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JosephineK (Virginia)
Posts: 9
Posted:
I am on a Board in VA and am a stickler for following the laws. The VA Non-Stock Corporation Act says that, unless the articles of incorporation or bylaws provide otherwise, action required or permitted to be taken at a
directors’ meeting may be taken without an actual meeting if the action is taken by written consent of all of the directors included in the minutes or filed with the corporate records, in which event the action may be described in any document as a meeting vote (§ 13.1-865).

However, the VA Property Owners Association Act, which takes precedence over the more general Non-Stock Act, requires that all meetings be open, of course, and that the Board is not allowed to have "informal" meetings. The exact language is: "The board of directors shall not use work sessions or other informal gatherings of the board of directors to circumvent the open meeting requirements of this section."

I am trying to reconcile these provisions. Our Board President wants to use email (among Board members only) to take actions -- let's use approving the minutes as an example -- prior to the next meeting. I think that's illegal but he is adamant that it is perfectly proper.

Under what circumstances would it be proper for the Board -- not at an open meeting -- to take any action and still be in compliance with the VA sunshine provisions.

Thanks much.
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Josephine,
I hesitate to say anything because Virginia has such quirky laws.
I would suggest you work all this procedural stuff out with your president and rest of board. Come up with something you all can live with that is not too far out of bounds with your state documents, then amend your documents with a vote of members as required by your documents.. There will be times that some conflict will occur in precedence requirements, etc. However for a meeting procedural rule or chapter or what ever fits your nomenclature I don't see any advantage in going to war over it. If the Board wants to use e-mail notifications and nothing forbids it, make it a rule and put it in documents. I side with using e-mail for just about every communication the board puts out. It is fast, cheap, you have a record of messages sent, and if someone insists on a hard copy, send it to them. I have never seen anything that suggests e-mails are read any more or any less than snail mail. Either do it now or wait and play catch up when it becomes more common than snail mail. E-mail is so under used for all kinds of things. Our condo and our HOA send out e-mail blasts about a lot of stuff that is current business and if you wanted to notify by snail mail, it would cost a fortune and be passé when the letter arrived.
MaryA1 (Arizona)
Posts: 7,043
Posted:
Quote:
Posted By JosephineK on 02/13/2009 4:21 PM
I am on a Board in VA and am a stickler for following the laws. The VA Non-Stock Corporation Act says that, unless the articles of incorporation or bylaws provide otherwise, action required or permitted to be taken at a
directors’ meeting may be taken without an actual meeting if the action is taken by written consent of all of the directors included in the minutes or filed with the corporate records, in which event the action may be described in any document as a meeting vote (§ 13.1-865).

However, the VA Property Owners Association Act, which takes precedence over the more general Non-Stock Act, requires that all meetings be open, of course, and that the Board is not allowed to have "informal" meetings. The exact language is: "The board of directors shall not use work sessions or other informal gatherings of the board of directors to circumvent the open meeting requirements of this section."

I am trying to reconcile these provisions. Our Board President wants to use email (among Board members only) to take actions -- let's use approving the minutes as an example -- prior to the next meeting. I think that's illegal but he is adamant that it is perfectly proper.

Under what circumstances would it be proper for the Board -- not at an open meeting -- to take any action and still be in compliance with the VA sunshine provisions.

Thanks much.

