Board meeting or something informal?

Started by AdamD1 • 38 replies • 1378 views

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AdamD1 (Indiana)
Posts: 179

Posted:

I'm on the Board and serve as the VP. The president just sent an email stating....

[another Board member] and I will meet this afternoon at 2:30 pm to discuss the insurance policy. All are invited. Realizing most of the BoD is unavailable, we’ll reach back with any salient details. This is not a Special Meeting. The intent is to clarify our exploration of the current policy, our search process and to identify next steps.

So if nothing is being voted upon, would this just be an informal meeting with no need to have meeting requirement/minutes?

SheliaH (Indiana)
Posts: 6,964

Posted:

What is wrong with this president - didn't you smack his hand for trying to appoint someone to an advisory board outside an open board meeting? If so, why is he still president?

The trouble with "meetings" like this is that people often decide unconsciously to do something although they might not come out and say "at the next board meeting, let's do X" and no one realize a decision was made outside of regular board meetings. If most of the board isn't available for this "informal meeting', who's to say if they're getting all the "salient details" needed to make a decision?

Once again, you need to reign in this guy - it would probably take 5 minutes or less to clarify what will happen with the insurance policy, designate who will do what, if appropriate, and have that person report back at the next meeting.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

AdamD1 (Indiana)
Posts: 179

Posted:

Yup I just don't get it SheliaH! I'm not trying to be a wet blanket, but there's a system in place to ensure everything is done on the up and up. Circumventing such systems allow for abuse and offers an appearance of impropriety, IMO, whether legitimate or not.

AdamD1 (Indiana)
Posts: 179

Posted:

So, just for fun, what would you say to the president? Appreciate your feedback!

SheliaH (Indiana)
Posts: 6,964

Posted:

I'd probably say a lot about this and get the stink eye (but I got used to that while I was on the board!) However, part of what I might say would go something like this:

Excuse me Mr. president, did we not just have this conversation about you making decisions outside of regular board meetings? Is there any reason why the insurance issue can't wait until a regular board meeting where we can "clarify" what we're going to do, especially since you already know most of us can't attend this "informal meeting?"

We've have enough issues in this community, with the previous board not doing their jobs or keeping people updated - why do you want to go back to that? I really don't want to have to have this discussion again - either bring up this stuff in open board meetings like everyone's supposed to or the rest of us will have to decide if you should continue to be president. Is there any part of this you don't understand?

(I'd also say this in front of whoever agreed to attend this "informal" meeting, so he/she would understand the same thing could happen to him/her). In fact, go ahead and have an executive session and get all this out in the open

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

AdamD1 (Indiana)
Posts: 179

Posted:

Wow, that's really well formulated. Question, our regular Board meeting is scheduled to take place beginning of Feb. Currently, our insurance policy is about to expire on Jan. 25 (but will automatically renew). So I understand this is time sensitive, but a Special Meeting with appropriate agenda/notice could have been done before the policy is set to expire. Knowing this information, does that change your feelings about this?

SheliaH (Indiana)
Posts: 6,964

Posted:

No. It would seem to me someone was asleep at the switch and didn't note the expiration date was coming up and perhaps the Board should consider if they wanted to shop around for something else, talk to the current company about the coverage and what's really needed or not. That could have happened months ago and by now you'd be preparing to switch to another company if you could get a better deal.

Since they didn't and the policy will automatically renew anyway, go ahead and let it ride. You can still do your shopping around and perhaps decide later on this year if you want to make a change. Hopefully you haven't had a lot of claims, so the current company may be more inclined to negotiate a better rate to keep your business.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

AdamD1 (Indiana)
Posts: 179

Posted:

Really appreciate your wisdom and clarity on this site! Never had a claim that I know of, so hopefully we will just continue on with them. Thanks so much!

KerryL1 (California)
Posts: 14,550

Posted:

Remind us, Adam, how many are on your Board??

KerryL1 (California)
Posts: 14,550

Posted:

Remind us, Adam, how many are on your Board??

AdamD1 (Indiana)
Posts: 179

Posted:

5 Directors

TimB4 (Tennessee)
Posts: 21,059

Posted:

Adam,

If there is a quorum present, it is a board meeting (by definition) and proper notice requirements, if any, must be complied with.

If there is not a quorum present, then it's a task officers are doing to be able to present their findings about insurance options to the board (keeping in mind that Officers and Directors are two different positions).

I'm in an Association where 3 is a quorum. Therefore, we always have only two board members work on these things together.

I get the impression that the individual who is your President is trying to get things done that they notice needs to be done. They simply aren't knowledgeable enough on the procedures they are required to follow. Therefore, information vs. scolding would be the route I would take to address this.

Keep in mind, the President is an Office that an individual is appointed to by the Board.
The Board can remove the individual from that office if they desire.

