Saturday, July 02, 2011

Mistake costs Leisure World Seal Beach nearly $273,000

The retirement community was penalized after its management company failed to pay the majority of a total of $3.5 million in property taxes on time.

1 comment:

Anonymous said...

No problem for management - just raise the assessments.

CAI Public Policy #3

"In some cases, the association must pay essential, unavoidable, anticipated expenses to fulfill its statutory and legal duty to maintain the community, whether or not the members may so choose."

"Assessment increase limitations on a percentage basis are arbitrary and not necessarily related to the reality of a given community."

"Assessment increases should be based upon the directors' prudent estimate of the funds necessary to meet anticipated expenses which must be paid for the benefit of their owners pursuant to their fiduciary duties. "

CAI Public Policies #3

By the way, what states impose a "fiduciary duty" on nonprofit directors? Many states have only a "reasonable person" standard. "Fiduciary duty" is over-hyped by this vendor trade group organization in an effort to create a standard of liability that does not exist. Oddly, agents (like HOA vendors) do have a fiduciary duty to their principals and yet management company contracts are an exercise in self-dealing, indemnification, and liability avoidance by the members of a trade group that are so quick to claim everyone else has a fiduciary duty.