Closed Board Meeting Minutes

Started by BillB17 • 26 replies • 1796 views

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BillB17 (South Carolina)
Posts: 92

Posted:

I live in a single family HOA in South Carolina. Our Board of Directors holds Open Meetings every other month. They also hold closed Board meetings to conduct the business of the association as needed. Minutes of all meetings are posted to the Association Website where Members have access to them.

In the past, all Closed Board Meeting Minutes have recorded the motions, seconds and votes on actions the Board considers. The votes are recorded as unanimously approved or, where there was a split vote, the minutes record how each Board Member voted. This method of recording the vote allows the Association Membership to see how each Board Member voted on the issues, especially those issues most important to the Membership. The minutes also record the discussion the Board had relating to an issue before them with a brief synopsis of the discussion which provided the Membership insight into how the Board came to its decision.

Our governing documents state that Roberts Rules of Order shall govern the conduct of all Association proceedings. Under Section 60 of those rules it states that "The votes on each side should be recorded in the minutes. The votes however are not recorded if the organization has a rule or tradition that they are not." Our HOA has no such rule and, in fact, the tradition has been to record how Board Members vote on each side.

Recording the minutes in this fashion has provided a level of transparency which is important to the common good of the community, insight into the Boards vision for our community and the rationale for actions taken.

At a recent closed meeting, the Board decided to simplify meeting minutes and include only actions and motions of the Board. This will remove the transparency we have always had and provide no insight as to the rationale the Board used in coming to their decisions.

Our governing documents do not speak to this issue at all and I understand the Board can decide how it wants its minutes recorded. I have requested that they revert back to the previous method, without a response in three weeks. I am looking for any input on this situation.

Thnaks

KerryL1 (California)
Posts: 14,550

Posted:

Do you think, Bill, that the board would consider making all of its meetings open as is required in many states? (Except, of course, executive session matters)

Another way to simplify the minutes is to only eliminate the discussions, which shouldn't be in minutes anyway. A one sentence reason for the way they voted is a good idea.

Since there's no legal requirement in SC for Board meetings to be open, I really don't l know how you might regain the lost transparency. Given that you're accustomed to such useful minutes, it will be odd to suddenly have important details left out.

(Our Bylaws require following Robert's Rules for our Association, i.e., membership meetings, but not board meetings. And I don't recall if Robert's says the names of board voters need to be recorded, or just the vote breakdown.)

JanetB2 (Colorado)
Posts: 4,219

Posted:

The BOD unless regulated by any Documents or Laws can make such determinations. Potentially if the Owners want something different, then your option is to replace the BOD who is not operating as the Owners have expected and desire. However, there is a point where you do not over complicate the minutes which need to mainly reflect whether approved and by what vote. So the question potentially should be are you willing to step up to the plate and take on the WORK to do the meeting minutes the way you want done if you replace the BOD???

JohnC46 (South Carolina)
Posts: 14,265

Posted:

A BOD Member can, after a vote, ask the minutes to list who voted what way.

KerryL1 (California)
Posts: 14,550

Posted:

Hmmmm, John, I don't know if the Board must honor a request from a director to list how specific directors voted in the minutes. Our Board voted long ago to list these for transparency reasons. Can you cite a source for that?

TimB4 (Tennessee)
Posts: 21,059

Posted:

an individual director can insist that their vote and the reason for their vote be noted in the minutes. By elimination, this would likely identify how the others may have voted.

Additionally, see Roberts Rules of Order Online - Minutes

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By KerryL1 on 03/13/2018 12:48 PM
Hmmmm, John, I don't know if the Board must honor a request from a director to list how specific directors voted in the minutes. Our Board voted long ago to list these for transparency reasons. Can you cite a source for that?

My understanding comes from being a BOD Member of a business fraternal organization and being told it is in Robert's Rules of Order when a new BOD Member began requesting such and we asked our lawyer. We were also told each member could have their reason for voting as such listed in the minutes. I have no specific reference.

I for one agree when not unanimous, how each voted should be listed.

KerryL1 (California)
Posts: 14,550

Posted:

Thanks, Tim & John. I'll look it up. I want members of our board to express their reasons for their votes for the record if they wish. Currently, we may not though we have no board vote on this matter. While we don't have a board policy to use Robert's, we have referred to it.

KerryL1 (California)
Posts: 14,550

Posted:

Well...I read Tim's attachment of Minutes per Robert's Rules, but I didn't see that directors may have their reasons for voting the way they did in the minutes if they request it. I may have missed it???

