Those of us who have been involved in representing community associations (in my case, for over forty-five years) have, no doubt, experienced a situation where so-called dissidents in a community association, for clearly irrational reasons, strive to seize control of the association so they can further their “platform”, which frequently leads to the demise of a successfully-run community association.
Without a doubt, every management company that has had any experience in community associations, as well as attorneys who have represented community associations, have been subjected to this type of situation. What typically happens in the case of an attorney is that he or she is called upon by the community association to seek redress against a co-owner for a bylaw violation, collection of assessments or some other violation of the deed restrictions. Ultimately, all co-owners in violation are made to account for their sins, but later they organize themselves as a political force to seize control of the association, in many cases just for spite because they were subjected to enforcement action and (the greatest insult) had to reimburse the association for its legal fees. The attorney is then left with the prospect of having to deal with a Board of Directors controlled by adversaries who, no doubt, want to excommunicate that attorney from the representation of the association. Or there may be new members of the Board of Directors who get into a skirmish with incumbent members of the Board and want to make sure that their agenda prevails, thereby causing the incumbents either to fight or quit.
Generally speaking, there are provisions in the bylaws of most community associations, as well as the Michigan Nonprofit Corporation Act, that allow co-owners and/or members of a community association to seek to remove the directors from their positions as directors. Normally, the directors have their own ability to remove officers that they have appointed, with or without cause. There are also frequent situations where certain members of the association will gather proxies and otherwise begin a propaganda campaign to marginalize the present members of the Board of Directors, the management company and/or, for that matter, the attorney, regardless of the truth or accuracy of their allegations, much like a typical political campaign. When these persons seize control of the association, assuming, of course, that they are not operating in good faith, they can and often do wreak havoc on the successes which the association has achieved prior to their involvement. By way of example, they will stop enforcing the deed restrictions as it relates to bylaw violations. They will provide favors to certain co-owners as opposed to others who have helped them in their political ascendancy. They will get rid of the management company or, for that matter, the form of management that took place prior to their time, and that attorney who assisted in enforcing the bylaws against them will be first on their agenda to fire.
How then can members of an association avoid the crazies “taking over the asylum”, so to speak? They can simply be ever-vigilant regarding the manner in which their association is being run. They cannot be apathetic and simply allow anyone who wants to run for the Board to gain control of the association unopposed if their motives are improper. But how do you determine that? That is a difficult question, and the answer is even harder, because a shrewd politician-candidate can push the right buttons in the minds of naïve co-owners to obtain their support. Co-owners should be asking the proper questions, and prospective directors should be made to answer these questions in an open forum. For example, were the candidates for the Board of Directors subject to prior or present bylaw violations or other types of deed violations enforced by the association? What was the basis for these “dissidents” to make accusations against the association’s present Board, its management company and/or its lawyer, particularly in situations where the management company, the Board or the lawyer have been in place for a considerable period of time and the association has been run successfully? What is the experience of these prospective persons to properly manage the affairs of the association as directors, regardless of whether they were successful in their own businesses or occupations? Do they understand the role of the Board is not to spend as little money at whatever cost, but to get the best possible talent available to assist in the operation of the association?
These questions must be garnered and presented to prospective candidates, and the membership must be aware of the fact that one bad apple in the bushel can spoil the successful operation of the association. I have seen it happen on too many occasions where paranoid dissidents, who have never had a leadership role in their life, are upset because additional assessments were levied; they were pursued for bylaw violations; one of the present Board members spoke with them in a raised voice, or some other provocation motivated them to seek election just to be vindictive.
Human nature being what it is, every association is likely to face this dilemma at some point in its history. In one case, it occurred in an association where my firm represented the association for over forty years, never having a problem with any of the Board members through countless administrations. Yet a few members of the association decided that they didn’t like the way the association was being run, drove the good directors off of the Board, and went a different direction in regard to the legal services being rendered. The co-owners were being provided the propaganda by the new Board as to why the changes were made, but no one even questioned why some of the directors had resigned in protest to the actions of the majority of the Board, who had their own agenda.
The way to guard against this kind of conduct is to be alert and involved in the operation of your association. Be aware of the criteria that should be considered in hiring and firing managing agents, attorneys and other professionals for the association. The Board has a fiduciary duty to operate in the best interests of the association, not in their own selfish best interests, and unless the members of the association are cognizant of this possibility, the investment in their property and their ability to live in peace and harmony can be severely jeopardized.
By Robert M. Meisner
