Conflict between Bylaws and Declaration in regards to vacant seats. Who wins

HomE (Washington)
Posts: 29

Posted:

The condo with which I'm involved has a conflict between the Bylaws and the Declaration.

The Bylaws note

"Except as otherwise provided by law, vacancies in the Board of Directors, whether caused by resignation, removal or otherwise, may be filled by a majority of the remaining Directors, even though less than a quorum, at any meeting of the Board"

The Declaration notes

"Board members may be removed by the requisite affirmative vote of the same Unit Owners entitled to elect them, and any replacements of Board members whose terms expire or who resign or are removed shall be made by the same Unit Owners that were entitled to elect the departing member."

Bylaws say board can fill the seats and the Declaration says otherwise. The Declaration wins out does it not?

MelissaP1 (Alabama)
Posts: 13,836

Posted:

CC&R's trump by-laws. There is a hierarchy to the documents. Should be in your documentation on what overrules what. Usually By-laws are trumped by CC&R's but all them trumped by local, state, and federal laws...

Former HOA President

MelissaP1 (Alabama)
Posts: 13,836

Posted:

Oops. CCR's trump By-laws... Mistake when written.

Former HOA President

TimB4 (Tennessee)
Posts: 21,062

Posted:

Home,

The Declaration is specifying what happens with a recall.

The Bylaws are addressing vacancies caused by resignation or nobody running.

KerryL1 (California)
Posts: 14,550

Posted:

Tim is right. There is no conflict as there are two different topics involved. If you still wonder about your Bylaws re: vacancies,, HomE, you might check WA corporation laws, if your HOA is incorporated. They might address this topic too.

HomE (Washington)
Posts: 29

Posted:

Quote:

Posted By TimB4 on 08/24/2017 4:26 PM
Home,

The Declaration is specifying what happens with a recall.

The Bylaws are addressing vacancies caused by resignation or nobody running.

The declaration notes that it's not all that it's there for though. "any replacements of Board members whose terms expire or who resign or are removed " Being removed would be just one of those three.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By TimB4 on 08/24/2017 4:26 PM
Home,

The Declaration is specifying what happens with a recall.

The Bylaws are addressing vacancies caused by resignation or nobody running.

I agree. Two different subjects.

KerryL1 (California)
Posts: 14,550

Posted:

I dunno; now i'm thinking Melissa's right since both refer to resignation. That seems to be the source of confusion since recalls would be per the Declaration and expiration of terms too.

I'd still check state laws on this topic.

HomE (Washington)
Posts: 29

Posted:

Quote:

Posted By JohnC46 on 08/24/2017 6:18 PM

Posted By TimB4 on 08/24/2017 4:26 PM
Home,

The Declaration is specifying what happens with a recall.

The Bylaws are addressing vacancies caused by resignation or nobody running.

I agree. Two different subjects.

The declaration does note specifically resignation, removal or terms expiring. Why would this apply only to recall if it mentions those cases?

any replacements of Board members whose terms expire or who resign or are removed

TimB4 (Tennessee)
Posts: 21,062

Posted:

HomE,

I refer you to RCW 24.03.105, applicable if your association is incorporated as a nonprofit (most are but check to be sure).

The order of precedence is typically:

Federal laws
Federal Regulations
State Laws
State Regulations
County Codes
City Ordinances
Deed Restrictions (CC&Rs)
Articles of Incorporation
Bylaws
Resolutions

The statute I provided a link to defers control to the articles of incorporation. It does not defer control to the CC&Rs.

HomE (Washington)
Posts: 29

Posted:

Thanks. The interesting thing though is that the bylaws specifically defer to the CCR's in cases of a conflict. I just don't know if State Law deferring to Bylaws that defer to CCR's means that State Law defers to the CCR's in this case.

TimB4 (Tennessee)
Posts: 21,062

Posted:

HomE,

I guess you will have to pay for a legal opinion then.

DaveD3 (Michigan)
Posts: 796

Posted:

"Board members may be removed by the requisite affirmative vote of the same Unit Owners entitled to elect them, and any replacements of Board members whose terms expire or who resign or are removed shall be made by the same Unit Owners that were entitled to elect the departing member."