Josephine,

I'm in AZ and we have the same nonprofit corp statute regarding an action taken w/o a meeting and also an HOA open meeting statute. This is what I call one of the "gray areas" in the open meeting statute. I have proposed an amendment which would allow an action to be taken w/o a meeting but only if it was impossible to obtain a quorum of the board for an emergency situation. The AZ attorney general has ruled that email communications are a violation of the open meeting law. Any time a quorum of the board meets, whether business is being conducted or not, it is deemed a meeting of the board and all members must be noticed. Approving minutes or taking any other action by email cannot be construed as taking an action without a meeting, as the board members are actually "meeting" thru email.
I think your Pres. is way off base in his thinking! Perhaps it would be wise to seek advice from an HOA attorney on this one.
MaryA1 (Arizona)
Posts: 7,043
Posted:
Quote:
Posted By RobertR1 on 02/13/2009 6:27 PM
Josephine,
I hesitate to say anything because Virginia has such quirky laws.
I would suggest you work all this procedural stuff out with your president and rest of board. Come up with something you all can live with that is not too far out of bounds with your state documents, then amend your documents with a vote of members as required by your documents.. There will be times that some conflict will occur in precedence requirements, etc. However for a meeting procedural rule or chapter or what ever fits your nomenclature I don't see any advantage in going to war over it. If the Board wants to use e-mail notifications and nothing forbids it, make it a rule and put it in documents. I side with using e-mail for just about every communication the board puts out. It is fast, cheap, you have a record of messages sent, and if someone insists on a hard copy, send it to them. I have never seen anything that suggests e-mails are read any more or any less than snail mail. Either do it now or wait and play catch up when it becomes more common than snail mail. E-mail is so under used for all kinds of things. Our condo and our HOA send out e-mail blasts about a lot of stuff that is current business and if you wanted to notify by snail mail, it would cost a fortune and be passé when the letter arrived.

Robert,

Josephine's concerns have nothing to do with informing members of board actions, etc. AZ also has an open meeting law and our attorney general has ruled that conducting business via email is a violation of that law. Any time a quorum of the board meets, whether or not business is conducted, it is considered a meeting and all members of the assn must be notified beforehand. Email communications are considered a means of "meeting". Josephine's BOD may decide to pass a rule or even ask the members to pass an amendment allowing the board to conduct business via email but that would be a direct violation of a state law, which, as you know, is a no-no.
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Mary and Josephine,
You both are too quick on the trigger. I never advocated in doing business by e-mail. I suppose if you are looking for it, you may conclude I did. My concern was the Boards hesitancy about using e-mail for notification of issues. Not all the Boards business is done at meetings or ES, or little get together sessions or how ever it is done. I know that shady stuff is never going to stop.......nature of the beast.

But just don't get spun up about what is right and what is wrong and blame it on e-mail. We use teleconference for all meetings and all are open, I am proud to say. Supposedly all business is conducted at the table, it isn't and all know it. But, you can e-mail minutes to all members once they are published, in fact I am proud to say we e-mail and put on web site Drafts of meetings and label them so, for anyone that wants to follow, you can see the inner workings of the Board and there is nothing wrong with that.

I am curious as to how you can think anyone, even me, would propose something like holding a meeting via e-mail? Reading back on your post, explain to me what the AG meant when he said it was a violation to do Boards Business via e-mail. Considering if all board business has to be done via meetings, what is a conversation exchange between less than a majority of board members. Is using the telephone to discuss Board business a violation? I think this reference is directed to holding a meeting by e-mail, and why would anyone want to do that, when they can teleconference, and we can, maybe you all can't, but I bet the board members exchange e-mails about board bushiness and also use the telephone and at times may desire to teleconference, such as a committee meetings, which is plainly boards business and entered into minutes at such. Our clause of holding a meeting without notice has been discussed over and over and the fact is there may be circumstance this may be necessary, so we left I in. If a hurricane or a flood seek you out, the Board better be ready to make Board decisions without a notice and a meeting.
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Josephine's BOD may decide to pass a rule or even ask the members to pass an amendment allowing the board to conduct business via email but that would be a direct violation of a state law, which, as you know, is a no-no.