Long ago, I thought the same thing, but I don't think I could find any justification in Robert's rules. I'll look through my own copy when I have some time. I might even go to Robert'sFlashForum, which I haven't done in a long time. This topic is relevant to our current board here in my HOA

RichardP13 (California)
Posts: 3,868

Posted:

As the OP hasn't re-appeared so I will give my two cents.

The title of the post is closed door meeting. Minutes would n't be available to the members, only open session. Any vote would be private. Their might be a summary listed in the minutes of the open board meeting for the members to view.

JanetB2 (Colorado)
Posts: 4,219

Posted:

To give an example:

If a government Planning Commissioner or City Council Member votes NO they are supposed to give the reason “why” voted against the issue. This is because if any Property Owner or Citizen wanted to appeal or in some instances file legal litigation regarding the vote ... the vote is noted regarding those for the issue and any individual voting against has their reasoning for their said vote. This potentially if followed by local governments would be good policy to follow for HOA governments.

BrandyJ2 (Florida)
Posts: 16

Posted:

Beware of "advice" from people who think that meeting minutes are just some formality and they don't need to be detailed. If you're sued and need to justify your use of association funds, the minutes are your most important piece of evidence. Bad condo attorneys will tell you to put in as little as possible; good condo attorneys will tell you to make them as detailed as possible. There's an old adage

"If it isn't in the minutes, it didn't happen"

BillB17 (South Carolina)
Posts: 92

Posted:

Thanks to all for your input. I would agree with Brandy from Florida comments. The following is an excerpt from the Community Association Institute (CAI) publication on Conducting Meetings:

"It is proper to show the names of those voting in favor, abstaining, and in opposition to a resolution. Because of the Board's fiduciary duty, it is advisable to list those voting with respect to all substantive action motions. It is especially important to list those dissenting, so they are not held responsible for the consequences of an action with which they disagree." The minutes document the official actions taken and the information in the minutes can be used against the Board (and to protect those who opposed) should there be a law suit.

While not authoritarian, the CAI organization is well recognized in this arena.

Another way to get the information on how each Board Member votes is to have one Board Member request a roll call vote. This would then require the minutes to record how each member voted. However, given the stance of our BOD on the issue, that is not likely to happen.

Control of our Association was turned over to the Membership in 2010. I served on the BOD from 2011 to 2016, four of those as President. Transparency was always a priority for us and we structured our closed meeting minutes to provide just that. And I, speaking now as a Member, hold the same opinion.

I have requested the present Board to explain why they have turned direction on meeting minutes, but have not received any response in nearly a month.

Frustrated!!

JeffS28 (Tennessee)
Posts: 29

Posted:

Quote:

Posted By BillB17 on 03/14/2018 8:11 AM
Thanks to all for your input. I would agree with Brandy from Florida comments. The following is an excerpt from the Community Association Institute (CAI) publication on Conducting Meetings:

"It is proper to show the names of those voting in favor, abstaining, and in opposition to a resolution. Because of the Board's fiduciary duty, it is advisable to list those voting with respect to all substantive action motions. It is especially important to list those dissenting, so they are not held responsible for the consequences of an action with which they disagree." The minutes document the official actions taken and the information in the minutes can be used against the Board (and to protect those who opposed) should there be a law suit.

While not authoritarian, the CAI organization is well recognized in this arena.

Another way to get the information on how each Board Member votes is to have one Board Member request a roll call vote. This would then require the minutes to record how each member voted. However, given the stance of our BOD on the issue, that is not likely to happen.

Control of our Association was turned over to the Membership in 2010. I served on the BOD from 2011 to 2016, four of those as President. Transparency was always a priority for us and we structured our closed meeting minutes to provide just that. And I, speaking now as a Member, hold the same opinion.

I have requested the present Board to explain why they have turned direction on meeting minutes, but have not received any response in nearly a month.

Frustrated!!

Hi, I have been following this thread and wanted to reply, the board has no obligation to do what you want. Also, far as I know, Robert's rules do not have authority in any court of law in the world. Your covenants say they "should" be governed by Roberts Rules not that they "must" be governed. The court will favor the board in this.

Now if you covenants in a separate section stating votes must be recorded in the minutes for each side, then they have violated the covenants by not recording them. Given the information you have presented, no lawsuit because they have not broken any laws or covenants that I can see. Now, if they broke the laws for an action they voted on, then you can sue them. But then that presents a whole new set of problems, which director voted on it and which director didn't, each director can claim the other voted on the action item, it will create a huge problem.

