guest blog by Nila Ridings
Communication and documentation. Key words in the business world.
Here’s a case of a contractor who sold windows to the HOA. He became ill and unable to perform as promised. He also stopped communicating. Why didn’t he call the contact person and explain he was ill and would be back on the job? Why did he spend the money that was supposed to pay for the windows? Why didn’t he refund the money immediately and apologize for not being able to fulfill the agreement?
As I see it, the HOA paid too much money up front. Why didn’t she get a surety bond to guarantee the work would be done? Why didn’t she require the money be put in an escrow account and withdrawn as needed to pay for the windows and then the labor? Did she talk to other customers of this company? If not, she should have. Did she do an internet search for lawsuits, past and pending?
The loss could have been much greater. Hopefully, the windows will arrive and the contractor will get them installed and all will be well. But if they aren’t this HOA will be in court trying to recover its money and the cost of litigation will more than likely exceed the recovery.
Another lesson learned about board members who lack the experience of negotiating contracts and operating on trust instead of logic. Amateurs managing an HOA? Always a formula for disaster. We’ve seen it happen all across America. And there are times when the best of people with massive business knowledge still get taken.
Who ever thought the HOA concept would ever work must have been out of their minds!