A) HOW TO RECALL:
Board members may be removed by the requisite affirmative vote of the same Unit Owners entitled to elect them,

B) HOW TO FILL VACANCIES:
any replacements of Board members whose terms expire OR who resign OR are removed shall be made by the same Unit Owners that were entitled to elect the departing member

Or as separate sentences:
any replacements of Board members whose terms expire shall be made by the same Unit Owners that were entitled to elect the departing member

any replacements of Board members who resign shall be made by the same Unit Owners that were entitled to elect the departing member

any replacements of Board members who are removed shall be made by the same Unit Owners that were entitled to elect the departing member

Crystal clear. The owners fill ANY board vacancies.
Not sure how you guys are reading it any other way

JohnC46 (South Carolina)
Posts: 14,265

Posted:

The more I read and pay attention, there is a definite conflict between the Declarations and Bylaws concerning filling BOD vacancies no mater how the vacancy(s) was created. As Declarations have a higher priority than Bylaws, in the discussed case it appears that any vacancy on the BOD should be filled by an owner election as per the Declaration.

JanetB2 (Colorado)
Posts: 4,219

Posted:

Quote:

Posted By HomE on 08/27/2017 8:34 PM
Thanks. The interesting thing though is that the bylaws specifically defer to the CCR's in cases of a conflict. I just don't know if State Law deferring to Bylaws that defer to CCR's means that State Law defers to the CCR's in this case.

You need to follow the State Law Tim posted if you are registered as a Non-Profit Corporation. Generally the HOA Statutes will give more emphasis and defer to the CCR's and the Corporate Statutes will give preference and defer to the By-Laws. This is due to the CCR's describe the HOA and what is allowed or not allowed and the By-Laws describe how the HOA corporation is to be managed via the Non-Profit entity. However, the State Laws can supersede, unless they defer to said governing document.

HomE (Washington)
Posts: 29

Posted:

State law defers to the bylaws if there's some language in the bylaws, there is
Bylaws say X but defer to the Declaration if there's a conflict, there is
Declaration says they can't appoint for someone stepping down or being voted off

I have no idea if that means that state law vicariously defers to the declaration.

TimB4 (Tennessee)
Posts: 21,062

Posted:

State law says that the Board appoints.
State law defers to the Bylaws if the Bylaws say something different.
Per your posting, the Bylaws says that the board appoints.

Hence, in my opinion the Board appoints.

Obviously you want it to be how the CC&Rs specify.
In that case, contact an attorney and see what your legal options are and how much it will cost.

HomE (Washington)
Posts: 29

Posted:

How I want it is immaterial. How the law works is more of what I'm looking for. It's pretty common for a legal document to reference attachments and schedules that aren't on the document. Do you have specific experience with an issue like this that would lead you to make your statement that the bylaws apply.

Everyone on the forum realizes that they can contact an attorney and nobody thinks they're free.

TimB4 (Tennessee)
Posts: 21,062

Posted:

Quote:

Posted By HomE on 08/28/2017 1:25 PM

How I want it is immaterial. How the law works is more of what I'm looking for.

Well, the you should be on a legal forum.

We are not attorneys. We can only provide layperson opinions (which we have done).

Quote:

Posted By HomE on 08/28/2017 1:25 PM

Do you have specific experience with an issue like this that would lead you to make your statement that the bylaws apply.

I have a fair amount of experience deciphering legalize and government regulations.
However, I am not an attorney.

I didn't say that the Bylaws apply.
I stated that the Bylaws didn't conflict with the statute.
Hence, in my opinion, the statute applies (which has higher precedence then the CC&Rs).

Bottom line, until legally challenged and a court makes a ruling, even legal opinions are simply that, opinions. Your Board is free to interpret those documents how they wish. If one disagrees with said interpretation the options are:

1) Meet with the Board to change their mind
2) Gather support and replace the board with individuals who agree with you
3) Legal action
4) Live with it

Quote:

Posted By HomE on 08/28/2017 1:25 PM

Everyone on the forum realizes that they can contact an attorney and nobody thinks they're free.