If you are trying to protect the dissenting vote's from liability. Then it should be up to that director to request that in the minutes. Also if that director disclosed his/her vote to you, then they may be in a bit of trouble but that is a whole other matter. If that director is out voted when they vote on the minutes then it does seem to be a problem of transparency. I still don't see a law broken. However, if you can't find the solution in the Covenants, you may find a solution in the Corporation Law in your specific state where it specifically addresses the issue of each directors liability. You may also find a solution in the D&O insurance if the HOA is sued and how is each director responsible if no votes have been recorded for each side. You should check if South Carolina doesn't have new legislation recently passed to address this problem.

Also, if that "dissenting" director is not in line with the other directors, perhaps its time to protect him/herself and resign. You can also try to vote out the board.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By BrandyJ2 on 03/14/2018 5:33 AM
Beware of "advice" from people who think that meeting minutes are just some formality and they don't need to be detailed. If you're sued and need to justify your use of association funds, the minutes are your most important piece of evidence. Bad condo attorneys will tell you to put in as little as possible; good condo attorneys will tell you to make them as detailed as possible. There's an old adage

"If it isn't in the minutes, it didn't happen"

Many believe the problem comes when there is to much information, often slanted, in the minutes. Minutes should have all motions made and the result of the motion and little else. The less said, the better.

KerryL1 (California)
Posts: 14,550

Posted:

With John on this. Minutes should include what was done, not the discussions leading to the decision. I do think, though, that it's good to put in the minutes why the Board majority voted a certain way--1 sentence, maybe two. I too would like to see the reasons(s) why directors dissented.

It's the discussion/debate before the vote that don't belong in minutes per Robert's Rules. If the Bylaws state that Robert's must be used at board meetings, then what was done not what was said will be in the minutes. I believe Robert's (aka, RONR) must be used by HOA boards in CT for board meetings. Our Bylaws state we must use it only for Members meetings.

In FL, I think I've read that the names of directors and how they voted must be in the HOA (or condo?) minutes. But there's no such legislation in CA, so our board voted to include those details. I agree, then with Bill's citation of CAI on this point.

Bill, I think some readers take your use of the phrase "closed meetings" to mean executive session, e.g., Richard of CA. But I thought you meant these closed meetings are just like the Board's open meetings thus the minutes can be shared. Am I wrong on this? If not, I don't see a way that Bill's HOA board can be forced to put who voted how and/or why in the minutes.

As someone else wrote, this current board might have to be replaced if enough owners what more transparency. Say, Bill, can you ask the board in their next open meeting?

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By KerryL1 on 03/14/2018 12:29 PM
With John on this. Minutes should include what was done, not the discussions leading to the decision. I do think, though, that it's good to put in the minutes why the Board majority voted a certain way--1 sentence, maybe two. I too would like to see the reasons(s) why directors dissented.

It's the discussion/debate before the vote that don't belong in minutes per Robert's Rules. If the Bylaws state that Robert's must be used at board meetings, then what was done not what was said will be in the minutes. I believe Robert's (aka, RONR) must be used by HOA boards in CT for board meetings. Our Bylaws state we must use it only for Members meetings.

In FL, I think I've read that the names of directors and how they voted must be in the HOA (or condo?) minutes. But there's no such legislation in CA, so our board voted to include those details. I agree, then with Bill's citation of CAI on this point.

Bill, I think some readers take your use of the phrase "closed meetings" to mean executive session, e.g., Richard of CA. But I thought you meant these closed meetings are just like the Board's open meetings thus the minutes can be shared. Am I wrong on this? If not, I don't see a way that Bill's HOA board can be forced to put who voted how and/or why in the minutes.

As someone else wrote, this current board might have to be replaced if enough owners what more transparency. Say, Bill, can you ask the board in their next open meeting?

Again,

This was closed meeting. Why are they minutes available to members?

KerryL1 (California)
Posts: 14,550

Posted:

I asked Bill if he meant executive session or just a regular board meeting that wasn't open to members. SC isn't required to have open board meetings at all, per JohnC, or maybe just one a year--can't quite remember.

If bill meant executive sessions, with their very limited possible agenda items, then, yes, I'd wonder too why those minutes re going to homeowners.

KerryL1 (California)
Posts: 14,550

Posted:

I asked Bill if he meant executive session or just regular board meetings that aren't open to members. SC isn't required to have open board meetings at all, per JohnC, or maybe just one a year--can't quite remember.

If bill meant executive sessions, with their very limited possible agenda items, then, yes, I'd wonder too why those minutes were going to homeowners.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By KerryL1 on 03/14/2018 1:46 PM
I asked Bill if he meant executive session or just regular board meetings that aren't open to members. SC isn't required to have open board meetings at all, per JohnC, or maybe just one a year--can't quite remember.

If bill meant executive sessions, with their very limited possible agenda items, then, yes, I'd wonder too why those minutes were going to homeowners.

