HOA Covenant regarding a quorum...

Started by MitchM1 • 29 replies • 1817 views

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MitchM1 (Colorado)
Posts: 32

Posted:

Here is an excerpt from the covenants:
(*we have 406 homes)

“…the presence of Members or of proxies entitled to case 60% of all votes if each class of membership shall constitute a quorum. If the required quorum is not present, another meeting may be called, and the required quorum at the subsequent meeting shall be on-half (1/2) of the required meeting. No such subsequent meeting shall be held more than 60 days following the preceding meeting.”

This applies to a meeting that would be called to vote for a Special Assessment for a fancy fence the President of the Board wants to install and not for our normal HOA meetings.

The way I read this is we need 244 votes/proxies for a quorum. If we do not have that we can have another meeting and the number is reduced to 122. And that's it...you cannot have a third meeting.

The President of the Board of Directors is saying we can have a third meeting attempt if we do not have 122 proxies and the number would once again be chopped in half and that only 61 votes/proxies would be needed.

I don't think they can have a third meeting the way I read the covenants. It sounds like someone is trying to abuse this paragraph and keep reducing the number.

What do you think?

JohnB7 (South Carolina)
Posts: 176

Posted:

Poorly worded .... the attorneys will get wealthy.

IMO the intention is to reduce the quorum to 50% (203 homes) for the first 'second' meeting WITHIN 60 days of the first.

? third meeting ? :;

JohnK3 (Pennsylvania)
Posts: 967

Posted:

Mitch,

If your excerpt is all the docs have to say, then yes, I agree with your reading of the quorum requirements. If the 244 then 122 is not achieved, you'd have to start again at the 244 level.

MitchM1 (Colorado)
Posts: 32

Posted:

Quote:

Posted By JohnB7 on 04/27/2009 10:11 AM
IMO the intention is to reduce the quorum to 50% (203 homes) for the first 'second' meeting WITHIN 60 days of the first.

John,

I never looked at it that way. 406 then 203....interesting.

Mitch

MitchM1 (Colorado)
Posts: 32

Posted:

Quote:

Posted By JohnK3 on 04/27/2009 10:18 AM
Mitch,
If your excerpt is all the docs have to say, then yes, I agree with your reading of the quorum requirements. If the 244 then 122 is not achieved, you'd have to start again at the 244 level.

John,

Yes...this is the only section that covers this quorum requirement for a special meeting. Any you have come to the same conclusion that I have. If the second meeting does not have a quorum then you have to start again. If not then what's to stop a 4th and 5th meeting....

Thanks,

Mitch

MaryA1 (Arizona)
Posts: 7,043

Posted:

Mitch,

I agree with JohnK!

It appears to me the Pres is bent on having a meeting with a required quorum low enough to ensure the approval of his pet project. Don't let him get away with this! The bylaws must be adhered to and he cannot just change them at will.

SusanW1 (Michigan)
Posts: 5,202

Posted:

Mitch - establishing a quorum is not the same thing as meeting an amendment or Special assessment requirement, so I'd be sure to re-confirm the VOTE requirement. The quorum just confirms that it is a duly called meeting of the HOA.

No one can force a person to vote at a meeting. That person IS counted as part of the quorum needed to even hold the meeting, but the required VOTE count may be a whole nuther kettle of fish.

Do your bylaws or other documents say anything about the VOTE requirmement for passing a Special Assessment?

GeraldT4
Posts: 1,022

Posted:

MitchM1 - Quorum is established at 60% of 406 homes, which is 244. If quorum is not met than the subsequent meeting must be no more than 60 days later and quorum can then be 30% (1/2 of 60%). Please explain why it is that you think a 3rd meeting can't be held? Nothing in the language prohibits a 3rd subsequent meeting. It is illogical that quorum be further reduced after a second meeting but as written the covenant allows for it in the poorly worded language.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Gerald,

I'm curious to know how you interpret this to mean a third meeting can be held.

