With more than a month of chaos, canceled ballots and overturned elections all unfortunately intertwined with the holidays, we find ourselves as property owners facing a new year in Big Canoe with a self-appointed board and more questions than answers. Leadership responsible for the aforementioned calamitiesremain to spearhead what may yet be more invalid elections and continued uncertainty as really nothing has changed other than a paltry attempt at the much deserved apology to a board candidate deemed ineligible.
Based on advice from POA staff . . . the election committee chair and POA president chose to proceed . . .
First, let’s talk a bit about governance as it pertains to the eligibility of board candidates. Among other things, only “owners” of property in Big Canoe as defined in the 1988 covenants (1a) can be considered for the position of director. It is unfortunate for the candidate and the community that, based on interpretation from POA staff and a yet unnamed attorney (2), the election committee chair and POA president chose to proceed contrary to what was so clearly defined in our governing documents. Eight months later, countless hours of discussion with two separate law firms and presumably many dollars have been spent to determine how to unravel the mess and move forward when a simple understanding of governance 101 should have prevailed. And now, this very same president, election chair and member of POA staff is charged with ensuring that our next election will be valid? Perhaps it is time for some to step aside.
Committee positions also fail to meet eligibility criteria . . .
Assuming that leadership now has an accurate understanding of what constitutes ownership, they would be well served to also review the various committee positions for failure to meet the “ownership” criteria as several can be found. (3) Likewise, it would be judicious to enforce the published rules and regulations that prohibit one individual from serving on more than one board committee simultaneously. The reasons for this prohibition should be obvious. The overlapping of committee positions was apparent in 2019 and presumably continues into 2020. As an example, in 2018 alone, one individual sat on three separate board committees while also serving on the general manager search committee. These statistics do not even include membership on general manager committees where such overlapping is actually permitted. Obviously, observance of established rules and regulations has not been the practice of this and previous boards leaving the important committee function completely lacking in diversification and appropriate representation.
And what about those property owners representing 323 properties whose 570+ votes were deemed ineligible due to the sheer absurdity of an interpretation, once again, by POA staff. Do they also deserve an apology?
The entire delinquency and suspension of voting right issue has not been adequately addressed. Given the conflicting opinions and interpretations from parties on all sides of the issue along with the fact that the disqualification of a substantial block of votes serves to significantly dilute the required quorum, a written, legal opinion should be obtained. Continuation of this practice of declaring property owners ineligible to vote without an appropriate legal review of that practice, will most certainly put future ballots and elections in question and jeopardy.
Leadership may have failed to research the governing documents in their entirety . . .
Taking that entire discussion a step further, while the board and management cites it’s authority for denial of voting rights from two separate governing documents (1b) (4) (5a), it appears that leadership may have failed to fully research those documents.
In case of any conflict between By-laws and the Declaration . . . the Declaration shall control.
First, leadership cites Article VI, Section 7 of the covenants dated March 26, 1988. (1b) This article and section seeks only to define when an assessment becomes past-due or delinquent. It does not reference voting rights. Most importantly, no mention of the suspension of voting rights regardless of delinquency status can be found in this section or anywhere within the entire 1988 declaration of covenants.
Secondly, leadership cites the 2006 by-laws at Section 2.7. “Suspension of rights: If a property owner is shown on the POA’s books and records to be more than thirty (30) days past due in any assessment or charge . . . neither the Member nor the Member’s spouse shall be eligible to: (i) vote, either in person or proxy . . .”
As stated in this 2006 amended and restated by-laws, as well as all past amended by-laws at Article XII, “In case of any conflict between these By-laws and the Declaration, the Declaration shall control.” (5b) (6) As stated above, no reference to the suspension of voting rights can be found within the 1988 covenants.
Further, the Restated Articles of Incorporation (7) filed with the Georgia, Secretary of State in 2011 address voting at Item No. 4. Specifically, “All owners, by virtue of their ownership of Property in the Community, are members of the Association. The members shall be entitled to vote as provided in the Amended and Restated General Declaration of Covenants and Restrictions of the Big Canoe Property Owners Association and Big Canoe Company, recorded on July 13, 1988 . . .”
Once again, this author has been unable to find any reference to suspension of voting rights within the 1988 declaration of covenants.
As for the by-laws . . . required property owner approval has not been obtained since 2004 . . .
As a matter of additional information, Article X of the by-laws does allow certain amendments by the affirmative vote of a majority of the Directors, although it specifically prohibits any alteration, amendment or repeal of any by-law affecting the number, classes, election, powers and duties of the Board without the affirmative vote of two-thirds (2/3) of the Members of the Association, entitled to vote. (5c) (6b)
Clearly the 2006 third amended and restated by-laws relied on by leadership were in conflict with the 1988 covenants but also should have required property owner approval. Not only did it contain the verbiage regarding suspension of voting rights, other sections dealt with indemnification of directors and deletion of requirements that committees keep minutes of all meetings. Perhaps failure to obtain property owner approval was an oversight, and whether this renders the by-laws invalid, is unknown.
