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KASS: Board’s actions can’t be secret

RESPONSE FROM A READER: As for the settlement referred to in your column, I wonder how any action a Board might take could be kept secret from the owners. Only the owners have a titled interest in the condominium and the Board members are only the persons to whom owners delegate some/all of their powers. Seems to me the Board must be accountable to the owners for any and all actions they might take.

Even if a court should seal such a settlement, how could it be sealed against the owners? Would that not be like a settlement between a client’s lawyer and the other party being sealed against the client? Could that be done?

Finally, I don’t see how any disbursement of condominium funds by the Board could legally be kept out of the condominium financial records. To do that, the Board would have to falsify the bank statements, the financial record, or both. Our monthly financial report from the Board includes the balances of the accounts and a reconciliation between those balances and the bank statements. To hide a payment would mean one or the other (or both,) must be falsified.

I can’t imagine how such an action to hide the facts could be controversial.

My wife and I live in a townhouse condominium and I have been on and off the Board for more than 30 years usually holding the office of treasurer. Such an act as described by the questioner would never have stood muster in our community.

Thanks for your efforts. I look forward to your reply, Warren.

MY RESPONSE:   Warren, you are referring to the court settlement against a condominium where the parties wanted to keep the settlement secret. I completely agree with you and I am not an advocate of secrecy. However, if a party to a court suit asks the Judge to put the docket (or at least the final settlement) under seal, that’s the Judge’s prerogative. Courts do not favor putting a seal on anything, and will carefully review any such request. But if after careful consideration, the Judges authorizes putting the information under wraps, there is nothing anyone can do about it, short of appealing to a higher court.

As for how the money will be classified, unfortunately as we all know, there are many ways that a clever person can find to hide how money is accounted or (or not accounted for). Once again, I do not subscribe to privacy in these cases.

OF INTEREST:

The Community Association Institute – a national organization that works for and consists of community associations all over the United States, recently did a study on the nature and content of proposed legislation impacting those communities.

Fourteen states had legislation dealing with short term rentals – such as AirBnb. Twenty one states were dealing with priority lien statutes. Other issues pending before the various state legislatures included (1) construction defects; (2) flags or signs, (3) manager licensing, and (4) fees during resale.

Every day, a new issue arises in the wonderful world of community association living.

 

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