Board tie with vacancy

If a newly elected BOD vacates their BOD position and leaves the board with 4 members. The bylaws say the the remaining BOD should elect a new BOD to fill the vacancy. The vote would be a tie, 2-2, and the motion goes down. So how can that be remedied? I cannot find any remedy excepting a special election which is costly. Can the vacated board member stay on and vote for their replacement with the other BODs? I didn't think so as the bylaw says the remaining board members will elect and fill the vacancy. Are there any Michigan state laws that would apply here? Could we appoint an additional officer as the bylaws allow that, but I am not sure if they are allowed to vote.

What are our options?

thanks!

HI! Augustin D!!! Finding a candidate who would get a majority vote might be impossible, but I do think it a good idea. The BOD has not vacated their position yet....does that matter?
Bylaw says, The directors may appoint an Assistant Treasurer, and an Assistant Secretary, and such other officers as in their judgment may be necessary. Any two (2) offices except that of President and Vice President may be held by one person." Nowhere do I find anything that talks about voting by Directors. The bylaws also say the BOD can make rules and regulations and can establish committees as Bod deems necessary, etc. Nothing in Michgan Law about ties? Glad you are here.....

Lou
In our bylaws it says that the officers are elected and the officers comprise the board of directors. So if you have a vacancy on the board it needs to be filled only if the bylaws say it must. You could operate for a little while with that board. But best thing to do is, as stated before, find a candidate who is non-political and will work well with the other board members.

BOD is not a singular person. Sorry, I couldn't read beyond that awful misperception.

If the other board member has already left the board, he or she has no say in who the replacement should be. It would have been nice if he or she had delayed the departure until after a replacement was found that the rest would like - in fact, it would have been nicer for the departing board member to recruit someone to replace him or her, and then the board could find out a little more about the person before voting.

As for Michigan law, I suspect it doesn't address the matter. As I've said several times before, not everything in HOA land is addressed in state or local law or even your documents. That's when you need to apply common sense - if there's a tie, either another candidate will need to be found or someone will have to be persuaded to change his/her mind.

Appointing an additional officer isn't necessarily the same thing as appointing a board member. This sounds like you have five board members, with four serving as president, vice president, secretary, and treasurer, with the last one being a member at large. If your bylaws said an additional officer could be added by the board, it would be up to them to decide what that position would be (e.g. some organizations have a recording and corresponding secretary) and who would take that job.

This is an interesting idea. Kerry, are you saying that all five directors would vote on a replacement, and if a majority agrees, then on an agreed-upon date, one director would resign, and the new director would take office?

I have not heard of this in the past. But right now I cannot think of any reason the law would prohibit this.

GenoS...... Seems like you could overlook such an "awful misperception." This "awful misperception" is in the eye of the person who chooses to call it an "awful misperception." I can't seem to get past someone having such an "awful misperception" of a "word" pluralized unnecessarily......so sorry if your sensitive senses were so "awfully" bothered that you had to make such a huge deal out of it. I put an "s" on a word I have seen an "s" on before, does that mean I don't know the meaning of BOD? Does that mean I don't understand the word BOD? Give me a small break, will you please. Do you put an "s'" when you are showing possession?

Kerry L....You guys are obsessed by my s on BOD. Because of that "awful misperception".....a word misspelled....I get all sorts of grief from you perfect people... Director(s) can be officers as well. Our bylaws say the principal (really spelled "ple"....no, just kiddidng) officers of the Association shall be a President, a Vice President, a Secretary and a Treasurer. The Directors may appoint an Assistant Treasurer etc. Please do your homework....you aren't necessarily "right" about everything. All Bylaws are not the same.

I also think you are wrong about the director, still in office, being able to vote on a replacement. It was clear, as I wrote that the bylaw said, "Vacancies shall be filled by vote of the majority of the REMAINING Director"s............. pretty clear unless there was some state HOA law that said something different.

To All Whom have replied to me......Additionally, I reread my mistake and it was in a question I had addressed to Augustin D, who is always respectful and kind enough to understand and overlook any mistakes or typos. He always provides me with valuable information. More than I can say for many of the replies and answers I receive from other HOATalk leaders, who frequently don't even read the question correctly or will say things the questioner has all ready said in their previous message. Or they will pick out something they can criticize or make the questioner feel stupid.

Oops. Post-o. Substitute GeorgeS21 for JohnT38.

