By Josh Davis, Associate Editor
(Aug. 30, 2018) Ocean Pines Association attorney Jeremy Tucker on Friday briefed the new board of directors of several items of public interest, from the complicated issue of drainage, to how the Fair Housing and the community’s nonprofit status played into the Oasis pool controversy last year.
The directors, during the annual orientation meeting for new and returning elected officials, began the morning with an hour-long closed session led by Tucker.
When they reopened, Tucker provided a two-hour overview of Ocean Pines legalese.
He said the association is unusual in that it had separate declarations of covenants for each section, which was problematic “because as the community progressed over time, the developer added different language into different covenants.”
Drainage, for instance, is complicated because “the older [plats] don’t have the same references to drainage as the newer ones,” Tucker said.
“It’s obvious that drainage serves the public generally – if it blocks up, it could cause problems in the roadways – but the question is, is whether the documents require [Ocean Pines] to maintain that,” Tucker said.
He added, “One provision says the lot owners shall maintain the easement area, the other one says, ‘the association shall maintain those drainage easements that are reserved by the declarant.’”
“We looked to see what drainage easements are reserved by the declarant and, in my opinion, that kicks us to the plats,” Tucker said. “We’ll see where we end up with that … we’re left with interpreting documents that we’re presented, unfortunately not the ones that we would have drafted.”
He said the hierarchy of Ocean Pines legal documents is: the declaration of covenants; plats; articles of incorporation; bylaws; rules and regulations; and resolutions.”
“You will see, in the drainage issue, how we are working to try to [reconcile the various documents].” Tucker said. “The way it was sort of set up is that there isn’t absolute consistency across all the documents … the legal fun for me is trying to reconcile the inconsistencies.”
Along with its own set of legal documents, Ocean Pines is also subject to federal, state and county laws, including the Fair Housing Act.
“The main law that we see in a federal context is the federal Fair Housing Act. This requires us to grant an accommodation to anybody who has a disability who needs an accommodation, and it prevents us from discriminating against familial status, disability, race [and] nation of origin,” Tucker said.
Last year, that came into play with the Oasis pool, he said.
“The issue was raised of whether we could create an adult swimming pool,” Tucker said. “You can’t say, ‘adults, you can come in, but children, you can’t.’”
Also complicating matters was Ocean Pines’ tax-exempt status as a 501(c)(4) nonprofit.
“That means your facilities have to be open to the public – you have to basically allow the public to use it on similar conditions that [homeowners] do,” Tucker said. “Not only are you dealing with Fair Housing issues, but when you are open to the public, you now are subject to Maryland anti-discrimination laws, which basically says you can’t discriminate based on age.
He added the nonprofit status had some financial benefits, but also some drawbacks and was ultimately optional.
“You could always say, ‘we don’t want to do this anymore,’” he said.
“It rears its head in a lot of things that you would not expect it to,” Tucker continued. “It’s an extraordinarily important aspect of your government that we all, including me, have to remain conscious of.”
Citing another example, Tucker said the association was sued several years ago for “failing to allow the general public to use the parking spaces” at the beach club.
“And you lost badly – I mean you lost badly,” Tucker said. “The court slammed you, and you were hit with a pretty sizeable hundreds of thousands of dollars of responsibility on a case that was clear that you were going to lose, in my opinion.”
Tucker said a disgruntled Ocean Pines resident brought up the case.
“We always have to be conscious not just to do the right thing, but that people are watching and people are smart and people understand these things,” he said. “There are huge financial implications for doing it wrong, so … we need to make sure that we do it right.”
During a discussion on the new ethics policy, Tucker explained why certain sections were crafted deliberately, despite seeming redundant.
Director Slobodan Trendic, as an example, pointed to a bylaws provision that says, “Individual members of the board of directors shall not give orders to any employees of the association.” He said that was repeated in the ethics policy in a section on “Interaction with Association Employees.”
According to Tucker, removing a director for cause must be because of “a violation of the rules, not a violation of the bylaws.”
“That’s why it’s there,” Tucker said. “This sort of slingshots that in.”
On the subject of pending litigation, Tucker offered, “board members may not be personally liable for damages, so suing individual board members is not correct.”
“We’ll be dealing with this with current litigation,” he said. “As you know … anybody can sue anybody for anything. It’s not really cliché – it’s actually true. People sue people all the time for all kinds of ridiculous things that they don’t have any real case for.
“Whenever I get the question, ‘Can we be sued for this?’ The answer is, ‘Yes.’ You can be sued for anything – the question is will they win?” Tucker continued. “This is exactly why we have [errors and omissions] insurance … to make sure that when people sue us, you are protected.”
On a frequently asked question about references to “discussion of matters pertaining to employees and personnel” often cited as a reason for closed meetings, Tucker said it was his opinion “personnel” could apply to elected association officers and appointed committee members, but not to directors.
Association President Doug Parks said the board during the last session “took it on the chin” for meeting too often in closed session and struggled with the perception of being nontransparent, versus “the balance of putting too much information out there” and compromising vital information.
He called for the new board to be more specific in its stated reasons for closed sessions.
“Maybe a little bit more information will ease perception,” Director Esther Diller said.
“No it won’t, but it’s a good idea,” Director Ted Moroney said with a laugh.