Annual Election meeting adjournment California

Our HOA is holding board of director elections. Our governing documents state if no quorum is achieved (which will most likely occur) "a majority of the members who are present, either in person or by proxy, may adjourn the meeting to a time not less than five days nor more than 30 days... at which meeting the quorum requirement shall be 25%". Our association attorney said since a mail in ballot is considered an owner "present" this section would only apply if the majority of the owners who voted were physically present at the meeting since a mail in ballot can not vote to adjourn. Does this sound accurate? I would guess a mail in ballot would not have to vote to adjourn and a majority of the owners physically at the meeting would be sufficient.

This link that explains Davis Stirling Act states members who mailed in their ballot need not be present. What do we do if our attorneys opinion is wrong?

> a majority of the members who are present, either in person or by proxy, may adjourn

I am not a lawyer, but as far as I know "may" is not the same as "shall" or "must."

Aaron,

I am not an attorney and I do not work in the legal profession.

I believe that what you are being told is being mus-interpreted.

Per CA Civ. Code §5115(b) [emphasis added]:

"If a quorum is required by the governing documents, each ballot received by the inspector of elections shall be treated as a member present at a meeting for purposes of establishing a quorum."

In my opinion, per that statute, the ballots only count as member present for the purpose of establishing a quorum. NOTHING ELSE (other then votes of course). I believe that this is supported by CA Corp. Code §7512(d) [emphasis added]:

"(d) In the absence of a quorum, any meeting of members may be adjourned from time to time by the vote of a majority of the votes represented either in person or by proxy, . . ."

Since mailed in ballots do not count as a vote in person (it only counts as a quorum in person), then those present in person or by proxy make that decision.

This opinion appears to be further supported on the Davis-stirling site, No Quorum:

"Members who mailed in their ballots need not be present. A simple majority of those members present in person or by proxy is sufficient to adjourn the meeting to a later date."

With all of that said, depending on who is advising the Board on this issue, it may be difficult to convince the Board of this interpretation without a third party (legal advice, court ruling, ombudsman opinion, etc.).

I was just going to paste the same quotation as Tim did.

Where, Richard, can you show us an opinion that opposes Adams Kessler (the firm that complies davis-stirling.com)?

The one that Tim just posted.

This was the very topic that got me on this blog in the first place back in 2009. Our attorney at the time cancelled our elections for the very same reason.

AaronJ,

The davis-stirling site dealing with “No Quorum” seems quite specific: stating (and gives some options, adjoin, recess, take measures to obtain a quorum):

www.davis-stirling.com/MainIndex/NoQuorum/tabid/3035/Default.aspx#ixzz3K1YUBUZB

“Vote to Adjourn. If a quorum cannot be obtained, the chair calls the meeting to order, announces the absence of a quorum, and entertains a motion to adjourn the meeting to a later date.

... in the absence of a quorum, the assembly may fix the time to which to adjourn, adjourn, recess, or take measures to obtain a quorum.

... If there is important business that should not be delayed until the next regular meeting, the assembly should fix the time for an adjourned meeting and then adjourn.

... the chair calls the meeting to order, announces the absence of a quorum, and entertains a motion to adjourn [to a later date]. (Robert's Rules, 11th ed., pp. 347-349.)”

Then it goes on to state (assuming that you want to adjoin to a later date, and provides a reference to Robert’s Rules):

“Members who mailed in their ballots need not be present. A simple majority of those members present in person or by proxy is sufficient to adjourn the meeting to a later date.”
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Maybe this is what is confusing because in the above sentence – and in this sentence only - is the phrase “A simple majority of those members present in person or by proxy”
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Here is an interpretation from Jim Slaughter from this site:
http://www.lawfirmrbs.com/blog/what-happens-if-you-dont-have-quorum-at-the-beginning-of-a-meeting/

What Can Be Done in the Absence of a Quorum?

Under Robert’s Rules (but this could vary by statute), a few procedural steps can be taken in the absence of a quorum, including:

Setting a continued meeting through the motion to Fix the Time to Which to Adjourn.

Ending the meeting through a motion to Adjourn.

Recessing the meeting, in efforts to obtain a quorum.

Taking measures to obtain a quorum, such as rounding up members in the hall or contacting members.

Under Robert’s, a meeting at which quorum never appears can still be called to order. At that point, however, the meeting must either adjourn or address one of the procedural motions allowed in the absence of a quorum listed above. (While some non-business items such as hearing from a guest speaker may be appropriate, no substantive business should be considered.)

