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VV Home Owners Association:

Proposed Bye-Laws

Collated by CPCN

May 16, 2014

Distilled Wisdom of Ages Collated together and unabshedly stolen from many sources

Source: From the long experience of the people running their own Associations democratically for ages.
1
Contents
1 INTRODUCTION 5
A Name and Address: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
B Jurisdiction/Area of Operations: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
C Denitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
D Objects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2 MEMBERSHIP 7
A Liability of member . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
B Membership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
C Member . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
D Associate member. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
E Nominal members. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
F Limit of membership. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
G Admission of new members before the General Body Meeting . . . . . . . . . . . . . . . . . . . . . . . 8
H List of members . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
I Eligibility/Disqualication for membership. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
J Application for membership and admission as member. . . . . . . . . . . . . . . . . . . . . . . . . . . 9
K Rights of Owner members. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
L Cessation of membership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
M Resignation of Membership of the Society. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3 FUNDS OF THE SOCIETY 10
A Working Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
B Raising of funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
C Deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
D Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
E Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4 REGISTRATION OF IMMOVABLE PROPERTY 12
A Applicability of Stamp Duty and Registration fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
B Deeds of Conveyance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5 MEETINGS OF THE SOCIETY 13
A All Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
B Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
C Special General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
D Notice for the General Meeting and Special General Meeting. . . . . . . . . . . . . . . . . . . . . . . . 14
E Quorum for General Meetings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
F Chairman of the general body . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
G Voting in general meeting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
H Adjournment of general meetings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
I Rectication of Resolution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
J Recording of the GBM Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2
6 BOARD OF MANAGEMENT (BoM) 15
A Duty & Constitution of BoM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
B Election of Oce-bearers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
C Disqualication to become a Member of Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
D Quorum for the Board meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
E Powers of the Board of Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
F 32. Attendance of members of the Board of Management. . . . . . . . . . . . . . . . . . . . . . . . . . 18
G Board Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
H Board Meetings Proceedings Book. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
I Chairman at Board meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
J Vice-Chairman. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
K Chief Executive Ocer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
L Duties of the Chief Executive Ocer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
7 Administration 20
A Handling of funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
B Building Repair Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
C Details of essential repairs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
D Reserve Fund. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
E Depreciation Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
F Maintenance of accounts and audit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
G Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
H Audit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
I Details of receipts and disbursements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
J Structural audit of building. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
K Appropriation of surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
L Membership of other Co-operative Institutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
M Act, Rules and Bye-laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
N Alteration of the Bye-laws. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
O Interpretation of the Act or Bye-laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
P Ocial Immunity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Q Ocial Seal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
8 Fiduciary Standard 23
9 Core Fiduciary Duties- 23
10 APPENDIX A: BILL OF RIGHTS 24
A HOMEOWNER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
B HOMEOWNER RESPONSIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
C COMMUNITY LEADERS : RIGHTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
D COMMUNITY LEADERS: RESPONSIBILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
E GOVERNANCE GUIDELINES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
3
11 Appendix B: MODEL CODE OF ETHICS 27
A Board members should . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
B Board members should not: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
12 APPENDIX C: COMMUNITY ASSOCIATION FUNDAMENTALS 27
13 APPENDIX D: Cooperative Principles 28
4
HOME OWNERS ASSOCIATION:
PROPOSED BYE-LAWS
Homeowners associations (HOA) are formed to preserve the aesthetics and integrity of a neighborhood,
address residents needs and, should anything happen, address major issues. With day-to-day duties that
include everything from managing the services to replacing power equipment, running a HOA requires a
substantial amount of nancial resources, which traditionally comes in the form of monthly, quarterly or
annual fees. It is an undeniable fact that community associations benet their respective communities by
reinforcing the rules and regulations that are mutually agreed by the members of association.
T
he bye-laws and best practices of Home Owners As-
sociation has been formulated and kept for review
over a period by Members of the VV Yahoo Group
and Members of the User Committee. This contain the
distilled wisdom of many years of Home Owners experi-
ence of creating a democratic apparatus to manage their
common interest development and running the same es-
sentially to:
1. Preserve
2. Protect
3. Maintain &
4. Enhance the value of the Assets
1 INTRODUCTION
A Name and Address:
1. The name of the Society shall be VVOCHS Ltd.
2. The Registered Oce of the Society shall be located
at ..............
3. Any change in the address of the Society shall be
communicated to the Registering Authority and all
others concerned within 30 days of such change.
4. The Society shall exhibit outside its oce on a
prominent board its Name, Registration Number,
Registered address and the working hours includ-
ing weekly holiday.
B Jurisdiction/Area of Operations:
The area of operation of the Society shall be conned
to the ............. (Development Authority/City Corpora-
tion Blocks/City Municipality/City Municipal Corpora-
tion/ Notied Area/Local Planning Area/Revenue Vil-
lage/Revenue Taluk)
C Denitions.
Unless otherwise separately provided in these Bye-laws
the following words and terms shall have the following
meaning assigned to them. (
1. Words importing singular or plural numbers shall
include the plural or singular number and words
importing the masculine gender shall include the
feminine gender;
2. Society means the ............... ;
3. Act means the Karnataka Co-operative Societies
Act, 1959, as amended from time to time;
4. Rules means the Karnataka Co-operative Soci-
eties Rules, 1960, as amended from time to time;
5. Registrar means the person appointed under the
Act to perform the duties of the Registrar of Co-
operative Societies in Karnataka;
6. Committee means the Committee of Manage-
ment of the Society to which the aairs of the So-
ciety is entrusted;
5
7. Member means a person joining in the applica-
tion for the registration of a Co-operative Society
and a person admitted to membership after such
registration in accordance with this Act, the rules
and the Bye-laws and includes a nominal and an as-
sociate member and who either owns an Apartment
or an Apartment which is under construction and
is allotted to him by the Society or who is desirous
of getting an Apartment;
8. Government means the Government of Kar-
nataka;
9. Year means the Co-operative year as dened in
the Act;
10. Bye-laws means the approved Bye-laws of the So-
ciety;
11. Apartment means a part of the property intended
for any type of independent use, including one or
more rooms or enclosed spaces located on one or
more oors (or part or parts thereof) in a building
or an independent villa intended to be used for resi-
dential purposes and with a direct exit to a common
area of the Society leading to a public street, road
or highway;
12. Apartment owner means the person owning an
Apartment and an undivided interest in the com-
mon areas and facilities in the percentage specied
and established in the deed of declaration executed
by the Society;
13. Building means a building containing four or
more Apartments, or two or more buildings, each
containing two or more Apartments with a total of
four or more Apartments for all such buildings and
comprising a part of the property;
14. Competent Authority in relation to the buildings
constructed or to be constructed, means the Regis-
trar of Co-operative Societies as denned in the Kar-
nataka Apartment Ownership Act, 1972;
15. Parking Space means a marked open space within
the premises of the Society that has been notied
for parking of a vehicle by a member, for which the
development charges have been paid by such mem-
ber. A monthly administrative parking fee may be
charged to the member, for the use of the parking
space in the Society. The approach way to a garage
is not to be deemed a parking space and is not to be
utilized for parking of vehicles, even by the owner
of such garage;
16. Building Repair Fund means the fund constituted
under the provisions of the Bye-law of the Soci-
ety and intended for the upkeep of the buildings,
common areas, restricted areas and facilities on the
premises. The fund is however not to be used in
the interiors of the Apartments for repairs, upkeep,
replacement of tments, modications or improve-
ments, which is the responsibility of the members
to perform at their own expense being the owners
of such Apartment;
17. Depreciation Fund means the fund constituted
under the provisions of Bye-law No......... of the
Society. The fund is also sometimes referred to as
the Sinking Fund of the Society;
18. Chief Executive Ocer means an employee of the
Society and includes an ocial of the State Govern-
ment on deputation who discharges the functions of
the Chief Executive under the Act, Rules and Bye-
laws;
19. Year shall be co-terminus with the Co-operative
year (as dened in the Act);
20. Cooperative Principle means principles explicitly
stated in Appendix B
21. All other words and expressions in these Bye-laws
shall have the same meaning assigned to them as
under the Act and the Rules:
D Objects
.
Applicable when dealing withSite purchased and
Apartments under construction/purchase
6
1. To purchase or take on lease a site or sites for the
purpose of construction of Apartments thereon for
allotment to the members of the Society for their
authorized use OR
2. To purchase a building or buildings known as ........
Constructed on the plot/plot Nos ............... of
........... and measuring..........sq. m. for the allot-
ment of Apartments therein to the members of the
Society for their authorized use.
3. To obtain conveyance of right, title and ownership
of the land in the name of the Society and con-
sequent to completion of the construction of the
Apartments, ensure the conveyance of such right,
title and ownership of the Apartments and undi-
vided share of the land to the allottee members
in accordance with the provisions of the Registra-
tion Act, 1908, Karnataka Registration Rules, 1965,
Karnataka Stamps Act, 1957, the Transfer of Prop-
erty Act, 1882 and the Karnataka Apartment Own-
ership Act, 1972.
