Q. Many members of our community feel that our president has put himself in a situation of conflict of interest by awarding contracts to his own construction company.
He has underestimated costs and paid out money without informing the members or the committee in advance. Now some of us are trying to get him out but he insists that he was elected in 2014 for two years. He himself had new statutes voted on at an AGM which specify the two-year period: The general meeting at which the changes were made had an attendance of just over 18 per cent of the owners and I always thought that 100 per cent approval was required to change the statutes.
J H (Costa del Sol)
An auditor’s report shows that contracts were awarded to a company apparently operated by the president without any competitive bidding and that the expenses are much higher than the estimates given.
Conflict of interest is a general term, not a legal matter, unless the statutes specifically forbid it, as suggested by your auditor. That is, a community president who awards a contract to his own company might be acting in the best interests of the members. However, it is certainly irregular.
Yes, revising the statutes requires a unanimous vote of the members, but if only 18 per cent of them attend and vote in favour, and the remaining members do not protest within 30 days of being informed of the decision, it is regarded as unanimous.
The way to replace a sitting president is to call an Extraordinary General Meeting with this item on the agenda. If 25 per cent of the members agree, the EGM must be held.
Finally, there is the possibility of a lawsuit brought by any member against the president to recover community funds paid without authorisation.