Category Archives: Legal

Attorney Quashes Rights of Association Members

Does anyone else find it curious that at the RVS Annual meeting on Tuesday, November 18, 2014, when an Association member in good standing made a motion (which received a second) to revise the Agenda (prepared by the Board and the Association Manager) to allow for a longer time period for Association members to ask questions of the candidates running for office, that the Association’s Attorney, Lynn Krupnik, (not a member of the Board, not the facilitator of the Association meeting) stood up and declared that the motion was “out of order”?

When challenged by an Association member that the motion was, in fact, in order since the meeting was being held by the Association and therefore, members have a right to make motions and have them discussed by the whole,  Ms. Krupnik responded again that the motion was “out of order.

When asked to explain in what way this motion was “out of order,” Ms. Krupnik’s only response was that it was “out of order.” No citing of parliamentary procedure rules, no explanation at all. Just that the motion was “out of order.”

Unfortunately, many of the Association members present chose to allow Ms. Krupnik, the Board President, and three of the other Directors to ignore the motion, and continued the meeting with the challenged Agenda.

The Agenda item providing time for Q&A from the audience to Justin Scott, HOAMCO CEO, did not occur, since his presentation went far beyond the time set aside. Ms. Krupnik’s presentation also went beyond the time set aside but a Q&A session followed. Please note, that the candidates’ introduction time of one minute each with no time allocated for Q&A was timed with a stop watch. The other presentations: Warren Thompson from Ranchland Utilities with time for Q&A; Cliff Baldwin from the Finance Committee –  the 2015 Budget with time for Q&A; and reports from the other committees with time for Q&A. But none of these presentations were timed. (with or without a stop watch)

Incidentally, the Agenda item listed for providing time for Q&A from Association resident/owners was cancelled because of insufficient time available, even though there were many voiced appeals calling for that part of the meeting to occur. The former Board President explained that the meeting had run over the time set aside for the meeting, and declared that the room had to be cleared by 9 p.m. Yet the meeting was adjourned at approximately 8:35. Hmm. I guess the President believed it would take all of 25 minutes to clear the room. It is interesting to note as well that the President, being so concerned with following the time frames set aside, neglected to use a stop watch to time the other Agenda items. Hmm, imagine that.

The end result: Another instance of where Carol Thompson, and certain Directors, in collusion with the Association’s attorney and our management company, quash members’ input, silence attempts to inform the Association of critical concerns held by many members, and abridge members’ rights to free speech and responsible representation from their elected officers.

The Election Fix — Who Cast the Most Proxy Votes in the Board Election?

Someone who isn’t an owner or a resident of Rancho Viejo South. The Community Manager.

How to Fix an Election

It’s really simple. You allow the person who is supposed to be acting in a neutral capacity — collecting the proxies, reviewing the proxies for accuracy, and making sure there are enough proxies for a quorum — to vote the proxies. That’s what happened on Tuesday night. In all previous elections, designated proxies could only be RVS homeowners in good standing.

When an objection was made at the meeting about the community manager being allowed to vote proxies, Association Attorney Lynn Krupnik stated that anyone could be designated as a proxy; the person did not have to be an owner.  Anyone off the street could walk in and attend our meeting and vote on behalf of an owner. That’s interesting because the ballot form requires an address or lot number of an owner. What address did Vince Montoya write in?

What’s wrong with letting non-owners vote? Plenty. RVS owners who are in arrears in paying their assessments are not allowed to vote. Individuals who have no ownership interest do not pay assessments. Let’s say an owner in good standing designates as his proxy (perhaps unknowingly) an owner who is in arrears on his assessment. According to attorney Krupnik’s opinion, since anyone can be a proxy, that person who cannot vote for his own unit, can vote as a proxy for someone else. The attorney’s opinion severs the relationship between ownership/payment of assessments and voting rights. That’s a very bad precedent.

Last year the Board decided to hire neutral ballot counters because they did not believe residents could be trusted to honestly count ballots. Proxy ballots are mailed to HOAMCO; the address is the office of the Community Manager. As the recipient of the proxies, the management company is supposed to act in an unbiased and neutral manner. The Bylaws (Section 2.8) actually require that proxies be mailed to the Association Secretary, who is an owner. Again, this is a blatant disregard for the Bylaws. As a neutral third-party, the community manager’s responsibility is to open the proxies, ensure there are an adequate number to attain a quorum, and ensure that the owners who submit proxies are in good standing.