True.

Therefore, how big of an issue is this for you?
Are you willing to shell out $200 to $600 for a legal opinion?
If the legal opinion agrees with your interpretations, are you willing to shell out the thousands of dollars a court case might cost?

JanetB2 (Colorado)
Posts: 4,219

Posted:

Quote:

Posted By HomE on 08/24/2017 3:20 PM
The condo with which I'm involved has a conflict between the Bylaws and the Declaration.

The Bylaws note

"Except as otherwise provided by law, vacancies in the Board of Directors, whether caused by resignation, removal or otherwise, may be filled by a majority of the remaining Directors, even though less than a quorum, at any meeting of the Board"

The Declaration notes

"Board members may be removed by the requisite affirmative vote of the same Unit Owners entitled to elect them, and any replacements of Board members whose terms expire or who resign or are removed shall be made by the same Unit Owners that were entitled to elect the departing member."

Bylaws say board can fill the seats and the Declaration says otherwise. The Declaration wins out does it not?

Your Bylaws are as you noted above and which I made bold.

Your State Law says:

RCW 24.03.105
Vacancies.
Any vacancy occurring in the board of directors and any directorship to be filled by reason of an increase in the number of directors may be filled by the affirmative vote of a majority of the remaining board of directors even though less than a quorum is present unless the articles of incorporation or the bylaws provide that a vacancy or directorship so created shall be filled in some other manner, in which case such provision shall control. A director elected or appointed, as the case may be, to fill a vacancy shall be elected or appointed for the unexpired term of his or her predecessor in office.

Because the State Law does not reference the CCR's ... the information in the CCR's becomes null and void and essentially of no consequence potentially regarding this issue. I agree with what Tim stated before ... the section of your CCR's is most likely in place for any "recall" of the board. Some laws regarding recalling a Board director will note or defer to the CCR's.

So ... maybe you need to clarify the reason you are asking. Is it because a BOD member resigned and needs replaced or has the membership exercised as recall of a BOD member? If resigned the BOD replaces for remainder of term ... if due to a recall then the membership would elect.

KerryL1 (California)
Posts: 14,550

Posted:

Janet cited: "Any vacancy occurring in the board of directors and any directorship to be filled by reason of an increase in the number of directors..." But I don't think HomE is talking about a case where the the Board's numbers have been increased.

KerryL1 (California)
Posts: 14,550

Posted:

Janet cited: "Any vacancy occurring in the board of directors and any directorship to be filled by reason of an increase in the number of directors..." But I don't think HomE is talking about a case where the the Board's numbers have been increased.

JanetB2 (Colorado)
Posts: 4,219

Posted:

Quote:

Posted By KerryL1 on 08/28/2017 3:37 PM
Janet cited: "Any vacancy occurring in the board of directors and any directorship to be filled by reason of an increase in the number of directors..." But I don't think HomE is talking about a case where the the Board's numbers have been increased.

Sigh ... an increase occurs when one resigns and then is replaced. Example have 3 ... one resigns and now have 2 ... need to increase and add one so have 3 as needed by docs.

KerryL1 (California)
Posts: 14,550

Posted:

In our bylaws, it IS an increase if, say, the board decides to increase it size from 5 members to 7, which it did several years ago. The same bylaws article & section gave the power of selection of the 2 new directors to the Board.

JanetB2 (Colorado)
Posts: 4,219

Posted:

Quote:

Posted By KerryL1 on 08/28/2017 7:09 PM
In our bylaws, it IS an increase if, say, the board decides to increase it size from 5 members to 7, which it did several years ago. The same bylaws article & section gave the power of selection of the 2 new directors to the Board.

Yes ... that would also be an "increase". It is just legal wording, so that they do not have many paragraphs to explain every minor reason for adding a BOD member. Legislators make it simple ... if BOD member needs to be added it is an increase to the BOD. It keeps the text short and to the point.