It says "another meeting may be called"; if more than one more meeting were allowed to be called, wouldn't it say "subsequent meetings may be called", or something to that effect? But, it only talks about the original meeting and one other meeting which must be held w/i 60 days of the initial meeting. "No such subsequent meeting" (note the singular tense); if more than 2 meetings were allowed, wouldn't it say "subsequent meetings"?

“…the presence of Members or of proxies entitled to case 60% of all votes if each class of membership shall constitute a quorum. If the required quorum is not present, another meeting may be called, and the required quorum at the subsequent meeting shall be on-half (1/2) of the required meeting. No such subsequent meeting shall be held more than 60 days following the preceding meeting.”

MitchM1 (Colorado)
Posts: 32

Posted:

Quote:

Posted By GeraldT4 on 04/27/2009 1:13 PM
MitchM1 - Quorum is established at 60% of 406 homes, which is 244. If quorum is not met than the subsequent meeting must be no more than 60 days later and quorum can then be 30% (1/2 of 60%). Please explain why it is that you think a 3rd meeting can't be held? Nothing in the language prohibits a 3rd subsequent meeting. It is illogical that quorum be further reduced after a second meeting but as written the covenant allows for it in the poorly worded language.

Gerald,

What I was trying to say is that I think you cannot cut down the % again after the 2nd meeting.

I am saying you would have this by the way I read it:

First Meeting: 60%
Second Meeting: 30%
Third Meeting: 60% (start again)
Fourth Meeting: 30%
and so on…

Thanks,

Mitch

GeraldT4
Posts: 1,022

Posted:

MaryA1 - How can you interpret the fact that another meeting may be called to mean another can't be called? It talks about another meeting, not just "one" other meeting. The wording is poor but as such it leaves the process open to a meeting upon "another" "subsequent" meeting. If there was to be a limit, don't you think it would have stated a limit?

GeraldT4
Posts: 1,022

Posted:

Mitch - The purpose of the percentage deduction is to make it easier to achieve quorum. As written you must keep on reducing quorum, not jockey back and forth between a higher and lower percentage. It's more logical to stop at 30% than to keep going lower or to go back to 60% when it could not be achieved in the first place.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Quote:

Posted By GeraldT4 on 04/28/2009 12:42 PM
MaryA1 - How can you interpret the fact that another meeting may be called to mean another can't be called? It talks about another meeting, not just "one" other meeting. The wording is poor but as such it leaves the process open to a meeting upon "another" "subsequent" meeting. If there was to be a limit, don't you think it would have stated a limit?

Gerald,

I invite you to take another look at the article (see below). It says "another meeting may be called" and states the quorum required for that meeting. If more than one other meeting were meant to be allowed, IMO, it would say something to the effect that: "If the required quotum is not present, additional meetings may be held unil a quorum of XX% is achieved." IMO, it's very clear that only one more meeting may be held, the quorum of which is 30% and must be held w/i 60 days of the initial meeting. The sentence "No such subsequent meeting" pertains to the second meeting with the reduced quorum. The purpose of this sentence is to only state when that second (subsequent) meeting shall be held.

“…the presence of Members or of proxies entitled to case 60% of all votes if each class of membership shall constitute a quorum. If the required quorum is not present, another meeting may be called, and the required quorum at the subsequent meeting shall be on-half (1/2) of the required meeting. No such subsequent meeting shall be held more than 60 days following the preceding meeting.”

MitchM1 (Colorado)
Posts: 32

Posted:

MaryA1:

I agree with you.

When I read the line "another meeting may be called" it tells me ONE other meeting can be called.

If it said "additional meetings may be called" then sure...have as many as you want.

The way I see it is this was written by lawyers who are usually pretty anal (in a good way) and if they meant more than two meetings they would have stated so.

I will be sure to post what happens.

Thanks,

Mitch

MaryA1 (Arizona)
Posts: 7,043

Posted:

Mitch,

All I can say is:

Great minds think alike! :-)

DwightT (Idaho)
Posts: 664

Posted:

I agree with Gerald on this. The President (or whoever else is authorized to call a meeting) can keep calling as many meetings as they want. Even if they actually manage to have a full quorum and lose the vote they could still call another meeting. At least until the membership gets tired of it all and votes to remove them.

