Action Without Meeting

A situation arose during the last few weeks which requires some equipment to be replaced. The cost for these replacement parts will be paid from reserves. Certain board members wanted to authorize the expense immediately without waiting for our next meeting (in two weeks) which was acceptable. I tried to explain that the easiest way to authorize the immediate expense would be to call an emergency meeting (by email with all directors in agreement). No notice would be necessary because of the urgent situation and then we could each record our vote (by email too) and address it at our next meeting and record in the minutes. This didn't seem like a huge inconvenience to me as I am the Secretary. Nobody had to leave their home or computer keyboard!

They did not want to follow that procedure preferring just to ask back and forth via email expressing that it needed authorization immediately and why were we delaying! The attitude was that it was unnecessary formality. I didn't vote either way. I just let them get on with it.

I researched how to handle a situation such as this on the Davis Stirling website and in our ByLaws (and offered to do the necessary paperwork etc) . I am the secretary and also the treasurer. To handle this situation would have been no more difficult than the way it was handled (in my opinion, wrongly).

Was I correct?

I know following the Davis Stirling Act can be a PITA.

I have been on the board as President, Secretary and now Treasurer over two terms (four years) and about to move into a third term. They are new to both HOA living and the BOD. I do not want to have a bad relationship with my fellow directors or come off a difficult or 'know-it-all' but this type of behavior is giving me a bad feeling.

That didn't happen. I was at the last meeting. I'm the secretary and I take the minutes.

Thank you for taking the time to respond with some excellent advice. I appreciate it and I will implement it ☺️

Well that's very nice of you to say that. I suspect there are members of my board who would gladly hand me over to you 🤣

But nobody called an emergency meeting.

As I interpret DS to call an emergency meeting all directors must agree to the emergency meeting. After that the vote doesn't need to be unanimous - a majority is allowed.

Quote
Unanimous Written Consent. Email may be used as a method of conducting an emergency meeting, provided all members of the board consent in writing to the meeting. The written consent must be filed with the minutes of the board meeting. (Civ. Code § 4910(b)(2).) Once the board agrees to hold the meeting via email, any votes on emergency items need not be unanimous. A simple majority is sufficient to approve an item of business.
Unquote

LmT, did you know that, where proper notice was not provided for the day and time of a board meeting or an owners' meeting, many states' statutes say that the appearance of an individual at the meeting waives their right to object to the improper notice?

Guess why.

Perhaps I'm really thick! To me this suggests why even bother having meetings if decisions can be made using the 'unanimous consent' concept.

I'm prepared for the drubbing!

I understand email decisions can be made if certain conditions are met (as in an emergency situation). As I understand the DS Act a BOD must follow rules to implement those decisions. i.e. declare an emergency meeting. Then, follow those rules to authorize the action by email or other means (physical, zoom or email). Unanimous decision to declare an emergency meeting but not for the vote. Record in the next open meeting minutes.

If I am missing something I am fully open to correction.

Civ Code 4910 (b) (2) says there must be "consent." I do not think this is the same as "declare."

I feel you are correct in wanting consent. I feel you are incorrect in believing consent for the emergency meeting was not evidenced when each of the directors voted by email.

I interpreted the Davis-Stirling as you have. It's not unusual for D-S to be a little ambiguous and sometimes hard to really figure out. When that happens I come to this forum and get other opinions which helped enormously in this case. The situation is resolved now and I'm satisfied with the outcome. I don't see many situations affecting our small HOA where an emergency could arise and this was not strictly an emergency but it did fall under the 'could not have been foreseen' portion of the requirements. I don't want a difficult working relationship with my fellow board members so I went along with the approval. Everyone is happy but I will be keeping a closer eye on things and will try to head off these conflicts before they become too difficult. My next challenge is to have our ByLaws updated and, hopefully, as we work on them both new and seasoned board members will become more familiar with what is and is not allowed. We could all always use a refresher.

You are correct. Meeting must be called by president or two other directors. Must be for an unforeseen purpose. All directors must consent in writing to the emergency meeting which is separate and distinct from conducting the actual meeting. And only in an emergency meeting can decision/action be made by email. Consent first, meeting second.

Nowhere does the statute say that the consent must be separate and distinct from the actual meeting.

Legal "consent" can take many forms, from acquiescence to actions indicating consent to more.

Contrary to the first post, perhaps LmT thinks maybe this was not an emergency at all. Or she wants her fellow directors to understand that email votes are only for emergencies. All these concerns are admirable and important. But if push came to shove, I think she would lose in court on the instant claim (the directors did not "consent" to the emergency meeting) here.

I entirely agree with LmT & Terri. And I supplied a real-life CA HOA Board example for just one reason why it matters. Directors must first concur the topic IS an emergency.

Another. reason I agree with LmT & Terri -- Both CA HOA Board members-- is the CA HOA an attorneys who compile Davis-Stiriling.com agree with us.

A 3rd reason: (Civ. Code § 4910(b)(2).)"....Email may be used as a method of conducting an emergency meeting, provided all members of the board consent in writing to the meeting...."

I think it's best here to forget LmT's earliest wording, and to stop talking about "court," when LmT shows no tendency whatsoever to pursue such an extreme action.

The plain meaning of the statute says zero about when the written consent must occur.

I understood this to imply written consent to the meeting.

Unanimous Written Consent. Email may be used as a method of conducting an emergency meeting, provided all members of the board consent in writing to the meeting. The written consent must be filed with the minutes of the board meeting. (Civ. Code § 4910(b)(2).) Once the board agrees to hold the meeting via email, any votes on emergency items need not be unanimous.

In the instance I write about two of the board members had not chimed in yet.

