Proxy

Our annual meeting and board election is held the first week in February. At our 2025 meeting, when the vote counts were counted, verified etc, the community manager informed the board and ultimately those in attendance that we could continue the meeting and thus the election with a "declining quorum". It turns out this was inaccurate advice and subsequently the meeting and election were deemed invalid per our legal counsel and interpretation of the bylaws.
Another meeting is scheduled in early May. Proper notice, and nomination forms were distributed on schedule. The proxy/ballots were mailed on schedule.

On the proxy it basically states that it is in place for 11 months. However, our annual is held in February.This means that for purposes of quorum and/or voting, the proxy is good beyond our February 2026 annual meeting/election and therefore the proxies are good for two annual elections. That doesn't seem fair or right!

Property Management says, proxies are kept for purposes of any questions or concerns that come up after an election is held. Further, our Board members serve two full years and therefore our Board elections can no longer be held in February!

As a boardmember, I am so confused and also continue to wonder about the professional advice we are getting from our property manager! Opinions and advice are really appreciated. I've learned a lot in my first year to say the least! Help!

Some observations:

-- An owner who has assigned someone to be her or his proxy may revoke this assignment at any time.

-- The 11 months number most likely comes from the Texas Nonprofit Corporation Act, BO 22, Section 22.160. See https://statutes.capitol.texas.gov/Docs/BO/htm/BO.22.htm

-- This time limit for proxies is pretty common nationwide. It probably comes from the Uniform Corporation Act yada, which many states adopt in large part.

What is the issue?

I think you may have to quote exactly what your HOA's bylaws say on the subject of director terms, annual elections and more.

Fact: Bylaws cannot anticipate every strange situation. When a meeting is found to be invalid, notice requirements combined with what the bylaws say can mess things up. The best HOA attorneys advise: Do the best you can, aiming for reasonableness and fairness.

Thank you for your thoughts. Appreciated!

It sounds like you need to rethink the wording on your proxies, specifically the expiration date. Ours state that the proxy is effective for the upcoming annual meeting and for any adjournment thereof. It allows for unexpected events that force adjournment, but it's not open-ended. It would not cover any other votes that may take place in the community, particularly another election.

Consult state law to see what limits are imposed on proxies. Some states allow for open-ended ones with no expiration date (I don't recommend - it's too easy to lose track of who is allowed to vote).

And as ElleN noted, a proxy may be revoked by the person who signed it. You have to allow for people who sign a proxy and then show up at the meeting.

The bylaws do not mention declining quorum. I agree that re-wording the language is warranted on the proxy for the future. I always understood the proxy could be revoked at anytime during the term of the proxy, but also understand that most people would not think to do that. As I've researched a bit ( unfortunately after the fact) I have learned much! I have studied our bylaws and other governing documents. We could have recessed the meeting until such time that we had a quorum and proper announcement of when the meeting would be reconvened. I will suggest rewording proxy at our April meeting! Thank you

Thank you for elaborating and doing so carefully. It helps so much.

For future reference: Is this a Condominum Association?None of the relevant Texas statutes have a provision for adjourning the annual meeting to a future time, with the quorum requirement being reduced.

This is neither in your bylaws nor state statutes. The manager is incorrect any way one slices it.

This is a learning opportunity. Granted you directors should not be teaching the manager. Still, consider asking the manager what bylaw, state stature or other citation says what she claimed.

Your manager gave legal advice in her capacity as a paid employee or contractor. If she is not an attorney, what she did is the unauthorized practice of law and violates state statute via the attorney's very serious code of conduct (which is also statutized, state by state). In the past HOA Managers have been warned about giving legal advice and so the unauthorized practice of law. The manager (or you or I) can give legal "information." But this is not what the manager did here. In so many words, the manager said, "Do this, and it will be lawful."

As for formal education, many managers have a high school diploma and that's it. If a manager has a ton of experience, this can certainly mean a lot more than a manager having say even a Masters degree. But in my experience many (not all) managers understand that they are in a position of some authority. They do not admit their limitations and when they need to ask for help.

In my experience over many years, including observing much litigation between HOAs and owners and how judges interpret HOA statutes, covenants and so on, the best managers and directors will say to anyone complaining or wondering about xyz: Show me where in the Declaration, bylaws or state statute it says what you claim.

