How do we dissolve a HOA in WA if all board members resigned and no other homeowners want to take over?

We're an association with 56 homes & have always had problems with homeowners not wanting to be on the HOA Board. For those that've been on the Board, we've had problems enforcing the CC&Rs, collecting annual dues, etc. The Treasurer submitted her resignation last month, but agreed to help transition anyone willing to take over the position; the Secretary now wants to resign & the President just submitted his resignation but refuses to help in finding a replacement or make the necessary transition. We've been unsuccessful in filling these positions & feel we're forced to move towards dissolution. What if homeowners don't respond to our voting request & we don't have enough votes, but also don't have a Board? What steps do we take to dissolve & what costs are associated with it?

Auburn, WA -

Attorney Answers (2)

Kevin Lee Britt

Kevin Lee Britt

Residential Real Estate Lawyer - Seattle, WA
Answered

The outgoing Board members should continue to serve until a person can be elected or (more likely) appointed to serve in their place. The power to appoint new Board members in these circumstances is probably contained in the Association's Bylaws. In a pinch, a board can act with as few as two members. The Association obviously needs a functional Board that can take action to address common concerns.

Terminating the association would require a vote of most or all of the owners (depending on what kind of association you are and what is in its governing documents). It is usually more practical to focus on achieving a functional board.

James S. Tupitza

James S. Tupitza

Real Estate Attorney - West Chester, PA
Answered

Believe it or not, the answer will be in your mortgage and everyone in the community's mortgage. Go get a copy and read the PUD rider. It will say there are 4 things you cannot do: 1) abandon the HOA, 2) have the HOA operate without insurance, 3) amend the HOA documents in areas dealing with protection of lenders and 4) go from professional managemnt to self management.
I currently represent an association that is headless and adrift like yours. The problem is that this condition disqualify ALL the houses from being mortgaged. Almost all lenders inquire into the health of the HOA as a condition of funding. Every week it gets stricter. Do not wait until your association is on a "No Lend" list before acting. I think if you hire a professional management company, a lot of your problems will go away.

The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than the educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might possibly change. Attorney is licensed to practice law only in the Commonwealth of Pennsylvania. Responses are based solely on Pennsylvania law unless stated otherwise.

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