There is no way the person who is performing these administrative tasks as an employee of HOAMCO should be voting. Mr. Montoya, via his inappropriate e-mail blasts, had made clear his preferences for the Board. Allowing him to cast ballots makes a mockery of the supposed neutral and fair voting process. Mr. Montoya has been rewarded for his unethical behavior with a $9,000 raise starting in January.

The proxies that were submitted without a designated person to vote the proxy were supposed to be used for quorum purposes only. A few of us were watching how the proxies were being handled at the registration desk. There was a pile set aside and we asked the ballot counters if these were the “quorum only” proxies. They said yes.  During the committee report part of the meeting Mr. Montoya brought several proxies/ballots to Jim Kerr, the Secretary, who wrote on them. This was in full view of all attendees.

Then Mr. Montoya went outside to where the ballot counters were. I was outside and saw him with a stack of about 15 stapled yellow proxies and blue ballots, signing the ballots as quickly as he could and handing them to the ballot counters next to him. (See the picture in ELECTION FRAUD.) Could he have put his name in as the designated proxy on the “quorum only” proxies and then submitted a ballot? Could Mr. Kerr have written his name in as the designated proxy on the “quorum only” proxies?  Did the quorum only pile make its way into the counted ballot pile?

Last year it was suspected that something similar occurred and a resident asked to see the paper proxies and ballots, and was refused by former President Thompson and Community Manager Montoya (see Oct 8th comment). I presume the same thing will happen this year.

The Board attorney and HOAMCO, who should be neutral and adhere to professional standards and ethics, willingly participate in this charade. The current Board can serve for life if we let this continue.

Watch this video to see what can happen when a few people have absolute control. The Board in the video approves expenditures after the fact. We already have that. The Board uses intimidation tactics. We have that, too.

In January 2015 our Board will be voting to possibly change Board meetings to quarterly. That would mean that minutes and financials would not be posted for three months. That’s even less transparency than we have now.

Is this the future you want for Ranch Viejo South?

Budget misuse by President

It seems the board president is confused about how our budget works.  She believes that all budget line items must be spent by the year end.  This is not how the RVS budget works.  She also believes that she does not need approval from the other board members to spend association money.  Not having an audit in 3 years is irresponsible and she is not doing her fiduciary duty.  I believe she has misappropriated funds and if we continue down this path our reserves will not be adequate to cover future repairs.  Remember, our association does not have city or county services to help cover repairs to our community.  The association pays for everything, to sign replacement to pot hole repairs.  Yes, we have over a million dollars in reserves, but if and when we have to do major road repairs or irrigation repairs, this amount will decrease substantially.  For those of us who plan on living here a long time, we need to be concerned about the future because the current board president is not.

Retaliation, Intimidation, and Invasion of Privacy

At the July 30 community meeting, in response to a question, we discussed the retaliatory actions of some Board members against another Board member who had asked to see Board records that the Bylaws entitle him to see. Board members wrote to the individual’s employer, saying derogatory things about the Board member and asking the employer to “do something” about the individual. The letter was not signed but the information contained in it described things only Board members would know.

The Board has moved on to their next victim — me. On August 15, I received a letter stating that I was leasing my home in violation of the Bylaws, which state, “Any dwelling that is leased shall be leased only in its entirety…” In other words, residents are prohibited from having roommates or renting a room while they are still living in their homes.

I am not leasing my home. I do have overnight guests from time to time. I was informed that I should respond to the letter within 14 days or I would be fined. I did respond within the time period in writing but received a violation letter anyway stating that I had not responded. Again, nobody signed the letter, but there is a title — compliance coordinator. I had my attorney write a letter explaining that I am not leasing my home. In response I received a second letter with a larger fine. Then I received another letter saying I had not complied. I am now getting letters every day, with ever increasing fines, even though the Board has scheduled a hearing. That is harassment.

If the Board has asked for legal advice on this matter from the HOA attorney, it is residents’ dues that are paying for this.

The Board and the Community Manager have apparently enlisted one of my neighbors to watch my home. They call this “an inspection of the community.” I suppose there may be a positive side to this. I could post a sign in front of my house saying, “Burglars beware, my neighbor has this house under constant surveillance.”

