A Vivid Example of Why You Need Good Records
Poor recordkeeping can undermine the results of even the most amiable and productive board or membership meeting. When a meeting is contentious, insufficient records can prove even more disastrous.
A community in Pennsylvania learned that the hard way. A trial court described the community as mired in utter chaos, nonstop disagreement, and a continuing power struggle between two factions, each claiming to be the lawful board of directors and each separately billing members for dues and assessments.
One faction claimed three members — Larry Floss, Samuel Mall, and Julie Evcimen — were duly elected to the board and remained the legitimate board. Floss testified that he’d been president for more than two years. Although he admitted that he submitted a resignation letter in 2017, Floss said that the board never accepted it and he later rescinded the letter. John Swift testified that he was on the board in 2017 and the board did accept the resignation. He couldn’t, however, identify any corporate records indicating acceptance of the resignation letter.
Everything had come to a head at a general membership meeting in November 2018. “A group of owners gathered together to confront the board then in place regarding what it thought was financial shenanigans,” says Robert Ducharme, a solo practitioner who has represented New Hampshire associations for 20 years. The board apparently responded by leaving the meeting.
The other faction — dubbed the “Interim Board” by the court and made up of Swift, Lara Winkler, Joseph Griger, Linda White, and Ben Gardner — claimed to have assumed control after the other board walked out. Swift, in fact, claimed that he had never left the board. The court found no evidence, though, that he appeared initially at the meeting and participated as a board member.
And then things got even crazier: Records Matter: A Bizarre Case Study