4. To manage, maintain and administer the property
of the Society.
5. To employ, engage and control the sta as essential
for the proper administration of the Society, keeping
in mind economy and necessity.
6. To raise funds for achieving the legitimate objects
of the Society.
7. To take all necessary steps for the ecient admin-
istration of the Society within the framework of the
Act, Rules, Bylaws and the other enactments in
force and in accordance with Co-operative princi-
ples and secular ideals.
Applicable when dealing withApartments already
constructed and occupied by members
1. To ensure proper taking over of assets physically as
well as legal title from the builder with respect to
common facilities and ensure conveyance of right,
title and ownership of the Apartments and share of
common areas to the allotted members, in accor-
dance with the provisions of law on his paying the
consideration amount towards the undivided share
of the land and value of the Apartment.
2. To manage, maintain and administer the land, com-
mon areas, restricted areas, facilities and ameni-
ties intended for the common usage of the members
within the premises of the Society and to develop
the common areas and facilities to the best advan-
tage and benet of the members and residents in
accordance with Co-operative principles.
3. To raise funds for achieving the legitimate objects
of the Society.
4. To manage, maintain and administer the property
of the Society.
5. To employ, engage and control the sta as essential
for the proper administration of the Society, keeping
in mind economy and necessity.
6. To take necessary steps for the ecient administra-
tion of the Society within the framework of the Act,
Rules, Bye-laws and the other enactments in force
and in accordance with Co-operative principles and
secular ideals.
7. To construct or to build or cause to be constructed,
necessary infrastructure required for common util-
ity of the members by employing the Societys funds
or by collecting the required funds from the con-
cerned members where necessary with the due ap-
proval of the General Body.
8. To manage construction of additional units and fa-
cilities when duly authorized sanctions are obtained
from the local authorities
2 MEMBERSHIP
A Liability of member
The liability of member- shall not exceed the value of the
shares held by him/her
B Membership
The membership of the Societys shall consist of members,
associate members and nominal members as under.
7
C Member
A person who owns an Apartment or who has been allot-
ted an Apartment is under construction or who is desirous
of getting an Apartment is eligible to become a member
of the Society. He shall hold a minimum of one fully paid-
up share. Notwithstanding anything contained in these
Bye-laws, all members of the Society enjoy equal rights,
irrespective of the number of shares of the Society that
they may hold. Further, all members enjoy an interest in
the undivided property of the Society.
D Associate member.
At the stage of purchase of a site or construction of the
Apartments, it may be expedient for an Employees House
Building Co-operative Society or other General House
Building Co-operative Society to oer shares and admit
associate members to be on the wait list for the allotment
of sites or Apartment. But an associate member shall be
allotted an Apartment only after admitting him as a reg-
ular member of the Society Associate Members shall not
be entitled to become oce-bearers of the
E Nominal members.
1. Any individual or rm, may be admitted as a nom-
inal member on payment of a non-refundable fee of
Rs .......... along with a prescribed application form
duly lled and completed. Persons with whom the
Society has nancial transactions such as contrac-
tors maintaining buildings of the Society or per-
sons/agents involved in the supply of goods or ser-
vices to the Society, may be admitted as nominal
members provided that such nominal membership
shall cease on completion of the purpose for which
they were admitted as nominal members.
2. A nominal member shall not be entitled to any share
in any form whatsoever in the assets or prots of
the Society, nor can he be elected or co-opted as an
oce-bearer of the Society.
3. A nominal member shall not enjoy the same rights
and privileges as the shareholder members of the
Society. Nominal membership may be terminated
by the Managing Committee, assigning due reasons
for their such actions.
4. A tenant residing in the Society premises may seek
and be granted nominal membership, to enable him
to utilize the common facilities and utilities in the
Society premises. Such nominal membership shall
cease when such tenant vacates the premises of the
Society.
5. Nominal members shall not attend General Meet-
ings of the Society.
F Limit of membership.
The number of members in the Society shall be limited
to the number of Apartments in the Societys premises.
Joint memberships are not permitted.
G Admission of new members before the
General Body Meeting
.
1. The Society shall not admit any new member thirty
days prior to the date of a General Body Meeting.
A new member admitted to the Society shall not
have the right to exercise his vote at meetings as
a shareholder, until he completes twelve months in
membership of the Society. Further, he shall not
stand for elections to the Committee of Manage-
ment or be co-opted as member in such Committee,
till completion of, twelve months in membership.
2. Where a new member is to be admitted, consequent
to re-sale/transfer of an Apartment, the applicant
or member shall be required to furnish a copy of the
registered deed or sale/transfer of the Apartment to
the Managing Committee, for the oce record.
3. In the case of admission of a new member by suc-
cession rights to the Apartment consequent to the
death of a member, the membership of the Society
is not automatic and succession to the property of
the deceased member can only be claimed by fur-
nishing a copy of the Will of the deceased member
or a copy of a Court Order in proof of succession.
The nominee/legal heir shall only be admitted as
8
a member of the Society consequent to producing
valid documents in proof of having transferred the
Apartment to his/her name in the Municipal and
Revenue Records.
H List of members
The Society shall prepare a list of members as on the last
date of each Co-operative year. The list shall be furnished
to members along with the annual report or notice issued
prior to any General Meeting of the Society. The list as
prepared shall indicate the name of the member, the date
of his admission to the Society and share certicate num-
bers as held. A copy of the same list shall be furnished
to the Registrar of Co-operative Societies 15 clear days
prior to the date xed for a General Meeting or elections
to the Committee and shall also be prominently displayed
on all the notice boards of the Society.
I Eligibility/Disqualication for mem-
bership.
Any person who is above the age of 18 years and who is
competent under Section 11 of the Indian Contract Act,
1872 (Central Act II of 1872), may be admitted as a mem-
ber of the Society, provided.
1. He expresses intent and takes actions to own an
Apartment in the Society.
2. He has not applied to be adjudicated as an insolvent
or is not an undischarged insolvent.
3. He has not been convicted for any oence other than
an oence of political character or an oence involv-
ing moral turpitude, such sentence not having been
reversed or the oence pardoned arid a period of
5 years has not elapsed from the date of expiry of
such sentence.
4. Carries on a business of the kind carried on by such
Co-operative Society.
5. Is already a member or becomes a member of a Co-
operative Society carrying on business of the same
kind as itself. The Society shall obtain from the
applicant for membership, an adavit sworn to be-
fore a notary to the eect that he/she is not al-
ready a member of any other Co-operative Soci-
ety and that he/she does not already own a site
or plot or house/at/Apartment in his/her name in
the Corporation limits/Development authority lim-
its/Municipality limits in whose limit the Society is
situated.
6. He/she does not already own a site or plot or
house/at/Apartment in his/her own name in
the Corporation limits/development authority lim-
its/Municipality limits in whose limit the Society is
situated
.
J Application for membership and ad-
mission as member.
1. Every application for membership shall be in writ-
ing, submitted in the form prescribed by the Society
and shall be addressed to the Chief Executive O-
cer along with full paid-up value of at least one share
of Rs. 100/- and share fee of Rs, 10/- and applica-
tion fee of Rs. 10/-. Grant of membership to an
applicant shall not be decided by circular amongst
the Committee members, but shall be decided after
deliberation in a meeting of the Committee.
2. Within a period of seven days of such resolution, the
CEO shall enter the applicants name if admitted as
a member in the membership and share ledger of
the Society duly indicating the resolution number
and the date when such Committee meeting was
held
3. The Committee shall within three months from the
date of receipt of application for membership, ei-
ther admit or refuse to admit the applicant as a
member and shall send a written communication of
such admission/refusal of membership to the said
applicant. If no communication of admission as a
member of the Society is received by the applicant,
before the expiry of the said period his application
shall be deemed to have been refused by the Com-
mittee of the Society on the 1st day of the said
period for the purpose of Section 105-A of the Act.
9
K Rights of Owner members.
All members shall be eligible to avail the benets of as per
the Objective under the Bye-laws of the Society subject
to the condition, that a member shall be eligible for al-
lotment of a site/Apartment/house only, if he fullls the
bye law requirements. Bill of Rights given at Appendix
A to these bye-laws.
L Cessation of membership
A member of the Society shall cease to be such a member,
for any of the following reasons. ,
1. By sale or transfer of his tenement; as per proce-
dures outlined in the Bye-laws.
2. By voluntary surrender or withdrawal of all -of the
shares held by him.
3. On the death of the member.
4. Consequent to acceptance of resignation as submit-
ted by the member, to the Committee.
5. By reasons mentioned in Sections 17 and 18-A of
the Act.
M Resignation of Membership of the So-
ciety.
No member, shall be permitted to resign from the mem-
bership of the Society unless.
1. He has given one months notice of such resignation
from the . Society.
2. He has completely discharged his liability to the So-
ciety.
