Questioning Amendment Approval

I used to serve on the Board of Directors, but resigned about 2 months ago. Our by-laws state that there will be 3 directors, but an amendment among the management company's paperwork that was apparently approved in 2003 states that there will be 5 directors.

I have searched the Land Records here in MD and cannot find any record of this amendment being legally recorded among our documents. I also purchased my home in 2007 and was given a copy of the documents as per the laws in the state of MD. This amendment was not among my documents.

The amendment I received from management states "The foregoing amendment to By-Laws was approved by Owners having the requisite number of votes of quorum of the Owners present at the meeting in person or by proxy." Our By-Laws require a 90% approval of all Owners for amendments. We have trouble getting the 10% quorum at our annual meeting because people just don't care to attend or even fill out and return their proxy. The way I read the amendment is that it was approved based on a 90% vote of the people present at the meeting which is a clear violation of our by-laws.

Does anyone else read this the way I do? How can we as Owners ask for verification of this amendment vote? Since this vote was taken, the community has changed management companies at least 4 times. This leaves the board with limited access to any proxies on file from 2003.

The remainder of the board may not be able to fill the remaining 2 slots. No one comes to the meetings and no one wants to be on the board. They are asking me if I could look into this document because I have knowledge on accessing the Land Records. They would prefer to keep the board at 3 members if this amendment was not approved properly, which I don't think it was.

Thanks for any and all feedback.

Christina, I would first look at your Ariticles of Incorporation (if you are incorporated) to see what they state the number of Directors. The Articles overrule your By-laws so their limits the number of directors applies.

Whether or not this resolves the required number of directors, you should try to amend the By-laws if they really require 90% approval of all members. Try to amend to a reasonable number - such as 2/3 of the members voting to approve at a duly called meeting. If this is approved the Articles of Incorporation should be amended as well.

Jeanne,

We are an HOA and in completely reviewing our documents over the last few days I have found that the Amendment was voted on and apporved in accordance with the regulations, however it was not recorded.

In addition, the Articles of Incorporation also states that the # of BODs can be changed by an Amendment to the By-Laws.

This now limits the board to proving this Amendment was not recorded so they don't have to put additional people on the board. The only people volunteering are people that the board doesn't want on the board, but if the MUST have 5 people they will HAVE to put them on the board if they are the only choices.

Can you offer any additional information? The meeting is Jan. 11.

Thanks

The problem is that no one wants to be involved. The only woman that wants to volunteer at this point has made statements at meetings concerning the poisoning of neighborhood dogs or other methods of harm to keep them off her property. I don't want a person on the board with these types of views and neither does anyone else.

We are also a Townhouse community and we are at 52% rentals and about 3% foreclosures or shortsales. And the tenants don't seem to care. We are located well outside the DC area and most of our residents commute to DC or even Baltimore and don't want to spend any of their very limited time working on HOA stuff.

A friend of mine and I have been looking through books of code here in MD and it does state that amendments must be recorded, but it doesn't specify whether they pertain to Covenants, Articles or By-Law amendments.

In MD, an amendment is invalid until such time as it is recorded with the state. Our hope is to use this grey area to persuade the board to record the amendment giving the current board additional time to find more volunteers. Our argument is that since the amendment is to the ByLaws but is in direct conflict with the Articles of Incorporation, it should be among the documents given to Homeowners, which is required by law here in MD.

Christine, Is it possible you have a working relationship with the board that would allow you to be appointed by the Board as a special officer of the Board to research, which you have done, the problem and put you on the agenda for the annual meeting or Board meeting? It appears this failure to register the amendum has put the Board in a vulnerable position. It also appears if you don't effect the change, it won't get done. You are much too knowledgeable to let all this go done the drain and the same for your friend.You also have the option, as far as I know to make a motion at an annual owners meeting, get your friend to second it and force a discussion and vote.

I'm missing something, I think.

Why would one want to limit the number of warm bodies on a board of directors?

It would seem to me that the more people doing the work of the association, the better.

Did I misread something along the lines?

I would always vote for a board of 5 over a board of 3.

Now, that doesn't mean you HAVE to fill all 5 positions, does it?

In our HOA, the bylaw that addresses number of directors reads something like, "No fewer than 3 and no more than 9."

A board of 3 to 5 would be nice, if people will step up to fill the 5 slots, don't you think?

Well, then, Christine, that's your real concern.

I would not mess with the number of board members. It is what it is.

And "could lead" to tie votes does not in any mean it necessarily will lead to tie votes. If you have a 5-member board and one director needs to abstain for some reason or another, you'd have the some potential.

An even number is not necessarily the best scenario, but, in my experience, given the relatively few significant things that directors really truly have to "vote" on, even numbers won't necessarily hamper anything.

The thing is, you shouldn't change your documents simply because you are afraid of a particular director. The documents should be held separate from the personalities that could or might fill the roles.

It would seem to me that the more prudent course would be to begin a campaign to remove this pet-hazard from the board.

Christina,

If your only concern is WHO is serving on the board not the number of board members then what you can do is lobby for those people who you think should be on the board. The members elect the BOD and if the majority who are voting vote for someone you don't like that's tough. Sorry to sound so harsh but it's a fact of life. The candidates we want in office don't always get elected -- it happens at the federal, state and local level so it's understandable that it also happens in HOAs.

If your bylaws state the board shall have 5 members but you can't get enough members to run for the open position, then the board is automatically reduced. There is nothing that can be done about this. Some bylaws will state not less than 3 or more than 5 and that it must always be an odd number. When there are vacancies most bylaws allow for the BOD to make appointments. Perhaps your bylaws need to be amended again!

Christina, the remaining Board members chose who they appoint to the Board. It doesn't matter whether she is the only volunteer, a majority of the Board would still have to vote to appoint her.

Just because someone volunteers does not mean the board is obligated to appoint her.

It is their option.

Frankly, I would vote no.

The thing is, however, this may be a moot point.

If she ends up nominating herself for the next general board election, unless you get 5 other people to run, making her number 6 on the slate, she's likely to be elected anyway.