ANOTHER DBPR ARBITRATION RULING OUTRAGE!

HOA ELECTIONS JUST A JOKE!

An Opinion By Jan Bergemann 
President, Cyber Citizens For Justice, Inc. 

Published January 25, 2010

   

One of the latest hires of Chief Arbitrator James Earl, Shirley J. Whitsitt, obviously loves to make off-the-wall rulings. A few days ago we reported about her ruling in a recall case where she allowed an owner to cast 101 votes, despite that owner being billed only for the equivalent of 7 lots. Arbitrator Whitsitt didn't even make sure that these "lower" dues were actually paid, despite the request of the Owners Voting For Recall who had serious doubts if these payments were actually made. 

[See: ANOTHER RECALL ARBITRATION JOKE -- AT THE EXPENSE OF THE HOMEOWNERS!]

   

In another brainstorm Arbitrator Whitsitt ruled on a homeowners' association election dispute, coming up with some landmark ideas that clearly fail to follow the legislative intent of the statutes. But, as we have all figured out in the mean time, the Division's arbitrators are not really interested in the wording of the statutes or the legislative intent; they create their "readings" and "interpretations" -- trying to stir up the folks with weird rulings!

    

The actual SUMMARY FINAL ORDER in the case of Leah Saar v. Wellesley at Lake Clarke Shores Homeowners Association, Inc. is not really what makes me wonder. It's more how this ruling came about. If you read the initial ELECTION PETITION FILING by Leah Saar, an owner in the Lake Clarke Shores Homeowners Association, you will realize what really happened in this case of an "annual meeting with election" that never took place. And allowing this to be called "legal" by the Division's Arbitration Section is the OUTRAGE in this case.

How do you like these kinds of shenanigans used to make sure that the sitting board members don't have to face an election process:

  • A new annual meeting with election was not rescheduled after the originally called meeting couldn't be conducted due to lack of quorum.

  • Request for a rescheduled meeting by members was ignored by the board, even after threat of arbitration petition.

  • Three of the five board members, whose terms expired at the next election, refused to reschedule the annual meeting with election and declared themselves officially "re-elected."

  • By their own “judgment” the board members declared two candidates -- owners who volunteered to serve on the board -- not suitable to serve on the board of directors.

  • Sitting board waived a new election due to the "unsuitability" of the other candidates.

  • Board declared that even if the meeting were postponed as required until quorum was achieved, the challenging candidates could not be elected due to their "unsuitability" -- a "proven fact," according to the board.

In other words: Why should we [the board] hold an election if nobody but we are suitable anyway -- especially considering the danger that the owners at a rescheduled election may not vote in our favor?

  

The case management conferences are always the real fun part of these arbitration cases.

 

How about an arbitrator showing her attitude in regards to lack of quorum at the first meeting: “If there isn’t a quorum, what do you expect them to do, round up people at gunpoint?” According to Arbitrator Whitsitt, it's not the board's obligation to organize the meeting with election, it's actually the members' responsibility to make sure that the meeting is organized, meaning the members should "force" the election. Gee, French Revolution all over again?

  

When petitioner verbally argued that the board had a fiduciary duty to the members to organize and hold the annual meeting, no matter what the mechanics of the solution, Arbitrator Shirley J. Whitsitt responded (quote): “You say board members have a fiduciary duty to the members? Can you cite the legal authority for this alleged fiduciary duty?”   

  

That surely raises the question: Who do board members owe a fiduciary duty to? Most interpretations claim that board members owe a fiduciary duty to the association. BUT WHO IS THE ASSOCIATION? Wouldn't the answer be: The members of the association?
   
No matter what -- if an arbitrator of the State of Florida -- fully informed about the board's actions -- allows this refusal to hold a rescheduled election to stand, this no longer is the Land of the Free. If board members are allowed to decide who of their neighbors is “suitable” to serve on the board and refuse to hold elections due to the fact that "all opposing candidates are not suitable to serve on the board" and have a Division arbitrator sanction these actions, our community associations are in even deeper trouble than we already figured.

   

Now some smarty-pants will argue: The owners can always recall the board if they don't like the way the board conducts business. Sure, but in a recall arbitration you deal with the same brainstorming arbitrators as in election arbitrations. 

  

So, why bother trying as long as our legislators are not willing to create election procedures for FS 720 (HOA statutes) that stop dictatorial boards from using loopholes to stay in power forever.

   

Florida's homeowners' associations are Banana Republics par excellence -- if our statutes allow these methods -- methods worthy of a banana republic. I almost forgot that Florida couldn’t even get the national election results correct in the year 2000, so why should I think that fair elections should be allowed in our homeowners' associations?

 

With all these shenanigans declared to be “legal” you still wonder why the steady flow of retirees moving to Florida from up North has stopped? Nobody wants to move into a Banana Republic!

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