Best practices for amending your community’s documents

Hi I’m Betsy Barbie and this is Cam Matters Welcome to our show today as we Talk about amending your documents we’ll Be talking about your declaration your Articles of Incorporation your bylaws And we’ll even mention the prospectus And proprietary lease but best of all You will learn how to distinguish Between a big vote and a little vote Stay tuned and come join us welcome to Cam matters condos co-ops HOAs and Beyond Betsy barbeeue is an informational Leader in Florida on Community Association living rights and Obligations she is an expert on the Rights and obligations of owners as well As the association if you live or are Planning to live in the state of Florida There’s a good chance you’ll be part of A Community Association and by the end Of this show you’ll know a little bit More about Community associations and Why they matter Welcome to the show I’m Suzanne Lynn With Betsy Barbie and today we’re Talking about the exciting topic of Amending documents right amendments Amendments and why would that need to Happen why why is this an important Topic because they’re written so badly Well I’m sure that they’re all married Together right yes and and maybe we’ll Go back and talk about let’s just review

I haven’t waved these in front of her And it’s been a while yeah and so we’ll Terrify her now but I want to go we’ll Review okay for your main documents for Condo and HOA now uh Co-op is a little bit different but Still the amending process is the same But we’ve got a declaration okay and What’s the Declaration the Declaration Is the contract among all the owners Okay and the association so it’s and in Co-op it’s your prospectus and your Proprietary lease so that would be your Contract and what it does just like a Contract it says what each party will do And it says who pays for what okay and Who does Who does what okay so and what you what The parties can and cannot do okay So in your declaration it will make the Association responsible for maintaining The property and its value okay It will Tell the association It will say that the association then Will um Um maintain the common elements To do that it costs money okay to Maintain the common elements so you’ve Got yard demo you’ve got buildings to Paint pool to clean Insurance management Uh that’s all standard right so yeah Yeah pretty much sometimes it needs to Be amended well but the the maintenance

The association is to maintain the Common things that means pay for it that Means money has to come from somewhere Okay so the owners in the contract have Promised to pay their share of that so That’s the assessment okay so it it Gives the the Declaration is the Contract that says the association will Take care of everything and you pay okay And the owners pay their share okay the Corporate documents are the Articles and The bylaws And each of these work together one is The birth certificate of the corporation Okay it looks kind of like a birth Certificate yeah and so like a birth Certificate it will give the name of the Association the date it was born which Is this filing date it will a little Footprint down there yeah The place of birth so in here somewhere It’ll likely say which what county the Land is in the parents will be the Initial board of directors okay the Developers And the gender will be condo Co-op or HOA all right so if you think about a Birth certificate you’ve got it right Here it’s so easy to remember yeah and Then Florida Statutes whether you’re a For-profit or a not-for-profit requires That every corporation have a set of Bylaws okay and you know what it’s it’s Interesting how life just comes back

Around but my first job at the law Office not an attorney but my first job At the law office when I was 20 years Old Was the corporation Secretary clerk person I have typed Bylaws and minutes and stockholders Agreements and shareholders agreements And minutes and minutes and minutes Since I was 20 years old no kidding I Don’t remember not knowing them so when I’m reading through some of the cam Stuff way way back and and I’m reading About the bylaws being the formal Procedures for operating the business of The corporation I’m like what what on Earth did that just say because bylaws Are just bylaws in my brain I never sure Didn’t know what they were And so when I started thinking was well Bylaws Uh there are certain things that Corporations have and need okay Corporations have people they have Groups of people who need to meet they Have members they have boards and they Have committees so if you want to know Anything about meetings it’s in your Bylaws If you want to know who what when where Why how It’s pretty much in your Bible you may Get so relatable I mean that makes so Much sense the other thing that that

Corporations have and need is money so If you want to know when is the fiscal Year can you charge engines can you Charge a late fee Who develops the Budget what about raising and lowering Reserves what about changing the Financial reporting requirements what About collections Those things are in your bylaws now There’s some in your declaration too in Your contract there’s some there and so In class uh and they’re way over there Right now but in class everybody gets a Package of M M’s okay And I tell them to eat them and then put That package in their book because your Bylaws are your M M’s meetings and money Oh nice see how clever that is you can Have a lot of fun coming in class Yeah now can you imagine though that the Attorney who wrote the Declaration It was probably not the attorney who Wrote the articles in the bylaws okay See that doesn’t make sense to me Because they kind of stack on each other They’re married right yeah yeah But and and whoever didn’t they and they Didn’t read them before they wrote the Other one okay so it’s obvious from some Of the languages why we’re talking about Amending right and so the question is Can these be amended right and the Answer is yes okay and each one of them Should say like your declaration if you