3. He has ceased to own an Apartment in the Society.
3 FUNDS OF THE SOCIETY
A Working Funds
.The following shall constitute the working funds of the
Society:
1. Share Capital.
2. Members deposits.
3. Borrowings.
B Raising of funds.
Funds may be raised in one or more of the following ways:
1. By admission fees.
2. By issue of shares or fees on transfer of shares from
one member to another.
3. By loans and subsidies.
4. By deposits from members.
5. By voluntary donations.
6. By contribution from members to meet the cost of
land/building or Apartment.
7. By the sale of garden produce of the Society.
8. By collection of rental charges for use of the com-
munity hall of the Society or temporary use of any
other facility of the Society, by a member or non-
member when sponsored by a member of the Soci-
ety.
9. By any other mode permitted under these Bye-laws
C Deposits.
The Society may receive deposits from members only at
such rates of interest xed by the Committee of Manage-
ment.
D Borrowings
.The Society may borrow loans for the fulllment of its
objects from the following sources. (
1. Financial Institutions.
2. Karnataka State Co-operative Housing Federation,
3. Housing and Urban Development Corporation,
10
4. National Housing Bank.
5. Housing Development Finance Corporation.
6. The institutions approved by the Government of
Karnataka or Registrar of Co-operative Societies.
E Loans
.The Society shall not advance any loans or advances to
any non-member or casual daily wage employee of the
Society.
Investment of Funds. The funds of the Society shall
be invested or deposited in the manner laid down under
the Act and Rules or otherwise as approved by the Reg-
istrar of Co-operative Societies, Karnataka.
Share capital The authorized share capital of the So-
ciety shall be decided in the annual general meeting of the
Society. The Share Capital of the Society shall consist of
shares of Rs. 100/- each. The full value of each share
shall be paid in one lump sum.
Share certicate. Every member shall be provided a
Share Certicate signed by the Chairman and the Chief
Executive Ocer specifying the value of the shares al-
lotted to the member, in proof of his membership of the
Society. In the event of loss of a share certicate by a
member, a sum of Rs. 10/- shall be the fee chargeable
for issue of a duplicate share certicate. All share cer-
ticates duly machine numbered in serial order shall be
accounted for in the share ledger of the Society. All blank
share certicates shall bear a machine number and shall
be scrupulously accounted for by the Chief Executive Of-
cer.
Transfer of Shares. A member may apply for the
transfer of shares to another member, subject to the ap-
proval of the Committee. A sum of Rs. 10/- shall be
the fee chargeable for transfer, subject to a maximum of
Rs. 50/- on a single transfer of any number of shares
as proposed to be transferred. No transfer of shares of a
member shall be eected unless such member has held the
shares for a minimum of one year and has rendered the
request for transfer to the Society, in writing. No transfer
of shares shall be deemed to be valid, if any or all of the
conditions contained in these Bye-laws are not fullled
in such transfer. The Committee may reject any transfer
application assigning due reason thereof. Any snare to be
transferred shall require to be endorsed by the Managing
Committee. Thereafter, no claim shall be made by the
transferee upon the Society.
Quantum of Shares held by member. The quan-
tum of shares of the Society held by a Member is in no
way linked to his share in the undivided land and owner-
ship of the Apartment allotted to him.
Value of the shares held by member When a share-
holder ceases to be a member of the Society, the sum
representing the value of his/her share or interest in the
capital of the Society to be paid to him/her nominee or
legal representative shall be calculated in the following
manner.
1. It shall be the amount arrived at by the valuation
based on the nancial position of the Society as
shown in the last audited balance-sheet preceding
the cessation.
2. The amount so ascertained shall not exceed the ac-
tual amount received by the Society in respect of
such share or interest.
3. If the net loss of the Society, if any is equal to or
exceeds the paid-up share capital of the Society, the
value of the share shall be treated as nil.
4. In the event of a dispute between a member or
his/her nominees/legal representatives and the So-
ciety, regarding the value of the Share or interest
in the share capital, the decision of the Registrar
thereon shall be nal.
Refund of Share Capital. A member who ceases to
own an Apartment in the Society will be refunded the
share capital subscribed by him/her after the sale or
transfer of his tenement subject to:-
1. The limit for the refund of share capital xed by
the general body for time to time.
11
2. Ascertaining the value of the share as per Rule 12
of the rules and Bye-law No. 18.
3. Approval by the Committee of management.
Transfer of interest on the death of a member On
the death of a member, the Society shall transfer his/her
Apartment and undivided share in the immovable prop-
erty of the Society, as follows.
1. To the person nominated by the deceased in accor-
dance with the rules where the nomination subsists.
But nomination alone is not sucient proof of the
nominees right to succession to the property of the
deceased.
2. If no person has been nominated by the deceased or
if the nomination does not subsist:
(a) The Apartment and undivided share of the im-
movable property of the Society assigned to
the deceased member shall be transferred to
only such person as produces valid documents
in proof of being the heir or the legal represen-
tatives of the deceased on the execution of an
indemnity bond with such sureties as it may
require.
(b) The Apartment and undivided share in the
immovable property of the deceased member
shall be transferred to the person producing
a valid succession certicate or authentic Will
and last testament of the deceased with signa-
tures identied and authenticated by two valid
witnesses specically bequeathing the Apart-
ment and shares to such person as the legal
heir: Provided that such nominee, heir or legal
representatives as the case may be is admitted
as a member of the Society: Provided further
that nothing in this Bye-law prevents a minor
or a person or unsound mind from acquiring by
inheritance or otherwise the share or interest
of the deceased member of the Society.
(c) Any such nominee, heir or legal representative
as the case may be, may require the Society
to pay to him the value of the Share or inter-
est or the deceased member as ascertained in
accordance with Bye-law No. 18. The Society
may pay to such nominee, heir or legal repre-
sentative as the case may be, all moneys due
by it to the deceased member.
(d) All transfers and payments made by the Soci-
ety in accordance with the provisions of these
Bye-laws shall be valid and eective against
any demand made upon the Society by arty
other person.
Nomination Every member of the Society shall nomi-
nate a person to succeed him in the event of his death. A
member may revoke or vary such nomination. The mem-
bers are advised to nominate only one person who is the
legal heir in respect of the shares and tenement of the
member, incorporating a clause nominating another or
other person in the event of the rst nominee predeceas-
ing the member. In the case of a nominee who is a minor,
the care-taker guardian shall be named in the nomina-
tion form. A nomination made by a member under this
Bye-law shall not be valid unless it is made in writing and
is signed by him in the presence of at least two member
witnesses, and such nomination is registered in the books
of the Society prior to the death of the member.
Register of members The Committee shall maintain
a share ledger in which will be entered the name, occu-
pation and address of the member to whom such share
was originally allotted and each successive holder of the
share with the dates of sanction of transfer and when the
share is repaid, forfeited or canceled with the dates of
such repayment, forfeiture or cancellation duly entered
and signed by the authorized signatory.
4 REGISTRATION OF
IMMOVABLE PROPERTY
A Applicability of Stamp Duty and Reg-
istration fees
Every instrument of transfer of immovable property shall
be registered paying proper stamp duty and registration
fees as applicable under the Registration Act, 1908 and
the Karnataka Stamp Act, 1957. The exemption from
12
compulsory Registration of instruments listed under Sec-
tion 38 of the Karnataka Co-operative Societies Act, 1959
shall not apply to instruments which is intended to trans-
fer or in eect transfers the right, title or interest in im-
movable property executed by or in favor of House Build-
ing Co-operative Societies registered under this Act. The
following procedure shall be followed.
1. A member can take possession of the house/site/
Apartment/garage/parking space allotted to him
by the Society only by way of registration under
the Registration Act, 1908 and the Karnataka Reg-
istration Rules, 1965.
2. A Co-operative Society shall transfer house/site/
Apartment/garage/parking space only by way of
registration under the Registration Act, 1908 and
the Karnataka Registration Rules, 1965.
3. No house/site/Apartment/garage/parking space
shall be transferred to a member by way of share
transfer or any other mode other than by registra-
tion.
4. A Co-operative Society shall handover the posses-
sion of the house/site/Apartment/garage/parking
space to its members only after due process of reg-
istration under the Registration Act, 1908 and the
Karnataka Stamp Act, 1957.
5. In executing the transfer of title of ownership of an
Apartment, due care shall be taken to ensure that
such deed of conveyance also includes in its Sched-
ules the car garage or open car parking space al-
lotted to the member for which he or she has paid
the charges for construction/development charges.
All other open spaces and stilts for parking of vehi-
cles in the precincts of the Society shall be clearly
marked and numbered for ease of recognition and
may be allotted for the use of the other members.
A nominal fee may be levied by the management of
the Society for the parking of every vehicle within
the premises of the Society.
B Deeds of Conveyance
The Society shall ensure that proper deeds of conveyance
are executed paying stamp duty and registration fees
as applicable in every instance of sale/resale/transfer of
Apartments as outlined in Sections 54 and 55 of the
Transfer of Property Act, 1882 and Section 17(1) of the
Registration Act, 1908. In every such transfer, the Soci-
ety shall.
