Daly’s push to rescind resolution linked to its focus on just one result

By Greg Ellison

(May 27, 2021) Concerned over due process issues, Ocean Pines Director Frank Daly has proposed rescinding resolution B-08 relating to board member and officer ethics and conduct.

Daly presented a first reading of a measure to repeal B-08, which was originally approved in 2018, during the board meeting on May 15.

“I think the intent of B-08 was to address inappropriate director behavior within the board or in interaction with employees,” he said.

Daly said the ethics guidelines, however, have opened the doors for a wider array of grievances regarding board conduct.

In August 2018, Director Dr. Colette Horn moved to approve resolution B-08, which passed by a 5-1 vote with Director Slobodan Trendic opposed.

In 2017, the board formed a work group to draft the policy, which initially considered forming an ethics committee to oversee conduct complaints.

After Horn introduced resolution B-08 for a first reading in May 2018, that provision was dropped, with the board retaining sole authority to examine conduct issues.

Speaking this week, Daly echoed a sentiment voiced by Trendic when he opposed the measure in August 2018.

“If you look at our bylaws, there’s nothing that a B-08 complaint does that our bylaws can’t currently do,” he said. “It’s creating an extra layer in there.”

Other aspects that trouble Daly involve limited public disclosure.

“You do not know what director it’s against and you do not who is filing the complaint,” he said. “So, all of the directors fall under this cloud of suspicion.”

Daly said resolution B-08 fails to specify that the aggrieved party should draft the written complaint.

“What has happened in all three [B-08] cases is someone has complained to a director [who] has written a complaint on behalf of that person and presented it to the board,” he said.

In addition to a complaint filed in February against Association President Larry Perrone by Colby Phillips and another last November when General Manager John Viola raised an issue with Director Tom Janasek, former OPA Human Resources manager Nate Douty in 2019 filed a B-08 complaint that developed into a wrongful termination lawsuit.

In the B-08 complaint generated by Viola, Daly said a lack of clarity regarding desired resolutions muddied the process.

“We were looking at removing Janasek from the board,” he said.

Viola later publically stated his intent was never to have Janasek booted.

Daly said the miscue resulted from the board not hearing directly from the person who had initiated the complaint.

Daly said when Director Doug Parks voted in 2018 to adopt B-08, it was based on the ability to result in varied outcomes.

“The only reason that Doug said he voted for it is because it gives the directors an option to do something aside from removing a director,” he said. “Yet, the way it’s written, the first vote is to consider removal … it doesn’t make sense.”

At the time, Parks said the existing bylaws provided an “all or nothing” solution for ethics complaints, while theorizing that B-08 would permit an “introspective look.”

In the Phillips and Perrone instance, Daly said a restriction on board members discussing the investigation allowed only one side to comment in public.

“Larry Perrone couldn’t say a word and couldn’t even acknowledge the complaint was against him,” he said. “He couldn’t defend himself at all and he’s getting trashed publicly.”

Daly also said the B-08 process prohibited Phillips’ stated desire to bring her complaint directly to the board.

“When we have one of these investigations, the public doesn’t understand how the investigation is supposed to be run,” he said. “I’m not sure all the board members completely understand.”

Daly said association attorneys pursuing B-08 investigations interview staff and board members.

“There have been cases, in Colby’s case specifically, [where] she … wanted them to talk with people that weren’t employees of the association or board members,” he said.

Daly said the association has no legal authority to compel testimony.

“We are not a criminal investigation unit with prosecutors and a grand jury,” he said. “We can’t go and subpoena somebody and have them come and testify.”

Daly said a work group is continuing to draft revisions to the B-08 procedure, most notably to enhance public disclosure, with a second reading to rescind B-08 planned for the next board meeting on June 16.

“We should handle this exactly like a corporation does [or] a court system does,” he said. “In either case, if someone accuses you of wrongdoing you know who the accuser is and you know who is being accused.”

Basic elements warranting transparency include who is conducting the conduct probe and which parties would be interviewed.

“We stand in serious legal jeopardy of someday somebody taking us to court for having a B-08 hearing and saying you’re violating my legal due process and my rights under the constitution,” he said. “It’s just a poor procedure.”

Daly said based on reactions to the more recent B-08 case, there remains little doubt a revamp is in order.

“If you go into a court situation or arbitration … and both sides come out and say this is a lousy process, then you have a lousy process,” he said. “That’s exactly what happened the last time we went through it.”