The following is a variation of a common question relating to who can serve on the board of an HOA or Condo Association.

“What are the rules in California regarding HOA Board members not being actual owners? If a woman owns the unit and it is recorded under her name, can her son who occupies the unit run for the Board? Thanks”

The answer to this question will be found in the governing documents of the association, probably the Bylaws. Look in the section on directors or elections first. If it is a new association, the docs probably say that a director need not be a member of the association. This is to assure the developer that he or she can put people on the board who are not owners of the company, but employees or staff, while he or she still has enough votes left to get a candidate elected to the board. When associations amend or restate the documents to update them they often, sometimes at the advice of the attorney, change the language to allow only owners to serve on the board.

There’s more  to this. Sometimes owners will do things to try and get around an “owners-only” restriction for the Board.  For example, a mother such as that in the above scenario may decide to give the son a part ownership in the unit. Sometimes owners put their property into a trust and then the trust becomes the record owner. Here, it gets more complicated and the language in the documents has to be reviewed carefully because some rights can be exercised by the trustee of the trust (which is usually the prior owner of the property) and the question is – “what rights”? Voting? Attending meetings? Running for the Board? When a property is owned by a trustee or a business, there may be some language somewhere in the documents tied to some of the rights that defines what happens. Example? Maybe the docs say that the Trustee appoints the person who has the right to vote. Or the business owner designates the person authorized to exercise membership rights.

If the documents say the directors have to be “record owners”, then no one can be a candidate unless they are actually on title in the official records of the county.

Once again, what seems like it should be a simple question, lends itself to all kinds of sub-questions and answers.

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3 Responses to
  1. Michael
    June 30, 2011 | 4:48 am

    We had our HOA election and several ballots were dismissed for various reasons. Several homeowners are upset that those ballots were not counted. We’ve contacted the Inspector of the Election with our challenges but have not received an offical response and its been over a month. It is our understanding that we can take our challenges to Small Claims Court to have the issues addressed, but not sure how to proceed with that. Our first question is who is the defendant? The HOA or the Inspector of the Election? And how do we identify or specify our claim for the lawsuit? And can a group of homeowners file the claim together?

    • Beth Grimm
      July 5, 2011 | 10:40 pm

      First of all, I have been recommending for a long time that HOAs and Condo Associations make some effort to assure that votes are counted and one way to do that is to have the inspector or manager contact people whose ballots will not be counted (if the return address is present so they know what property is involved) and provide some means of having them come in and correct the error – which OFTEN is that they did not sign the outside envelope. Yes, it is true that owners tend to either ignore the instruction or forget to sign the outside envelope. Many boards feel that is the owner’s fault for not following instructions but some are willing to set up a process whereby the owner can come in and sign their ballot envelope. However, do not interpret this suggestion as meaning the owner can retrieve the ballot package and take it away from the inspector. Once in the hands of the inspector it is not revocable. And depending on who the inspector is, and how difficult, cumbersome or costly it is to set up such a process, it may not even be feasible.

      I would caution HOAs and Condo Associations that do not take these measures however. In a fairly recent Superior Court case (not a published opinion but indicative of what a court might do when there are uncounted ballots), the judge did not respond favorably to a Civil Code 1356 petition to approve restated CC&Rs because, in part, of the fact that there were 100 uncounted ballots. If a board is trying to pass an important or very material ballot measure, it would make good sense to do whatever is reasonbly possible to encourage owners – and to assist even those who do not follow instructions – in a way that makes sure as many ballots as possible are counted.

    • Beth Grimm
      July 5, 2011 | 10:44 pm

      And as to the question about small claims court, an owner can challenge an election and generally the HOA would be the defendant in such a challenge. However, if the inspector is independent, they could be named; I am not sure what a judge would do about that though because it is an HOA election and the inspector is only an agent of the HOA. It is similar to a situation when an owner names a manager as a defendant when in actuality the issue is over an HOA or Condo Association policy. Small claims judges and hearing officers have quite a bit of lattitude and sometimes take liberties they should not take. On the other hand, some step back from making decisions in suits where although they have the power, they would rather say they don’t and back off.

      As many say – Small Claims Court is basically a “crapshoot”. Sometimes it works very well, and other times it can be disastrous.