Question:
Do we have to send a letter to homeowners 48 hrs prior to the board meeting to decide on a new management company. I understand that it is the board’s decision but do we need to call a special meeting before we actually sign a contract?
Answer:
Homeowners associations by-laws generally provide that the board “shall have and exercise all lawful powers and duties necessary for the proper conduct and administration of the affairs of the homeowners association and for the operation and maintenance of the homeowners association’s property.” Homeowners association’s by-laws may specifically provide the board with “the power to enter into a contract for professional management of the homeowners association at such price and upon such terms as shall be determined by the board, to perform such duties and services as the board may lawfully delegate.” Whether your by-laws give the board the general power to manage and operate the homeowners association affairs and its property or the specific power to engage a management company, the board, acting alone and without membership involvement, has the power to engage a new management company. There is no legal requirement that the board notify the homeowners prior to the board making its decision to hire a new management company, nor to hold a special meeting before the contract is signed.