Proxy votes

Started by CharlesG5 • 25 replies • 3586 views

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CharlesG5 (Florida)
Posts: 60

Posted:

Prior to our annual meeting, a packet is sent out with all the candidates who are running for the board and a general proxy. The proxy give you the choice of either the Secretary of the HOA or a person of your chice to vote for you.

The question is: Does the Secretary vote the way the board directs him or does he get to vote the way he wants too?

DavidW5 (North Carolina)
Posts: 565

Posted:

Proxies come in two "flavors" - general and directed. A general proxy gives the designated person the authority to cast your vote as he sees fit. A directed proxy instructs the designated person to cast your vote as directed on the proxy form.

IMO if the proxy is general and designates the Secretary, the secretary can vote as he/she sees fit.

CharlesG5 (Florida)
Posts: 60

Posted:

If your right about the secretary, he/she is more powerful than the president. Just think, each homeowner gets one vote, the secretary through the proxies can control who gets on the board

DonnaS (Tennessee)
Posts: 5,671

Posted:

Charles,

The below Statute is from 617, which is our not for profit corp Statutes under which all HOAs are filed in Florida. If you can make any sense of this section, well, I think that I did but will wait to hear from our more legal wise folks. It means to me that the Secretary MAY cast the votes of each proxy that has been assigned to her, as she sees fit for the benefit of the corporation.

My condo HOA in Florida states what or who the Secretary will be voting for or on so it isn't a crap shoot by signing away your vote. It was explained that for those who do not know about candidates or do not know about the voting issue, the Secretary will assume the responsibility.

"617.0721Voting by members.

(4)If any corporation, whether for profit or not for profit, is a member of a corporation organized under this chapter, the chair of the board, president, any vice president, the secretary, or the treasurer of the member corporation, and any such officer or cashier or trust officer of a banking or trust corporation holding such membership, and any like officer of a foreign corporation whether for profit or not for profit, holding membership in a domestic corporation, shall be deemed by the corporation in which membership is held to have the authority to vote on behalf of the member corporation and to execute proxies and written waivers and consents in relation thereto, unless, before a vote is taken or a waiver or consent is acted upon, it appears pursuant to a certified copy of the bylaws or resolution of the board of directors or executive committee of the member corporation that such authority does not exist or is vested in some other officer or person.

HeatherB4 (Florida)
Posts: 51

Posted:

General proxy ballots can only be used in the state of FL for annual meetings. You can not use limited proxy ballots.

Which means, if you sign that you want the secretary to represent you, the only thing they can do is use it for a quorum. Only the people that are at the election will be able to cast a ballot.

So, if you are not able to attend the meeting, sign your proxy. No worries that the secretary will hoard the votes.

I hope that helps!!!

CharlesG5 (Florida)
Posts: 60

Posted:

To Heather 84

You stated that only general proxies can be used in Florida and that if a proxy is sent in the secretary can only use it for a quorum.

Where is this stated in the Florida Statutes?

AnnD2 (Connecticut)
Posts: 76

Posted:

Check out: www.robertsrules.com for definitions of proxies and job descriptions for all board members, including secretaries....

JanetB2 (Colorado)
Posts: 4,219

Posted:

Hi Charles:

If you are HOA proxy voting is covered here:
http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&Search_String=&URL=0700-0799/0720/Sections/0720.306.html

If you are Condominium then here is the statute:
http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&Search_String=&URL=0700-0799/0718/Sections/0718.112.html

DavidP18 (Florida)
Posts: 2

Posted:

I read the 720.306 Statute and am still confused.

If the secretary is listed on the Proxy, does she get to vote for whoever she chooses?

In our situation, our secretary is definitely "in bed with" the property management people and is only going to vote for candidates that will serve to tighten that alliance. That alliance is already dangerously tight and our board has almost become a puppet of the management company.

Whoa is us...what can be done?

David

BjS (Florida)
Posts: 16

Posted:

We are in the process of amending our bylaws to have a secret ballot as allowed under Florida FS 720 only for the election of directors and get rid of these proxy votes for that.

We have had the proxy system for election and it is not popular. We hate it.

Last year, our president was up for re-election and that person tried real hard to get that position named on the proxy president, if you didn't pick someone else. Didn't work because our by-laws said the secretary hold those proxies. We have a very ethical secretary and she did not change a vote. But other proxy holders did.

Per our lawyer, the following was how the proxies were handled.
-Absentees members vote on the proxy, it is totally public. Anyone can see how they wanted to vote.

-The proxy holder can change the vote and has. The holder has the proxy and is given a ballot which will not have a name, so there is no way to tell if they voted as requested or not. of course they can change the vote.
The management company was saying we could not, but the lawyer was present at the meeting and he made them stop monitoring the proxy holders.