1. obtain a copy of the deed of transfer/deed of Apart-
ment from the transferee, for the purpose of main-
taining a record in the Society.
2. notify to the appropriate Ward Oce of the City
Corporation under Section 114 of the Karnataka
Municipal Corporations Act, 1976, the details of
Transfer of the Apartment, to facilitate the trans-
fer of khatha and levy of khatha transfer fees as
applicable.
3. enumerate in the annual report of the Society, the
details of such transfer indicating Apartment num-
ber, details of outgoing/incoming member, the con-
sideration amount paid and the transfer fee col-
lected by the Society.
4. record in the occupancy register of the Society every
such detail, which may be of interest to the ocials
of the City Corporation and Income-tax.
5. Collect from the transferor the transfer fee not ex-
ceeding one per cent of the consideration amount
received by him, in the resale/transfer of the Apart-
ment.
5 MEETINGS OF THE
SOCIETY
A All Meetings
1. All meetings, including the General meetings of the
Society shall be held at the registered oce of the
Society.
2. If any meeting is to be held elsewhere it shall be
held with the previous permission of the Registrar
as per Section 113(2) of the Act.
13
3. Subject to provisions of the Act, Rules and Bye-
laws of the Society, the nal authority of the Soci-
ety shall vest in its general body convened in such
manner as is specied in these Bye-laws.
4. All meetings will follow Roberts Rules of Order
for orderly conduct of ecient meetings. Roberts
Rules of Order is the foremost guide to parliamen-
tary procedure. It is used by more professional asso-
ciations, fraternal organizations, and local govern-
ments than any other authority.
B Annual General Meeting
The annual general meetings of the Society shall be held
prior to the last day of September in that calendar year,
for
1. Recording and conrming the minutes of the last
annual general meeting, if any, and to note the ac-
tions taken thereon.
2. Consideration of the annual report, statement of ac-
counts and the latest available audit reports along
with actions taken in rectication of defects pointed
out in the audit report.
3. Approval of the programme of activities of the So-
ciety prepared by the Managing Committee for the
ensuing year, including the actions /activities pro-
posed to be implemented for the common utility
purpose in the interest of the members.
4. Consideration, deliberation and sanction of the an-
nual budget estimates of the Society.
5. Consideration of appropriation of surplus funds.
6. Creation of specic reserve and other funds.
7. Amendment of Bye-laws.
8. Perusal of the list of the employees who are rela-
tives of members of the Committee or the appointed
Chief Executive Ocer.
9. Formation of a Code of Conduct for the members of
the Committee, Oce-bearers and employees of the
Society. This shall be reviewed from time to time
to make it eective.
10. Consideration of inquiry report, if any.
11. Consideration of any other matter, brought forward
in accordance with the Bye-laws.
C Special General Meeting
The Special General Meeting of the Society may be called
at any time by the Committee or shall be called within
one month of the date of receipt of the requisition in writ-
ing and signed by at least 1 /3rd of the members of the
Society or from registering authority. The meeting so
convened shall not transact any business other than that
mentioned in the notice of the meeting.
D Notice for the General Meeting and
Special General Meeting.
A notice of 15 days clear notice shall be given to the mem-
bers for annual general meeting and 7 days clear notice
shall be given for special general meeting. A notice for
the such meetings may be given in one or more of the
following modes.
1. By axing a copy of the notice of the meeting on
the notice board.
2. By sending the notice by post under certicate of
posting to the members.
3. By circulation of the notice book and, getting sig-
natures of members on the same.
Note: Any irregularity in the serving of notice shall not
by itself invalidate the proceedings of General Meeting.
E Quorum for General Meetings.
1. The quorum for every general meeting of the Soci-
ety shall be one-fth of the total members of the
Society or 50 members whichever is less.
2. If within an hour from the time appointed for the
meeting, there is no quorum, the meeting if con-
vened upon the requisition of the members shall be
dissolved. In any other case it shall be adjourned by
at least one hour on the same day clearly indicating
the time, of the adjourned meeting.
14
3. At the commencement of the general meeting, the
chairman shall bring the attendance record book
of the meeting before the members and cause the
attendance gures to be read out to satisfy the re-
quirement of a quorum to hold the meeting. The
gures in attendance shall then be recorded in the
minutes book of the Society as the quorum at such
meeting. Late comers may only add their names in
the attendance book, at the conclusion of the meet-
ing, with the permission of the Chairman.
4. If at any stage of the meeting, it is observed that
the quorum has fallen below the required minimum
the meeting may be adjourned at the request of the
members for discussion on the balance of points on
the agenda at an adjourned date not beyond 15 days
of the original date given for the meeting.
F Chairman of the general body
The Chairman of the Society or in his absence the Vice-
Chairman or any Director or any member or in the ab-
sence of both Chairman and Vice-Chairman, any Direc-
tor, any member elected at the meeting of the general
meeting shall preside over the general meeting.
G Voting in general meeting.
Every member present shall have only one vote and ev-
ery member shall exercise his vote in person. All sub-
ject/issues/except amendment of Bye-laws shall be de-
cided by the majority of votes of the members present
and eligible to vote. When votes are equal, the Chairman
of the meeting shall have a casting vote.
H Adjournment of general meetings.
If all the business on the agenda of the General Meeting
of the Society cannot be transacted, for unavoidable rea-
sons, on the day on which the general meeting is held, a
resolution shall be passed in the general meeting record-
ing the reasons for not completing the business and ad-
journing the meeting to another date, clearly indicating
the date, time and venue of the meeting. No notice is
necessary for such adjourned meeting. The agenda of the
original meeting only shall be considered in the adjourned
meeting.
I Rectication of Resolution.
No resolution can be brought at a General Meeting of a
Society, rectifying its previous resolution, unless six clear
months have expired, after passing such resolution.
J Recording of the GBM Proceedings
.The Chief Executive Ocer of the Society shall record
the minutes of every general body meeting held in the
Society and sign the same along with the Chairman of
the meeting. A signed copy of the minutes of every such
meeting shall be submitted to the jurisdictional Registrar
of Co-operative Societies within 10 days of such meeting.
Convening of the rst meeting of the Committee
of management after elections are held As soon as
the. results of the election to the Committee of the Man-
agement are declared, the CEO shall notify their names
on the notice boards of the Society as required by sub-rule
(15) of Rule 14 of the Karnataka Co-operative Societies
Rules, 1960 and shall convene a meeting of the Commit-
tee Members by giving a notice of 7 days in writing under
registered post under intimation to the Registrar of Co-
operative Societies, specifying the date, time and place of
meeting of the Committee of Management for the purpose
of electing the Oce-bearers as required to be elected un-
der the Bye-laws of the Society.
6 BOARD OF MANAGEMENT
(BoM)
A Duty & Constitution of BoM
The fundamental duty of the Board of Management are
1. Preserve
2. Protect
3. Maintain &
4. Enhance the value of the Assets
15
Every action of the Board is governed by these fundamen-
tal duty of the Board. The General Body is the supreme
body and Board is assigned these fundamental goals and
the Board represents the wishes of the General body. The
Management of the aairs of the Society shall vest in the
Board constituted in accordance with the provisions of
the Act, the rules and the Bye-laws of the Society.
1. The Board shall consist of at least nine members of
which one seat shall be reserved for SC/ST member
and one seat for woman member. However, no such
reservation need be made if such members do not
exist in the Society.
2. The term of oce of the Board shall be ve years
and the election shall be held for the entire Board
other than the nominated members, if any.
3. If a vacancy is caused in the Board of management
by death, resignation, removal or any other cause,
the vacancy may be lled up by co-option of an-
other member to the Board for the remaining period
of the term of the Board, under intimation to the
jurisdictional Registrar of Co-operative Societies.
B Election of Oce-bearers
The members of the Board of Management shall elect
from among themselves the oce-bearers of the Society
such as Chairman and Vice-Chairman. They shall hold
oce for two and half years.
C Disqualication to become a Member
of Board.
A member shall be in-eligible to become a member of the
Board, if he or she.
1. is in default to the Society or any other Co-operative
Society in respect of any dues from him as borrower.
2. is interested in any contract made with the Soci-
ety or in the sale or purchase made by the Society
privately or in auction or transaction of the Society
(other than investment and borrowing) involving -
nancial interests in that contract, sale, purchase or
transaction.
3. carries on a business of the same kind carried on by
the Society
4. is employed as Legal Practitioner on behalf of the
Society or accepts employment as Legal Practi-
tioner elsewhere against the Society.
5. is a paid employee of the Society or its nancing
Bank, provided that nothing in this clause shall ap-
ply to the Chief Executive Ocer.
6. is a near relative of a paid employee of the Society.
The term near relative is explained in Section 29-
C(l)(f) of the Act.
7. becomes bankrupt or of unsound mind.