And the article continues: “Some states have provisions for homeowners associations that if a meeting doesn’t have quorum, it can reschedule the meeting for another date where quorum is halved (and the halving continues for each meeting until a quorum is met).
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Aaron, you posted: What do we do if our attorney’s opinion is wrong?

Did you just ask your Attorney the question, what to do if you do not reach quorum?
Or is your Attorney “running” the meeting?

Larry

When management companies insist and Boards comply.

I believe it's that same law firms website that says mail in ballots do not need to be considered when adjourning.

I find the terminology being used to be confusing. I have not read D-S on this topic, but will add my $0.02 anyway.

There appears to be 3 gradations of mail-in rights:
Ballot = a vote.
Directed Proxy = an assignment of rights to a particular individual who can only vote/speak in accordance with the specific rights granted in that directed proxy.
General Proxy = an assignment of rights to a particular individual to vote/speak as that individual sees fit on all matters that might arise during the meeting.
The specific language of the Proxy will typically determine what rights are granted or excluded.

It would seem to me that a Ballot and a Directed Proxy would be similar in that they are limited in scope, and might not grant adjournment voting rights.

But a General Proxy has no such limitation. Anyone holding a General Proxy should be able to vote on any issue that comes up at the meeting, whether it be substantive or procedural. Adjournment would be included under procedural.

This jumbling of Ballot, Directed Proxy, and General Proxy together as if they were one and the same makes no sense to me.

Ok. Have now looked at D-S website.

Apparently, no distinction is made under CA statute between Directed Proxy and General Proxy. Anyone with a Proxy is given a Ballot for voting purposes. The Proxy-holder can vote that Ballot any way he/she wants regardless of restrictions in the Proxy itself.

Quorum count consists of count of all Ballots that are issued (to those present and to proxy holders). As far as I can see, there is no justification for the lawyer saying that Proxies are invalid for voting on an adjournment.

That's what I thought too John - Before I read the procedural description on the D-S website here:

http://www.davis-stirling.com/MainIndex/Proxies/tabid/2015/Default.aspx#axzz3KebOcQEb

See what it says under "Potential Fraud." For all intents and purposes, a Directed Proxy-holder is given the same rights as a General Proxy-holder regardless of the specific language in the proxy itself. So for purpose of the OP's original question, the Proxy-holder/Ballot-holder does have the right to vote for adjournment regardless of the Proxy language.

I'm not sure how this thread wandered into the land of proxy voting. The OP says nothing about proxies.

In CA, which permits absentee voting by mail, a physical quorum frequently is NOT present at the annual meeting. With 37% landlords and another 10% timers, a physical quorum would be hard to achieve in my HOA. In our recent election, 97 ballots were received (a toto of 9 were thrown out/were invalid) and quorum was (25%= 52). About 25 owners (not households) physically attended.

The mail-in/absentee votes count towards quorum in CA. But since these voters aren't physically present at the meeting, they cannot possibly vote to adjourn.

Few people vote by proxy since they can mail in their double envelope ballot. No one in my HOA has used a proxy in several years. Many bylaws that have been rewritten in CA remove the proxy option. But, based on Ellie & Tim above, proxy holders, if any, can count towards those present thus who move to adjourn the meeting in CA.

Short answer, Richard. Neither those owners who mailed in ballots nor those who gave their proxies to owners, are required to be present. Only those who voted in person at the meeting, those who REPRESENT voters VIA PROXIES, and those who voted absentee but showed up at the meeting are permitted to vote to adjourn the meeting.

I read the below Corps. Code to say that in the absence of quorum, persons REPRESENTED in person or by proxy may vote to adjourn the members (Owners) meeting. Absentee owners, of course, are in neither category unless they attend, which often happens here. (They vote absentee incase they won't be here for the meeting or, put another way, in case something more exciting than the annual mtng. emerges!)

CA Corps. Code 7512 (d) “In the absence of a quorum, any meeting of members may be adjourned from time to time by the vote of a majority of the votes represented either in person or by proxy...”

The below Civil Code only states that absentee voters count towards quorum

CA Civil Code 5115 (b) “A quorum shall be required only if so stated in the governing documents or other provisions of law. If a quorum is required by the governing documents, each ballot received by the inspector of elections shall be treated as a member present at a meeting for purposes of establishing a quorum.”

This below is the davis-stirling website attorney's opinion. I also take it and the above to say that non-present absentee voters do not count towards those who vote to adjourn. Since it only take a majority of those "REPRESENTED in person or by proxy who are present," there would be no need for absentee voters to vote to adjourn the meeting

“Members who mailed in their ballots need not be present. A simple majority of those members present in person or by proxy is sufficient to adjourn the meeting to a later date.”

