COLUMN: Barbara Holland

Q. In our association, any assessment not paid within 30 days after the due date shall bear interest from the due date at the rate of 10 percent annually, according to the covenants.

We are required to pay quarterly dues in advance. I was billed $97.50 on Oct. 1, 2003, which paid for dues through Dec. 31, 2003, or $32.50 per month.

If the entire quarterly amount is not paid on time, we are subject to a $25 late charge. I see this as a late charge on the $32.50 for that month, since the balance of the dues are for the following months. What happened to the 10 percent rate?

A. Start by reviewing your governing documents. If they state that dues are paid by the quarter, even though you are paying them in advance, then the amount of money that should be received by the association is the quarterly amount. That is the payment arrangement made and agreed upon when you entered the association. The late fee would then be based upon the quarterly amount.

As for the amount, many governing documents state that the association can add an administrative charge over and above the 10 percent.

If the governing documents state that dues are paid to the association monthly, then the association cannot enforce the quarterly payment schedule.

Q. As I understand the law that went into effect in October, the removal of board members will be the same as an election by secret ballot, not by proxy, and a quorum is not required. Is this so?

I would also like your opinion on a matter: if a board is meeting its fiduciary responsibility, exercising its best business judgment and complying with labor laws, can a board make contractual/hiring decisions based on the common religious affiliation the vendor has with the board members?

A. On the first matter, a secret ballot is required. The association must give members 15 days in which to return the secret ballot. Only secret ballots that are returned may be counted; proxies are not acceptable.

A quorum is not required to be present to count the ballots at a meeting but -- and this is a very large but -- not withstanding any association's governing documents, a two-thirds vote of all persons entitled to vote must be achieved to remove a director.

The revisions to the law did not delete the two-thirds requirement. If that was their intent, then the legislature did a poor job in clarifying the procedure. I do not believe it was.

On the second point, I think you may be asking for a discrimination lawsuit. One could easily argue that the board is not meeting its fiduciary responsibility if its selection of vendors is based upon religious belief. You should not even ask what religious affiliation a vendor has in the first place.

Questions for Barbara Holland may be sent to Association Q. & A., P.O. Box 7440, Las Vegas, NV 89125. Her fax number is 385-3759.

Barbara Holland, Certified Property Manager, is president and co-owner of H&L Realty and Management Co. She is a member of the Institute of Real Estate Management and is the author of two books on the subject. Holland is a past president of the Greater Las Vegas Association of Realtors.

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