Based on my understanding of your bylaws so far, here is what I believe should have happened:

Quorum was not met. Hence per the Texas Nonprofit Corporation Act at section 22.208, the incumbent directors continue to hold office "until a successor is elected, appointed, or designated and qualified."

This is not something the owners can lawfully decree by vote. The Board would have to decide whether (1) the bylaws allow another attempt to hold an election (before the 2026 annual election); and (2) whether they wish to do so. Elections are expensive. It's the owners' en masse decision to not vote (in person or by proxy). I would not blame a board one bit if it simply waited until 2026 to hold another election. The latter might be way more consistent with the bylaws, overall.

I would have to say exactly what your bylaws say about elections and terms to say whether maybe the Board should consider cancelling this May election. Yes, I am for democracy. But when it costs a fortune and it is the owners' fault for quorum not being achieved, I think the requirements for giving owners democracy have been met.

It is a community of single family homes. Thank you so much for your insight! Valuable, to have an objective 3rd party ask appropriate questions and provide options to think about. You are very kind given the information I provided!

Excellent question. Maybe only bylaws need restatement but CC&Rs could only be amended?

What percentage of owners must vote in the affirmative to amend/restate each of these? Be clear about whether the percentages are "of all owners" or only 'of a quorum of owners attending a duly called owners' meeting' or something else.

Pros:
Less confusion, as people read the bylaws and CC&Rs and assume they are gospel, but often newer state laws trump the bylaws/CC&Rs. Then directors and owners alike, not being versed in the legalities, do not know how to parse the bylaws/CC&Rs.

Cons:
$$$$$$

Cost-Benefit Analysis:
Get an estimate. Compute the cost per owner. Given the age of the governing documents, I am thinking the wasted energy of directors and owners alike (as they try to figure out what is still valid in the bylaws/CC&Rs) argues for at least restating the bylaws and possibly amending the CC&Rs.

Kerry, Sounds good. I'm always game to discuss/learn the experiences of others with HOT TOPICS. Restating Documents ('87) is costly and extremely time-consuming...and probably emotionally draining when dealing with a typical apathetic membership. What's the gain...... with low interest in leadership and not wanting to spend money when Davis Stirling is available and the law?

Ellen, you are always SPOT-ON. Thanks. Our CCR's ('87) under termination and Amendment requires "members representing not less than 67% of the voting power..."
"However termination of this declaration and any of the following amendments, to be effective, must be approved in writing by the Beneficiaries of 75% of the First Mortgages on all the lots..." etc, etc, etc! OMG! Lending group Apathy, no doubt, would surpass member apathy, + spend tons of money (legal, etc) with questionable success...and takes YEARS of volunteer work. No guarantees!

Cost-Benefit: A while ago I was given a $6,000-7000 estimate. But let's say $10,000 now with 140 SFHs, rare amenities (streets, lights, 2 entrances, front yard landscaping, mailboxes, bulletin board, fencing.) So $72 per owner; however we're currently well funded. I've lived here 24 years, been on all the committees and Board President past and present.(numerous times). Less than 6 attend meeting (every 2 months), and no one jumps for joy to be on any committee or consider a Board position (3). Why update/restate documents ($$$$$$$) when Davis Stirling clearly states Right and wrong. The gray areas can be clarified in our Rules/Regs? We're nearly 40 years with outdated documents (which most members are unaware of) so I'm questioning the obvious?

Further to my original post: I couldn't make this stuff up if I tried! Unbelievable really!

1. February Annual Meeting was invalid because of the use of declining quorum which is not stated in our HOA bylaws.

Questions: Are the 11 month term proxies submitted for the February meeting still valid for the now rescheduled Annual
Meeting in May?

Are the proxies indicating that the proxy can be used for purpose of meeting a quorum of homeowners,carried over
to the rescheduled May meeting?

Are the proxies that designate an individual vote on their behalf at the meeting still valid?

It gets better....

2. Ballot and 11 month term proxies were mailed to homeowners for the May Annual. However this May ballot was incorrect! Soooo,

3. A corrected version of the first May ballot/proxy was mailed to homeowners. The board requested that an email be sent immediately from management company acknowledging their error and it was also posted on our neighborhood webpage. (The error was ommitting the word "incumbent" next to his name)

Question:If someone returned the incorrect May ballot/proxy before receiving the corrected version, are these ballots AND
proxies invalid because the form was incorrect?

Can the proxies designated for quorum purpose only on the incorrect form be used for the rescheduled May meeting?

Again, I can't make this stuff up!