Residents in condo and HOA communities are frequently quite busy. Boards generally consist of elected volunteers who nearly always have other jobs and lives outside their duties as trustees. So while a professional management company can handle much of the day-to-day operations of a multifamily community, no decision can be made without those board members coming together to represent the interests of their neighbors.
This is why regular board and community meetings are essential. For one, they’re usually mandated by law. The specifics can vary by region, but overall, the law typically requires an annual meeting of owners or shareholders and several other gatherings of board members throughout the year. But meetings shouldn’t be just another administrative box to check: they should be efficient, well-organized forums for conversation between an association and its leadership where questions are addressed, needs are discussed, and action plans laid out that are understood by all parties involved. Communication is key to community, and so a board that acts in an opaque, closed-off manner is asking for friction down the line.
New England Condominium spoke with condo and HOA attorneys across the country to outline the legal requirements for association meetings, as well as their personal recommendations for best practices to keep those meetings smooth, productive and brief.
Charles A. Ryan, partner with Pilicy & Ryan, a law firm in Watertown, Connecticut
“In Connecticut, we’ve adopted the Common Interest Ownership Act, which governs both board meetings and unit owner meetings. The Act requires that a board must hold at least two board meetings per year at a place convenient to the community. With respect to unit owner meetings, the Act only requires one meeting per year. However, it is important to carefully review the association’s governing documents, as those might mandate that more meetings be held than the statutory minimum.
“The Act also requires notices of board meetings to be provided to residents at least five days in advance of a meeting. Some agenda items require 10 days’ notice, such as amendments to bylaws or rules and regulations. The Act also allows the board to set a fixed schedule for meetings. So long as the board follows this schedule, it need not provide additional notices. However, it must make the agenda available to owners at least 48 hours prior to the meeting.
“Additionally, the Act mandates that notices of unit owner meetings be provided no less than 10 and no more than 60 days prior to the unit owner meeting. In most cases, a notice of meeting need only include the date, time, location, and agenda. According to the Act, notices may be sent via hand delivery to each unit owner, or by USPS; commercially reasonable delivery service; electronic means when owners have provided to the association an electronic address; or any other method reasonably calculated to provide notice to the unit owner. Furthermore, notices are effective when sent, as opposed to when received.
“Failure to comply with notice requirements can be devastating for an association, and actions taken [by a board] can be invalidated. For example, if a board wanted to adopt a rule but the notice was drafted improperly, the rule could be found to be invalid. Another common example involves budgets and special assessments. If the notice is not provided correctly, the association’s ability to collect can be jeopardized.
“In my experience, meetings generally last far longer than necessary. The most efficient approach to running any meeting is to follow the agenda and avoid discussions without proper motions pending. All too often a board will discuss a certain topic for a period of time, and in the end, move on to the next subject without making any decision whatsoever.”
James Arrigo, attorney with Rathje Woodward, which has offices in Illinois and Wisconsin
“In Illinois, meetings are a statutory matter. You must hold no fewer than four board meetings per year, and one members’ meeting, which typically doubles as your annual meeting.
“Virtually all associations in the state are subject to its Not-for-Profit Corporation Act, which requires a members’ meeting to take place every year. There are other reasons that this type of meeting can be called—filling board vacancies, for example—and members can petition the board to hold one. If they get 20 percent of the association as signatories, [that meeting] is required to take place within 30 days. However, that is a rare occurrence.
“In Illinois, meetings must be announced at least 48 hours before they take place. Governing documents can and should say how boards will give notice – and should the documents fail to do so, there’s a presumption that the announcements will be mailed out and posted in a conspicuous location on association premises. There are also provisions that allow for and encourage electronic communications.
“If you’re dealing with a budgetary or special assessment issue, those require at least 10 and up to 60 days’ notice, and are normally posted in a lobby, elevator, hallway or at the maildrop in a more spread-out development.
“The requirements for meeting announcements generally include the time, date, and location. I always encourage boards to include a little more info, because it might entice someone with particular interests who may not have time to attend every meeting. You don’t have to put the entire agenda on a notice. But if there are specific hot-button issues that are being discussed, it might be pertinent to include those. But if one of the topics at hand involves the potential removal of a director, then that has to be included in the meeting notice, which is pretty consistent across not-for-profit corporation statutes.
“If you hold a meeting without notice, then I could argue as an attorney that the meeting is improper, and that it needn’t be considered a meeting at all. Not holding meetings is a quick way for a board to get sued for failing to uphold its fiduciary duty—especially if it’s making and enacting decisions outside of meetings.
“Finally, boards frequently keep chapter-and-verse detailed minutes that recite every point and counterpoint, which I strongly advise against. If someone needs to know, they can ask. But to put it on paper can lock the association into things, and quite frankly can be used against you as evidence if you’re being sued by someone. It’s a better idea to keep your minutes limited to just the corporate formalities.”
Gregory Vinogradsky, associate with Callahan & Fusco, LLC, a law firm with locations in New Jersey, New York, Pennsylvania, and Florida
“An open board meeting is necessary when a board decides to take an official action on behalf of an association. This should be done when approving new actions and/or ratifying prior actions. Board and shareholder meeting frequency is guided by the association’s governing documents, typically found in the bylaws. At a minimum, an association should meet annually to elect its board, set a budget, etc. Should the association’s governing documents be silent on the issue, then the New Jersey Condominium Act, New Jersey Planned Real Estate Development Full Disclosure Act, and/or the Nonprofit Corporation Act typically provide guidance in our state.
“The New Jersey Condominium Act also contains an administrative code that provides a minimum for notice to the residents of a meeting. Also, the association’s bylaws will provide for specific requirements for notice, quorum, and procedure. Typically, the announcement will provide for the time, place and agenda of the meeting. Failure to do so may void board actions and/or increase the association’s exposure to litigation.
“To maximize efficiency, I would recommend ensuring that each meeting has a set agenda that is strictly followed. The agenda should be conveyed to all board members in advance, so that each board member can review and prepare for the meeting. Prior to an open session, the board should meet in a closed session to review the agenda and go over certain issues that are not appropriate for an open session. These typically include any collection matters, privacy matters—such as disability accommodation requests—as well as pending and/or anticipated litigation.
“Also, it is important to know that a board meeting is for the board to conduct official business. If a board chooses, it can set aside a portion of a meeting for residents to voice their concerns, which should be timed to allow each resident an equal—but limited—opportunity to raise issues. If a resident feels as though their board is not conducting meetings properly, they should attend a meeting and voice those concerns. It is important to remember that a board is composed of volunteer owners who rely on their professionals to guide them. Often, a lack of perceived interest from residents causes boards to relax their meeting structures.”
While there is some clear variance from state to state, some common themes emerge from how boards should conduct meetings: objective; advance notice; efficient and structured participation of owners and shareholders; and a delineated agenda. A board who follows this basic rubric is likely to preside over an effective association.
Mike Odenthal is a former staff writer/reporter for New England Condominium.
Leave a Comment