Read through their far enough toward the End it should have a paragraph That says how to amend itself okay and What I mean by that is what is the vote Okay to amend it and then people say Well well who who can amend it the vote Of whom Well think about this Individually and collectively These are a contract okay okay and just Use regular contract law in contract law Who can change the parts of a contract The parties to the contract who are the Parties to the contract all the owners So who are the people who vote on the Changes the owners the board will likely Recognize the need to do it okay and Propose it okay by the ultimate decision Is the owners okay so I’m looking for a Paragraph that says how to amend this I would have the one that doesn’t have The way to do it that’s how my life Works what happens then the statutes Tell you how to do it okay so there’s There’s a thing that we learn about Called statutory defaults okay These documents were written in the 80s There have been a lot of times I mean That’s not old at all Yesterday actually Changes Um The There’s a there’s a good part about

Statutory defaults and a bad part upside Downside the upside is that every time The statutes change which is pretty much Every year Communities don’t have to go through the Expense of change in their documents and Keeping them up to date okay the the Downside is some of the statutory Changes not all but some are Automatically incorporated into your Documents so for those board members and Concerned owners who are really good About keeping up on their documents and They know what’s in them if you’re just Reading your documents and you’re not Reading the statute and the updates in The statute right you’re not getting the Whole okay you’re not getting the whole Picture okay that’s why managers have to Have a legal update okay they’re Supposed to go to a legal update every Year or every two years they keep Changing it uh to keep up with the Changes so that a manager should be able To say to their board president Wait a minute that changed I think this Changed I think it may involve us we Should check with our attorney So that way managers are at least aware Enough of of the changes So if the documents if I couldn’t find This paragraph in here and point to it And say this is what it says Right there right then the statute says

What the vote is okay and And then we can talk about big vote Little let’s do that all right this is a Great time to break and we’ll come back With big vote little vote hang on Are you ready for a new career do you Have skills or interest in management Real estate construction maintenance Accounting strategic planning project Management budgets Human Resource Management lawn and landscaping Pool Services or any other expertise needed To operate a Community Association if You do Community Association Management Could be for you for more information Feel free to email Betsy at Betsy Floridacamschools.com or visit the Florida cam schools website at Www.floridacamschools.com Florida Community Association Management Continues to grow career opportunities Abound So today we’re talking amendments and Amending these documents and why it’s Important and Betsy you will talk about Big vote little vote oh does it mean Like a vote only counts half as much if It’s a little vote how’s that work no it Is so confusing and um those of you of You have been in class you know that I’m Going to say bless their hearts our Legislators they just cannot be Consistent in their phrasing and They have

Used throughout statute and then it gets Jumbled up in your documents too but They’ve used about seven different Phrases in the statute to represent only Two configurations of owners for voting Okay there’s just two because they have About the more stuff in there to stir up The more confusing they can get they get Paid by the word it’s amazing but the in Class we learn about big vote little Vote okay and and the only way I know to Do it is give an example and I have to Use my hands okay and thank goodness she Doesn’t have a pen today no not today Let’s say we have 100 owners okay and 16 Of them are there okay and The documents or the statute says that The vote is a percentage of owners and This percentage can change it could be Majority which would be 51 percent or Two-thirds or 75 percent but it’s the Phrasing that comes afterwards okay and Let’s say majority for it’s easy to Calculate majority of those present Or the phrasing in the statute or the Documents would say a percentage okay Like a majority two thirds 75 percent of The entire membership okay So if we have a hundred owners 60 are There at the meeting in person or by Proxy that’s that’s another that’s Another show yeah And the the wording indicates Majority of those present okay then we

Need 31 votes because we’re going with The 60. but if the phrasing Indicates that it’s the entire Membership or total or all okay so a Majority of the entire membership then We use the 100 okay total and have to Have 51 votes okay so for lack of a Better description because 31 is less Than 51 yeah this is little vote Got it got it got it it and see it’s Going to be a little vote big vote where No matter what the percentage is Right 75 of those present is still littler Sure and 75 percent of the entire Membership absolutely and once you get That you can read any of these things And you look brilliant very interesting It was like this light that just went Off you know so smart what I love the Way and you do this with your Pre-licensing courses and and quick Start and everything it’s just you make Things so relatable and you give Examples it’s not just teaching it’s Saying look I get to say these words and Even and you know like The description that I originally Understood back 20 years ago about what They were saying bylaws were the former Procedures for operating the business of The corporations like yeah that means Nothing to me And I typed it since I was 20. Um but let me say another important

