Absention on Property Purchase

[Guest Betty Madison]

I am a member of a community with association bylaws following the parliamentary rules of latest edition of RROO. I would like a reading of whether a "financier" member should have voted on a property purchase. The scenario is below:

Four officers of a 9 member association board purchased land in our community from another member in Mar 2009, and the purchase is financed by that member. They stated this Mar 2012 that their intent for this purchase was to keep it available for purchase by the association. There has been no prior discussion of this in membership meetings, nor board approval for their individual purchase of this lot and their incurred debt they now want to transfer to the association.

The "financing member" also owns 14 other lots, and is the financier of multiple other lots in the community by members paying their mortage payments to them. Each association member's lot has 1 vote, and the financier has 14 votes, with his debitors voting on their own lots. With ~ 280 lots in the community, she holds 5% vote, and influence possible over several other votes (for which she holds the "note" on the property)

The four officers of the board now owe $7K more than they did at their Mar 2009 purchase due to interest paid to the financing member, taxes, etc. and wish the association to purchase their lot at their total cost. A meeting was held, motion made, 2nd, discussed, and called. The financing member voted 14 votes for the purchase, and is likely the "private financier" that the officers say is willing to finance the purchase for our association. The "financing member" spoke several times during the meeting, with the involved officers, to suggest this purchase be made.

None of the information regarding the financing member's monetary interest in this lot was provided the general membership in the meeting. The majority voted for the purchase, but a small majority had her votes not counted. This vote was to give a sense of desire to the remaining 5 board members, who will vote on the final decision regarding the purchase.

My questions are:

1. Was it appropriate for the financing member to vote in this instance?

2. Would it be approprate for the owing officers to vote in this instance?

3. Was I remiss as a member in not bringing the situation to the members attention before the vote? I was pretty sure of the situation but did not know for sure she was the financier until after the meeting. If so, would I be advised to bring this to the attention fo the 5 officers of the board who will vote on the matter?

4. Is it a conflict of interest, or is it appropriate for this "financing" member to finance the lot sale to the association, and thus the association owe her the money and possibly more influence.

As a note, this "financing" member is a stalwarth member of the association, giving much of her time and money over many years in service to the community.

Thanks, in advance for your RROO expertise on this matter. Am only looking for RROO feedback, it is a dicey situation I know, separate from RROO rules. Betty

I love my community and want to be a "part of", but would also like to keep by the rules of RROO in our affairs,

[George Mervosh]

" No member should vote on a question in which he has a direct personal or pecuniary interest not common to other members of the organization. For example, if a motion proposes that the organization enter into a contract with a commercial firm of which a member of the organization is an officer and from which contract he would derive personal pecuniary profit, the member should abstain from voting on the motion. However, no member can be compelled to refrain from voting in such circumstances." RONR, p. 407, lines 21-31

[Guest Guest]

Thanks. Since it says "should", not "shall", and can't be compelled to refrain, I suppose I have no claim to complain unless there is a legal reason that one should not vote in such an instance. oh my goodness, not interested in paying a lawyer to find out.

[George Mervosh]

Thanks. Since it says "should", not "shall", and can't be compelled to refrain, I suppose I have no claim to complain unless there is a legal reason that one should not vote in such an instance. oh my goodness, not interested in paying a lawyer to find out.

Oh you can complain outside of the meeting.......RONR has no rule preventing that. You could even raise a point of order at the meeting that the member should not vote, but he can't be compelled to abstain even if your point is well taken. But it might get him to think.