8. has been convicted of an oence punishable under
Section 193-A or Section 171-E or sub-section (2) or
sub-section (3) of Section 505 of the Indian Penal
Code, 1860 or clause (b) of subsection (2) of Sec-
tion 39-K of this Act unless a period of six years
has elapsed from the date of such conviction.
9. was a paid employee of a Co-operative Society
and was dismissed, removed or compulsorily retired
from service of a Co-operative Society.
10. is disqualied to be a member of the Society or to
vote as such member or has been disqualied for
a specic period under Section 29-C(8)(b), (c) and
(d) of the Act.
11. has been convicted by a Court in India for any of-
fence and sentenced to imprisonment for a term of
not less than two years, unless a period of ve years
has elapsed from the date of his release.
12. is found guilty of corrupt practice within the mean-
ing of Section 39-C unless a period of six years has
elapsed from the date on which he was round guilty.
13. has failed to remit any amount to any Co-operative
Society (other than a loan) retained by him in con-
travention of the provisions of the Act, Rules or
Bye-laws.
16
14. is a representative of a Co-operative Society which
is in default to a nancing Bank or to any Co-
operative Bank or to any Cooperative Society in re-
spect of any dues by the Co-operative Society which
he represents for a continuous period of one year.
15. was a member of the Board which failed to make
arrangement for election within the time specied
in Section 39-A of the Act.
D Quorum for the Board meetings
Quorum for all Board meetings shall be ve. If there is no
quorum within half an hour of the time xed, the meeting
shall be adjourned with no business transacted
E Powers of the Board of Management
The Board of Management shall have the following pow-
ers
1. To admit new members including associate mem-
bers and nominal members.
2. To consider applications for allotment of shares,
share transfers, refund of share amounts.
3. To consider the applications for resignation of mem-
bership.
4. To appoint, suspend, punish or dismiss the salaried
sta members of the Society in accordance with the
Subsidiary Rules framed by the Committee and ap-
proved by the Registrar of Co-operative Societies.
5. To raise working capital, limited to the resolution
if any, passed in the general meeting.
6. To authorize institution of and defend legal pro-
ceedings for and against the Society; or
7. To compromise or withdraw legal proceedings with
the prior approval of the General Body.
8. To arrange for inspections of the buildings and other
infrastructures in the Society premises.
9. To arrange for the maintenance of accounts and
other records required for the smooth and ecient
functioning of the Cooperative Society.
10. To obtain securities from the paid employees of the
Society.
11. To take action for the upkeep and improvement of
the buildings and other infrastructures in the Soci-
ety.
12. Renting or leasing out the Community hall if any
for sports, cultural or religious purpose to derive
income to meet the administrative and other ex-
penditure in the Society instituted for the common
benet of members.
13. To constitute Sub-Committees comprising of the
President, Vice-President, CEO and not more than
two elected members of the Board for specic pur-
poses and specic periods to perform duties with
regard to the aairs of the Society. The recom-
mendations of the Sub-Committee, if any, shall be
placed before the Committee for decision.
14. To appoint certied Contractors (certied by the
P.W.D.) for development/execution of civic ameni-
ties /construction of buildings by calling of tenders
and accepting the eligible tender by taking adequate
guarantee and security. Any revision in the terms of
agreement shall be in accordance with the P.W.D.
norms.
15. To appoint qualied Architects and allocate work of
inspection of compliance to norms, quality or speci-
cation, planning or design as and when required a
n d to f i x t h e ir fee /remuneration and payment
thereof with the prior approval of the general body.
16. ) To frame fair and equitable subsidiary rules such
as sta service rules, rules for parking of vehicles,
rules for the renting of Apartments to the extend
no property rights are violated, disposal of garbage,
Rain water harvesting measures, rules for sale and
disposal of garden produce, rules for renting of com-
munity hall, working rules for the operation and use
of the building repair fund, complaints record proce-
dure, procedure on disputes arising amongst mem-
bers, Tender calling and contract operating pro-
cedure, security and re prevention measures and
other working rules concerning the business/aairs
of the Society under the provisions of Bye-laws.
17
F 32. Attendance of members of the
Board of Management.
Should a member of the Board be absent for three con-
secutive meetings of the Committee without special leave
of absence, he/she shall be deemed to, have ceased to be
a member of the Board of Management.
G Board Meetings
1. The Board shall meet at least once in a month to
conduct the aairs of the Society. The meeting shall
be convened by the CEO in consultation with the
Chairman. Notice of at least seven days shall be
given to the members along with the Agenda and
related notes. The Chairman shall preside over all
meetings. All decisions shall be taken by a simple
majority. In the event of a tie, the Chairman shall
have a casting vote, except in matters of election
of oce-bearers. In case a proposal for change of
rules of the Society, a 3 out of 5 majority will be
necessary.
2. In a situation where it is impractical to convene a
meeting due to paucity of time, the matter may be
circulated amongst the Committee members and.
a decision taken. A decision taken by such circula-
tion shall be placed before the Managing Committee
during the next meeting for its ratication. Should
sharp dierence in opinion-arise in the course of cir-
culation, the matter shall not be decided by circula-
tion or at the discretion of the Chairman, but shall
be done by calling an Emergency Meeting of the
Managing Committee, giving three days notice.
3. Public access to the proceedings and decision-
making processes of boards, agencies and commit-
tees is an essential element of a properly function-
ing democracy. Sunshine is the best disinfectant.
. Secrecy and a free, democratic government dont
mix. Openness and disclosure will be the all pervad-
ing rule, condentiality only an exception that too
only to protect the privacy rights of the homeown-
ers individuals. Privacy as used in an exemption
means disclosure of information about the person:
(1) would be highly oensive to a reasonable person,
and (2) is not of legitimate concern to the public.
The test for exemption on grounds of privacy is a
two-part test. Information may be highly oensive,
but if it is of legitimate concern to the public, it
is not exempt. Information may not be of legiti-
mate concern to the public, but if it is not highly
oensive, it is not exempt.
4. All meetings will be open meetings which means
any member of society can attend the Board. This
is extremely important for total transparency. The
meetings of the Board of Management are open to
the members. A member of the society requesting
to address the Board on an agenda item will be al-
lowed a total of three (3) minutes per meeting, and
a request to address the Board must be submitted
in person to the Chief Executive Ocer prior to the
item being called. The Board may limit the member
input on any item, based on the number of people
requesting to speak and the business of the Board.
5. Any member can request to bring an item on the
agenda in all matters of violation of rights and the
request made with 1 day notice will be honored. In
matters other than violation of individual rights, a
request to bring an item on the agenda will need
the signature of 10 members at least.
H Board Meetings Proceedings Book.
A proceedings book of the Board meetings of the Soci-
ety shall be maintained by the Chief Executive Ocer
in which the names of the members present and the pro-
ceedings of each meeting to include the passing of monthly
accounts shall be recorded and signed by the Chairman
and the CEO. The book shall be written up within 3
days of a meeting. The blank space, if any, between the
last lines of the minutes as recorded and the signatures
of the Chairman, shall be scored out in ball pen to elim-
inate scope for the late additions to such minutes. Such
minutes as recorded shall be read out to members at the
next meeting of the Committee and shall be signed by
them in authentication of the correctness of the minutes.
The book shall be available in the oce of the Society
for perusal by the other members, on all days during the
working hours.
18
I Chairman at Board meetings
The Chairman of the Society shall preside over all the
meetings of the Board provided that if at any meeting
of the Board he/she is absent the Vice-Chairman may
preside over such meeting.
J Vice-Chairman.
The Vice-Chairman in the absence of the Chairman on
leave shall exercise all the powers of the Chairman.
K Chief Executive Ocer
The Chief Executive Ocer shall be a paid servant of the
Society. He/she may either be a full-time or part-time
paid employee of the Society. He/she shall be appointed
in accordance with Section 29-G of the Act and Rules 17
and 18 as amended.
L Duties of the Chief Executive Ocer
The Chief Executive Ocer of the Society shall be subject
to the control of the Chairman. His duties and functions
are as under.
1. To issue notice along with agenda and notes to sum-
mon . meetings of the General Body and the Man-
aging Committee in consultation with the Chair-
man.
2. To record proceedings of such meetings in the min-
utes book.
3. To call the meeting of the Committee for election
of
4. To maintain account books, registers and other
records and initial and sign all the entries in the
same.
5. To nalize the accounts of the Society each month
in the required manner.
6. To produce the records of the Society before dier-
ent authorities concerned with regard to the work-
ing of the Society.
7. To sign all documents for and on behalf of the Soci-
ety, subject to authorization by the Managing Com-
mittee.
8. To receive applications for membership, for with-
drawal and transfer of shares etc., and place the
.same before the Managing Committee with his
opinion.
9. To place before the Managing Committee all docu-
ments relating to complaints and suggestions from
the members, and all vouchers and receipts pertain-
ing to the receipts and payment statement.
