Thu, Dec 5, 12:49 PM
Hi All,
As the managing attorney for legal matters at my firm, I’ve been following this situation along with David Berk in my office and we have had many discussions about the matter. The analysis contained in the attached .pdf email is correct and comes from Mr. Berk. Mr. Berk has written on this matter and attended a meeting to explain the matter to Mr. Jones and Mr. Ates; Mr. Berk is correct. His opinion was formed in consultation with me. There are currently 4 legitimate directors (Jones, Ates, Naik and Blakeman).
The board appears to be split 2-2, and as a result our firm cannot take direction from or support either side. Further, 2 of those legitimate directors cannot, by themselves, make any business decisions for the Association (as discussed in the attached). It is imperative that the board operate in accordance with applicable law and the governing documents, and it is recommended that the 4 legitimate directors cooperate to do so.
There can be serious negative consequences to the Association if this course of conduct proceeds, there is potential personal liability to the directors purporting to take actions which are contrary to applicable law and the governing documents. Further, the Association entity itself is exposed to serious liability when business matters are not properly approved. In addition, it is a breach of duty to compromise your Association and your community by proceeding in this manner.
Mr. Berk told me that at the meeting he attended, one or more of Mr. Jones and Mr. Ates indicated they had spoken with an attorney about this matter and that attorney supported their position. If that is the case, then that attorney is not familiar with either the facts or with Property Owners Association Law, which is a highly specialized area of law; I would challenge that person to put their opinion in writing or contact our office to discuss. Moreover, I am advising that taking advice on this matter from an attorney not familiar with this area of law is careless and a breach of duty to the Association. If a Director wants to seek a second opinion from an attorney not associated with our law firm, at their own expense, then I would suggest that they reach out to a local attorney who, like me, is Board Certified in Property Owners Association Law; you can search for such an attorney here: https://www.tbls.org/findlawyer-results
David and I are happy to work with the 4 directors to reach a resolution and would very much like to do that so the Association can get back to its business and to operating properly. There is no need for things to have proceeded in this manner, there is still time to course-correct. Please let David and me know if we can meet or have a conference call to discuss, however, we would want all 4 of the directors to approve/participate. If this cannot be achieved, then I would advise not to make business decisions until a resolution can take place.
Luke P. Tollett
Attorney at Law
Holt Tollett, PC