I beg to differ. What you are stating requires no action. It is only when a vote is taken and the vote prevail and the decisions is adopted or rejected, is it business, the rest is just fluff and it goes on all the time. Can you ask the members to vote via e-mail? Not unless you notice a meeting and have them vote via proxy. Does the Board form consenus via e-mails and phone calls and conversation external of Board Meetings, of course they do and that is also a no, no., as you know.
JosephineK (Virginia)
Posts: 9
Posted:
Robert. Thanks for your comments. And I'm glad you said: "I am curious as to how you can think anyone, even me, would propose something like holding a meeting via email?" In fact, that is EXACTLY what our President is maintaining. He is relying on a VA Supreme Court decision from 2004 called Beck v. Shelton, which held, on the peculiar circumstances of that case, that the emails in that case did NOT constitute a "meeting." From that, our President has jumped to the conclusion that if emails are not a "meeting," we can do anything we want via email, despite the VA POA statute's sunshine provisions. (And this from a President who claims he wants complete "transparency" in Board actions.) I have tried to explain that the VA case involved a public body, which we are not. I have tried to explain that the VA case involved members-elect, which we are not. He calls my explanations "utter nonsense" and continues with the emails asking for agreement or, in the last one, "concurrence" with actions. I find this exceedingly dangerous, and frustrating, and don't want to spend POA money for a formal legal opinion on something like this. Our President is supposedly "certified" by CAI, and keeps claiming that he's the expert. But maybe spending money on a legal opinion is the only way to keep us out of trouble.
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Josephine,
I am not so sure the intent of your president is way out of line. I would be concerned if the members allow him to steamroll them if he finds a Board Member that disagrees with him. That is dangerous and your Board members should be reminded they ELECTED the President, they can also dis-elect him. Also, skirting the requirement to hold an open Board meeting and providing notice can be problem and get you in trouble. All that e-mail correspondence is subject to recovery and also to the request for any Regime documents that an owner would want to review. I suppose you all have this standard clause in your documents. It would be difficult for the Board to claim official meetings or actions by e-mail and not make any correspondence concerning that exempt from discovery.

It is a tough job, especially with absentee owners, antipathy, and plain "I don't care attitude", that prevails through out most of all associations. So, maybe your president is so experienced that he is at the point that owners and Board members have to "prove" their motivation. I certainly think that if this differing opinions between you and the president can't be solved at the table, then at least agree to abide by a legal opinion and pay to get one. Maybe some of these lawyer sites on the INTERNET that offer a "free" opinion on one subject would save a few bucks. I do think he is headed for trouble if he continues forward with the assumption as you stated. I also think the Board should provide guidance and "control" the president. The president has one vote, that is all. If you decide on any method of getting legal advice, make sure you both agree as to the question and will agree to abide by the decision. If you can work it out......that's the way to go, with the entire Board of course.

Hey, I just thought of something. If the Pres is big in the CAI, why don't he and you draft a question to them. Them being some of his counterparts in Cai.
JosephineK (Virginia)
Posts: 9
Posted:
I already have requested an interpretation from the new VA Common Interest Community Board, which is the new VA Board that would be hearing a complaint from any of our owners. The CIC Board is specifically authorized to give "non-binding" interpretations of the VA POA Act, so I figure it is best to get it straight from the horse's mouth.

Our problem is precisely what you have suggested -- "steamrolling". Our President just keeps sending email after email to all Board members. He believes that the emails are NOT subject to discovery because they're not "meetings" -- in what I am sure is misplaced reliance upon the court case, which was a state FOIA case seeking documents from a public body.

This all started at our very first meeting when we "elected" him (he was the only Board member who wanted to be President) and he presented the Board with his 18-point list of "priorities". One of his first priorities was getting approved minutes -- not draft minutes -- to the homeowners quickly. We have draft minutes available to the homeowners every month, in half the time required by law (60 days), but because some homeowners feel it is too burdensome to come to meetings, or to come to the clubhouse (we're a small development, not large, and everyone can walk to the clubhouse) to review the minutes and pre-meeting packet, he wants to get approved minutes sooner, and wanted to get that approval via email. I immediately objected because I believe that approving minutes is Board action that cannot be done via email. I don't have any legal objection to getting draft minutes out sooner if the Secretary wants to do that, but I did, quite forcefully, object to approving the minutes via email. I believe that it starts us down a very slippery slope in terms of the sunshine requirements of our state's POA statute.

Most of the other Board members, and some of the homeowners, believe that I am a nuisance for constantly questioning the legality of what we are doing, and that I'm the one trying to avoid "transparency."

I decided to try HOATalk as a "reality check". Am I overreacting? I just think all these emails are very dangerous.
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Josephine,
This "Over reacting", phrase people like to hang on something that they disagrre with is troublesome. I certainly don't think you are over reacting and you have an absolute right to question what you think is wrong. As does any member and those that throw this over reacting stuff around need to give a little thought to this proclamation, for the reasons I have just stated.