10. Subject to such rules as may be framed from time to
time, and any resolution in that behalf by the Com-
mittee, the CEO is empowered to sign all papers,
transact business on behalf of the Society, to ac-
quire, draw interest or endorse all Government and
other remittance, Bank transactions and to repre-
sent the Society in litigation relating to the Society,
as approved by the general body.
11. He shall be the person to sue and be sued on behalf
of the
12. He shall be responsible for the safe custody of all
Registers and other records of the Society inclusive
of cash, stock and other properties of the Society.
The overall responsibility for all nancial transac-
tions of the Society lies on the Chief Executive Of-
cer.
13. He shall be responsible for controlling the sta and
ensuring ecient functioning of the oce of the So-
ciety.
14. He shall attend to any other work relating to the ad-
ministration of the Society entrusted by the Com-
mittee. He shall be courteous to all the members
and shareholders of the Society.
15. He shall by the tenth day of every month, submit
to the jurisdictional Registrar of Co-operative Soci-
eties a certied extract of the receipt and payment
details of the previous month as contained in the
general ledger.
16. He shall perform all other duties and responsibilities
as specied under Section 29-G of the Act.
19
7 ADMINISTRATION
A Handling of funds
A Bank account shall be opened by the Society
into Which all monies received shall be paid. The CEO
may .however retain in his custody a sum not exceed-
ing Rs. 500/- belonging to the Society to meet sundry
expenses of the Society. All payments above Rs. 500/-
shall be made by cheque signed jointly by the Chairman
and CEO or in the absence of the Chairman by the Vice-
Chairman and CEO. All receipts and payments made in
cash shall be recorded in the Books of Accounts, on the
same date as the transaction. In making payment of bills,
the amounts in payment shall not be split, merely to
facilitate easy payment. The Society shall maintain its
Bank account with the District Co-operative Bank in the
area. However, another Bank account in a Nationalized
or Scheduled Bank may be opened with the prior permis-
sion of the Registrar of Co-operative Societies.
B Building Repair Fund
Periodic major repair and upkeep of the buildings would
necessitate sudden and very heavy burden or contribution
from the members. To ease the burden of such contribu-
tions from the members, a fund called the building repair
fund shall be created. The fund is to be collected from
members in monthly subscriptions to form a corpus for
meeting the contingencies of periodic and essential major
repairs of the buildings, the facilities, utilities and com-
mon areas of usage in the Society. The amounts in the
fund may also be utilized to meet contingencies of essen-
tial Minor repairs and upkeep of the common facilities in
the premises of the Society, besides emergent special re-
pairs without which the functioning of the Society may be
hampered. The amounts in such fund shall not however
be utilized towards repairs and replacement of ttings in
the interiors of the Apartments owned by the members.
The upkeep and repairs to the interiors of the Apartments
owned by the members is the responsibility of the mem-
bers themselves. The following tasks in repairs may be
carried out by the Society on a work order basis, with
expenditure from their building repair fund.
1. All internal roads, Compound walls, external wa-
ter pipelines, water pumps, water storage tanks, so-
lar heaters, if installed. External rain water and
drainage lines, Stair cases, Terrace and parapet
walls, Staircase lights, security lights, outer walls
of the tenement buildings, electric service lines up
to the meters and control switches in the ats.
2. All other repairs and replacement of ttings not
covered by the Society, shall be carried out by the
members at their own cost.
C Details of essential repairs
The details of essential repairs which may be carried out
in the buildings, facilities and utilities of the Society and
the nature and scope of major repairs, minor repairs and
special repairs shall be outlined in subsidiary rules to be
framed by each Society, duly approved by the general
body and the Registrar of Co-operative Societies.
D Reserve Fund.
The Reserve Fund amount shall be invested in the man-
ner provided in Rule 23 of the Karnataka Co-operative
Societies Rules, 1960.
E Depreciation Fund
A Depreciation Fund at a rate to be decided by the Gen-
eral Body may be constituted and invested on long term
basis along with the interest earned thereon by one of the
modes, permitted under the Karnataka Co-operative So-
cieties Act. The fund is only to be utilized in exceptional
cases, for reconstruction of the buildings or for carrying
out such structural additions or alterations to the build-
ings as in the opinion of the Societies architects, would be
necessary to strengthen it or for carrying out such heavy
repairs as may be certied by the architect as inescapable
and essential. Utilization of the fund would require the
prior sanction of the general body and permission of the
Registrar of Co-operative Societies. This fund is also re-
ferred to as the sinking fund.
F Maintenance of accounts and audit.
The Society shall maintain the following books of ac-
count, records and registers:
20
1. Register of members;
2. Share issue register;
3. Nomination register;
4. Receipt book;
5. Voucher book;
6. Cash book;
7. General ledger;
8. Occupation register Apartments;
9. Properties register;
10. Investment register;
11. Loan register;
12. Mortgage register;
13. Register library;
14. Minutes book of general meetings;
15. Attendance book general meetings;
16. Minutes book of the managing Committee meet-
ings;
17. Audit rectication register;
18. Complaints and suggestions register;
19. Building repairs work order book;
20. Other books of accounts as may be prescribed by
the Director of Co-operative Audit and the Regis-
ter of Co-operative Societies from time to time.
G Documents
The Society shall maintain the following documents.
1. Application for membership;
2. Letter of resignation of members;
3. Application for transfer of shares and interest on
the capital;
4. Correspondence with Registering Authority;
5. Conveyance of property;
6. Agreement and contract deeds;
7. Application for allotment of Apartments;
8. Approved plans of Apartments;
9. copy of the registered Bye-laws with up-to-date
amendments;
10. Certicate of registration;
11. Member-wise loan application, sanction and docu-
mentation;
12. Periodical statements submitted to the Regulators
and the Government;
13. Audit memos and audit reports;
14. Notice and agenda of general body meetings;
15. Notice and agenda of meetings of the Committee of
management;
16. Copies of the Karnataka Cooperative Societies Act
and the Karnataka Co-operative Societies Rules as
amended from time to time;
17. File containing all circulars/directions issued by the
Registrar and the Director of Co-operative Audit or
any other authority connected with the Society;
18. Copies of documents of title deeds, registration of
property;
19. Receipts of Corporation taxes paid for the land, of-
ce and common areas or utility and the restricted
areas in the Society;
20. Electricity and water bills that are paid by the So-
ciety;
21. Photo copy of the receipts of annual property tax
paid by the members to the City Corporation in
regard to their Apartments.
21
H Audit
The accounts of the Society shall be audited each year by
the Auditor appointed or deputed by the Director of Co-
operative Audit in compliance of Section 63 of the Act.
For the purpose or Annual General
Meetings of the Society, the audited statement of
accounts and the audit report shall be circulated amongst
the members at least 15 days prior to such General Meet-
ings. The statement and Audit Report along with a brief
of the replies furnished to the audit observations shall be
provided to the members and shareholders in advance, for
consideration and approval by the general body.
I Details of receipts and disbursements
In compliance of Section 63(4-A) of the Act, the Society
shall furnish to the Registrar and to the Director of Co-
operative Audit a statement showing details of receipts
and disbursements, prot and loss and the balance-sheet
for the year and such other statements and returns as the
Registrar and the Director of Co-operative Audit may, di-
rect within two months from the end of a nancial year.
Should any defect in the working of the Society or other
irregularity be pointed out in audit, the Committee shall
in terms of Section 63(7) of the Act take action for rec-
tication of the said defects and explain to the Director
of Co-operative Audit and the Registrar of Co-operative
Societies steps taken to rectify the same and the actions
taken thereon.
J Structural audit of building.
In order to ensure that the buildings are capable of with-
standing earthquakes, cyclone, re disaster etc., the So-
ciety shall arrange for structural audit to be undertaken
by the panel of architects of the Municipality or Archi-
tects/Structural experts duly appointed by the Govern-
ment in respect of buildings within the Municipality lim-
its, undertaken once in 5 years in case of all the buildings
which are more than 15 years old and once in 3 years in
case of buildings which are 30 years old, and if the nd-
ings of such audit are serious, action shall be taken to
direct occupants of such buildings to vacate the premises.
K Appropriation of surplus
. The net prot of the Society shall be arrived at in the
manner provided in Section 57 of the Act and Rule 23.
The net prot to be determined shall be appropriated in
the general meeting as under.
1. The amount of not less than 25 per cent of the net
prot shall be carried to the reserve fund.
2. The balance of the net prot shall be utilized for all
or any of the following purposes:
(a) Contribution towards Co-operative Education
Fund at the rates specied in the Act and
Rules.
(b) Contribution to building fund, share capital
redemption fund, jubilee fund, employees wel-
fare fund and building repair fund as may be
specied in the Bye-laws.
(c) Donation of amounts not exceeding ten per
cent of the net prots for any charitable pur-
poses as dened in Section 2 of the Charitable
Endowments Act, 1890.
(d) Payment of dividend to members out of the
balance of net prots available after making
deductions as provided above.
