Harassment vs. Retalitatory Behavior?

Using his familiar spinning, deceptive writing style, David Berman has said the following on his bog:

“…a very small number of residents, who often have not participated in the process, have decided that it is appropriate for them to harass the Association with demands to cancel contracts that have been awarded, and in some cases they threaten to take their concerns forward in the form of complaints to the Division of Real Estate and promises of legal action. In addition, they have reached out to some of our vendors, filing complaints against them and threatening them with legal action, despite the fact that these vendors are acting in a completely proper manner.”

“Though I don’t like to single out individual residents for criticism, I must in this case, for a homeowner named Nathan Sonnenfeld, who has issued complaints over several actions taken by the Board and committees, has gone public on a blog administered by Board member Bob Frank with his complaints about the recent selection of a contractor to replace the decorative rock in certain common areas of Sun City Anthem.”

It is interesting that David Berman (as surrogate spokesperson for his blog-silent, board president spouse) considers resident complaints about financial mismanagement to be “harassment”, but the laws specifically encourage challenges to financial management by association members. Member challenges through the State are one of the few available checks against gross misbehavior by board directors and CAM managers involved with our millions of dollars of community resources.

Please note that the Bermans have failed to mention the fact that the law prohibits adverse actions against community members for such challenges. No matter if it is annoying to them to have to provide coherent, detailed answers to member questions, it is part of the responsibilities of the association management.  The Board and CAM are required to provide factual, open, and complete answers to member questions.

But, adverse reactions initiated by directors and CAM managers against homeowners is prohibited.  Such can be punished as being considered “retaliatory” behavior.  Directors can also be severely punished for “acting for reasons of self-interest, gain, prejudice or revenge.”  If found guilty of willful misbehavior, directors and CAM managers can lose their Directors & Officers insurance coverage, and they can be held personally liable.  While this rarely happens, it is possible.

Here is what the law says in NRS 116.31183:

“Retaliatory action prohibited. An executive board, a member of an executive board or an officer, employee or agent of an association shall not take, or direct or encourage another person to take, any retaliatory action against a unit’s owner because the unit’s owner has:

1. Complained in good faith about any alleged violation of any provision of this chapter or the governing documents of the association; or

2. Requested in good faith to review the books, records or other papers of the association.”

And, here is what the law says in NAC 116.405:

“Members of executive board: Prohibited acts. (NRS 116.3103, 116.615) In performing the duties set forth in NRS 116.3103, a member of an executive board shall not:

1. …

2. Act for reasons of self-interest, gain, prejudice or revenge;

3. Commit an act or omission which amounts to incompetence, negligence or gross negligence;”

So, you might now understand why certain board members, and CAM supervisors, are beginning to get very worried over the many well-documented charges of mismanagement (and worse) by Norm McCullough, Sonny Sonnenfeld, Tim Stebbins, Ron Johnson, Dick Arendt, Bob Frank, etc. through the Nevada Real Estate Division. You might also understand why certain past and current directors and finance committee members are so strongly opposing a detailed, investigative/forensic audit. The results from such an audit are highly likely to expose some very embarrassing facts about past mismanagement.  And, the recent financial meltdown by Wall Street and Washington shows that being trained to be a CPA does not say anything about a person’s business judgment.

Naturally, if none of the allegations are valid, the certain individuals could dismiss them as just so much flailing about by ignorant, senile residents. But, if any of the individuals are found guilty of the charges, certain individuals could be dismissed from their positions, and the association may have to pay fines to the State.  In addition, any directors who have knowingly participated in cover ups of mismanagement could also be sanctioned.

So, you might consider the outrageous counter-charges of “harassment” by the board and CAM as being illegal threats by a few desperate individuals who are worried about what an investigative audit will disclose.

This entry was posted on November 4, 2008 at 12:33 and is filed under SCA Board, Community Affairs, Laws & Rules. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

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