Jenna √ SC.Iss. #4-2018(w)

Palmetto Communities

The official publication of the South Carolina Chapter of CAI

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Issue 4, 2018

From the CED: D uring 2018 we had almost 40 events, covering the entire state. We expect about the same for 2019. Our regular popular events like the Round Tables and Association Boot Camps will be back, but we have some new formats for 2019. In April we will be running two “HOA/Condo Industry Debate” programs. There is so much to talk about in this industry, with a wide range of topics. We thought it would be fun to set the event up as a debate forum. The presenter’s topics will not necessarily represent their personal views, as they will have been assigned at random to them to get the conversation going. For now, we have three topics set up: “Should boards always show a ‘united front’?,” “Manager Licensing – Yea or Nay?” and wrap- ping up with someone acting in the role of a “Resident Activist.” It should be interesting to watch the debate progress. There are plenty of CAI National events for 2019. The South Carolina Chapter has met or exceeded all the attendance goals for these events over the last three years. In September, we will present a program on “Proactive Exterior Maintenance.” It will basically cover everything on the outside of buildings and homes. We plan on having large equipment demonstrations. Last year the management company Lunch & Learns were a huge hit. We expect to have even more for 2019. If your management company would like us to do one at your office, please contact me. Lastly, the goal of the South Carolina Chapter of CAI is to provide education. We don’t always need to have an event with huge attendance. We’ll meet with 10-15 board members and managers to help educate them on association topics. We’ll go just about anywhere in the state. I hope everyone enjoyed their holiday season, and look for- ward to a successful 2019 for the South Carolina Chapter. Best Regards, Raymond J. Dickey, Executive Director, South Carolina Chapter of CAI

South Carolina Supreme Court Rules Members of Golf and Amenities Club were Required to Continue Paying Dues, Even After Resignation By Sean A. O’Connor, Esq.


O n November 14, 2018 the South Carolina Supreme Court, fol- lowing a petition for rehear- ing, issued its decision in the case of Callawassie Island Members Club, Inc. v. Dennis, Op. No. 27835, 2018 WL 5984108 (Re-Filed November 14, 2018), which brought to a close some seven years of litigation over whether mem- bers of the private club at the Callawassie Island devel- opment in Beaufort County had the right to stop paying membership dues and fees upon resigning from the club. In 1999 Ronnie and Jeanette Dennis bought a home on Callawassie Island for $590,000 and joined the private club known as the Callawassie Island Club, for which they paid a $31,000 initiation fee to become “equity members.” The club’s governing docu- ments in effect at that time provided that an equity mem- ber who resigned from the Club would be obligated to continue to pay dues and food and beverage minimums to the club until his or her equity membership is reissued by the Club.

In 2010 the Dennises de- cided to resign from the club and stopped making all pay- ments; their dues and fees ob- ligation at that point amount- ed to some $9,808 per year. In 2011 the club filed a breach of contract action against the Dennises. In defending the suit the Dennises asserted that they were told by a club manager that their maximum liability would be only four months of dues, because after four months of not paying, they would be expelled. The Dennises also alleged that the membership arrangement violated the South Carolina Nonprofit Corporation Act. The Members Club filed a motion for summary judg- ment which was granted by the circuit judge, who found the membership documents unambiguously required a resigned member to continue to pay dues, fees, and other charges until the membership is reissued, and rejected the Dennises’ arguments regard- ing the Nonprofit Corporation Act. The Dennises appealed, and the court of appeals re- versed on both issues, find-

CONTINUES ON PAGE 5. The supreme court’s opin- ion, decided by a 3-2 margin, features an interesting inter- play between the majority opinion, written by Justice John Few, and the dissenting opinion, written by Justice Kaye Hearn. For instance, the club’s governing docu- ments were amended sev- eral times over the years, and the dissent argued that the club had been inconsistent in identifying which docu- ments constituted the con- tract between the parties. The majority opinion noted, however, that all versions of the documents contained the language requiring that the payment of dues and fees must continue. In regard to the Nonprofit Corporation Act, the Dennises argued, and the ing that the relevant terms in the governing documents were ambiguous. The court of appeals also found that the club’s requirement that members must continue to pay after resignation violated the Nonprofit Corporation Act. The club filed a petition for certiorari, which the state supreme court granted.

Have your community association board members changed since last year?

Be sure to update your board’s member names, titles (President, Vice President, Treasurer, Secretary, and Board Member), and contact information to ensure your board members receive all the latest CAI member benefits!

Update today: ONLINE at EMAIL

MAIL to CAI, P.O. Box 34793, Alexandria, VA 22334-0793

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