Page 7 - Chicago Cooperator Spring EXPO 2019

YOU’LL LEARN SO MUCH YOUR HEAD COULD EXPLODE. (Our lawyers said we had to warn you.) THE COOPERATOR EXPO 2019 WHERE BUILDINGS MEET SERVICES STEPHENS CONVENTION CENTER, ROSEMONT — WEDNESDAY, MAY 8, 10-3:30 FREE REGISTRATION: CHICAGOCONDOEXPO.COM CHICAGOCOOPERATOR.COM THE CHICAGOLAND COOPERATOR — SPRING EXPO 2019 7 QUESTIONS & ANSWERS Legal Q A& Dysfunctional Board Q We have a board that just doesn’t get along. I am the presi- dent, and one of the other board members is a big bully. It’s really hard to deal with him, and I hear from contractors that he is nasty. He wants to run it all. No matter what I or others say, he overrides us. He didn’t show his true colors until recently, and it’s aff ecting the board’s abil- ity to function. He has two more years to serve. What can we do? —Losing Control A “To begin with,” says at- torney Michael Kim of the Chicago-based fi rm Mi- chael C. Kim & Associates, “while a di- versity of directors and their diff ering per- spectives may be of value, a director who is a rogue or bully is a problem that should be addressed by the board as a group. Such intemperate and irresponsible behavior by a director not only undercuts the ability of the board to function effi ciently, but can even result in liability for the board and association. I suggest that you consider the following approaches: “Have a discussion among all board members to address the legitimate as- signed roles for each of the offi cers and directors, as well as the converse (mean- ing that non-offi cer directors are not to undertake any initiative on their own in any matter involving the association or third-party vendors, unless such action is specifi cally authorized in writing by the board). In general, the president as CEO for the board/association is responsible for interacting with outside parties. It is cru- cial that third parties have a single source of contact so as to avoid misunderstand- ing, confusion and frustration. Of course, there may be occasions where a director may be appointed to handle a particular task, but that should be an assignment given by the board to that director – not assumed by the director him or herself. “If a director disregards those limita- tions, then they may be subject to certain disciplinary actions by the board. If an informal reminder is insuffi cient to deter the director’s misconduct, then the board can exercise its own authority to censure the director by a resolution to that eff ect adopted at the board meeting, stating the misconduct and the board’s express re- nunciation of it. In addition, assuming that state law or the association’s own gov- erning documents may mandate a notice requirement and/or the opportunity for a hearing, the director could be charged for the violation and, if found guilty, sanc- tioned with a monetary fi ne. “If the director continues their miscon- duct and refuses to abide by any appropri- ate restraints imposed upon them, there may be a need for more formal proceed- ings, possibly involving legal action. In Il- linois, the not-for-profi t corporate statute provides that the association can bring an action against the director who ‘is engaged in fraudulent or dishonest conduct or has grossly abused his or her position to the detriment of the corporation.’ If proven to the satisfaction of the court, that director may be judicially removed from offi ce ‘in the best interest of the corporation,’ and the court may even bar them from reelec- tion for a prescribed period of time. Such action may also be instituted by a small percentage of ownership interest (10 per- cent), and even by an individual associa- tion member as a derivative lawsuit. Ob- viously, engaging in a lawsuit to address such bullying behavior it is a rather strong measure, but if the situation warrants such action, the board should consider that as a last resort. “A bullying director may not only have a negative eff ect on fellow directors’ mo- rale, but may also negatively aff ect mem- bers of the association – and may even deter vendors from dealing with the as- sociation. Bullying behavior may also even provoke potential litigation against the board and the association, especially where third parties perceive that director as having some authoritative role. While a director may engage in bullying behavior due to some personal past negative expe- rience, the board is not tasked with being an armchair mental health professional; it must conduct the business of the associa- tion in an orderly manner, and in accor- dance with its fi duciary responsibilities.” Smoking on the Balcony Q I’m a resident owner in a 56- unit condo building, and share a common balcony with my next- door neighbor, divided by just a short rail. I have sensitivity to cigarette smoke, and don’t believe it’s fair that the building al- lows smoking on the balconies. I have my door and windows open since it’s getting nicer out, but have to close them when people go out and smoke. To add insult, when it rains, they smoke inside and the smoke comes through the walls. Is there anything we can do to ban smoking on shared balconies? —Owner Who’s Had Enough A “Th e association can cer- tainly ban smoking on the common area balconies,” says attorney Robyn Kish of the fi rm Klein, Daday, Aretos & O’Donoghue, LLC, in Rolling Meadows. “Th ere are two methods the association can use: the board can adopt a rule, or the owners can pass a declaration amendment. A rule is easier to pass, as it does not require owner approval – just a vote by the association’s board – but a declaration amendment is voted on by the owners, and is more likely to stand up if challenged in court by an owner. “A smoking ban in individual units would require a declaration amendment. However, a smoking ban on a limited common element – such as a shared bal- cony – could be done by rule if the decla- ration allows the board to make rules re- garding limited common elements (which most declarations do). Even if challenged by an owner, a rule in regards to a limited common element will stand up in court, so long as it is reasonable. “In regards to smoke from the unit, the board can adopt rules requiring owners to prevent smoke infi ltration into other units by mandating that owners seal their unit or use an air purifi cation system. Most declarations have a nuisance clause pro- hibiting off ensive or noxious behavior that creates a nuisance for other owners. Using this provision, the board can adopt rules to prevent the nuisance of cigarette smoke into other units.” n Disclaimer: Th e answers provided in this Q&A column are of a general nature and cannot substitute for professional advice regarding your specifi c circumstances. Always seek the advice of competent legal counsel or other qualifi ed profes- sionals with any questions you may have regard- ing technical or legal issues.