His desire to get the minutes out ASAP is commendable in my view. I also have no trouble with putting a draft on the web site or sending them as a e-mail draft copy. The minutes will not be approved to the next open Board meeting anyway, what's the problem? I think also your board could change drafts until they agree to accept the minutes as written, if they want, but they are still not approved until next meeting of Board. I am BIG on Transparacy and anything the Boards do that skirts around a document requirement in order to be upfront and transparant, I am all for. There is no reason Boards and Members should be denied the use of e-mail as a means of discussion between them. Certainly, you can't make an amendment this way or spend money, but you can convey, for instance: "Hey guys, it looks like we are going to have to spend X $ to get Y fixed and that little matter will be on the agenda the next board meeting. If you have any comments, you can e-mail the Board, post on web site or better yet, attend the next meeting". To me that is good. You can also e-mail suggested or required amendments that need to be added. You should not rely on these comments as votes and adopt these changes.
The is room for flexibility and you don't sound like you are void of this attribute.
RobertR1 (South Carolina)
Posts: 5,164
Posted:
To add,
A legal meeting is required to take a legal action. That means your minutes must be noticed and posted prior to meeting. That also means the Meeting has to be called to order and a quorum reached. That means the presiding must call the meeting to order. That means the president must announce all Board members present and guests, and in most meetings list the members attending. If you have open meeting law, and you do, you must alllow for any member to attend this meeting that wants to. Try that through e-mail.
JosephineK (Virginia)
Posts: 9
Posted:
Robert, thank you for the reality check. Yes, his hang-up is my objection to my contention that "approval" must take place in an open meeting, and I'm going to stick by my guns on that one. One more piece of information by way of background I should give you.

In response to my contention that there is no legal way to approve the minutes other than at an open meeting -- a position that he claims is "utter nonsense" -- our President says the 'simple solution' is to have an extra Board meeting two weeks after the regular Board meeting, just to approve the minutes. Of course, I said that that would entail additional notices and additional minutes -- sort of a set of "pyramid" meetings, if you will. No one really wanted to do that, of course.

We did agree, at the last meeting, to circulate the draft minutes among the Board members and to submit suggested corrections or changes to our Secretary prior to the next Board meeting, when the minutes will be approved. I have no problem with that and it makes life easier for everyone. But that's when he went into a tirade about how emails are not "meetings" and Boards have a right to do anything outside of a meeting that they can do in a meeting, as long as they all concur. And that's where the lack of transparency comes in, and I just cannot agree to that. Yet, his comments make it appear to those in attendance that I am the one against transparency because I will not agree to actually approve the minutes sooner than the next actual meeting.

Again, thank you for your comments.
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Josephine,
You can't win them all, just keep chewing away, eventually your motivation and sincerity will win the day in the end. It did with me and I am sure, if he keeps taking his medicine, you will win him over also. I do get a little riled when I see a Board anything start to chase good people that show interest and caring away from the table. What a crazy thing to do.
JosephineK (Virginia)
Posts: 9
Posted:
I think our replies crossed one another.

Your point is precisely the one that caused the problem in the first place. I made this point at the very first meeting, and it is the one with which he vehemently disagrees, claiming "show me where it's illegal to approve minutes via email." Both I and another Board member immediately said that approving Board minutes is "action" that can only be taken at an open meeting and our President -- who, again, professes to be a certified "expert" in homeowner associations -- absolutely refuses to accept that, to the point where he circulated an email to all homeowners -- under the guise of a "President's Report" that none of us saw prior to its distribution -- proceeded to tell all homeowners the following:

"To tell Homeowners to go to the clubhouse and read "draft" minutes if they're that interested is, in my view, a wrong attitude. As you can see, correction of this problem is still high on my list of priorities. However, during our recent Board meeting, a majority was apparently convinced by a couple of others, bolstered by a former Board member of the same persuasion, who argued that there are no legal alternatives to our current delay of five or six weeks between Board meetings and the approval of minutes. That is, of course, clearly not the case, so you might be comforted to know that this issue remains a priority -- and will be resolved. The most obvious (and simplest) alternative is to have a brief 15 or 20-minute Board meeting one week after the regular meeting to approve minutes."

As you might surmise, there are some homeowners who are rather upset with me for not "cooperating" to get approved minutes out sooner.

