Yes, This Manager Is Wrong, But What to Do? [HOAleader.com Video]
HOAleader.com - Tip of the Week - October 27, 2023
In this week's tip, we help out an HOA president whose question to us clearly conveys his utter frustration with the manager his community is replacing.
Our reader asks: "Our association recently changed management companies. Things were moving along until the last week of the contract. The new management company started sending emails asking for help in obtaining our June financials and banking information as the outgoing management company was being unresponsive. Without the final financial data, we cannot reconcile our banking info
or that all association monies had been transitioned. Two days before the end of the contract the outgoing company sent the board a letter stating they would hand over the remaining data only after they were paid what was due them.
"The
contract states the following: Agent shall turn over all association records in the possession of Agent pertaining to the operation of the association to the board and/or its assigned agent upon the last day of the agreement…All compensation earned by agent shall be paid after the transfer of records is complete and shall not exceed 30 days thereafter.
"I sent the owner of the old management company this: 'The data you're withholding is keeping us from reconciling our financials, and that's keeping us from being able to make payments, including yours. Release the data to the new company, and you'll get your invoices paid.'
"His reply: 'I appreciate your response, but your statement is incorrect…All required data will be provided within two business days once our team verifies payment has been received.'
"This type of action fits perfectly in the definition of extortion, but is it?"
Click on the arrow below to hear a short clip in
which two of HOAleader.com's experts— Robert E. Ducharme, founder of Ducharme Law in Stratham, N.H., who specializes in representing community associations, and Matthew Zifrony, who advises homeowners and condo associations at Tripp Scott, a Ft. Lauderdale law firm, and who has also served as the president of a 3,000-home association—explain why, yes, this president has every right to be frustrated.