-If you are present, you get a ballot no one will ever know who you voted for.

So totally legal and so totally unfair. The president did not get re-elected and was defeated by a large margin. Many proxies were in the hands of members that did not want the current president re-elected.

Proxies are powerful

People can still politic, but they can't gather a block of votes. Hope our amendment is approved.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

BJ

I believe it is not a voting method problem but that one was simply/nearly outfoxed. I fail to see how a "secret" ballot corrects the outfoxing.

Please educate me.

Thanks

JohnC46 (South Carolina)
Posts: 14,265

Posted:

BJ

I meant to add that while your theory of if present you get to vote might limit the outfoxers, good luck on gathering a quorum or majority. Without proxy/absentee ballots (we can discuss the differences/merits of each but not the subject here) I have rarely (like never) seen Covenant/Bylaw change amde especially when most of the owners are happy, apathetic, absentee owners, etc.

One way to assure no changes are made, is to require a majority of owners to be physically present to vote.

BjS (Florida)
Posts: 16

Posted:

John, Our homeowners are not happy with the proxy system for the election process. We have people who don’t vote just because of the proxy system. We want absentee owners to vote.

Proxies will continue to be used be for every other issue -- except the election of directors. If they can’t make the meeting, they will send in a proxy with their secret ballot. The proxy does have its purpose for quorum and is necessary for all the other issues before the membership.

All we can do is correct a bad situation as much as possible. Only honest people can make a fair election. We had to use a “general” proxy because of the way our documents are written. At this point, changing the docs to a limited would not convince anyone that they choice would not be changed. We have been burned, Secret is the only way to go.

There will still be politics; we know that someone will give their ballot to another. We can’t stop everything. But it will be more difficult for someone to get a block of proxies and vote anyway they want

One member had aprox. 30 proxies last year. Even this person admits it was difficult to persuade those to give up their proxy (some understood their choice could not be changed). Some realized exactly what would happen to their proxy and did not vote.

No one has any objection to someone campaigning. As individuals we can close the door, turn them off. But I don’t let them vote for me.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Sample of a simple proxy. One sheet with a General and Directed Proxy on it.

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📝1820571149071.doc(29 KB)

TimB4 (Tennessee)
Posts: 21,059

Posted:

Quote:

Posted By BjS on 08/20/2012 5:25 AM

We had to use a “general” proxy because of the way our documents are written.

BJ,

What is the language that is preventing you from using a directed proxy?

I ask, because I've never seen language that allows proxies but prevents the use of directed proxies.

TimB4 (Tennessee)
Posts: 21,059

Posted:

To David,

If an individual or Officer is named in the proxy, then that individual (or Officer) can vote for the member. If the member did not direct the individual how to cast the vote (i.e. a directed proxy) that individual may vote how they choose.

My Association always specifies within it's proxy that if no name is filled in, the member is naming the Board of Directors as it's proxy. Our Board will then specify, by resolution prior to the meeting, how the votes under the Boards control are to be cast.

BjS (Florida)
Posts: 16

Posted:

Tim

I “think” the attorney used these two sentences to render his opinion that it had to be a general proxy for the election. Now we can debate the interpretation; but we all know the last say in a legal interpretation (before court) is the HOA hired help. I believe the key phrase is …their proxies may cast…as many votes...

…Every proxy shall be revocable and shall automatically cease upon conveyance by the Member of his Unit….

…At such election, the Members or their proxies may cast, in respect to each vacancy, as many votes as they are entitled to exercise under the provisions of the Declaration….

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By TimB4 on 08/20/2012 6:36 AM

Posted By BjS on 08/20/2012 5:25 AM

We had to use a “general” proxy because of the way our documents are written.

BJ,

What is the language that is preventing you from using a directed proxy?

I ask, because I've never seen language that allows proxies but prevents the use of directed proxies.

I have never seen proxy types limited when proxies were allowed.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

A general proxy is effectively telling the proxy holder (the one you gave your proxy to) that they can pretty well do anything their little heart desires to do and in your name. Once you gave them that general proxy then kiss your power/control goodbye as you willing gave it to someone else.

I believe that when most were presented with their first proxy they knew nothing about proxies, forget general or directed. I will also bet they were presented with a general proxy by someone looking to control. The problem was not the proxy it was the people. The people being those that did not understand and those looking to control. Those posting/reading on here undertstand better, but I would bet over 90% of associtaion members would still be confused and could be lead.

That said, is it our obligation to teach them? Well I would say if one wants to be honest then sit down and explain the procedure to them so they know how to do it. Show them both a general and directed proxy specifically aimed at your association. Explain each. Yes ask them for their proxy and even suggest/discuss why they do it in a specific way. Nothing wrong with that, but let them decide general or directed or not vote at all.