Ah, the joys of being on the Board.
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Well, you got me Josephine,
Does this track: The problem is the delay in approving the Board last Minutes. There is a six or eight week delay because of one thing or another, which surely must mean a number of drafts of the minutes is one of the reasons. But now, you all are going to be able to get a good draft in two weeks. How are you going to do that? And more important if you can do it in two weeks, why not just go ahead and do it now? Then if he wants to notify owners the final draft of the minutes are done, send them an e-mail and those that want one send them a draft.

He mentioned a majority on the Board. Why not motion, if you have a majority, that drafts of the minutes will be sent out by e-mail and note the next meeting of the Board as when the minutes will be approved. I can see all kinds of problems coming down the road if he is allowed to push the majority around, and that is exactly what he said he was going to do. Don't take that crap. Vote him from the Presidency. I also would like to note that if you see this homeowner that got up at the Board Meeting and gave his views that just happen to go counter to what this President thought; tell him for me he did good, and maybe he should have a private talk with this guy and inform him officially of his name and tell him if he is going to refer to him in a public notice that he will ask his permission the next time. His personal synopsis of the Board Meeting does not represent the Board and I bet he signed itxxxxxxxxxxxxxx,
President of some association. Board of Directors.

If he did, he owes each Board member an apology. IMHO

This line is interest: a majority was apparently convinced by a couple of others, bolstered by a former Board member of the same persuasion, who argued that there are no legal alternatives to our current delay of five or six weeks between Board meetings and the approval of minutes.

That means, of course: there was a majority convinced plus a couple more that did the convincing.
MaryA1 (Arizona)
Posts: 7,043
Posted:
Robert & Josephine,

Robert, I'm sorry if I misread your message. :-(

It's very apparent to me from some remarks you've made that you don't understand the open meeting law, which is quite understandable as you don't have this law in SC. The intent of the law is to ensure that ALL meetings of the assn are open to all members. Anytime a quorum of the board takes an action outside of an open meeting it is considered a violation of the open meeting law.

About the AG opinion: it has been ruled that if a quorum of the board meets, whether or not they discuss assn business or vote on any assn matters, it is considered a meeting therefore it must be noticed. If less than a quorum meets, they of course cannot conduct any business and it is not considered a meeting. Regarding email communications, if all the members of the board are sent an email asked to respond with their opinion or vote that is considered a meeting and would be a violation of the open meeting law because it was not noticed. Of course the board can use teleconferencing however there must be speakers used so that anyone attending the meeting can hear all parties speaking. And, of course the teleconference meeting must first be noticed.

Josephine:

Your Pres. is using a court case that does not relate at all to what he wants to do. By sending an email to all board members and asking them to vote on an issue that is a direct violation of the open meeting law. I will be very surprised if the VA Common Interest Community Board ruled differently. Allowing a BOD to operate in that manner would defeat the purpose of the open meeting law. The only time the BOD would be excused from noticing a meeting would be for an emergency meeting or for taking an action w/o a meeting because of an emergency event and a quorum of the board cannot be obtained.

It appears to me your Pres. needs to re-read the definition of "transparancy". If that is his goal as a board member, he's falling far short of reaching it!
JosephineK (Virginia)
Posts: 9
Posted:
Thank goodness I'm not losing my mind.

We DO have a version of the open meeting law. It says:

All meetings of the board of directors, including any subcommittee or other committee thereof, shall be open to all members of record. The board of directors shall not use work sessions or other informal gatherings of the board of directors to circumvent the open meeting requirements of this section.

He claims email is not a "meeting" (relying on that court case) so we can do anything via email, including approving minutes and, I presume, approving anything else.

All in the name of "transparency" -- which I find hilarious, let alone hypocritical.

He just sent another email this morning, asking for "majority concurrence" on a draft of a letter that we asked him to send. I have no problems with his letter -- it's actually very good -- but I do have a problem with agreeing to anything via email. I'll comment, but I won't agree.

MaryA1 (Arizona)
Posts: 7,043
Posted:
Josephine,

Frankly I think it's time the board had an attorney provide an opinion on this matter. Of course, if you're the only member who objects to this, that may not come to pass.
JosephineK (Virginia)
Posts: 9
Posted:
The one fact I did not tell you and Robert is that I am an attorney, as is the other Board member who is very vocal on this issue. We both have degrees in accounting, as well, and the other Board member was appointed by the VA Governor onto the state's Board of Accountancy. Yet, when we both raised an issue about how our reserve funds were being accounted for, the President refused to believe us, and started waiving CAI brochures that purported to condone our POA's practices.