HomE (Washington)
Posts: 29

Posted:

Quote:

Posted By JanetB2 on 08/28/2017 2:48 PM

Posted By HomE on 08/24/2017 3:20 PM
The condo with which I'm involved has a conflict between the Bylaws and the Declaration.

The Bylaws note

"Except as otherwise provided by law, vacancies in the Board of Directors, whether caused by resignation, removal or otherwise, may be filled by a majority of the remaining Directors, even though less than a quorum, at any meeting of the Board"

The Declaration notes

"Board members may be removed by the requisite affirmative vote of the same Unit Owners entitled to elect them, and any replacements of Board members whose terms expire or who resign or are removed shall be made by the same Unit Owners that were entitled to elect the departing member."

Bylaws say board can fill the seats and the Declaration says otherwise. The Declaration wins out does it not?

Your Bylaws are as you noted above and which I made bold.

Your State Law says:

RCW 24.03.105
Vacancies.
Any vacancy occurring in the board of directors and any directorship to be filled by reason of an increase in the number of directors may be filled by the affirmative vote of a majority of the remaining board of directors even though less than a quorum is present unless the articles of incorporation or the bylaws provide that a vacancy or directorship so created shall be filled in some other manner, in which case such provision shall control. A director elected or appointed, as the case may be, to fill a vacancy shall be elected or appointed for the unexpired term of his or her predecessor in office.

Because the State Law does not reference the CCR's ... the information in the CCR's becomes null and void and essentially of no consequence potentially regarding this issue. I agree with what Tim stated before ... the section of your CCR's is most likely in place for any "recall" of the board. Some laws regarding recalling a Board director will note or defer to the CCR's.

So ... maybe you need to clarify the reason you are asking. Is it because a BOD member resigned and needs replaced or has the membership exercised as recall of a BOD member? If resigned the BOD replaces for remainder of term ... if due to a recall then the membership would elect.

I think I explained this in a previous post. The bylaws themselves do note that if there's a conflict between them and the declaration, then the declaration rules. State law defers to the bylaws, the bylaws because of the conflict refers to the declaration and then as such it seems that state law vicariously refers to the declaration.

TimB4 (Tennessee)
Posts: 21,062

Posted:

HomE,

Have your brought that argument to your Board?

If not, why not?
If you have, what was their response?

It's not anyone on this site you have to convince.
You need to convince your Board.

Again, the bottom line is, until legally challenged and a court makes a ruing, even legal opinions are simply that, opinions. Your Board is free to interpret those documents how they wish. If one disagrees with said interpretation the options are:

1) Meet with the Board to change their mind
2) Gather support and replace the board with individuals who agree with you
3) Legal action
4) Live with it

JanetB2 (Colorado)
Posts: 4,219

Posted:

Your Bylaws say the same thing as your State Law for replacing Board Members. If you do not like that answer then you need to spend $$$ to ask an attorney.

HomE (Washington)
Posts: 29

Posted:

The Bylaws do defer to the rules in the Declaration if there's a conflict as there is.

TimB4 (Tennessee)
Posts: 21,062

Posted:

Janet,

That argument is the one HomE is sticking with.
Nobody here will change it.

Even if everyone agreed (and they don't) that the CC&Rs should be the document followed in this case (vs. State statutes), it doesn't change the options HomE has:

1) Meet with the Board to change their mind
2) Gather support and replace the board with individuals who agree with you
3) Legal action
4) Live with it

JanetB2 (Colorado)
Posts: 4,219

Posted:

Quote:

Posted By TimB4 on 08/29/2017 5:43 PM
Janet,

That argument is the one HomE is sticking with.
Nobody here will change it.

Even if everyone agreed (and they don't) that the CC&Rs should be the document followed in this case (vs. State statutes), it doesn't change the options HomE has:

1) Meet with the Board to change their mind
2) Gather support and replace the board with individuals who agree with you
3) Legal action
4) Live with it

LOL ... Yep which is why I told him to feel free to spend $$$ for an attorney. He is wanting someone to agree with him which all of us who have been there and done that are not going to agree.