Thing about the amendments there is Never ever ever never a surprise to an Owner of what they’re going to vote on For an amendment okay so they are given Advance notice of every word that is Going to be changed in the documents Okay and there’s a particular way that The statute requires you to write that So that the owners can tell words that Are being added to the to the document Okay will have words underlined and Words that are being taken out are Stricken through and if anyone has ever Looked at legislation that comes through That’s the way that is so that an owner Can look and see exactly what is being Proposed to come out and go in But they get that in advance any kind of Membership meeting is a 14-day written Notice to the owners okay and anything They’re voting on is always included in Those Um envelopes okay so there’s never ever Ever a surprise to an owner which is why Our agendas have to be settled and fixed 14 days out okay there’s nothing added To the agenda at the meeting okay unlike Other Corporation boards business boards We can’t add anything to the agenda okay After the 14 days that’s nice so so as We’re talking about amending Um I guess my question is what is worst Case scenario what happens when when an Amendment is not made I mean are is

There present time like what happened no There’s no present time but what happens Is a board and or manager will stall There’s you can’t move forward without Clear Direction okay the Um for instance recently I came across a Community that had no bylaws at all And they had had several management Companies Before me And I said how does the management Company know what to do we as managers Don’t know how to do our job right You’re enforcing without right right We’re we’re helping to enforce schools But as far as dates and time frames can I charge interest can I charge lengthy When is the budget due when is the Annual meeting due who votes on the Budget those things that me and the Board need to know If you don’t have bylaws you don’t have That information so I don’t know how you Even know when to schedule an annual Meeting right I don’t know how you know When your budget year is is it a Calendar year is it a fiscal year wow so Can you charge a late fee can you charge Interest Without bylaws there’s no way for us to Do our job Sometimes the the directions in the Bylaws and in the Declaration conflict Now there is that seems like the

Problematic seems like it shouldn’t Happen right it does but then the Statute gives us a hierarchy okay of Which one wins okay but for me to tell You that is the unauthorized practice of Law okay we’re not going to do that no No No but the once the amendments are done And see they’re coming after you do the Sirens yeah the floor bar yeah but once The amendments are finally Um produced and voted on and done then As a last step and there’s a lot of Steps in here that I’m leaving out but They are then this would be an amendment And this amendment refers here okay to The original recording okay so it Corresponds yeah so these Um three Our three main documents have been Recorded in the public records and it’s Kind of like they run well the languages They run with the land okay so it’s sort Of as if they’re buried in the ground Underneath the property okay and then The warranty deeds that go back and Forth from seller to buyers sell it or Buyers sit on top and move but these Don’t move right these stay with the Land so when the amendment is recorded It’s as if it’s a as if it’s attached to These and buried in the ground it’s Permanent in that way yeah right and That way in a title search

When you’re selling the closing agent Will find all of the Amendments because They’re vicariously attached to the Original Very interesting And ready to take your test no way ma’am No way ma’am Um but do you have any final thoughts I Mean I’m thinking about people who might Have some questions as we dig deeper in This and they’re like yeah but how can They get a hold of you or are there some Is there a page that they can go to to Get some basic information well not well No okay other other than the statutes Okay and your attorney okay or Betsy I and yeah people who know me know that I answer emails all week long I know With questions and I love it I love it Yeah okay it’s it is if you can imagine I have the worst boss ever And any break that I can get and talk to Somebody on the phone or online and get Away from her Well this was really great I mean so Much more to it than I thought And and if you and if you you know feel Like you bother me to death with Questions and things there are Communities that will put me on a small Retainer for a period of time so that They don’t feel so guilty emailing me And calling me all the time so all right Well contact Betsy give us the contact

Information Betsy at Florida Camschools.com or area code 352-326-8365 all right this was great Thank you oh my husband and this was a Good one all right have a good one we’ll Catch you next show thank you for Listening to cam matters be sure to Subscribe so you don’t miss any future Episodes for more information feel free To email Betsy at Betsy Floridacamschools.com or visit the Florida cam schools website at Www.floridacamschools.com information Provided on this show is General in Nature and does not constitute legal Advice please contact a licensed Attorney for your specific situation [Music]