The only real question is what would the quorum requirement be for the third and subsequent meetings? To me it looks like it could either be back to the 60% level for every odd-numbered meeting (start the whole process over again) or it would go to 50% and stay there. It would never drop below the 50% level. Personally I would lean towards the starting over interpretation.

As to Mitch's comment about lawyers having written the verbiage and stating what they meant - don't count on it. There is always the obvious implication of poorly worded CC&Rs keeping attorneys employed for a long time. But even beyond that, remember that in every graduating law school class there is somebody who was at the bottom of the class. He's probably the guy who got handed the job of writing CC&Rs.

MitchM1 (Colorado)
Posts: 32

Posted:

Quote:

Posted By DwightT on 04/28/2009 1:36 PM
I agree with Gerald on this. The President (or whoever else is authorized to call a meeting) can keep calling as many meetings as they want. Even if they actually manage to have a full quorum and lose the vote they could still call another meeting. At least until the membership gets tired of it all and votes to remove them.

The only real question is what would the quorum requirement be for the third and subsequent meetings? To me it looks like it could either be back to the 60% level for every odd-numbered meeting (start the whole process over again) or it would go to 50% and stay there. It would never drop below the 50% level. Personally I would lean towards the starting over interpretation.

As to Mitch's comment about lawyers having written the verbiage and stating what they meant - don't count on it. There is always the obvious implication of poorly worded CC&Rs keeping attorneys employed for a long time. But even beyond that, remember that in every graduating law school class there is somebody who was at the bottom of the class. He's probably the guy who got handed the job of writing CC&Rs.

I am totally ok with having a zillion meetings about the same issue, I just don't think the quorum should be halved more than once. Of course each meeting announcement has to be mailed and that starts to add up after a while.

If a third meeting is called, I think it must me treated as a first meeting and the quorum is back to the 60% level.

Which goes back to:

First Meeting: 60%
Second Meeting: 30%
Third Meeting: 60% (start again)
Fourth Meeting: 30%
and so on…

Your comment about someone having to graduate last made me laugh!

Mitch

MaryA1 (Arizona)
Posts: 7,043

Posted:

Dwight,

You wrote: "The only real question is what would the quorum requirement be for the third and subsequent meetings? To me it looks like it could either be back to the 60% level for every odd-numbered meeting (start the whole process over again) or it would go to 50% and stay there. It would never drop below the 50% level. Personally I would lean towards the starting over interpretation."

I follow what you're saying until you get to: "or it would go to 50% and stay there." Where does that come from? I don't recall seeing a 50% requirement anywhere in the CCR provision Mitch posted. The CCRs provide for only 2 meetings, the first with a 60% quorum and the second with 30% and the second meeting must take place w/i 60 days of the first meeting. And that's it! Only two meetings -- PERIOD. If the board wants to try again, I tend to agree with your last statement.

DwightT (Idaho)
Posts: 664

Posted:

From Mitch's original post:

Quote:

If the required quorum is not present, another meeting may be called, and the required quorum at the subsequent meeting shall be on-half (1/2) of the required meeting.

1/2 is 50%. I just didn't say 50% of what. The bit that Mitch posted doesn't say anything about any meetings after the second, so I think that is where the confusion is happening here and where Mitch's Board President is playing loose with the interpretation. But as I mentioned though, I agree that if they fail to get quorum at the second meeting then they need to start the process all over again, so the quorum requirement goes back to 60%. I just also happen to see how somebody could interpret it the other way.

But one of my favorite quotes is "Be reasonable - see it my way!"

MitchM1 (Colorado)
Posts: 32

Posted:

Quote:

Posted By DwightT on 04/29/2009 10:37 AM
From Mitch's original post:

The bit that Mitch posted doesn't say anything about any meetings after the second, so I think that is where the confusion is happening here and where Mitch's Board President is playing loose with the interpretation. But as I mentioned though, I agree that if they fail to get quorum at the second meeting then they need to start the process all over again, so the quorum requirement goes back to 60%. I just also happen to see how somebody could interpret it the other way.

