Refer to the community map (attached separately). Areas include:
- Trammel Loop entrances/medians (shared or not owned by HOA) - Orange
- Skylark common areas (HOA-owned) - Green
- Ridgemist Lane (City of NLR maintenance responsibility) - Pink
- Red Bud Court / Red Oak / Tammy areas (SWAPY designated areas) - Green
Dissolution of an HOA is governed by Arkansas law and the Association’s governing documents.
Attorney guidance:
Dissolution requires compliance with the Arkansas Nonprofit Corporation Act, including member approval and filing Articles of Dissolution with the Secretary of State.
In addition, the Association’s Bylaws (§11.1) require member approval for amendments, and dissolution would require at least an equivalent or higher threshold of owner approval.
The Association currently owns and maintains common areas, streets, drainage swales, and related infrastructure. The Covenants (CCRs, Article XXV in applicable declarations) assign maintenance responsibilities to the Association and/or individual owners and note that the City of Sherwood does not assume maintenance responsibility for these areas.
Any dissolution would require a legal plan for:
- Transfer or disposition of common areas and infrastructure
- Resolution of outstanding debts, liens, and obligations
- Coordination with lenders and mortgage holders
Most mortgage lenders require ongoing HOA covenant compliance as a condition of the loan. Dissolution could therefore create title and lending complications across the community.
Even if a 51% vote threshold were achieved (approximately 193 of 378 lots), the Declarant retains certain rights under the governing documents. Additionally, the Association currently experiences quorum challenges, making it highly unlikely that sufficient participation could be achieved to approve dissolution. An individual owner does not have unilateral authority to dissolve the HOA.
Under the Bylaws (§9.5), the Board of Directors may not increase annual assessments by more than 25% over the prior year’s assessment.
Under Bylaws (§5.6), quorum is met when more than 50% of the total voting power of members is present (in person or by proxy) at a meeting.
Under Bylaws (§5.9), any action requires approval by more than 50% of the quorum present at the meeting.
Each lot owner is entitled to one vote per lot owned (CCRs Article XVIII(a)). However, CCR Article XVIII(b)(ii) provides that voting rights may be suspended if an owner has unpaid assessments, charges, or if common area usage rights have been suspended due to violations or delinquency.
A note from the Association’s attorney:
The Bylaws anticipate situations where a quorum for an election cannot be achieved.
Under Bylaws §6.3, Directors may serve beyond their term if so voted, and under the Arkansas Nonprofit Corporation Act, incumbent Directors “hold over” in office until their successors are duly elected and qualified.
This means that if an annual meeting fails to reach a quorum for an election, the current Board members do not vacate their positions. Instead, they remain in office and continue to serve in a holdover capacity until an election can be properly held.
In addition, Bylaws §6.3 provides that any Director seat that becomes vacant due to resignation or removal may be filled by the Board for the remainder of that term. This allows the sitting Board—even if reduced in size or serving in a holdover capacity—to appoint qualified individuals to fill vacancies without a member vote.
Any Director appointed in this manner serves until the next annual meeting at which quorum is achieved, and a formal election of Directors can occur.
