What you need to know:
Where the governing documents or the statute place the authority to interpret the governing documents with the board, the board’s interpretation will be binding unless unreasonable. However, if a director has a conflict of interest, the director can’t be part of the decision making process or the vote and must recuse herself/himself.
Continue Reading Conflicts of Interest and The Boards Power to Interpret the Governing Documents
Defendant, Castletown Corner Owner’s Association, Inc. (“Association”), had a duty to maintain a lift station. Specifically, the declaration imposed an obligation on the Association to pay “all Maintenance Costs in connection with” improvements constructed at the Association. Maintenance costs are then defined as “all of the costs necessary to maintain the … sewers, utility strips, and other facilities … and to keep such facilities operational and in good condition, including, but not limited to, the cost of all upkeep, maintenance, repair, replacement … for the continuous operation of such facilities.” Plaintiff, owner of one of the commercial units, sued the Association for failing to properly maintain the lift station after an incident where the sanitary lift station malfunctioned and flooded the building with human sewage, which allegedly caused Plaintiff’s tenant to terminate its lease.
Continue Reading Language in Declaration Makes Association Strictly Liable
When faced with a request by a homeowner or condominium owner to install solar panels at your association, your Board needs to determine a number of things:
Plaintiff, Ms. Carmichael, is on the board of directors of Commerce Towers Condominium (“Association”). On the board with her is Mr. Frese and Mr. Vickers. Mr. Vickers, Mr. Frese and Mr. Tarantino are the officers of the Association. (collectively “Officers”). All three are also the officers of Tarantino Properties, Inc. (the “Management Company”). Carmichael and other unit owners (collectively “Owners”), individually and on behalf of the Association, sued the Officers and the Management company for breaches of fiduciary duties and for unjust enrichment because the Officers caused the Association to provide for the maintenance and preservation of property that was not part of the Association (the retail space of the buildings). The Officers and Management Company asserted that the Owners did not have standing to sue on behalf of the Association (a derivative suit).
Continue Reading Self-Dealing by Director is a Breach of Fiduciary Duty (Case 2)
Most condominiums and homeowner associations (HOAs) are nonstock corporations under Wisconsin Chapter 181. As such their members can make decisions one of three ways:
Continue Reading Condo and HOA Virtual/ZOOM Meetings in Wisconsin – How Legal Are They?
Plaintiff, Coley, owns a home in an HOA, the Eskaton Village (“Association”). Two other Eskaton named entities (“Eskaton”) develop and support HOAs. A five-member board runs the Association, subject to the Declaration. Eskaton has always controlled three of the five directors on the Association Board because it owns 137 of the 267 units. The three directors are always employees of Eskaton and are “financially incentivized to run the Association for the benefit of Eskaton.” In short, the better Eskaton performs the higher their compensation, which is directly related to the expenses of the Association. Coley, one of the other two directors, filed suit because of various acts by the other directors to benefit their employer at the expense of the Association, including disclosing attorney client privileged communications.
Continue Reading Self-Dealing by Director is a Breach of Fiduciary Duty (Case 1)
Does your homeowners association have a written collection policy? What duties does the property manager and/or Board have under the policy? Learn what role the property manager and/or the Board of Directors should have in the assessment collection process.
Want to learn more about Wisconsin condominium and HOA law from experienced condo and HOA
I recently read an article on the difference between condominium and homeowner association officers and directors by an attorney out of Ohio, Jennifer B. Cusimano of Kaman & Cusimano, LLC. It was well written, clarified a subject that is often confused, and inspired me to do my best to explain the difference to our readers.
In simple terms, directors are elected by the owners, officers are NOT. Officers are elected by the Board of Directors annually.
Continue Reading What is the Difference Between Community Association Directors and Officers?
A 79-unit condominium association held a meeting to remove the directors from office and elect new ones. The president objected to the meeting, the procedure and the notice, but since the association followed the documents and had more than half of the unit owners vote for the removal, the directors were removed.
Continue Reading Directors Removed from Office – Just Follow the Documents
As Condominium and HOA attorneys, we often receive questions from our clients dealing with all the issues that can get in the way of conducting a successful annual meeting. Most often, it is the issue of not being able to achieve a quorum of owners in attendance—which stymies the Association’s ability to hold Board member elections, approve the budget, and take other important actions to further the HOA’s business for the coming year. So what happens if an Association’s Bylaws calls for annual board elections, but the Association does not hold elections for a number of years? Is there a Board? Does the Board have any authority? A recent case addressed these issues, and the court’s findings might surprise you.
Continue Reading If Your Association Fails to Hold Board Elections at an Annual Meeting, Do You Still Have a Board? The Answer May Surprise You…