AZHOC - Arizona Homeowners Coalition
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Removal of Directors

Hello…we are looking at trying to remove our directors (residents elected) for a number of reasons. We do understand the need to collect signatures and how the process works, I believe. Our question is really...
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HOA voting quorum

I asked this question before but I did not receive a reply. Is there a minimum percentage required for elections to be valid? Is it a 10%,20% etc. quorum required? I can not find if...
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ARC Documents

I have been asking to see a specific ARC Approval request and Approved Document. I have been told that these are not PUBLIC documents and cannot see them. However, I know for a fact (evidence)...
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Question

I live in a four unit condo building with a self-managed HOA. Up until June 2021, the HOA had no formal rules and regulations, along with no violation processes of potential fine, etc. Earlier this...
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Meeting minutes

Several of the homeowners have asked for meeting minutes, some have asked for minutes for the previous year as to verify previous meetings involving a special assessment issue. Some have received resent minutes from the...
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Meeting minutes

Several of the homeowners have asked for meeting minutes, some have asked for minutes for the previous year as to verify previous meetings involving a special assessment issue. Some have received resent minutes from the...
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  • From DennisL on HOA Selective Enforcement of the standards

    There is no current statute that prevents selective enforcement of governing documents but there is plenty case law decision by the courts relative to that issue. The most specific case is one that invoked the duties of the board to its members established in common law by the Restatement of Law Property Servitudes sections 6.13 and 6.14. That case Tierra Rancho v Kitchukov directly established the identified provision of the Restatement as the basis for the duties of all boards in Arizona. Two of those provision are that board must treat all members fairly and the second is that board must act reasonably in their discretional authority to enforce the governing documents. Both of those provision establish without doubt that board cannot selectively enforce any rule or restriction as that would not treat homeowners fairly or be reasonable.
    Absent a specific statute on an issue than common and case law prevails on all issues. Because of this, there is no difference between the true duty of the board in case law and if it would have been codified in state statute.
    Dennis

    Go to comment
    2022/05/15 at 8:51 am
  • From DennisL on Annual Meeting Question

    Joe,

    You are correct state law requires that a meeting of the members be held at least once a year. While not stated obviously the purpose of that is to fill vacancies in the board created by expired terms. A meeting that does not satisfy quorum is never held and unless re-convened does not satisfy the law. Your association and many more use this excuse to not hold elections and continue with board members beyond the term required in their governing documents. This is a total lie and misuse of power, and denying the most fundamental right and power of the members to elect their board and to hold the board accountable to the community thru these elections. Many community documents haver a provision that allows board members to continue in position until a replacement is elected, but that provision is specifically allow terms to run from election to election and based on terms of 365 days per year. If a board member is elected to a two year term on January 15th his two year term does not end on January 14th two years latter but rather whenever the election is held that year. It never allows the term to be increased indefinitely or to not hold an election in that year. Contact your board and ask them if they intend to reconvene the required annual meeting and if they say no than file a petition to ADRE for their violation of failing to hold an annual meeting of the members. The statute would be different depending if you are a Condo or a planned community, but the content of both statutes are exactly the same. Your association is intentionally violating the law for the purpose of denying the members the opportunity to vote. Quorum for members meeting can be adjusted by the board to address the needs of the community, but can never and should never be used by the association to deny the members the opportunity to elect its board.
    Dennis

    Go to comment
    2022/05/15 at 8:39 am
  • From DennisL on Charges for copies

    Mary,
    As you stated the association is allowed to charge $0.15 per page irrespective of how they print that out, so yes you awe the full amount charges. If the information that you desired to see is not visible on the page because of the way they printed the pages you can ask for reprints to ensure that the information is legible. If the management company refuses without additional charges your only recourse is to file a complaint to the board directly on the incompetence of the community manager’s staff. You can also simply request to view the original documents first hand and take pictures of the full pages that you want.
    Dennis

    Go to comment
    2022/05/15 at 8:24 am
  • From DennisL on How do we get an audit?

    Michele,

    Arizona law requires that every association to have either an Audit, Review or Compilation completed on the association finances every year. Those accounting reviews are identified in decreasing rigor. The associations are allowed the choice if the declaration (CC&R’s) do not specify that an audit is required. Many older CC&R’s used the term “audit” generically but those association then lose the option and must do audits annually.

    As homeowners you have absolutely no power to force the association to do an audit. If you have reason to question the finances, then you can ask for an audit to be done and provide the board the justification for your concerns. They do not have to comply with your request, but the board does have a fiduciary duty and if a legitimate concern does exist, they are obliged by their duty to the association to investigate the concern and if appropriate have the audit performed. Failure of the board to act reasonably with this issue could result in them being found in breach of duty to the association and its members and could personally be held liable for the consequences. Board liability indemnification and D&O insurance does not cover “breach of Duty” issues.

    As for the community if you are not happy with the response of the board you can always circulate a petition for a special meeting of the members to recall the entire board and elect a new board that will start with an audit of all finances and clear the slate and move on.
    I will note that even if your remove the board if a subsequent audit proves that the board failed to maintain its fiduciary responsibilities to the association the new board would be free to pursue litigation on the past board based on their actions when in office.