The President simply refuses to accept any conclusion other than his own. Unfortunately, the other Board member and I are fairly new to the neighborhood. Only a couple of years. We were asked by former Board members to run for the Board because of their concerns that things were not being done by the book, and these former Board members wanted homeowners with legal backgrounds on the Board.

With regard to the email approval issue, the President will not accept our conclusion that this is illegal because we are not "certified experts" in homeowners association law. The other Board members view us as merely "nitpickers". So, you're right, we might actually have to waste homeowners funds getting an HOA "expert" lawyer's opinion. The one good part about that, is that the Board President and I do agree on the expertise of one lawyer, in particular, and I have no doubt that, if requested, she will provide an opinion that confirms what the other Board member and I have been saying all along. The VA Common Interest Community Board may give us the interpretative ruling I've requested sooner rather than later. Of course, our President may not accept that interpretation, either, since it's "non-binding." He claimed, on the record, that "we've done very nicely for the last 18-19 years without you."

Very distasteful.
MaryA1 (Arizona)
Posts: 7,043
Posted:
Josephine,

My heart goes out to you for what you have to put up with for a board Pres. How many members on your board? Are you and your friend the minority votes? The best thing would be to strip him of his Pres. position. He's probably intimidated by your credentials as evidenced by his caustic remark and I'm sure he's hoping you and your friend will go away. Please keep us posted on what transpires with the VA Common Interest Community Board.
MaryA1 (Arizona)
Posts: 7,043
Posted:
Josephine,

Sorry, I meant to ask where in VA are you located? I lived in N.Va in the Herndon/Reston area for about 15 years.
JosephineK (Virginia)
Posts: 9
Posted:
We're in Williamsburg now. We lived in Fairfax for several years, and my husband was just up in Herndon on Friday for a funeral service. My fellow Board member and I (we did not really know each other before getting elected to the Board, but have become friends since because our backgrounds are so similar) have managed to get the other Board members to (begrudgingly) agree to vote to prevent the President from sending out any of his own "summaries" without review by the rest of the Board first. Of course, the President's reaction was, "well, if I write it and you 'gut it' then I'm not sending it." Fine with us.

I don't think we're in the minority on the Board, nor in the neighborhood, and that's our President's biggest problem. I think he thought he could bully his agenda through, an agenda that includes a number of items that are outside of the Board's authority and I do not intend to allow the Board to do anything except in accordance with our governing documents and the law. My problem is that I'm Italian, with a temper and a low tolerance for bullying, so I'm "vocal."

Where do you live now?
RobertR1 (South Carolina)
Posts: 5,164
Posted:
Josephine and Mary,
Funny thing happened. I posted a message about my opinion of the President and I suppose I got out of line and now my message is gone, but maybe I just thought I posted it.
Any hoo, I was lamenting about the Pres and how this sounded like Bizzaro World, when the President of an association would turn down the offers of two lawyers, when a lot of our posts end up, well, it's time to hire a lawyer. I also lauded the friend of Josephines that backed her up. And now it occurs to me this whole thing is showing the tell-tale sign of an entrenched Board. I also invited the two lawyers, I don't care what kind of lawyers they are to come on down here and you can be on our Board. We already have lots of pseudo lawyers running around, a few real ones would add balance.

MaryA1 (Arizona)
Posts: 7,043
Posted:
Josephine,

I LOVE Williamsburg! A good friend of our has retired down there but I don't know the name of the s/d. All I know is that it's a golf course community and a rather new one. We now live in Glendale, AZ which is right next to Pheonix. Actually we always said we'd like to retire to the Shenandoah Valley, but that's not going to happen.

But, it's a shame we don't live closer together because I think we'd get along really great. I'm also full-blooded Italian and have red hair (or did til it started going gray!)to boot. So don't talk to me about temper and being vocal! LOL

As for your board Pres, just don't let up! If you have the backing of other board members, then none of you has to put up with him. Remove him from his position as Pres. Make him a member-at-large with nothing to do. That should knock his ego down a peg or two.

Take care. . .

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