However, further amendments in 2007 (8), 2016 (9) and 2018 (10) dealing with the indemnification of directors and others and the composition of the election committee also did not obtain the required property owner approval.
Governing documents have been ignored, misinterpreted and redefined . . .
In conclusion, it would appear that for whatever reason, leadership has developed a pattern of historically ignoring, misinterpreting or redefining the governing documents put in place for the purpose of protecting property owners and our beautiful community. Whether through bad legal advice, willful intent or complete disregard, it is the property owners who ultimately suffer the consequences of those actions. At a minimum, it might be suggested that the present self-appointed board should refrain from making any major decisions or approving any large, non-emergency capital purchases until such time that a validly elected board is put in place.
Based on research of available POA documents, it is believed that the information and interpretations on these pages are accurate. Obviously, they are subject to written, legal review. Should anyone have additional information or corrections to offer, please let me know.
If you would like to see additional articles posted in the future, please subscribe for an email notification. Likewise, if you have questions or would like further discussion, I may be contacted at thepcrosses@gmail.com.
Patricia Cross (10438 Big Canoe)
References:
1 Covenants, March 1988 (a) pg. 7 (I); (b) pg. 26, Article VI, Section 7 (POAwebsite>login>POA>governingdocuments>covenants>covenants1988
2 Eblast – Communication to the Community from the POA Board, December 17, 2019
3 General Guidelines for Board Committees, Policy No. 300.4 (POAwebsite>login>POA>committees>GeneralGuidelinesForBoard Committees)
4 E-blast – A memo from Big Canoe Board of Directors and Management to correct misinformation from Focus on Big Canoe, November 27, 2019
5 2006 Third Amended and Restated By-laws (a) Article II, Section 2.7; (b) Article XII; (c) Article X (POAwebsite>login>POA>documentarchive>boardofdirectors>BigCanoe bylaws>112006ThirdAmendment
6 2004 Second and Restated By-laws (a) XII; (b) X (POAwebsite>login>POA>documentarchive>boardofdirectors>BigCanoe bylaws>10-2004BCPOABylaws)
7 2011 Restated Articles of Incorporation (POA website>login>POA> governing documents>ArticlesofIncorporation>ArticlesofIncorporation restated 2011)
8 2007 Amended By-laws (no longer posted on POA website. Contact for copy.)
9 2016 Amended By-laws (no longer posted on POA website. Contact for copy.)
10 2018 Amended By-laws (POAwebsite>login>POA>governingdocuments>bylaws>bylaws2018)
Thank you for actually reading the documents. I am a part-time owner who doesn’t get to GA nearly often enuf and never fir an extended period so haven’t done much except complain
I have been concerned since we didn’t seem to have effective attorney review at Developer turnover years ago; but became REALLY CONCERNED when two elections ago there was a question concerning Developer’s voting rights and no one saw the need for an attorney’s written opinion. I agree and have argued for the need to look at leadership provisions but please don’t forget to check out Developer’s rights and obligations. I believe if this is overlooked we are going to be facing the same types of problems in the future when an issue of importance to Developer arises
Patricia the POA board is not self appointed, they are elected by the property owners. Ideally you would correct this in a future message. I am also not sure who you are referring to when you said in 2018 an individual served on several committees and also on the GM search committee. I served on the GM search committee and cannot recall who would have been serving on several other committees. I was Chair of P and E committee at the time but that is a GM committee rather than a board committee. I totally agree with your statement about serving on several committees and also agree that all committee members should quickly be reviewed to see if they meet the requirements–I have been told that several do not. Your article was well written and the Board election process was a disaster and that is an understatement
Does the SOS of Georgia check into potential Articles of Corporations violations?
I may be the PO you are referring to that served on multiple committees in 2018. The May 2018 Board minutes document approval of the change in P & P 300.4 allowing for that condition after myself and another committee member were asked to join the Water Committee upon its formation. Three committee appointments was too heavy of a burden, and I resigned one of them at the end of that year. It appears the P & P on our current website does not reflect this update, but it is documented in the board minutes and should have been updated on the website. Also, I did not serve on the GM search committee while serving on those committees-don’t know where you got that information. I served on the original GM search committee 8/17-10/17 that did not hire any candidate, but was not on the subsequent committee that hired the Executive Search firm in January 2018. During the 2017 timeframe I was not a voting member of any other committee although Finance allows incoming members to audit the budget cycle prior to the beginning of their term. I know you do a lot of research on things, and was only a small portion of your post, but I really would have appreciated being asked for confirmation of this prior to making these incorrect statements to the public.