The Board has taken quite an interest in who is sleeping in my home and they want me to pay a fine. But the Bylaws apply to all residents. Last October, the HOA attorney advised Board President Carol Thompson to declare in writing that she has a potential conflict of interest because she has a business relationship with HOAMCO, the company that manages RVS. (In this ethics-challenged state there is apparently no such thing as an actual conflict of interest, only a potential one.) This fact was disclosed at the October Board meeting but mysteriously never made it into the minutes. There was another special meeting, the minutes of which have not been published because Ms. Thompson does not want this fact to become known. The Association paid for legal fees but no minutes were published.

Ms. Thompson has never recused herself from voting on the HOAMCO contract and has never disclosed her business relationship with HOAMCO in writing. Nor, almost a year after the attorney’s opinion, has she been fined to my knowledge.

Section 6.4 of the Bylaws states that, “Unless otherwise approved by a majority of the other directors, no Owner Director may transact business with the Association or any Association contractor during his or her term as director or within two years after the term expires. A director shall promptly disclose in writing to the Board any actual or potential conflict of interest affecting the director relative to his or her performance as a director.  A director’s failure to make such disclosure shall be grounds for removal by a a majority vote of the other Board members.”

I have read and reread the Bylaws and still can’t find any clause that says that Carol Thompson is exempt from them. She was also instrumental in passing a revised Board records policy that forbids any Board records from being taken off the premises of the Community Manager’s office. Yet this past summer, just a few weeks after the policy was passed, Ms. Thompson came to my block to help resolve a DRC dispute between two neighbors and she brought the original documents, not copies, with her. Again I looked for the clause that said that the Bylaws do not apply to her but could not find it.

So folks, what do you think? Should the Bylaws apply only to some residents? Are some people just way too important to comply with the governing documents?

I think the Bylaws apply to all residents equally. Though I do not believe that I have violated the Bylaws, I am willing to pay a fine when I see a copy of a letter from Carol Thompson disclosing her potential conflict of interest. I’m not interested in increasing the already way over-budget legal expenditures incurred by this rogue Board of Directors.

A hearing has been scheduled on my supposed violation next Tuesday evening at 6:10 p.m., just prior to the regular Board meeting at the Association offices. I invite all residents to the hearing. The Board wants it to be private. I want it to be public. And stick around for the regular Board meeting. See how your Board operates.

President Continues to Violate the By-Laws

As a Director I requested records from the President and Community Manager that were continually denied, despite ByLaws that guarantee Directors the right to examine records.  Even after a dispute resolution was started, that was denied, too.  I felt compelled to inform residents of these improper actions.  Please see the tab under Behind the Curtain or click Improper BOD Vote.

David Pfeifer

Dog Death Leads to Arraignment

In May, an off-leash pitbull attacked a shitzu on RVS trails and the shitzu could not be saved by emergency personnel.  The State of New Mexico has filed criminal charges against the pitbull owner who will be arraigned in Magistrate Court on July 23.  See drop-down under “Meetings and Notices” tab for more details.

Update: Link for 7/22/2014 article in the New Mexican:

NM HOA Law is Useless by Marcia Kaplan (Published in The New Mexican 6/8/2014)

Approximately 60 million Americans live in communities governed by a homeowners’ association (HOA). HOA board mismanagement is rampant across the country, with financial wrongdoing the most common form of misconduct. Why does this happen?

HOAs are mostly unregulated. Consumer protection laws do not apply. The majority of homeowners are disinterested until large association dues increases occur. The “Homeowner Association Act” of New Mexico, passed in 2013, requires re-registration by June 30, 2014 for our states’ approximately 50 HOAs. The law does not provide a state agency to monitor compliance with SB497, nor any mechanism to investigate alleged malfeasance. In other states, the Attorney General’s office handles complaints but that is not the case in New Mexico. When I called the Attorney General’s office they said to hire a private attorney.

NM residents who confront their HOA boards for infractions must pay their own attorney fees, while boards get to use HOA funds for defense. Those funds come from association dues, so if a resident sues an HOA, a portion of their dues is used against them. Most HOA bylaws state that HOA funds can be used for legal purposes only if the board members are in compliance with bylaws of the HOA; if they are not, board members are personally liable. But that cannot be proved until a matter goes to court. No wonder boards feel emboldened to act however they please.