Dwight,

There is nothing else written about a second meeting, just that one paragraph. And because there is nothing else about what happens after a second meeting, I think if you want to have another meeting then everything resets and the quorum is back to 60%.

Thanks,

Mitch

DonnaS (Tennessee)
Posts: 5,671

Posted:

Mitch,

They can call a "zillion" meetings but----"No such subsequent meeting shall be held more than 60 days following the preceding meeting.” So you will be hard pressed to get them all in within the 60 day timeframe limit.

Reducing the quorum percent is where this is screwed up as we all know. You can have subsequent meetings within the 60 day limit. Meeting one @ 60% for a quorum, meeting two @30%.. THIS WE KNOW FOR SURE.

Meeting three " and the required quorum at the subsequent meeting shall be on-half (1/2) of the required meeting." That is either 50% of the original membership(244) OR 50% of the 30% from the 2nd meeting which is 122. Now that would be either 244(50%) or 30% of 244= (61)

This is like a Rubiks cube.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Quote:

Posted By DwightT on 04/29/2009 10:37 AM
From Mitch's original post:

If the required quorum is not present, another meeting may be called, and the required quorum at the subsequent meeting shall be on-half (1/2) of the required meeting.

Dwight,

I got a chuckle out of your favorite quote; it brought back memories. When I was a Branch Chief of an Army Finance Office I always told the GI's working for me that we'd get along just fine if they remembered that I'm always right -- even when I'm wrong. LOL

But, getting back to the topic at hand. The portion of the CCR article which says: "quorum at the subsequent meeting shall be one-half (1/2) of the required meeting." means one-half of the required 60% quorum for a meeting making it a 30% quorum. A 50% quorum is never mentioned anywhere or even alluded to. Nice try, but no cigar. Frankly I think Mitch's Pres is just trying to find a way to hold the meeting because of uterior motives

MaryA1 (Arizona)
Posts: 7,043

Posted:

Quote:

Posted By DonnaS on 04/29/2009 11:06 AM

Mitch,

They can call a "zillion" meetings but----"No such subsequent meeting shall be held more than 60 days following the preceding meeting.” So you will be hard pressed to get them all in within the 60 day timeframe limit.

Reducing the quorum percent is where this is screwed up as we all know. You can have subsequent meetings within the 60 day limit. Meeting one @ 60% for a quorum, meeting two @30%.. THIS WE KNOW FOR SURE.

Meeting three " and the required quorum at the subsequent meeting shall be on-half (1/2) of the required meeting." That is either 50% of the original membership(244) OR 50% of the 30% from the 2nd meeting which is 122. Now that would be either 244(50%) or 30% of 244= (61)

This is like a Rubiks cube.

Donna,

No, no, no! The CCR provision only allows for two meetings. The "subsequent" meeting means the second meeting. The provision only talks about one subsequent meeting. And the statement: "the required quorum at the subsequent meeting shall be on-half (1/2) of the required meeting." means one-half of 60% which is the requirement of the "required" (the first) meeting. There is no 50% quorum allowed for any meeting! According to the CCR provision the quorum for the first meeting would be 244 (406 (membership) x .60) and the quorum for the subsequent meeting would be 122 (406 x .30). As I've stated repeatedly, the CCR provision only allows for two meetings -- period.

DwightT (Idaho)
Posts: 664

Posted:

Quote:

Posted By MaryA1 on 04/29/2009 12:44 PM

But, getting back to the topic at hand. The portion of the CCR article which says: "quorum at the subsequent meeting shall be one-half (1/2) of the required meeting." means one-half of the required 60% quorum for a meeting making it a 30% quorum. A 50% quorum is never mentioned anywhere or even alluded to. Nice try, but no cigar. Frankly I think Mitch's Pres is just trying to find a way to hold the meeting because of uterior motives

Mary - I haven't disagreed with you. I was being just lazy in my posting. As I said in my second post, when I mentioned 50% in my first post, I didn't say 50% of what. I know that it's supposed to be 50% of the original 60%, which means that quorum for the second meeting is 30% of the total membership. And that should be enough %s to confuse everyone.

