§ 34-41-3.17. Recall of manager by owners. (a) The owners may discharge the manager with or without cause in the manner provided by this section in addition to any manner permitted by other law or by the project instrument.

(b) Any owner may prepare a ballot affording the opportunity to indicate a preference between retaining the present manager and discharging him or her in favor of a new manager. A copy of the ballot and of any letter that is to be mailed with the ballots must be delivered to the manager. Not less than ten (10) or more than thirty (30) days thereafter, a ballot and a copy of any letter to be mailed, together with a copy of any written reply received from the manager containing no more pages than the letter, must be mailed to each owner by the owner who prepared the ballot.

(c) On the date specified pursuant to § 34-41-3.14(c)(2), the person who receives the ballots shall examine those that have been returned, tabulate the vote accordingly, and notify the manager of the result. If at least sixty-six and two-thirds percent (66 2/3%) of the vote, representing at least thirty-three and one-third percent (33 1/3%) of the votes allocated to all owners, favors discharging the manager, the developer also must be notified of the result, the ballots or photocopies thereof must be given to the manager, and the developer shall diligently attempt to procure offers for management contracts from prospective managers. Any owner also may attempt to procure such offers. If the developer or any owner obtains such an offer within sixty (60) days after the date the vote was tabulated, he or she shall notify the developer and the owner who was responsible for tabulating the vote. If no offer is obtained from a prospective manager other than the current manager within those sixty (60) days, that period must be extended for successive intervals of thirty (30) days each until such an offer is obtained. At the end of the period, the owner who prepared the ballot, or the developer if that owner so directs in a writing delivered to the developer, shall prepare and mail to each owner a second ballot stating at least the term and compensation provided by each offer that has been received and affording an opportunity to indicate a preference for any one of the offers or for retaining the current manager. A letter recommending that a particular offer be accepted or that the current manager be retained may accompany the ballot, and if the developer prepared the ballot he or she shall enclose a copy of any such letter submitted to him or her by the owner who was responsible for tabulating the vote. The developer has no obligation under this subsection, and nothing need be delivered to him or her, if he or she owned no estate or interest in any unit on the date the first ballot was delivered to the manager and neither the developer nor his or her affiliates or appointees caused the manager to be hired.

(d) On the date specified pursuant to § 34-41-3.14(c)(2), the person who receives the ballots prepared pursuant to subsection (c) shall examine those that have been returned, tabulate the vote accordingly, notify the manager of the result, and hold the ballots available for inspection by the manager and any proposed manager for at least thirty (30) days. If more votes favor accepting a particular offer than retaining the manager, the manager is discharged ninety (90) days after he or she is notified of the result, but, if the ballot prepared pursuant to subsection (b) was delivered to the manager before the current term of the manager began, the manager is discharged immediately upon being notified of the result. The person who received the ballots prepared pursuant to subsection (c) shall accept on behalf of the owners the offer that received the largest number of votes. The expenses thereunder are thereafter part of the common expenses.

(e) A manager discharged pursuant to this section is not entitled by reason of his or her discharge to any penalty or other charge payable directly or indirectly in whole or in part by any owner other than the developer.

(f) The reasonable expenses incurred by any owner in obtaining offers and preparing and mailing ballots pursuant to this section, including reasonable attorney's fees, must be promptly collected by the managing entity from all owners as a common expense and paid to that owner if a simple majority of the vote tabulated pursuant to subsection (c) favors the discharge of the manager. Similar expenses incurred by the developer also must be so collected and promptly paid to the developer.

History of Section. (P.L. 1984, ch. 141, § 2.)