My own HOA Board treats residents with disrespect, bullying, and intimidation. The President had a sheriff’s deputy come to our annual meeting and some monthly meetings. Resident comments were moved from the beginning of the meeting to the end. When asked why, the President said, “Because we can.” She also spent our money to get a legal opinion on it. Two months later, resident comments were limited to two minutes per issue, despite the fact that there are seldom more than eight residents attending. Meeting minutes have become increasingly abbreviated and no longer accurately reflect what happens at meetings. Why? The Association’s attorney recommended it to protect the Association and Board members from legal liability. More and more Board business is conducted in executive session, in total secrecy. Legal expenditures in the first four months are close to the whole year’s budget. Anyone who asks about the expenditures is told that details are confidential.

We have a newsletter that is funded by resident dues, but the Board will not publish residents’ letters to the editor.

Four members of the board held a meeting without three other members and called the sheriff on a resident because they said they felt threatened. This resident had the audacity to question their actions on a regular basis and they deemed this harassment. The HOA manager also called the sheriff to say that a Board member had threatened him. The Board member had been asking for months to see HOA records he is entitled to see and was refused. Exasperated, he used “foul language” according to the manager, triggering a visit from a deputy sheriff. In each case, sheriff’s deputies found no wrongdoing, but the residents had no recourse against these Board members.

A new records policy adopted by our Board forbids Board members from having a briefcase, purse, backpack, coat, cellphone, or camera when inspecting Association records. Board members, who are entitled through bylaws to examine and copy records, are being treated like criminals. The rules for ordinary residents are even more onerous. If they object to anything the Board does, they stand a good chance of suffering retaliation.

There should be a state agency that investigates complaints from HOA residents. Without any enforcement power, New Mexico’s HOA law is useless.

New HOA Law is Tough to Enforce – Residents Need to Pay Attention

Posted by/for mfkaplan

In June, a new law goes into effect in New Mexico, SB497, which provides rules for HOAs. Unfortunately, there is no state agency designated to enforce the new law. On a national level HOAs are largely unregulated, and even when there is a designated enforcement agency (mostly in larger states with many HOAs such as California, Florida, and New York), responding to HOA residents’ grievances is a low priority.
The best thing residents can do is become active in their HOA: attend Board meetings and look at the budget and most importantly the expenditures. Financial irregularities are the most common complaints in HOAs. Your Board is answerable to you – if they do not satisfactorily answer your questions or treat residents in a demeaning manner, then they deserve to be voted out of office.
Below are the 15 most common complaints (not in any specific order) about homeowners’ associations:
1. Wasting association funds
2. Selective enforcement of rules
3. Unable to access records
4. Assessments too high
5. Communications are spotty or poor
6. Hostile environment
7. Management misuse of assessments
8. Fair Debt Collection practices not being followed
9. Elections being manipulated
10. Association attorney favoring Board
11. Withholding use of facilities or services
12. Poorly written documents
13. Meetings being held in secret
14. Maintenance of common grounds is poor
15. ACC Policies are not consistent
Source: APM News, Florida

May Board Meeting: No Audits for 3 Years, No Transparency

Posted by/for jess4square:

It seems an audit has not been done for the association since 2010 (incidentally audits were done every year prior to 2010). This is a little concerning and I am baffled as to why for the past 3 years this was not taken care of by the finance committee, treasurer, or manager/managing agent. Due to this oversight, we will have to pay $5,800 for an audit.

Expenses are still not being approved by the entire board. The board president stated that she is following a policy from Patrick Thomas and/or the developer? I am not clear as to what this has to do with our association or with accounting practices. Our money is being spent however the board president and manager want to and with no oversight. In my 7 years of managing associations, board members always approved expenses for improvements, new equipment, legal opinions, or anything outside of normal expenses (utilities, minor repairs, etc.). This was the practice for RVS as well, but it changed in 2010.

Legal expenses are at $5,285.00 as of the end of April, with the yearly budget at $6,000, this line item will once again be over budget (Legal expenses for 2013 were close to $16,000.00). Also, $440.00 was spent on a transcriber for a legal meeting with the board and association attorney, in OCTOBER. However, this was not for minutes, but for a legal opinion, which the attorney charged $1200.00. So why did the association pay for 3rd party transcription services when the attorney should have had her staff do this work. Now this document is with the attorney and she is reviewing/correcting this document. I can only assume that she will be charging additional attorney fees for this. Since this is a legal matter, I do not know if all the board members approved all of these expenses.