(e) Payment of bonus to employees of the Society
as decided in the General Body Meeting after
the appropriation made above provided if the
Society declared dividend to its members for
the last 3 years continuously.
L Membership of other Co-operative In-
stitutions
The Society may become a member of the Karnataka
State Co-operative Housing Federation Limited, Banga-
lore or any other Co-operative Institution.
M Act, Rules and Bye-laws
The Society shall keep a copy of the Karnataka Co-
operative Societies Act, 1959, Karnataka Co-operative
Societies Rules, 1960 and its Bye-laws at the registered
oce of the Society, open for scrutiny and inspection free
of charge by the members, at all reasonable times.
22
N Alteration of the Bye-laws.
No Bye-law shall be made, altered or modied unless in
conformity with the procedure prescribed under the Act
and rules and unless.
1. A proposal to do so along with a text of the pro-
posed amendments and the reasons therefor has
been communicated in writing to all the members
a dear fteen days in advance.
2. The resolution is passed by not less than two-thirds
of the members present and voting at the general
meeting. All alterations to the Bye-law are to be
approved and registered by the Registrar of Co-
operative Societies on payment of the fees, as ap-
plicable.
O Interpretation of the Act or Bye-laws
Should any doubt arise as to the interpretation of the Bye-
laws in relation to the Act or Rules or in regard to any
other matter, there is a right to have delegated powers
construed narrowly, and complementary rights or immu-
nities of members construed broadly, and when in doubt,
the decision must always be in favor of the claimed right
against an ocial action over the claimed power of an of-
cial to so act. The onus of proving that the ocial has
the powers to pass these rules/act lies with the one who
has usurped the powers and the onus to prove that the
usurper has no authority to pass these rules does not lie
on the Member. In case of doubt, the Society/ the Board
shall obtain the advice and direction of the Ombudsman
and jurisdictional Registrar of Co-operative Societies. 54.
Strict Interpretation of Powers- Whether Powers be are
right is determined by the rule : A power is strictly inter-
preted. In cases of doubt, the presumption is not in favor
of a power.
P Ocial Immunity
- There is a duty not only not to have members rights leg-
islatively impaired, disabled, or disfavored, but also not
to have some accorded special privileges or protections
that favor them over the rest of the people, in ways not
essential to the performance of public duties. This means
ocial immunity for damages extends only to each act
under color of law for which an ocial has authority and
that is not an abuse of discretion, not to everything an
ocial might do while on the job. This means ocial im-
munity for damages extends only to each act under color
of law for which an ocial has authority and that is not
an abuse of discretion, not to everything an ocial might
do while on the job.
Q Ocial Seal
The Society shall have a common seal, which shall remain
in the safe custody of the Chief Executive Ocer.
8 Fiduciary Standard
Members of a Board elected and ocers appointed are
subject to the standards applicable to a trustee in a trust.
This is the highest duciary standard. This standard
reects the not-for-prot character of a common inter-
est community and the corporate quality of its governing
body and the business it must conduct. It means that
the business judgment rule will apply to the decisions of
the ocials of a common interest community.
9 Core Fiduciary Duties-
The Members of a Board and ocers and sta of the So-
ciety as trustees of the Society have Core Fiduciary duties
towards the Members of the Society for whose benet the
Society is instituted. This include 1.
1. Core duciary duties of care
2. Absolute and undivided loyalty to beneciaries
3. Prudence in dealing with trust funds
4. Disclose all material information when seeking in-
formation on trust outgoes and income and their
nature and disposal
5. No undisclosed Conict of interest at all whatso-
ever.
6. Fair Process (approval by non interested directors)
or else burden on directors to show entire fairness.
7. No co-mingling of funds
23
10 APPENDIX A: BILL OF
RIGHTS
A HOMEOWNER
I. Since living in a common interest development (CID)
requires an individual citizen to enter into a contract with
a governing association, the prospective homeowner must
give written informed consent to the terms of the associa-
tions rules and governing documents, but most especially
to the Codes, Covenants, and Restrictions (CCRs).The
governing documents comprise the contract between the
association and the homeowner and should clearly spell
out the Homeowner Rights.
II No CID board shall abridge a citizens freedom
of speech or of the press either through direct order or
through intimidation or any kind of public abuse; that no
board shall abridge the right of homeowner citizens to as-
semble peaceably or to petition the board for a speedy re-
dress of grievances. No CID board shall abridge freedom
of religion. Any right/privilege specically NOT given to
the co-operative society will lie with the people i.e the
Homeowner Members of the Society. CID will make NO
rule or law or what ever named which violates or abridges
in any way the rights of the owners specically provided
under the rule of law of the land.
III. Boards give a full, true and accurate account-
ing in writing of all association actions. No actions shall
be taken in secret.
IV. Homeowner citizens shall be entitled to
speedy access to all association records, particularly to
nancial records, contracts, and records of governance at
any time without exception.
V. Homeowner citizens shall not be deprived of
liberty or property, without speedy due process of law.
Nor shall private property be taken without just com-
pensation, specically; there shall be no non-judicial fore-
closure. VI. Homeowner citizens shall have the absolute
right to vote on any changes to the terms of the original
contract, i.e. changes in rules and amendments to gov-
erning documents or nes they are expected to pay. No
ne shall exceed the true costs of the remedy.
VII. If accused of violating rules, homeowner citi-
zens are entitled to a speedy and public hearing by an im-
partial body (Ombudsmen) not selected by the board; the
impartial body shall determine the guilt or innocence of
the accused and determine what nes, if any, be imposed;
that the accused be informed of the nature and cause of
the accusation; be confronted with witnesses; and have a
compulsory process for obtaining witnesses, records, and
advocates. Use of this system does not cancel a citizens
rights of appeal in the courts.
VIII. Residents shall be treated equally, and not
in an arbitrary fashion, without reference to age, race,
gender, cultural lifestyle, sexual orientation, national ori-
gin, marital status, disability or familial status as estab-
lished by both state and central laws and regulations.
IX. Rules enacted by a CID association and
amendments to its governing documents must conform
to all state and central fair housing and health, safety
and welfare laws.
X. Elections shall be in the hands of the home-
owner citizens, not the CID board: ballots shall be secret;
no homeowner citizen shall be denied the right to vote for
failure to pay any ne or tax, including assessments; di-
rectors shall serve no more than two terms and be held
accountable for their decisions; the makeup of the board
shall reect the makeup of the association membership.
XI Complaints All complaints will be answered
within 10 days from the date of receipt. Those complaints
that cannot be resolved will be decided by an independent
OMBUDSMEN BOARD (independent of the Governing
Board) and elected by the Members. Complaints from the
homeowner-consumer may fall into two broad categories:
1. Complaints arising during the time that the devel-
oper controls the association or that he is trans-
ferring control of the association to homeowners
who have purchased homes (or ats.) This is of-
ten the time that homeowners: complaint about
construction defects; question whether or not the
developer has underfunded / misappropriated the
reserve accounts (or not funded them at all). ques-
tion whether the developer is delivering common ar-
eas and amenities as promised in the public report,
marketing materials, and purchase contracts
2. Complaints arising over governance issues after
homeowners assume control of the association.
Complaints include: homeowner diculty in get-
ting access to association records, especially nan-
24
cial records challenges to election procedures and
results complaints over assessment collection
XII. Conict of Interest: An ocial (director or
member of a committee) shall not vote on any of the fol-
lowing matters: Discipline of the ocial (director or com-
mittee member). An assessment against the director or
committee member for damage to the common area or fa-
cilities. A request, by the director or committee member,
for a payment plan for overdue assessments. A decision
whether to foreclose on a lien on the separate interest of
the director or committee member. Review of a proposed
physical change to the separate interest of the director or
committee member. A grant of exclusive use of common
area to the director or committee member.
B HOMEOWNER RESPONSIBILITY
1. Read and comply with the governing documents of
the community.
2. Maintain their property according to established
standards.
3. Treat association leaders honestly and with respect.
4. Vote in community elections and on other issues.
5. Pay association assessments and charges on time.
6. Contact association leaders or managers, if neces-
sary, to discuss nancial obligations and alternative
payment arrangements.
7. Request reconsideration of material decisions that
personally aect them.
8. Provide current contact information to association
leaders or managers to help ensure they receive in-
formation from the community.
9. Ensure that those who reside on their property (e.g.,
tenants, relatives and friends) adhere to all rules
and regulations.
C COMMUNITY LEADERS : RIGHTS
1. 1. Expect owners and non-owner residents to meet
their nancial obligations to the community.
2. Expect residents to know and comply with the rules
and regulations of the community and to stay in-
formed by reading materials provided by the asso-
ciation.
3. Respectful and honest treatment from residents.
4. Conduct meetings in a positive and constructive at-
mosphere.
5. Receive support and constructive input from owners
and non-owner residents.
6. Personal privacy at home and during leisure time in
the community.
