Board action outside of meetings

Started by PaulC4 • 11 replies • 3463 views

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PaulC4 (Pennsylvania)
Posts: 13

Posted:

I am a member of a five member HOA Board. Our monthly meetings are open to the membership. Our president has adopted the practice of polling board members via email in the interim between meeting for consensus to give notice to contractors of the intent to award a contract for services and, that the contractor would be given the go-ahead to begin the work. Her idea being that we would adopt a resolution at the subsequent meeting to ratify the agreement.
I contend that HOA Boards are a "body politic" and that we only have the authority to conduct the business of the association when we are convened at a duly constituted meeting of the association.
I also believe that if this practice is not downright illegal ( I can't cite a specific law), it is, at best, highly unethical.
We have utilized the so-called "work session" prior to the regular Board meeting and, when called for, the "executive session".

I would appreciate being enlightened as to this specious practice.

Paul in PA

SusanW1 (Michigan)
Posts: 5,202

Posted:

Yes, there is such a thing as a meeting without a meeting, where a decison is ratified at the next meeting, but it is usually for emergencies. Hiring a contractor doesn't meet the criteria (UNLESS is was an emergency, like broken pipes or roof cave in)

Your president needs to be reminded that motions to spend HOA money need to be a open meetings.

The process is motion made, seconded, debated, voted on. - all recorded in minutes.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Paul,

In states where there is no open meeting law (meaning business is conducted in the open and members have the right to attend and in some instances also have the right to speak before issues are voted on), and the bylaws are silent on this issue, the board may conduct business by email or outside of a regular meeting. In other words they may conduct the business of the assn how ever they so choose.

Since your meetings are open to the members, polling the members b/4 the meeting and/or taking actions outside of a meeting could be construed as operating in secret. When a board is perceived to be operating in secret it only serves to cause dissension in the community.

JonD1
Posts: 2,350

Posted:

Paul:

Just wondering how long have you held a position on your Board?

I have no idea where or how the concept of "body politic" applies under Pa. state law. As it refers to government or political states not condo or HOA Boards.

Does this term exist in your governing documents? Is it mentioned in the state laws governing condo and HOA operation? I was unable to find it.

Do your documents require open meetings? Under Pa. it appears to require just one meeting per year not one each month.

Also under Pa. state law it gives the association the power to make decisions regarding the operation of the property in many aspects.

How many e-mail polls have taken place with your Board? And what type of decisions are made and whay type of contractors are you discussing?
Does this happen once per month? Or a few times each year?

Have any of the other Board members expressed concern as to this behavior? How long has this occured? And what questionable motivation have you determined is responsible for the Presdient's actions in this matter?

Here in NY we are not required to hold open monthly meetings rather one annual meeting each year. That results in the Board making many decisions without the input or knowledge of the unit owners. I myself prefer this system as it allows the members of the Board the ability to make decisions as they should be more knowledgable as to the details and permits us to get things done at meetings, between meetings and as mentioned in emergency situations when decisions need to be made ASAP.

I would suggest you review your documents, Pa. state law that pertains to your type of property and determine what the Board is empowered to do and what they are required to do in regards to making decisions within the official meetings or between meetings via phone, e-mail or any other communication. Before you assume this behavior is in fact questionable.

PaulC4 (Pennsylvania)
Posts: 13

Posted:

Susan, Mary and Jon, thank you for taking time to respond to my query. All of your comments are most helpful.
I should have scoured our governing documents more thoroughly prior to posting my question. On a closer look I found the following by-law:
"Subject to the provisions of 15Pa.C.S.A. P5763, despite anything to the contrary in these By-Laws, The Articles of Incorporation or the Declaration, the entire Board of trustees shall have the power to take action on any matter on which it is authorized to act, without the necessity of a formal meeting and vote, if the entire Board, or all the Trustees empowered to act,whichever the case may be, shall consent in writing to such action".
A review of the Articles of Incorporation and the Declaration reveals nothing "to the contrary".
Since 1988, I have been a member of no fewer than five planned communities. Until two years ago I eschewed positions on the Boards, choosing rather to perform my civic duty by serving on committees. As an active sailor, I did not want to commit myself to a schedule of meetings lest I should miss a good sailing opportunity. In all of these experiences,I never saw important business being conducted so casually,
unless, as Susan pointed out, "in an emergengy situation".
I guess my concern stems from having served thirty-eight years in the
public sector where we are generally held to a higher standard of ethical conduct.
Once again, I'm grateful for your input; it will be most valuable.
Paul in PA

RichardP13 (California)
Posts: 1,767

Posted:

I agree 100% with Jon. Matter of fact, I think our government in Washington should run just like a HOA Board. I would welcome 38% Federal Income Tax, 12 State Income Tax, 9.75$ County Tax and while we are at it, maybe throw in a 20% increase every year. Count me in.