In life cheaters cheat. Manipulators manipulate. It is near impossible to stop them so spend your time and effort making it easy for the honest people to understand what they can do and how to do it. The more the honest people understand and act, the less the chance for cheaters/manipulators to control.

BruceF1 (Connecticut)
Posts: 2,535

Posted:

Sometimes it helps to go back to the basics.

Proxies arise out of corporate law. Most (probably all) states have enacted laws governing the operation of corporations. Generally, these laws require that every "owner" of the corporation must be entitled to have a say (vote) in the affairs of the corporation according to some formula. In a stock corporation, generally the one who owns stock is entitled to one vote for each share of stock owned. If you own 1000 shares, for example, you are entitled to 1000 votes. In a non-stock corporation, such as an HOA, some other formula is used. This formula is generally specified in the Articles of Incorporation, the Bylaws, or, in the case of HOA, possibly the CCRs or Declaration.

Since corporations can be national, even international, in scope, it is not always possible for owners to travel to be present at the annual meeting of the corporation. Hence, the proxy was devised as a means for a member of the corporation to select a representative to attend the meeting and cast (as many) votes as the person appointing the proxy is entitled to. The reason for a proxy instead of a ballot is because a ballot is restricted to the candidates or questions to be decided that are printed on the ballot. The proxy, on the other hand, allows the representative to vote on any question that may come before the assembly during the annual meeting. Usually, the proxy may also make nominations and motions, and may participate in debate.

Some states allow the corporation to prohibit or otherwise restrict the use of proxies in their Articles of Incorporation or Bylaws. Still other states may have prohibited the use of proxies in HOAs altogether.

Interestingly, here in Connecticut, the death or incapacity of the individual appointing a proxy does not invalidate the proxy, which is different from what happens with a standard Power of Attorney.

BjS (Florida)
Posts: 16

Posted:

I understand that some have never seen a general proxy used for electing directors in an HOA.
I have, it was legal, and it was not nice.

The use of proxies at the HOA level is a neighbor-to-neighbor concern.
Education is good and believe it or not, most do understand the difference between general and limited proxies.

But when you are unable to attend the meeting, the choices are:
If general proxy, give your rights away or don’t vote.
If limited proxy, let everyone read your proxy and see who you voted for.

I am not in favor of a limited proxy system for the election of directors. Fortunately, in Florida we are allowed to have a secret ballot for that purpose ONLY; but it is not automatic; it must be spelled out in our documents.

I have no objection to the use of a proxy for other issues. General & limited proxies are necessary and appropriate.

So, I suggest that docs are read very, very carefully along with your state statute.
If there is a better mouse trap – amend your election process.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Quote:

Posted By BjS on 08/20/2012 6:56 AM
Tim

I “think” the attorney used these two sentences to render his opinion that it had to be a general proxy for the election. Now we can debate the interpretation; but we all know the last say in a legal interpretation (before court) is the HOA hired help. I believe the key phrase is …their proxies may cast…as many votes...

I think the attorney offered advice that was favorable to the client (the HOA - as this allowed the representative to vote how they wish) and chose not to offer additional information that either proxy is perfectly legal to use.

The last phrase you cited gives the impression that your Association uses (or allows the use of) cumulative (vs. plurality) voting. This can make a Directed proxy form more difficult to understand but it could still be used.

I wish we could use mailed ballots for directors but VA law requires the voting for directors to be done at a meeting.

BruceF1 (Connecticut)
Posts: 2,535

Posted:

Quote:

Posted By TimB4 on 08/20/2012 9:09 AM
The last phrase you cited gives the impression that your Association uses (or allows the use of) cumulative (vs. plurality) voting.

Although that may be a possibility, I don't get that interpretation at all.

An owner (such as an investor)] may own several units. In that case, the owner would be entitled to (at least) one vote per unit. That owner could appoint a proxy to cast all the votes he/she is entitled to cast. I think that is the more likely interpretation.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Quote:

Posted By TimB4 on 08/20/2012 9:09 AM

I wish we could use mailed ballots for directors but VA law requires the voting for directors to be done at a meeting.

I stand corrected.

If the bylaws so provide, voting for directors may be done by mail.
See § 13.1-846

However, if the Bylaws do not provide then I offer § 13.1-852 [emphasis added]

A. Unless otherwise provided in the articles of incorporation, directors are elected by a plurality of the votes cast by the members entitled to vote in the election at a meeting at which a quorum is present.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Bruce,

I agree, it could be either (or both) interpretation.

I do think the attorney acted in the best interest of their client and chose not to provide info that directed proxies could be used - OR - the question asked of the attorney didn't include directed proxies.

DavidP18 (Florida)
Posts: 2

Posted:

Thank You to everyone for helping me to understand the different types of proxies.

Sincerely and may God Bless,

David

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