Live in a home governed by a condominium, co-op orhomeowner's association? Have questions about what they can and cannot do? Ryan Poliakoff, an attorney and author based in Boca Raton, has answers.
Question: Our HOA has a three-member board. Two of these board members decided to get a new HOA management company. Fifty residents signed a petition asking those two board members to please allow the homeowners to have input into the decision. The two board members refused to allow the homeowners to have input and signed a contract with a new (out-of-state) management company.
Do the homeowners have any recourse? Signed, G.N.
Dear G.N.,
Just like our government and most other large organizations (including most big businesses), community associations
are representative democracies. The owners elect representatives (the board) that they hope will share their goals, and they leave it to those representatives to make most decisions on their behalf. If the directors (or legislators, or corporate board members) don't act in a way that most of the organization agree with, then those people do not get reelected.
There are a lot of good reasons that this system of governance works in so many different areas. Let's consider a system of governance where every member of a group (say, the United States) votes directly on every single decision being made. First, you can imagine how incredibly unwieldy that would be — you would end up having multiple daily votes, and getting even the most basic decisions made would take forever. Plus, do we really think that every person in this country would take the time to educate themselves on the complexities of every decision that would arise?
Our government representatives (theoretically) have a responsibility and duty to make sure they are well informed when they make decisions, but the public at large has no such obligation. And, if we're being honest, people's experiences, abilities and talents vary so dramatically that it would just be unrealistic to trust the public as a whole to run the government.
Now, while your HOA isn't nearly as complex as the United States, the issues are still the same.
You and your neighbors have lives. You are not involved in the dozens of day-to-day issues that boards regularly need to inform themselves about and address. Are you a person who goes to every board meeting, who reads the monthly financials, who reads the association's contracts — basically, are you acting as a board member despite not being on the board, such that you are positioned to make a well-informed decision on whether to hire a new management company? It may very well be the case that you are, but I'm sure you would agree that most of your neighbors are not. And the law expressly permits all your neighbors who care about the issue to attend the board meeting where the decision is made and tell the board how you feel. The entire point of this is to force boards to listen to their neighbors, whether they are inclined to do so, or not.
So, you are telling me that 50 neighbors signed a petition asking the board not to make a decision that a majority of the board supports. They got your message. Presumably, those two board members believe that your collective opinion does not represent a majority of the community. And ultimately, the real question here is whether that is the case.
You never say how many homes there are in your neighborhood, but even assuming that it was not just 50 residents signing the petition, but actual owners representing 50 individual homes (and votes), that might be anything from the vast majority of the owners, to a tiny minority in a thousand home HOA.
Your recourse, as you ask, and as is the case every single time that a board does not properly represent a majority of its constituency, is to remove the two board members and replace them with new representatives who agree with your position.
If your 50 residents do not represent a majority of your community, what would be the justification for having "recourse" that the board is making a decision that you do not agree with? Isn't it possible that everyone else feels differently and is thankful for the decision these two directors are making? And in contrast, if your 50 does represent a majority, or if you are confident that at least a majority of your neighbors are like-minded, then just remove the directors and replace them.
Recall is an uncomplicated procedure — the Division of Condominiums publishes a form you can use, and you just need a majority of homes to fill out the form, select the directors being recalled; and, if that is a majority of the directors, select their replacements. I have been involved in dozens of successful recalls. Recalls don't generally fail because the procedure is flawed — they fail because people overestimate how many of their neighbors disagree with the board as much as they do.
As a final note, I'll point out that all management companies working in Florida, regardless of where they are based, need to be properly licensed. If it turns out this new company is not, simply report them to the DBPR.
Ryan Poliakoff, a partner at Poliakoff Backer, LLP, is a Board Certified specialist in condominium and planned development law. This column is dedicated to the memory of Gary Poliakoff. Ryan Poliakoff and Gary Poliakoff are co-authors of "New Neighborhoods — The Consumer’s Guide to Condominium, Co-Op and HOA Living." Email your questions to condocolumn@gmail.com. Please be sure to include your location.
This article originally appeared on Palm Beach Post: Can homeowners stop HOA board from hiring a firm, or force a recall?