The board approved to spend $5,000 to pay the association’s share for an infrastructure engineering report. Although I agree that this is necessary, I would also like to see better planning for infrastructure repairs, replacement, etc. It is unfortunate that some board members decided to eliminate the infrastructure committee.

At the monthly meetings we keep hearing that the newsletter is breaking even or making money. According to the year-end and/or monthly financials, this is not the case. Last year the newsletter was over budget by $2,542.05. As of April, income vs. expenses, the newsletter is in the red by $1700.00. It is time to re-examine this elaborate newsletter and perhaps get back to basics. The yearly budget for the newsletter is $13,200.00, this money could be used for improvements to our community.

The Safety, Landscaping, and Townhome committees do not have any homeowners while some board members are on multiple committees. I have applied to both the Landscape and Safety committees, my application was denied despite a call for volunteers. However, the board has approved homeowners to the finance and DRC committees where there are plenty of homeowners.

The board approved to meet every other month. I am not sure if this is a good idea. It means the homeowners will not know what is going on with the association/board or what expenses or actions are taking place until months later. It seems transparency is disappearing.

Board Proposes Violating ByLaws – Again

See “Proposed Record Inspection Policies” under “Behind the Curtain” to download the policies proposed at the March BOD meeting.

You Be the Judge

♦ Blog Navigation Hint: Several recent comments pertain to Santa Fe County Sheriff reports on a resident and a director of the south association board.  Information regarding the text of these reports can be found under the menu tab:  “Behind the Curtain” – “Who Called the Sheriff … ?”

March Board Meeting and Bylaws Violations

Posted By:, March 31, 2014 at 6:45 pm

Comment: Thanks to all the homeowners who attended the March Board Meeting.  Although I had to leave the meeting early, I understand that many of you voiced your concerns to the board.

The most debated action by the board was the adoption of a records policy.  Basically this policy is restricting access to association records not only to the homeowners, but to the board members!  How are the board members able to do their fiduciary duty if other board members are restricting access to certain records?

Please refer to the Bylaws, 3.16 (l) and 9.4 (c), which can be found on the RVS website, under Community Documents.  Despite the fact that this policy is a clear violation to the Bylaws, the majority of the board still approved the policy (5 to 2).   Fortunately, policies cannot be adopted that are in conflict with NM Law or the governing documents of the association…the Bylaws.  Therefore, this policy is invalid.  This is just another example of how the majority of the board is conducting business that is not in the best interest of the homeowners or the association.

Perhaps the most shocking and blatant abuse of power and authority is the fact that 4 board members took legal action against me, a homeowner, for voicing my concerns.  They claimed it was harassment.  The Sheriff found no validity to their claim and the case was closed within hours of filing.  In fact, the Sheriff agreed that I have every right to voice my concerns to the board and he stated that no evidence was found to substantiate their harassment claim.  Did the homeowners not elect these board members to serve?  They volunteered to be on this board and to perform the responsibilities of a board, and if homeowners have concerns about certain issues, they have every right to voice their concerns to the board, without legal consequences.  By the way, this is also a violation to the Charter.   Board members only have the power and/or authority to bring legal action against a homeowner for violations to the CCRs and for past due assessments. Not for voicing their concerns!

I would like to see the majority of the board govern the association according to the Bylaws (I know I sound like a broken record).  This is not occurring.  However, 2 board members continue to fight for the Bylaws and although they are the minority, many homeowners appreciate their diligence.  I would also like to see the board president conform to the role appropriately.  A board president’s duties include setting the agenda, conducting the board meetings, and signing relevant documents such as contracts.  It does not include being at the association office on a daily basis managing the manager and managing the committees.  It is my understanding that some homeowners have resigned from the committees due to this.

Is it too much to ask that some of these board members read the Bylaws?  It is their responsibility to govern the association according to our governing documents.  There are rules and procedures in place for a reason, so that board members do not abuse their power and authority.

I hope that many more homeowners start attending the board meetings and voicing their concerns.   This is our association and we have a right to address these board members and to advise them that violating the Bylaws is not acceptable.  Thank you.