Lou - yep, Augustin is much nicer than most of us.

Me? I think it is great to help other Board and Committee members - even non B and C members who are just whining about something they don’t like that happened. I do, however, believe it is transactional in regard to the questioner having done their homework.

You spent a lot of words being upset at folks trying to help you ... reorient and work the issue.

I agree. If no vacancy exists, how can a Motion be made to fill the vacancy?

Lou. Do you or do you not agree with this statement. A simple Yes or No please.

Couldn't resist & had to look it up at Davis.stirling.com. Note this action refers to CA corporations and may not refer to other U.S states. Our may want to refer to such code in her state.

"Effective Date of Resignation. Resigning directors may set the effective dates and times of their resignations. (Corp. Code §7224(c).) Directors remain in office and continue to fully function as directors until such time as their resignations become effective. They may also participate in the appointment of their replacement. Doing so helps avoid deadlocked boards. The resigning director may participate in the selection of his/her replacement, provided the selection takes place prior to the effective date of the resignation. (Mayo v. Interment Properties.)"

KerryL, Thank you for looking up. It does not say that she could vote to elect this person, but I guess "participate in" could be interpreted as such. No, they have not submitted any resignation yet. Yes, with our board, you are an Officer and a Director. Both would be vacant, but only one person would fill.

George S21 Be very careful in making the assumption of whether or not the questioner has or has not done their "homework." Your remark sounded very judgmental.
Also, your remark about "reorient and work the issue" can be suggested to you as a way of looking within yourself to see why you say, "AugustinD is much nicer than most of us." Augustin D and others have helped me many times and have never been judgemental and/or rude.
Thank you.

AugustinD Would you please give me a couple of examples of a rule or regulation we might be able to make or a book or article I might read on how to formulate (rules or regulations) properly? Thanks again.

KerryL1 and JeffT2, thank you for the citations. I double checked Jeff's and agree the implications are as KerryL1 first stated.

LouH1, some examples of rules and regulations that would likely survive a test in court:

Suppose the condominium's Bylaws state that the Board shall have the right to make and enforce reasonable rules and regulations concerning use of the common elements. Suppose the Bylaws say that the association has the right to impose fines for violations of the Rules and Regulations. Your Board publishes the following rules and regulations, with plenty of notice before enforcing them:

Parking
Rule 1. All owners and their tenants shall park only in their designated parking spot.

Rule 2. All guests of owners or their tenants shall park in the Northeast section of the parking lot, in any of the spaces marked 71 through 81.

Pets
Rule 3. All pets must be licensed pursuant to municipal ordinance with copies of the license submitted annually to the Association.

Rule 4. All pets walked on the common elements must be on a leash and under control of the pet's Owner at all times.

Rule 5. All pet waste must be bagged and placed in one of the three trash receptacles on the condominium grounds.

Pool Usage
Rule 6. No alcohol is permitted in the pool area.

Rule 7. Children under the [FHA-approved] age of ___ shall be in the pool area only with the supervision of a person 15 years of age or older.

Procedure for Enforcement
Rule 8. All residents shall receive a warning notice for the first infraction.
Rule 9. All residents shall receive a second warning notice for the second infraction.
Rule 10. Upon a third infraction, all residents shall be assessed a fine pursuant to the Schedule of Fines along with a final notice will state that the accused has a right to a hearing with the Board and to review evidence presented by the Association.

Schedule of Fines
A violation of any of the parking rules shall result in a fine of $25 per day per violation.
A violation of Rule 3 shall result in a fine of $25 per day.
A violation of Rule 4 shall result in a fine of $25 per incident.
A violation of Rule 5 shall result in a fine of $500 (five hundred dollars) per incident.
A violation of Rule 6. shall result in a fine of $500 (five hundred dollars) per incident.
A violation of Rule 7. shall result in a fine of $100 per incident.

The Michigan Condominium Act speaks specifically of the Owners' duty to abide by the rules and regulations and the right of the association to impose fine when the governing documents allow fines.

If you hunt around on the net, you will find real-life examples of rules and regulations. E.g. here's a site with a link to a Michigan condo's R&Rs: http://www.ledgestonecondominium.com/condo-rules--regulations.html

Where Boards get in trouble with Rules and Regulations is when they create a rule that is unreasonable or when the Association does not follow its own procedures for enforcement.

Thanks for looking up Mich. codes, Jeff.

