitted to hold an executive session to discuss litigation, employee or contractor issues, or collection matters involving specific individuals. The board should not abuse this by using it to discuss controversial topics normally discussed in regular board meetings. As a rule, executive sessions should be rare.

Executive sessions can be announced at a regular board meeting when a topic arises that warrants it. The board then goes into private chambers to discuss the matter and then returns to the public meeting. An executive session can also be scheduled in advance but should disclose the general nature of the meeting so the members understand why the meeting is not public.

Question: What can the homeowner association do with bank owned properties that go delinquent or let their tenants break the rules?

Answer: Bank owned properties can become common in HOAs when the real estate market is not moving homes quickly enough. Foreclosed homes can remain vacant for long periods, may have yards full of weeds, maintenance issues and HOA fees may go unpaid in months.

If your HOA is having such problems with bank owned properties, here are several good options for solving these problems:

  1. Treat the bank like any other owner – don't wait for a sale to get paid.

  2. Use liens to ensure payment of assessments and correction of rule violations.

  3. Aggressively pursue foreclosure if the bank refuses to pay. Since there is no longer a mortgage against a bank-owned property, any HOA lien will be in first position. This means it is extremely likely the HOA will be paid quickly after a foreclosure action begins. If the owner-bank does not pay in full and a foreclosure sale is completed, the HOA would end up owning the property free and clear! by Eric R. Jaworski, Esq.

Question: Our HOA prohibits guests from using the pool unless accompanied by a resident. We have a resident who is challenging this rule because of an injury which prevents him from doing so.

Answer: Having residents accompany their guests is a standard that should be upheld. If it's not in place, what's to stop a resident from inviting their friends over to swim any time they want? Hold the line on this one.

For more innovative homeowner association management strategies, see Regenesis.net



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