Page 9 - New England Condominium June 2019

NEWENGLANDCONDO.COM NEW ENGLAND CONDOMINIUM -JUNE 2019 9 unit owners are typically familiar with amounts to a high crime. “There must be abandoning their community.” Gelfand month to help run their communities. If a provisions of the documents having to a balance between threatening the pro- do with open meetings, the availability verbial wrath of the gods, punishment to serve on the board because the only tation for not having consistent enforce- of records, when financials are supposed for transgressing legal thresholds, and re- to be distributed, etc. One of the biggest minding of \\\[the state’s\\\] recognition in the (and a court taking over), or having less- mistakes I see boards make is not follow- ing their documents and missing such an unteers should not be held to a standard will make whatever challenges or issues nity. Additionally, board members could event. Again, in the absence of informa- tion to the contrary, owners will often as- sume that the board is up to no good. “Other common trip-ups include the “If you constantly failure to properly handle the associa- tion’s ‘administrative’ details,” he adds. “If mentioned wrath an association is a corporation and they for every transgres- do not keep up their filings with the state, sion, then no one the corporation can be involuntarily dis- solved. Or, a vote on an important issue cause even the most might be challenged if something was studious follower lacking in the meeting notice. Another of the documents example would be that an amendment will be concerned could be challenged if the formalities with making an \\\[for making that amendment\\\] were not error and being held liable. Addition- complied with. This includes not just the ally, the term ‘volunteer’ for most direc- proper voting, but the proper execution of tors is not entirely appropriate; they are the document by the proper parties.” Of course, rule violations occur on a manner that makes them feel as if they a sliding scale, and not every overstep cannot refuse without being perceived as community association context that vol- stricter than the business judgment rule,” says Gelfand. threaten that afore- will volunteer, be- not paid, but they are usually drafted in goes on to say that some residents agree building or a community develops a repu- other alternative is having no one serve ment of its rules and regulations, that may than-competent people on the board who apartments and homes in that commu- the community is fac- ing significantly worse. Actions and Conse- quences When board mem- bers deliberately abuse their powers, they can face consequences that make whatever gains they’d hoped to get out of their position seem hardly worth it. “Selective enforce- ment of the documents may result in share- holder or unit owner unrest, and pos- sible action to remove a board member for cause,” warns Reilly. “These are all distractions for corporations and condo- miniums that detract from the hard work that volunteer board members put in each negatively impact the sale and transfer of find themselves facing jail time if they are found to be engaging in self-dealing con- duct or kickback schemes.” Occasionally, a board member will vio- late the rules in an effort to appease de- manding residents. This rarely works out well. “A fundamental problem is that ev- eryone eggs on board leaders to spend as little as possible and to keep assessments low,” says Gelfand, adding that part of the issue may be people’s tendency to balk at paying for intangibles. “Sometimes it’s ef- fective for legal counsel to point out to an association’s directors, as well as the membership, that they really do not want to live in a community that has the small- est budget and lowest assessments. “We have had high-rises next to one “In the absence of information to the contrary, owners will often assume that the board is up to no good.” — Gary Daddario continued on page 18