Aging HOAs should check corporate expiration date


Sara Barry with Leach Johnson Song &Gruchow law firm wrote in about concerns for resident agents, people who are registered with the Secretary of State’s Office to receive legal documents for HOA boards, and about state paperwork expiring for aging-master-planned communities.

Being a resident agent has a lot more responsibilities than just completing the annual list of officers and sending it in with the fees to the state. I would ask the association’s legal counsel to be the agent and shift this liability from you, which would include dealing with issues when served with lawsuits, etc. (I am not trying to sell lawyers or our firm, trust me.) This is a board decision.

In addition, I recently found an association that was formed July 2, 1964. The corporation was set to expire in 50 years. It did expire this summer, and even though the HOA sent in the officer list with the fees to the state, board members didn’t check the status of the corporation.

This is the first time I have seen one of these, but as we go down the “age” road of these corporations, many of the older ones were set to expire after a certain period of time. Check with the Secretary of State’s website for a corporation’s expiration date. Serious attention needs to be given to protect that date and work with an attorney to re-up it. Check the documents as well, as state employees make mistakes.

There could be insurance issues as well. Insurance companies that are insuring a corporation that doesn’t exist would have a nice “out” should there were to be a claim.

Q: I am a homeowner in an association. It has come to my attention that our board members have credit/debit cards to make purchases for our community.

Also, we won a construction defect lawsuit and the members of the defect trust committee also have these cards.

My question is: Do I, as a homeowner, have the right to review these card statements?

A: Send your board or management company a written letter requesting an appointment to view these statements. Be very explicit as to what you want to review. The association has the right to charge you $10 per hour in reviewing these records.

In many associations, both committee and board members use their own money or charge cards to purchase goods and supplies. They submit their invoices to be reimbursed by the association. Often that can take a couple of weeks depending upon the association’s procedures. Some associations have a petty cash fund to serve this purpose.

Many of the larger associations use credit cards. In any of these cases, a formal motion needs to be made in an open meeting as to use of credit/cards, policies and procedures — checks and balances and regular audits of the account by third parties. Many banks will tie in the credit/card to a specific checking account that has to be funded by the association.

Barbara Holland, certified property manager, broker and supervisory certified association manager, is president and owner of H&L Realty and Management Co. Questions may be sent to the Association Q&A, P.O. Box 7440, Las Vegas, NV. 89125. Fax is 702-385-3759, email is support@hlrealty.com.

 

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