KerryL1 (California)
Posts: 14,550

Posted:

Since Tim sees there's 5 on your board, I agree with him there's nothing wrong with 2 directors meeting to discuss insurance. 2 is less than a quorum of a 5-person board. It's why I asked the question.

BenA2 (Texas)
Posts: 1,273

Posted:

Maybe I missed it but I didn't see where anyone mentioned state law. They are not all the same. Typically, there has to be a quorum for it to be considered a meeting but I've heard that in some states if there are three people present, it can be a meeting.

TimB4 (Tennessee)
Posts: 21,059

Posted:

I haven't read or heard that.
Everything I have read is based on a quorum being present.

If you have heard otherwise, please do some research to verify and let us know.

AdamD1 (Indiana)
Posts: 179

Posted:

So here's a question.. our quorum would be three Directors.. so could three Directors get together for an informal meeting? W/O notice requirements? So long as no decisions are made?

AdamD1 (Indiana)
Posts: 179

Posted:

Actually I just now read your previous post. Seems to me my hypothetical question is answered! Thanks

MarkM31 (Washington)
Posts: 494

Posted:

Quote:

Posted By AdamD1 on 01/12/2018 7:32 AM
So here's a question.. our quorum would be three Directors.. so could three Directors get together for an informal meeting? W/O notice requirements? So long as no decisions are made?

It depends. To watch the playoffs? Then yes. But once they discuss anything that that could be constued as board buisness, then no.

KerryL1 (California)
Posts: 14,550

Posted:

It also depends what IN laws or your won bylaws say. In CA, for instance, a quorum of the board may not "discuss or deliberate' HOA biz outside of a duly noticed meeting of the Board.

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By KerryL1 on 01/16/2018 1:21 PM
It also depends what IN laws or your won bylaws say. In CA, for instance, a quorum of the board may not "discuss or deliberate' HOA biz outside of a duly noticed meeting of the Board.

Can you provide the Civil Code reference to your statement and not just an attorney's opinion.

Thank you.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

In SC we can.

With the insurance policy set to renew on Jan 25, I think several BOD Members discussing it is just fine. I would caution no vote unless a Quorum but a discussion, evaluation, investigation, etc. is fine. I would like to see some of the deadwood on my BOD become more active like two go off do as above then report back to the BOD for action.

As an example. At our last BOD Meeting we discussed an minor erosion problem we have. I was asked to look at it and get a quote to repair it from out landscaper. We casually agreed if less then $300 then just tell him to fix it. I did. He did. No need for a full blown meeting and a vote. It is done. Problem solved.

RichardP13 (California)
Posts: 3,868

Posted:

I will agree with John 100%.

In California, measures were put in place because of the wide spread abuse of the "Action Without a Meeting" (AWM). When changes were made in 2012, I didn't just take them for there word, I went to the legislators that created the bill to find out exactly then reasoning behind the measure. I didn't rely of the interpretation of some attorney, got the information from the horse's mouth, so to speak.

None of my board members live in high rise towers, nor do they have an on-site manager with an assistant that cost them $100K a year. Not all my boards meet on a monthly basis. God forbid, there are discussions on emails between meetings.

BUT, there has never been any action taken or a decision made that hasn't been done in a properly noticed meeting, whether open or executive, at a board that I have managed in 9 years. I have only been involved in one AWM at which I insisted that the actions be placed in the minutes of the next meeting, which happened, but over the objections of the remaining board members.

KerryL1 (California)
Posts: 14,550

Posted:

First, I merely gave CA as an example. Th point is what does IN or Adam's bylaws have to say about this? This isn't a debate about CA or SC.

Now in SC as JohnC has told us many times, directors can meet in secret whenever they feel like it. A quorum of directors can discuss whatever they wish. Your minor erosion issues was talked about at (I assume) one of your closed meetings and you got the go-ahead at the meeting to proceed if under $300. Our board does this type of thing all of the time. In our case it's usually to the PM: If under $xxx, go ahead. We do not need another meeting. Again, the point is, what about IN????

CA Civil Code couldn't be clearer, Richard. but feel free to show us actual legislation that disagrees with the simple citation below:

Civil Code §4090. "Board Meeting" Defined.
“Board meeting” means ...":
(a) A congregation, at the same time and place, of a sufficient number of directors to establish a quorum of the board, to hear, discuss, or deliberate upon any item of business that is within the authority of the board."

In CA, Board meetings must be noticed 4 days before the meeting so Owners can decide if they want to attend. No discussion or deliberations among a quorum of the board occurs here and I'm glad. Prior to our openness and transparency, previous abusive & secretive boards discussed matters whenever they felt like it and behind owners' back. That is the main reason some of us rebelled and became a majority on the board in one year.