    Dennis

    Go to comment
    2022/05/10 at 4:56 pm
  • From DennisL on HOA voting quorum

    Steve,
    The use of on-line voting systems was authorized in 2017 for the non-profit corporation act in section 10-3708. Section 33-1812 specifically states “Notwithstanding section 10-3708 or the provisions of the community documents …” . The association is required to allow votes to be provided in person and by absentee ballot or other form of delivery such as fax or e-mail. Because it specifically excludes any provision of section 10-3708 from applying to absentee ballots it bans the use of on-line voting for planned communities. Absentee ballots can be submitted by mail, e-mail of fax alone, and even if those forms are allowed the association must still allow votes to be cast in-person at any meeting of the members.
    While I personally have no problem with on-line voting systems for planned communities if managed and used properly, they are currently not allowed for use in planned communities or condominiums despite the wishful belief of all association managers and attorneys.
    While the provisions of the non-profit corporation act can be used by these association they cannot be used if a conflict exist between the non-profit corporation act and the planned community act. The confict arises because the planned community act excludes section 10-3708 in its entirety for use in association elections.

    Dennis

    Dennis

    Go to comment
    2022/05/03 at 1:26 pm
  • From Steve on HOA voting quorum

    Dennis-

    I am meeting with Mgmt today. I do not see anything specifically outlawing an online vote in 1804 or 1812. It state “some other form of delivery, including the use of email or as fax delivery. I see nothing specific for online systems, either for or against. Where would I find these specifics? THANK YOU!

    Go to comment
    2022/05/03 at 1:08 pm
  • From DennisL on Recording

    Dave,
    No single board member can act for the board so if a board member records a meeting and is not directly authorized by the board to do so for the association that recording is a personal recording of that individual member and is not an association record. The same way all of you can record any meeting. I put that provision into law, so I absolutely understand what the law does and does not do. There is nothing grey about this situation unless the board voted to restrict all homeowners from recording and chose to record the meeting themselves this is not an association record.
    Most bylaws have a provision that any board member that does not attend three meeting of the board that the board member is consider resigned and the board is authorized to fill the vacancy of that resignation.

    As for the recall vote the law is very clear a simple majority of the members voting either in person or by absentee ballot at the special meeting called for that purpose decides the recall. You absolutely do not need a majority of all votes in the community to decide the issue. And now another management company and attorney is proven full of crap.

    Dennis

    Go to comment
    2022/05/02 at 10:31 pm
  • From DennisL on Cancellation of a regular meeting for a non-emergency Special...

    Cynthia,

    Board meetings are board meetings, and the board can decide to hold meetings whenever they want as long as the comply with the open meeting law. Nothing in law dictates when a board can meet or how often the decide to meet. Nor will it ever, but they must always comply with the open meeting law.
    Dennis

    Go to comment
    2022/05/02 at 10:08 pm
  • From DennisL on Renter Restrictions for Community

    Christy,
    Both HOA and Condo boards are allowed by common law to create a rule that can limit the number of non-owner occupied properties to comply with federal lending restrictions. While most people do not know this once a threshold currently established by the FDA of non-owner occupied homes in a community is exceeded the the federal banking system will no-long allow loans on any properties to be underwritten. In other word if you want to sell your home or unit anyone trying to buy that unit or home will have to pay cash because they will not be able to get a loan to buy your property. This will significantly negatively impact your property value and the ability for you to sell your home. Since the association is in place to protect your home value than if they do not take action to prevent this from happening then they are breaching their duty to the association. So they are in fact obligated prevent the number of non-owner occupied homes to currently less than 50% of the homes. Under Federal law “owner occupied” is defined by the owner living in the home for at least 3 months a year.
    If you are currently at only 10% owner occupied you can no longer to anything to undo this. Not only has everything in your community deteriorated as you motioned but all property in the community can no longer be financed with a fanny-may or freddy-mack loan. Unfortunately you have few options other than to attempt to sue the board for allowing this to happen as a breach of duty to the community. It is uncertain if even this can change anything.

    Dennis

    Go to comment
    2022/05/02 at 10:05 pm
  • From DennisL on Unenforceable Rules Regs and CC&R's

    Cynthia,
    What you read is incorrect most of the time. Because a board has not enforced a rule for some period of time does not eliminate that rule. They can chose to start the rule with due notice of all homeowners. The issue is fundamentally, are they enforcing the rule fairly and consistently across the community if they are they can do what you described if they are not and only applying the rule selectively they cannot do that.
    The homeowner can contest any violation notice directly to the board in and request a hearing in open session relative to that issue, I would recommend that everyone do that.

    The association cannot do anything relative to rule enforcement that does not exist in writing. If the rule for “hold harmless agreement” what ever they are is not in writing it does not exist and cannot be enforced. Even if the association did create such a rule and documented it their ability to do that depends on the specific language of the CC&R’s.
    Dennis

    Go to comment
    2022/05/02 at 9:48 pm
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