I may have missed some important point, so help me if I have. Btw, Richard, I'm not sure WHAT Adrian Adams is saying in that last sentence of his newsletter--open to interpretation, I think.

A little background for me? How many homes? What size Board? Property mgr.? What % of owners do you need to make quorum for elections of directors?

Are there more candidates than available director positions? If not, you may have other options if no other measure is on the ballots.

Absentee voters are "present" for the purpose of making quorum. Is your attorney assuming they all would vote "no" on the motion to adjourn IF they were physically present?? How very odd?? Does this firm specialize in HOA law?

Your attorney, in my non-legal background opinion, is shockingly wrong. Did s/he give you the opinion in writing? If so what statute(s) did she cite?? If not in writing, why not?? As a director, I and my colleagues would never be comfortable with a verbal opinion. We'd demand one in writing with the relevant statutes, case law, etc. If your attorney refuses, your Board should hold an emergency executive session and vote to get a different opinion.

Your board is not required to accept this attorney's opinion. You can, if you wish, go ahead and hold your annual meeting making sure you follow your election rules and the Davis-Stirling Act exactly. You do have your inspector(s) of election, right? And a way for them to count ballots so that members (Owners) can observe??

Or does your HOA always have your HOA attorney preside at the annual meetings?

We are a board of five members, with 176 units. We have a property manager who serves as the inspector. We need a majority of units to make a quorum, so 50% + 1.

Yes our attorney gave their opinion in writing. I still think it's dead wrong. The rest of the board and propert manager are afraid to challenge it because they don't want to go against our council.

Look, Aaron, we directors are protected by the Business Judgement Rule (BJR- in CA, it's Corps. Code 7231) that basically protects us volunteers so long as we act with reasonable inquiry and proceed in good faith with the best interests of your association in mind.

Our Board voted to oppose our counsel's opinion once and nothing bad happened. There is no law or statute that you must follow your attorney's advice.

So ... what statue(s) did your attorney cite?? The same ones that some of us did? different interpretation?

Aaron

Is your attorney's initials, JM or RS?

Aaron

We terminated their services in 2013. We went to Adams Kessler and am questioning that now. Recent opinions have been very shaky. The more you know, the more I question the ethics of some of these attornys.

Say--per the rules of this site, we shouldn't mention company names.

Well, Aaron, It's hard to grasp HOW your attorney came to a different conclusion.

I disagree with the attorney's interpretation. Too many times if there is no quorum and the laws and docs are not followed these elections end up in a huge mess. If other members present vote to adjourn as the law states and are denied ... current board could be seen as power grabbing in cahoots with attorney. We then will have your HOA members on here probably asking how to recall the BOD. Many of us have seen this too many times.

If current BOD has done a good job then most likely will be again elected since not many tend to step up and serve. However, if seen as not following laws or governing docs ... the problems arise. I have argued many times with attorney ... Some statute text noted above has emphasis and good arguments.

I agree with you guys too. I guess I'll make a motion to adjoin the meeting, hopefully it will get seconded and voted on and go from there. The management company is under the impression if no quorum is reached the first attempt, we must start from scratch starting with nominations. As a current board member, I'm just trying to do the right thing.

Aaron: are you the President and going to run the meeting? After reading again above statute if you will be in top seat there is possible different approach.

During meeting for the minutes it needs to be noted:
1). Quorum not met, if indeed not met.
2). Explain that options are if no motion and second to vote to for moving elections to another date that current officers will serve another term.
3). I would then let the members make any motions or seconds. If they are happy with the status quo then maybe nobody will make the motion, but at least it will be noted they had opportunity.

The "May" statement in the law is giving opportunity not that it must happen. It is up to the members to exercise their option and rights.

Curious ... Is it only the annual meeting that the MC runs?

We have five open positions and seven people on the ballot.

It's my understanding any member can make the motion to adjourn.

Our PM who is the inspector has told us he will not be in attendance since he knows there won't be a quorum and he has another meeting. He is sending a representative from his company. Since I am the most knowledgeable about election procedure I will probably address the members and make the motion to adjourn.

The PMs representative should bring the received ballots correct? I am also going to post a sign in sheet for actual members in attendance. Our president is clueless so I can't count on him for anything. This should be interesting.

Aaron,

The proper procedure would be to adjourn as there are 7 people on the ballot, but it is up to the members, not the attorney, to go to a second meeting. If the attorney is there, they may try and cancel the election based on their opinion that the people who sent in ballots need to be present to vote to adjourn. I went out and got 25 attorney's opinions after our attorney cancelled our elections in 2009. Then I got into the business, and now do this for a living.