We are required to give written notice (US Mail) to all owners 30 days in advance of our Annual Meeting including place, time, an agenda, BOD election info, and so forth. At the meeting we present financial information such as Balance Sheet, Profit and Loss Budget versus Actual for the present and two prior years. We have a BOD Election (if a 20% Quorum is achieved as it always has been) with last minute nominations from the floor allowed. We have a no time limit Q&A session.

We do not have to notify Members of BOD Meetings but members are welcome to attend. We can conduct BOD business via Email which is where 99% of such is done thus the BOD only meets 2-3 times a year. A quorum of BOD Members can meet and chat about business without calling it a BOD Meeting.

Overall our owners are happy. The main issues are typically one offs meaning they are important to only the owner, not the community as a whole such as my fence this, my lawn this, my basketball hoop this, my car parking this, my trash barrel this...me...me....me...etc. We have no amenities nor any shared common areas which eliminates many problems.

SC laws are set up to allow a corporation/business to operate pretty much as it wants to but within the law of course. They are not set up to be overly protective of shareholders, employees, customers, frogs, birds, though we limit alligator hunting season licenses thus only so many gators can be killed each year. Gator tastes like chicken.

KerryL1 (California)
Posts: 14,550

Posted:

That's why I was trying to remember, John, and you wrote re SC: "We do not have to notify Members of BOD Meetings but members are welcome to attend."

Is it also true in SC that Associations are not required to have open board meetings? (Like PA, NY, and perhaps others?)

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Kerry

Not to split hairs but requiring to give notice of BOD Meetings and allowing owners to attend are two different things.

1. Do we need to notify owners written notice of BOD Meetings? No.
2. Can we bar owners from attending BOD Meetings? No.
3. If an owner called anyone on the BOD and said they would like to attend our next BOD Meeting so please notify them when and where, would we notify them? Yes.
4. Would we allow them to speak? Yes.
5. Can our system be abused? Yes.
6. Do other systems stand in the way of a BOD functioning? Yes.

Cheaters cheat no matter what rules, regulations, laws, safeguards, etc are put in place. Do not punish the majority for the actions of a few.

BillB17 (South Carolina)
Posts: 92

Posted:

I think a couple of clarifications are in order.

When I say "closed meetings", I mean BOD meetings which are closed to the Membership. These are NOT executive session meetings of the BOD. At these meetings the BOD conducts the affairs of the community, the minutes of which are available to the Membership.

Our By-Laws say that Roberts Rules shall govern the conduct of all Association proceedings. Our Declaration is silent on the issue.

Regarding John's comments on how his HOA is structured - Ours is very similar, except that Members do not attend BOD meetings. That made me go back and check more closely.

Our By-Laws refer to Meetings in two different areas. One under the topic "Meetings" where Annual and Special Meetings of Members are defined.

The other is under the topic "Directors" where it states that "regular meetings" of the BOD shall be held from time to time as may be necessary at such place and hour as may be fixed by resolution of the Board. However, there is no mention as to whether or not these "regular meetings" of directors are open to the Membership. Our BOD does hold Open Meetings every other month. These are open to the Membership.

What is your opinion on the "regular meetings" of the BOD? Open to Membership or not?

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Bill

As you said:

The other is under the topic "Directors" where it states that "regular meetings" of the BOD shall be held from time to time as may be necessary at such place and hour as may be fixed by resolution of the Board. However, there is no mention as to whether or not these "regular meetings" of directors are open to the Membership. Our BOD does hold Open Meetings every other month. These are open to the Membership.

In how many corporations, as an HOA is, are BOD meeting open to the shareholders?

The fact that your association holds notified, open to the owners BOD meetings every other month goes above and beyond SC laws.

Bill

Are you you a high rise association? In SC there is the SC Horizontal Property Act that controls high rises but it does not control non high rise associations. There is no SC Act that control non-high rise associations.

KerryL1 (California)
Posts: 14,550

Posted:

I prefer open HOA meetings and they are required in CA and in many other states. Our 18 y.o. bylaws also require them. Imo, owner input at meetings, and owners being able to see the process by which the Board reaches its decisions is healthy for the board and for owners.

John I haven't criticized SC's approach in this thread.

JanetB2 (Colorado)
Posts: 4,219

Posted:

Quote:

Amen ... that is why I stated if someone disagrees it should be noted and “reason why” they disagree. Generally if sued it will be due to NOT allowing anything and why it should be noted. If anything is denied and the individuals have noted potentially the Sections and Articles of the Documents or State Laws it will go a long way protecting the HOA in a lawsuit.

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