JonD1
Posts: 2,350

Posted:

Paul:

So it seems your President is in fact operating correctly, legally and in a ethical manner under your by-laws and Pa. state law.

The Board of a condo or HOA is in fact NOT a governement agency and is not operated under laws specific to these types of governement operation.
In most cases they are corporations and operate under guidelines set within your documents of state law.

I simply don't understand how you determine that the requirements placed on the operation of government entities becomes more ethical. But rather simply more comfortable to your personal taste.

Most Boards are elected to manage the affairs of the property they serve. They are empowered with the ability to make decisions as set forth in the documents how that is less ethical is lost on me.

And in these times when many levels of government find themselves broke, unworkable, and unproductive even with their ethical standards I wonder just how all that ethics is working in most cases?

PaulC4 (Pennsylvania)
Posts: 13

Posted:

Jon,
I suggest you read the By-law more carefully. Quite to the contrary, the president is in violation of the By-law.
"Consent in Lieu of Meeting and Vote" is permissable only if the entire Board shall consent in writing to such action. I have no intention of giving consent to such chicanery.

JonD1
Posts: 2,350

Posted:

So Paul you are going to withhold your consent just to prevent the Board from making a decision that might be serving the common good because in your opinion it is unethical or whatever you name it.

Please let us know how that works for you. Let us know how that is recieved by the other members of the Board.

And good luck.

KellyM3 (North Carolina)
Posts: 2,239

Posted:

Paul,

If you don't give your consent, and your by-laws require 100% feedback for written votes, then the board shouldn't proceed with letting the contract until the following meeting. However, if the work is being completed at the best value for the job and this is history of your board, I wouldn't call it "chicanery" - at least not in an open meetings as it's accusatory and not necessarily reflective of malicious intent. That only deals you a heap of ill-will with board colleagues whose help you may need. Bring up the by-law and ask that the board keep its word to its investors/dues payers. They should heed if they're ethical.

Often times, however, the "don't do anything unless we vote on it" positions tend to flow down to menial, daily management issues where small sums of money are spent to keep property amenities in top shape and can interfere with the property manager's job. A broken window can't be fixed because "the board must vote" in spite of the common sense nature of the property maintenance need.

Tread lightly, as it's a fine balancing act but contracts shouldn't be authorized for non-emergency projects until reviewed in open meeting, discussed and approved. Also, debate-by-email cultivates the finest in passive-aggressive behavior on behalf of arm-chair quarterbacking board members who complain and complain until the projects gets dropped in their lap, at which point, they're too busy.

DennisT (Ohio)
Posts: 109

Posted:

To Kelly's point, the other issue with debate-by-email is that a verbatim record of the board's deliberations now exists and could conceivably be subpoenaed by a disgruntled contractor or association member.

When I was on the board I had no problem telling the others that I wasn't comfortable discussing such and such issue via email because I felt it was too complex to accurately discuss in such a manner. At that point the discussion ceased until the next meeting. Interestingly after I started doing that several other board members started doing it as well on other issues. I think everyone wanted to be agreeable and until I put my foot down on something they were afraid of being perceived as disagreeable.

We eventually got to the point where the common sense items were done by email and the larger issues automatically went the next meeting. The only mention by email would be the president saying "I'm going to put the snow plow contract on the agenda for next week. Here are the three bids we received. Please review and be ready to discuss."

PaulC4 (Pennsylvania)
Posts: 13

Posted:

Hi, Kelly,
I was fully prepared to leave off any further interaction on this discussion but your sound assessment of this situation and suggestions beg a response.
Yes, the term chicanery is too strong but it was provoked by a supercilious
response to a serious question.
This matter has been discussed with the Board but, they are led by the pres. into believing they are in compliance with the By-Law. As of today, two other members see how their actions are at variance with the By-Law; one of whom proposed a vote to allow this activity.
I will vote to allow this action only in case of dire emergency.This would have to be a carefully circumscribed set of circumstances.
I probably would not be as upset about this if it were not that the system is being abused. There were three such email votes to let contracts since our July 20th meeting. In one case, deliberarion have been going on for eleven months; another, three months. You wouldn't believe the amount of email correspondence this activity generates. What's another two weeks?
The agreement with our management company allows the property manager to make unbudgeted expenditures up to $500.00 for maintenance and repairs. So,
you see, mechanisms are in place to prevent grid-lock.
I did not accept a position on this Board expecting it to be a full-time job (Iwas just re-elected to a two year term). As a retiree (I reside in an over 55 community)I like to travel as much as I can. Unlike many younger people, I am not a slave to my computer, blackberry or whatever.
I do not monitor my email when I am away. I just think others should give it a rest as well. The Associations business will get done.
By the way, my first two encounters with HOA's was in N. Carolina. They did
not conduct legal business in the manner I am experiencing.
Thank you ,Kelly, for your kind response.

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