7. Take advantage of educational opportunities (e.g.,
publications, training workshops) that are directly
related to their responsibilities and as approved by
the association.
D COMMUNITY LEADERS: RE-
SPONSIBILITIES
1. fulll ll their duciary duties to the community and
exercise discretion in a manner they reasonably be-
lieve to be in the best interests of the community.
2. Exercise sound business judgment and follow estab-
lished management practices.
3. Balance the needs and obligations of the community
as a whole with those of individual homeowners and
residents.
4. Understand the associations governing documents,
become educated with respect to applicable state
and local laws and manage the community associa-
tion accordingly.
5. Establish committees or use other methods to ob-
tain input from owners and non-owner residents.
6. Conduct open, fair and well-publicized elections.
7. Welcome and educate new members of the commu-
nityowners and non-owner residents alike.
8. Encourage input from residents on issues aecting
them personally and the community as a whole.
25
9. Encourage events that foster neighborliness and a
sense of community.
10. Conduct business in a transparent manner when
feasible and appropriate.
11. Allow homeowners access to appropriate commu-
nity records when requested.
12. Collect all monies due from owners and non-owner
residents.
13. Devise appropriate and reasonable arrangements,
when needed and as feasible, to facilitate the abil-
ity of individual homeowners to meet their nancial
obligations to the community.
14. Provide a process residents can use to appeal de-
cisions aecting their non-routine nancial nancial
responsibilities or property rightswhere permitted
by law and the associations governing documents.
15. Initiate foreclosure proceedings only as a measure
of last resort.
16. Make covenants, conditions and restrictions as un-
derstandable as possible, adding clarifying lay
language or supplementary materials when drafting
or revising the documents.
17. Provide complete and timely disclosure of personal
and nancial con icts of interest related to the actions
of community leaders, e.g., ofcers, the board and
committees. (Community Associations may want
to develop a code of ethics.)
E GOVERNANCE GUIDELINES
1. Annual meetings. Conduct at least one member-
ship meeting annually, providing at least two weeks
notice to homeowners and more than two weeks if
specied in the governing documents or dictated by
state statute.
2. Assessments. Collect assessments and other fees
from homeowners in a timely and equitable manner
and in accordance with state statutes and board-
approved procedures.
3. Communication. Provide at least one form of reg-
ular communication with residents, and use it to
report substantive actions taken by the board.
4. Conict of interest. Disclose all personal and nancial
con icts of interest before assuming a board position
and, once on the board, before participating in any
board decisions.
5. Elections. Hold fair and open elections in strict con-
formance with governing documents, giving all can-
didates an equal opportunity to express their views
and permitting each candidate to have a represen-
tative observe the vote-counting process.
6. Financial transparency. Share critical information
and rationale with residents about budgets, reserve
funding, special assessments and other issues that
could impact their nancial obligations to the asso-
ciation. Give members an opportunity, before nal
decisions are made, to ask questions of a representa-
tive who is fully familiar with these nancial issues.
7. Foreclosure. Initiate lien and foreclosure pro-
ceedings only as a last step in a well-dened
debt-collection procedureand only after other, less-
disruptive measures have failed to resolve a serious
delinquency issue in a specied period of time.
8. Governance and the law. Govern and manage the
community in accordance with all applicable laws
and regulations. Conduct reviews of governing doc-
uments to ensure legal compliance and to determine
whether amendments are necessary.
9. Grievances and appeals. Allow residents to bring
grievances before the board or a board-appointed
committee and follow well-publicized procedures
that give residents the opportunity to correct vi-
olations before imposing nes or other sanctions.
10. Records. Allow homeowners reasonable access to
appropriate community records, including annual
budgets and board meeting minutes.
11. Reserve funding. Account for anticipated long-
term expenditures as part of the annual budget-
development process, commissioning a reserve
study when professional expertise is warranted.
26
12. Rules. Uniformly enforce all rules, including ar-
chitectural guidelines, but only after seeking com-
pliance on a voluntary basis. Distribute proposals
for new rules and guidelines to all homeowners and
non-owner residents. Advise them when the board
will consider new rules and encourage input. Once
adopted, new rules and eective dates should be
distributed to every owner and resident.
11 Appendix B: MODEL CODE
OF ETHICS
A Board members should
1. Strive at all times to serve the best interests of the
association as a whole regardless of their personal
interests.
2. Use sound judgment to make the best possible busi-
ness decisions for the association, taking into con-
sideration all available information, circumstances
and resources.
3. Act within the boundaries of their authority as
dened by law and the governing documents of the
association.
4. Provide opportunities for residents to comment on
decisions facing the association.
5. Perform their duties without bias for or against any
individual or group of owners or non-owner resi-
dents.
6. Disclose personal or professional relationships with
any company or individual who has or is seeking to
have a business relationship with the association.
7. Conduct open, fair and well-publicized elections.
8. Always speak with one voice, supporting all duly
adopted board decisions even if the board member
was in the minority regarding actions that may not
have obtained unanimous consent.
B Board members should not:
1. Reveal condential information provided by contrac-
tors or share information with those bidding for as-
sociation contracts unless specically authorized by
the board.
2. Make unauthorized promises to a contractor or bid-
der.
3. Advocate or support any action or activity that vi-
olates a law or regulatory requirement.
4. Use their positions or decision-making authority for
personal gain or to seek advantage over another
owner or non-owner resident.
5. Spend unauthorized association funds for their own
personal use or benet.
6. Accept any giftsdirectly or indirectlyfrom owners,
residents, contractors or suppliers.
7. Misrepresent known facts in any issue involving as-
sociation business.
8. Divulge personal information about any association
owner, resident or employee that was obtained in
the performance of board duties.
9. Make personal attacks on colleagues, sta or resi-
dents.
10. Harass, threaten or attempt through any means to
control or instill fear in any board member, owner,
resident, employee or contractor.
11. Reveal to any owner, resident or other third party
the discussions, decisions and comments made at
any meeting of the board properly closed or held in
executive session.
12 APPENDIX C: COMMU-
NITY ASSOCIATION FUN-
DAMENTALS
1. Associations ensure that the collective rights and in-
terests of homeowners are respected and preserved.
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2. Associations are the most local form of representa-
tive democracy, with leaders elected by their neigh-
bors to govern in the best interests of all residents.
3. Associations provide services and amenities to resi-
dents, protect property values and meet the estab-
lished expectations of homeowners.
4. Associations succeed when they cultivate a true
sense of community, active homeowner involvement
and a culture of building consensus.
5. Association homeowners have the right to elect their
community leaders and to use the democratic pro-
cess to determine the policies that will protect their
investments.
6. Association homeowners choose where to live and
accept a contractual and ethical responsibility to
abide by established policies and meet their nancial
obligations to the association.
7. Association leaders protect the communitys nancial
health by using established management practices
and sound business principles.
8. Association leaders have a legal and ethical obliga-
tion to adhere to the associations governing docu-
ments and abide by all applicable laws.
9. Association leaders seek an eective balance be-
tween the preferences of individual residents and
the collective rights of homeowners.
10. Association leaders and residents should be reason-
able, exible and open to the possibility and benets
of compromise, especially when faced with divergent
views.
Note: Please feel free to review and add/correct
any of the provisions you might like to add /correct.
There may be many more objectionable aspects (includ-
ing violation of laws). This may require thorough review
before adoption.
13 APPENDIX D:
COOPERATIVE
PRINCIPLES
1. Co-operatives are voluntary organizations, open to
all persons able to use their services and willing to
accept the responsibilities of membership, without
gender, social, racial, political or religious discrimi-
nation.
2. Co-operatives are democratic organizations con-
trolled by their members, who actively participate
in setting their policies and making decisions. Men
and women serving as elected representatives are
accountable to the membership. In Primary co-
operatives, members have equal voting rights (One
member, one vote) and co-operatives at other levels
are organized in a democratic manner.
3. Members contribute equitably to, and democrati-
cally control the capital of their co-operative. At
Least part of that capital is usually the common
property of the co-operative. They usually receive
limited compensation, if any, on the capital sub-
scribed as a condition of membership. Members
allocate surpluses for any or all of the following pur-
poses, developing the co-operative possibly by set-
ting up reserves part of which at least would be in-
divisible, beneting members in proportion to their
transactions with the co-operative, and supporting
other activities approved by the membership.
4. Co-operatives are autonomous, self-help organiza-
tions controlled by their members. If they enter
into agreements with other organizations including
Government or raise capital from external sources,
they do so on terms that ensure democratic control
by their members and maintain their cooperative
autonomy.
5. Co-operatives provide education and training for
their members, elected representatives, managers,
and employees so they can contribute eectively to
the development of their co-operatives. They in-
form the general public particularly young people
and leaders about the nature and benets of coop-
eration.
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6. Co-operatives serve their members most eectively
and strengthen the co-operative movement by work-
ing together through local, regional, national and
international structures.
7. While focusing on member needs, co-operatives
work for the sustainable development of their com-
munities through policies accepted by their mem-
bers.
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