Q&A: Out-of-Control Board

Q&A: Out-of-Control Board

Q. My HOA board has not had an election in 10 years. They keep reappointing themselves and appointing their friends to the board when there is a vacancy. Is this legal? How can I stop this abuse of power by my HOA?

                                 —Helpless Resident 

A. “Your community’s Declaration of Covenants and Restrictions and/or bylaws (together referred to as “Governing Documents”) likely set forth the terms of office and election procedure for executive board positions, which often require that elections of board members be held at certain intervals,” says attorney Hubert Cutolo of the firm Cutolo Barros, which has offices in Freehold, Cherry Hill, and Newark.  “Pursuant to recent amendments to New Jersey’s Planned Real Estate Development Full Disclosure Act (“PREDFDA”), executive board elections “shall be held at two-year intervals” if a community’s bylaws are silent as to terms of office for board members (N.J.S.A. 45:22A-45.2(a)). If your community has more than 50 units, the term of office for any board members may not exceed four years in length (N.J.S.A. 45:22A-45.2(b)).  

In other words, if your community’s governing documents do not set forth a schedule of board member elections, your community must have elections every two years under PREDFDA. (N.J.S.A. 45:22A-45.2(a)). It would be advisable to review your community’s governing documents to determine whether elections have been held in accordance with the bylaws prior to taking any further action.

“If your community has not held elections for an extended period of time, a sufficient number of members may be able to force an election. Under PREDFDA, if a community has not held an election in two or more years, 

...it shall hold an election within 90 days of the submission to any current executive board member of a petition signed by 25 or more percent of association members in good standing, but in no event less than the number of association members required to meet the quorum requirements set forth in the governing documents.

N.J.S.A. 45:22A-45.2(a).  

“Under PREDFDA, a member is in “good standing” if they are

…current on the payment of common expenses, late fees, interest on unpaid assessments, legal fees, or other charges lawfully assessed, and which association member has not failed to satisfy a judgment for common expenses, late fees, interest on unpaid assessments, legal fees, or other charges lawfully assessed. An association member is in good standing if he is in full compliance with a settlement agreement with respect to the payments of assessments, legal fees or other charges lawfully assessed, or the association member has a pending, unresolved dispute concerning charges assessed which dispute has been initiated [through a valid ADR process]. N.J.S.A. 45:22A-23(r).  

“If your community has not held an election in accordance with its governing documents in more than two years, members may be able to force an election by submitting a petition signed by at least (i) 25% of members in good standing, or (ii) a sufficient number of members in good standing to constitute quorum, whichever is greater.”

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