Well, George, I cited the davis-stirling.com website, but you'll see that IT cites CA Corporations Code. I'm thinking this is not as unusual as some might think. It might even be in FL corporations codes.

Lou: the person who's resigning hasn't resigned yet, so s/he may vote on a replacement. But first, s/he must give the Board a written resignation and effective date. Yes, the words "participate in" means the person resigning can vote. S/he after all STILL is a director until the effective date of the resignation.

You wrote that the director who's resigning also is an officer. What officer does s/he hold? Does s/he want to resin as an officer too? If so, that also must be in writing to the Board with an effective date.

Wording that says "remaining directors" surely applies to when a director drops dec or resgns on the spot in a huff with a crazy follow up email that night (as recently happened here) making the resignation complete.

I'd like to see the exact Bylaws wording about filling director vacancies, please, Lou. Both JohnC & Sue (I think) also have made this request.

Just for fun, I took a few of the words Jeff used and did a quick search ...

Yep - all the info is right there ...

NONPROFIT CORPORATION ACT (EXCERPT)
Act 162 of 1982

450.2515a Vacancy.
Sec. 515a.

(1) Unless otherwise limited in the articles of incorporation or bylaws, if a vacancy, including a vacancy resulting from an increase in the number of directors, occurs on a board, the corporation may fill the vacancy in any of the following manners:
(a) The shareholders of a corporation that is organized on a stock basis or the members of a corporation that is organized on a membership basis may fill the vacancy.
(b) The board may fill the vacancy.
(c) If the directors remaining in office constitute fewer than a quorum of the board, they may fill the vacancy by the affirmative vote of a majority of all the directors remaining in office.
(2) Unless otherwise provided in the articles of incorporation or bylaws, if the holders of any class or classes of stock or the members of any class or classes are entitled to elect 1 or more directors to the exclusion of other shareholders or members, vacancies of that class or classes may be filled only by 1 of the following:
(a) By a majority of the directors elected by the holders of that class or classes of stock or the members of that class or classes then in office, whether or not those directors constitute a quorum of the board.
(b) By the holders of shares of that class or classes of shares or the members of that class or classes.
(3) Unless otherwise limited in the articles of incorporation or bylaws, if a corporation's directors are divided into classes, any director chosen to fill a vacancy shall hold office until the next election of the class for which the director was chosen, and until his or her successor is elected and qualified.
(4) If because of death, resignation, or other cause, a corporation has no directors in office, an officer, a shareholder, a member of a corporation that is organized on a membership basis, a personal representative, administrator, trustee, or guardian of a shareholder or member, or other fiduciary entrusted with the same responsibility for the person or estate of a shareholder or member, may call a special meeting of shareholders or members in accordance with the articles or the bylaws.
(5) A corporation may fill a vacancy that will occur at a specific date, by reason of a resignation that is effective at a later date under section 505 or otherwise, before the vacancy occurs, but a director who is elected or appointed under this subsection may not take office until the vacancy occurs.

History: Add. 2014, Act 557, Imd. Eff. Jan. 15, 2015

My last post was to GeorgeS21

I have answered this question Look in early previous posts to AugustinD and to SueW6. I will repeat it with additional info. "The principal officers of the Association shall be a President, who shall be a member of the Board of Directors, a Vice President, a Secretary and a Treasurer....The President shall be the chief executive officer of the Association. I will admit, it is a little confusing. Our BOD are also Officers and have been elected as such for decades.

Yes, I thoroughly understand that! Thank you.

I have been happy pushing quite a few out to sea - like the guy who continued to believe he could fly well - but, screwed up every single engine-out landing, every bad weather approach - and, every attempted no-flap approach and landing.

But, he too, continued to want to discuss - without having completed due diligence, without thinking things through, without doing the work.

Last I heard, he was an airline pilot.

Lou: what officer position does the person who wants to resign hold?

Look, Lou, you want to improve your HOA an make a difference. But to do that, it's important to learn the language of HOA boards. So.... Ou wrote: "Our BOD are also Officers..." But the correct language is: "Our directors are also officers..."

Another e reason to try to help you learn HOA lingo is to also inform other newbies who read these posts and might become confused. So, we're trying to help not only you, but others. : )

KerryL 1. I see your point and I appreciate and respect your efforts. Thank you, just tell people right from the get go what you said to me just now. You explained it well and I now understand what you are trying to do. Thank you.