And I agree that Mitch's pres is being creative for his own motives. But just for fun, lets let him get away with it. That would mean that he can keep calling meetings with the quorum for each meeting being 50% of the previous meeting, until eventually he gets to a meeting of 1 where he can pass his measure all by himself. Of course, that means that anybody else who is authorized to call a meeting (other Board members? some number of homeowners?) can play by the same rules, so they can keep calling recall meetings until they get the "quorum" they need to kick the Pres out (and revoke his pet project).

Seems fair to me.

MitchM1 (Colorado)
Posts: 32

Posted:

Yes...the President is being creative for his own motives. The other two board members are getting fed up with his antics.

They can vote him out if they want, but I doubt they will do that.

I will be running for Board President next April when his term is up.

I will update everyone with what ever the final decision is.

I appreciate all the input I got from everyone.

Thanks,

Mitch

MaryA1 (Arizona)
Posts: 7,043

Posted:

Dwight,

You are tooo funny!

Sorry I misunderstood you. :-(

KirkW1 (Texas)
Posts: 1,665

Posted:

Get busy and start collecting proxies. Then you can vote the whole thing down and stop it in its tracks anyway. But I would agree with the original post that you start with a need for 244 and then cut to 122.

Chances are that if you can get a lawyer to write a letter to the president with the same view and intent to follow up that she will back down.

MitchM1 (Colorado)
Posts: 32

Posted:

Quote:

Posted By KirkW1 on 04/29/2009 8:57 PM
Chances are that if you can get a lawyer to write a letter to the president with the same view and intent to follow up that she will back down.

I think I may just do that...thanks for the suggestion.

Mitch

MitchM1 (Colorado)
Posts: 32

Posted:

UPDATE:

One of the Board members emailed me this last night and I have to say that it further proves my point that OUR covenants do not allow a third meeting were the quorum would once again be cut in half.

*********************************

I have been doing some research and have found other associations that are somewhat similar in such that they reduce the percentage of people or proxy’s required for each subsequent meetings.

*this is the example he sent me AND NOT our covenant.

Notice and Quorum. Written notice of any meeting called for the purpose of taking any
action authorized herein shall be sent to all members, or delivered to their residences, not
less than thirty (30) days nor more than sixty (60) days in advance of the meeting. At any
such meeting called, the presence of members or of proxies or voting representatives
entitled to cast two-thirds (2/3) of all the votes of each class of membership shall
constitute a quorum. If the required quorum is not present, another meeting may be
called subject to the same notice requirement, and the required quorum at such
subsequent meeting shall be two-thirds (2/3) of the quorum requirement for such prior
meeting. The Association may call as many subsequent meetings as may be required to
achieve a quorum (the quorum requirement being reduced for each such meeting). No
such subsequent meeting shall be held more than sixty (60) days following the preceding
meeting.

*********************************

I pointed out to him that this line "The Association may call as many subsequent meetings as may be required to
achieve a quorum (the quorum requirement being reduced for each such meeting)." does not exist in our covenant and that his example does nothing but further my case against them.

He responded to my email but did not comment on my comment regarding this...sure sounds like someone put their foot in their mouth and just realized it?

Mitch

MaryA1 (Arizona)
Posts: 7,043

Posted:

Mitch,

Be thankful this provision is NOT in your CCRs! Depending upon what the vote % is (and in many instances it's based on the number of members "attending" the meeting), the board could continue to call a meeting every 60 days and reduce the quorum requirement by 2/3 each time until they achieve their purpose. In the end it could be just the board voting on a very important issue; depending, of course, on the apathy of the membership! I know this may sound far-fetched but I've learned to never say never! LOL

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