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By KerryL1 on 01/16/2018 3:44 PM
First, I merely gave CA as an example. Th point is what does IN or Adam's bylaws have to say about this? This isn't a debate about CA or SC.

Now in SC as JohnC has told us many times, directors can meet in secret whenever they feel like it. A quorum of directors can discuss whatever they wish. Your minor erosion issues was talked about at (I assume) one of your closed meetings and you got the go-ahead at the meeting to proceed if under $300. Our board does this type of thing all of the time. In our case it's usually to the PM: If under $xxx, go ahead. We do not need another meeting. Again, the point is, what about IN????

CA Civil Code couldn't be clearer, Richard. but feel free to show us actual legislation that disagrees with the simple citation below:

Civil Code §4090. "Board Meeting" Defined.
“Board meeting” means ...":
(a) A congregation, at the same time and place, of a sufficient number of directors to establish a quorum of the board, to hear, discuss, or deliberate upon any item of business that is within the authority of the board."

In CA, Board meetings must be noticed 4 days before the meeting so Owners can decide if they want to attend. No discussion or deliberations among a quorum of the board occurs here and I'm glad. Prior to our openness and transparency, previous abusive & secretive boards discussed matters whenever they felt like it and behind owners' back. That is the main reason some of us rebelled and became a majority on the board in one year.

I have cited to you on numerous occasions, but you ignore the citation.

"You can lead a horse to water, but you can make them drink".

KerryL1 (California)
Posts: 14,550

Posted:

Sorry, Richard, this may benefit other CA readers of these posts. You wanted an actual citation from CCC and I provided one. Now you gotta show me yours. C'mon now. Or is there some confusion?

RichardP13 (California)
Posts: 3,868

Posted:

Here is the exact text of SB 563. The wording in question is in the bill. There have been a couple of different interpretations, but I will always that then one from the individual who authored the bill.

http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_0551-0600/sb_563_bill_20110906_chaptered.html

No different than the attorney who interpreted the OP's Bylaws, wrongly I might add.

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By KerryL1 on 01/16/2018 3:44 PM
First, I merely gave CA as an example. Th point is what does IN or Adam's bylaws have to say about this? This isn't a debate about CA or SC.

Now in SC as JohnC has told us many times, directors can meet in secret whenever they feel like it. A quorum of directors can discuss whatever they wish. Your minor erosion issues was talked about at (I assume) one of your closed meetings and you got the go-ahead at the meeting to proceed if under $300. Our board does this type of thing all of the time. In our case it's usually to the PM: If under $xxx, go ahead. We do not need another meeting. Again, the point is, what about IN????

CA Civil Code couldn't be clearer, Richard. but feel free to show us actual legislation that disagrees with the simple citation below:

Civil Code §4090. "Board Meeting" Defined.
“Board meeting” means ...":
(a) A congregation, at the same time and place, of a sufficient number of directors to establish a quorum of the board, to hear, discuss, or deliberate upon any item of business that is within the authority of the board."

In CA, Board meetings must be noticed 4 days before the meeting so Owners can decide if they want to attend. No discussion or deliberations among a quorum of the board occurs here and I'm glad. Prior to our openness and transparency, previous abusive & secretive boards discussed matters whenever they felt like it and behind owners' back. That is the main reason some of us rebelled and became a majority on the board in one year.

Show me where an email is considered the "the same time and place" and I will purchase that bridge everyone wants to get rid of.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Kerry

Our meetings are not in secret nor are they closed. We just do not have the meeting notification criteria that some states do.

If an owner called anyone on the BOD and asked when the next meeting is, they would be told. If they asked to attend, they would be welcomed.

KerryL1 (California)
Posts: 14,550

Posted:

Neither the OP, any other poster nor I talk about email meetings, Richard. Why are you???

Here is the actual legislation from your citation, Richard:

"1363 Sec. 2, (k) (1) (2) (A) "Meeting' means ..."
"(A) A congregation of a majority of the members of the board at the same time and place to hear, discuss, or deliberate upon any item
of business that is within the authority of the board."

As you well know, the CCC was changed to 4090. The gist of my citation and yours are exactly the same. Both prohibit discussing or deliberating HA biz outside of properly noticed board meetings. Mine is in the actual current Civil Code that governs all
Common Interest Developments in CA.

Our Board follows the advice of our current and previous HOA GCs, and our MC; we don't violate that statue.

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By KerryL1 on 01/16/2018 7:21 PM
Neither the OP, any other poster nor I talk about email meetings, Richard. Why are you???

Here is the actual legislation from your citation, Richard:

"1363 Sec. 2, (k) (1) (2) (A) "Meeting' means ..."
"(A) A congregation of a majority of the members of the board at the same time and place to hear, discuss, or deliberate upon any item
of business that is within the authority of the board."

