Q. Our small condo association is having a difficult time getting enough volunteers to satisfy the leadership requirements of our Master Deed. What happens if an association simply fails to field a team of trustees? We can’t force people to serve on the board, but my understanding is that we can’t operate without enough board members.
—Looking for Leaders
A. “Unfortunately, it is not uncommon for a condominium association to have trouble convincing unit owners to serve on the board,” says Heather Gamache, a principal with Moriarty Bielan & Gamache LLC with offices in Boston, Quincy, and Falmouth, Massachusetts. “When unit owners do not volunteer to fill vacant seats on the board, it creates a significant problem for the association. The association cannot operate without a board that meets the minimum threshold requirements established in the governing documents of the condominium. The board has the sole control and management of the common areas and facilities and the common funds and profits of the condominium; it sets and collects common fees, pays bills and contractors, manages association bank accounts, and transacts business on behalf of the association. Without the board, none of these essential functions can be fulfilled.
“The governing documents of the condominium will establish whether the board can operate with a vacancy, for how long, and the steps that must be taken to fill the vacancy. In the event board positions cannot be filled, the documents should provide a mechanism for calling a special meeting to provide an opportunity to persuade unit owners to volunteer to serve.
“If efforts to persuade unit owners are ultimately unsuccessful, the association can initiate a lawsuit and seek the court appointment of a receiver to assume the board’s responsibilities and manage its business. The receiver will remain in place until a board can be established meeting all the requirements of the condominium documents.
“There are significant consequences if it becomes necessary for a court to appoint a receiver. The fees charged by the receiver in fulfilling the duties of the board can be quite expensive, and will be passed on to unit owners as a common expense, very likely leading to increased fees and/or special assessments. Additionally, buyers and lenders will not look favorably on the receivership, or the associated assessments. If unit sales stall or decline and lending is adversely affected, it may lead to decreased property values.
“If your association is headed down this path, enlist the assistance of an experienced condominium lawyer to advise the existing board and unit owners of the importance of maintaining an operational board and the negative consequences if that is not achieved.”
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