Member disregards their fiduciary responsibility

[Guest truthseeker]

It is believed ( not yet proven but easy to do so ) the Treasurer of our board has not followed the procedures that she was supposed to follow. This has put the organization at risk as we may not be able to collect back association dues that we have outstanding.

She actually gave a false report to the board saying she did something on a certain date which she did not do. This report is in writing.

How is something like this handled according to RONR ?

My second question is how is it handled in a practical sense.

Once it is documented, in writing, how is the information provided to other board members without risking any cause such as defamation or slander towards this member's character?

Thanks in advance for any help, procedural or practical you can give me.

[jstackpo]

Procedural: Chapter XX of RONR.

Practical: Very carefully.

[hmtcastle]

How is something like this handled according to RONR ?

See FAQ #20.

[Rev Ed]

Either Chapter #20 of RONR, or any disciplinary procedure spelled out in the organization's By-laws.

Of course, the Board is allowed to ask the member to resign first.

[hmtcastle]

Of course, the Board is allowed to ask the member to resign first.

Though permitting the treasurer to resign would remove the possibility of any (parliamentary) disciplinary sanctions.

[Rev Ed]

Though permitting the treasurer to resign would remove the possibility of any (parliamentary) disciplinary sanctions.

But at least it would deal with the issue - and depending on how much the Board wants to get rid of the member, may actually achieve the ends that are desired. It all depends on what is more important to the group - the means to the end (disciplinary process) or the ends (the actual discipline, which under the situation may be removal from office.)

[Gary Novosielski]

But at least it would deal with the issue - and depending on how much the Board wants to get rid of the member, may actually achieve the ends that are desired. It all depends on what is more important to the group - the means to the end (disciplinary process) or the ends (the actual discipline, which under the situation may be removal from office.)

I don't think you meant to say that the ends justify the means--at least not so clearly.

But, in this case, I think the actual ends are the protection of the society from (further) financial loss. And if the board loses sight of that, and believes that punishment is the main desired end, then they may all be guilty of disregarding their fiduciary responsibilities.

The details of this are so sketchy (failure to file a form, perhaps?) as to be less than useful in forming an answer. In the majority of cases, failure to do something is not usually irreparable. The society might be better served by keeping the Treasurer in place, if doing so would facilitate the remedy. There's also a difference between filing a "false" report and a merely incorrect one.

And if discipline is justified for the treasurer, I'm starting to wonder why the board has such a large role, and not the membership.

[Josh Martin]

But at least it would deal with the issue - and depending on how much the Board wants to get rid of the member, may actually achieve the ends that are desired. It all depends on what is more important to the group - the means to the end (disciplinary process) or the ends (the actual discipline, which under the situation may be removal from office.)

That might have been worded better, but your point is well taken. It is ultimately up to the society to determine whether letting the Secretary resign would be acceptable or if disciplinary action is desirable.

And if the board loses sight of that, and believes that punishment is the main desired end, then they may all be guilty of disregarding their fiduciary responsibilities.

The details of this are so sketchy (failure to file a form, perhaps?) as to be less than useful in forming an answer. In the majority of cases, failure to do something is not usually irreparable. The society might be better served by keeping the Treasurer in place, if doing so would facilitate the remedy. There's also a difference between filing a "false" report and a merely incorrect one.

And if discipline is justified for the treasurer, I'm starting to wonder why the board has such a large role, and not the membership.

It's a safe bet that once you start talking about "fiduciary responsibility," you've strayed well beyond the bounds of RONR, but your last sentence is an excellent point. Since the original question talks about distributing the information to other board members, there appears to be a presumption that the board will discipline the Treasurer. Under RONR, however, disciplinary authority rests with the general membership unless the Bylaws state otherwise.

[dbpc2000]

Thanks all for your answers. I appreciate them very much.

The issue is this: She did not send out a registered letter to homeowners who have not yet paid their assessments. The letters should have been mailed out back in January. These letters are required to be sent 45 days prior to a lien being placed on a property.

It is extremely troubling because three of the homes are under contract now and could close before we can file a lien under my state's Statues governing homeowner's associations.

This is just one thing that she has not been attending to according to our procedures but clearly the one that it most troublesome. I see the Treasurer's fiduciary responsibility to the membership greater than the other board members. I do realize all board members have the same fiduciary responsibility so to not do something would be a failure on my part. (How I look at it)

I spoke about distributing the information to other board members, because I personally would like to see her removed from office. That would require talking about it at a board meeting.

Resigning would be even better. (easier)

Too many issues to try to resolve at this point in my opinion but I could be wrong.

(our bylaws allow a majority to vote out for any reason.) See below:

REMOVAL OF DIRECTORS, OFFICERS OR EMPLOYEES

Any Directors, Officer or employee may be removed by the Board of Directors whenever, in the

judgment of the Board, the best interest of the Association will be served thereby, by a majority vote of

the Board of Directors. Failure to attend three executive meetings without a valid excuse shall

constitute cause for the removal of a Director. “

Still looking for any advise anyone can give me.

Thanks again.

[Josh Martin]

I spoke about distributing the information to other board members, because I personally would like to see her removed from office. That would require talking about it at a board meeting.

Resigning would be even better. (easier)

...

Still looking for any advise anyone can give me.

It seems fully appropriate to give her a heads-up that you intend to pursue disciplinary action and that if she wishes to avoid the embarrassment of that, she should resign. You might want to talk to other board members and show them the information first, so she doesn't just think you're blowing smoke. If she accepts, the board can accept her resignation at the meeting (I presume that if they have the authority to remove officers, they also have the authority to fill vacancies). If she refuses, follow the disciplinary procedures in your Bylaws. I would be sure that you share any information discreetly, and I would strongly advise that the board enter executive session when considering the motion to remove her.

[dbpc2000]

Thanks again for all the answers.

After being asked for a fourth time to produce the copies of the letters & receipts for mailing she resigned.

I'm so happy this is resolved. I can now concentrate on the things that will make our community a better place to live instead of this crap. What a waste of time & energy.

Of course there is the task of straightening out the last 3 months of financial documents, etc. The good thing is that it was resolved before any further damages were done.

I wonder why people volunteer if they don't have the desire or time to do what they agree to do?