As you well know, the CCC was changed to 4090. The gist of my citation and yours are exactly the same. Both prohibit discussing or deliberating HA biz outside of properly noticed board meetings. Mine is in the actual current Civil Code that governs all
Common Interest Developments in CA.

Our Board follows the advice of our current and previous HOA GCs, and our MC; we don't violate that statue.

You really don't get it.

I also in turn follow my attorney's advice, which is different than yours. And they are a VERY large HOA law firm.

KerryL1 (California)
Posts: 14,550

Posted:

For the benefit of other readers from CA, Richard, what is it that I "don't get?"

Meantime, where in CA CC does it say a majority of an HOA Board may hear discuss or deliberate among themselves outside of a properly noticed meeting agenda?? I k-e-e-p waiting.

(And you KNOW we aren't taking about emergency meetings.)

TimB4 (Tennessee)
Posts: 21,059

Posted:

What I find interesting is the number of references (not just in this thread) in replies to State laws that have zero bearing on the OP's Association. To me, this simply confuses the issue.

I mean, would the OP really care what VA laws say about the situation if they live in AZ? It simply wouldn't help them. However, taking the time to look up the OP's State statutes would provide valuable information that would be helpful.

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By TimB4 on 01/16/2018 9:37 PM
What I find interesting is the number of references (not just in this thread) in replies to State laws that have zero bearing on the OP's Association. To me, this simply confuses the issue.

I mean, would the OP really care what VA laws say about the situation if they live in AZ? It simply wouldn't help them. However, taking the time to look up the OP's State statutes would provide valuable information that would be helpful.

We thought you would do that.

KerryL1 (California)
Posts: 14,550

Posted:

I agree Tim and said the exact same thing above when Richard hijacked this thread. My use of CA only was an example, which I hoped would prompt the OP to review his own bylaws and IN law. I appreciate that you often do this for posters.

RichardP13 (California)
Posts: 3,868

Posted:

So I did a little research, something Kerry is not accustomed to doing, unless it deals with her own association and its laws.

Here are two references, one from a law firm that has the Indiana section on homeowner association: http://eadsmurraypugh.com/wp-content/uploads/2016/07/Indiana-HOA-Act-2016.pdf

Second is the Bylaws of a Indiana HOA, http://peppergrasshomeownersassociation.weebly.com/uploads/4/3/3/2/4332111/ppg_by-laws.pdf. If you look at pages 3-4, it discusses Quorum. Every act or decision done or made by a majority of the directors present at a duly held meeting at which quorum is present shall be regarded as the act of the board.

So to answer the OP question, if the meeting was not duly held (assuming noticed) then any decision that may have come from such a meeting is, well, NULL and VOID.

KerryL1 (California)
Posts: 14,550

Posted:

The thing is, Richard, we don't know if the bylaws you cited are the same as the OP's bylaws. We also don't know if IN law would trump an individual HOA's bylaws. It's nice of you, though, to look this up.

You're right, Richard, I do frequent research and it always deals with my HOA and my obligation to practice due diligence re: the issues my HOA faces. So far as I know I'm doing a fine job in that regard. Later this month I'll attend a legal seminar about some new CA HOA legislation. I want to know more about how it affects my HOA. Most folks would see this as a good thing.

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By KerryL1 on 01/17/2018 1:12 PM
The thing is, Richard, we don't know if the bylaws you cited are the same as the OP's bylaws. We also don't know if IN law would trump an individual HOA's bylaws. It's nice of you, though, to look this up.

You're right, Richard, I do frequent research and it always deals with my HOA and my obligation to practice due diligence re: the issues my HOA faces. So far as I know I'm doing a fine job in that regard. Later this month I'll attend a legal seminar about some new CA HOA legislation. I want to know more about how it affects my HOA. Most folks would see this as a good thing.

The reason I posted the link for the Indiana HOA law is for YOU to research.

I have attend the Legal Seminars for the past 9 years, I teach for one of the CAI Chapters and have been on the Legal Committee for another, which means I have to do a lot of research.

I did know that the Bylaws I posted were possibly not then OP's, BUT it might give some insight in what may or may not be Indiana Law.

BenA2 (Texas)
Posts: 1,273

Posted:

Quote:

Posted By TimB4 on 01/11/2018 11:55 PM
I haven't read or heard that.
Everything I have read is based on a quorum being present.

If you have heard otherwise, please do some research to verify and let us know.

My comment that I have heard of different rules was only meant to illustrate that the rules are not the same everywhere and before taking advice on what constitutes a meeting, one should make sure it applies to their situation. All states have different laws and some cities and counties may have laws that also apply.

RichardP13 (California)
Posts: 3,868

Posted:

If I were to use the Bylaws of the HOA I researched and then to answer the OP's posted question, I would say it was an informal meeting.

The OP can review his Bylaws with those that were posted and see how close they are.

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