I agree it’s not a hill to die on. I now have enough information if a situation arises again I will know what to do.

CA"Civil Code § 4923. Emergency Board Meetings
An emergency board meeting may be called by the president of the association, or by any two directors other than the president, if there are circumstances that could not have been reasonably foreseen which require immediate attention and possible action by the board, and which of necessity make it impracticable to provide notice as required by Section 4920."

Still with you LmT: "Emergency is defined above. "Reasonably foreseen" are the key words. In my 14 years of Cali board seers, I think our Board held 3 emergency meetings. All involved sudden change orders to projects in progress. I was sec'y'for all three. We had a tough time getting quorum for one so had to meet in person, when only a quorum is required.

Elle usually does want to follow the letter of the governing documents, e.g. how boards meeting must be called, or stat statute.I'm baffled about why she want sot die on this non-Utah hill.

I happen to agree. I wrote the following before I had to leave for an appointment:

LmT could always ask that the HOA attorney weigh in. I expect the HOA attorney would try to cover all bases as well as possible and advise that best practices are for all the directors to first expressly agree (or disagree) by email that this is an emergency warranting voting by email.

As for the past, as long as LmT (understandably) does not want to ruffle feathers, she could just include copies of the email votes in the Minutes (as required by law) and be done with it. This is for the reasons I gave.

I realize LmT disagrees that consent to the emergency meeting happened here.

The reason Lmt might need an attorney is because the other directors might resist buying what she is trying to explain.

I know a certain HOA director who was in the minority (all by himself) on a certain important HOA issue. The President attacked this director savagely. Still this HOA director managed to persuade the President to get an opinion from the HOA attorney. Just yesterday the HOA attorney took the side of the law, which in this case was also the side of the one HOA director. It was profound, especially since the President and HOA attorney are good friends.

Competent HOA attorneys can be excellent referees and educators.

I read this to say:

1. All BOD members must agree to have the emergency meeting.

2. As in any BOD decision, the majority rules.

Something I (and others?) missed from LmT's very first post:
Hence LmT consented to nothing when this email exchange occurred. This means unanimous consent to this emergency meeting by email did not occur.

This is the bigger problem in my opinion.
LmT is not satisfied with the outcome. In the future, LmT wants the directors to be unanimous in a separate, express written consent for an emergency meeting by email, then have a separate, second vote on the main issue by email.

I thought LmT had reached the point where she did not want to ruffle feathers. If this is not the case, then LmT can certainly try a second time at an open board meeting to point out the requirements of 4910 as she sees them.

Otherwise, bring in the HOA attorney. This is especially necessary because of what I quoted herein about LmT's not consenting by email to the emergency meeting by email.

I see no indications that LmT proposed the emergency meeting by email. Even if she did, you all are insisting on a separate, express, written consent.

And she wants them to listen in the future. What should she do?

I am fine with making another attempt at an open meeting. After this, if she still wants this done so as to minimize legal challenges down the road, bring in the HOA attorney.

I disagree that I “misunderstood” elle’s posts. And she now agrees that SHE misunderstood the OP, so her various "analyses" often are wrong. She bckpedlae. AND, she says we all misunderstood LmT too. Such hubris! And she’s now wrong again.

Here is what LmT wrote. I can agree with Elle that it’s a little difficult to follow. “I tried to explain that the easiest way to authorize the immediate expense would be to CALL an emergency meeting ([to be held] by email with all directors IN AGREEMENT….and then we could each record our vote (by email too) and address it at our next meeting and record in the minutes.”

But, if I understand this correctly, LmT: ”[They preferred] just to ask back and forth via email expressing that it needed authorization immediately and why were we delaying!” And so they all voted to make this emergency purchase. LmT did not vote. A Board majority approved the expenditure."

Here is what I wrote above: “when [LmT] presents meeting minutes for approval…[she’ll say] that a majority* of the board approved the motion on [date (or dates if online] to [spell out the topic of the Board decision, why? Needed?].”

The is NO reason to write that protocol to call such a meeting was not followed.

I further advise that LmT continue with a very tight explanation that will NOT be recorded: Something like: “While we did not follow the exact steps required to hold such a meeting, all directors agree that this was an emergency situation & expenditure. We all agree that it’s in the very best interests of our community.

And this last, LmT, is most important.

If the parts were purchased, it's a done deal. Owners will have no recourse to correct this past board action that arguably violated the Civil Code.

What to put in the minutes? State a vote was done by email due to an emergency; record the votes in the minutes. If someone wants to put two-and-two together and yell at the board for violating the Civil Code, state that going forward, the board will proceed as follows... " If an owner sues, in my opinion they cannot get anywhere.

Only a court could say for sure whether this was truly a violation of the Civil Code. A competent HOA attorney could make arguments saying it was not. But as I noted above, best practices say to do things as LmT describes.

Perhaps a wealthy owner would like to try go get a similar ruling from a judge in the situation LmT described. You know: Spend a few grand and try to humiliate the board. Maybe this would seem worth it to the owner.

In my opinion the only one who would look stupid is the owner.

Interesting opinion.

If it were so easy to understand, I wonder why disputes over the statute's wording land in court. Funny how some of these disputes are even appealed to the highest court of California. /s

Just a few months ago the California Supreme Court settled whether an email exchange among directors is a board meeting and so on.

They need some legal wisdom, from someone they will respect. Why? Because five will get you ten the other directors think it is obvious that they consented to an emergency meeting by virtue of simply voting on the main issue. Legally, the other directors may be correct.

But as I pointed out above, the problem is LmT did not vote one way or the other. She consented to nothing. Hence this was not an emergency board meeting. It was a board exchange that violated the Civil Code.