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Subject: Election of BOD using proxies

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WilliamG1
(Florida)

Posts:1

06/13/2006 1:58 PM
I am a member of a 250 parcel HOA in Florida. Our Bylaws state that Directors shall be elected at the annual general meeting, with voting by person or proxy. At the meeting, anyone can nominate themselves from the floor. There is no mention in Florida law (that I know of) or in our governing documents allowing or forbidding absentee ballots. Otherwise, we are governed by Robert's Rules. For at least the last ten years (and probably going back decades more), we have allowed absentee ballots to be used to give out-of-town members the opportunity to cast votes for specific candidates. Our absentee balloting procedure included safeguards which essentially treated the ballots equivilently to proxy provisions of state law. Does anyone know whether Florida law defines a proxy as excluding absentee ballots? Specifically, does any statute/ruling/precedent speak to the use of absentee ballots in HOA BOD elections? This year, without any discussion, the BOD president unilaterally decided not to use absentee ballots. He received advice from a new association attorney directing him to mail out only proxy forms which allowed the parcel owners to either appoint the board secretary as their proxy, or to name someone else. The attorney specifically said not to include an absentee ballot. Nothing was mentioned in the mailing about the possibility of writing on the proxy form directions for how the proxy should vote for specific directors. The secretary was instructed by the board to cast each proxy's votes (seven for each proxy) such that each of six sitting directors who were running for reelection received a vote, and then to split the remaining vote evenly between each of two new candidates. In defending the sudden change, the president claimed that almost all boards were elected without the use of absentee ballots. I believe he is totally incorrect on this point. However, I have nothing to back up my opinion except I know that every corporation in which I own stock has directions and provisions on their proxies which allow me to vote for or against specific candidates. Further, I believe the new procedure essentially disenfranchises residents who are out-of-town. This segment of parcel owners previously comprised roughly 50% of all parcel owners who voted. Non-board members can't correspond with the attorney without the president's permission. I understand that an association's attorney can effectively only take direction from the board. What could have been the attorney's rationale for this specific advice? Doesn't an attorney for an association have an ethical responsibility to affirmatively act for, and to provide advice which protects, the common interests of the parcel owners as a whole? That is to say, the attorney is the lawyer for the "association", and not for the "board". Shouldn't the attorney act or give advice to protect the interests of the "association", even if it potentially conflicts with the interests of the "board" or its individual members? After all, the board has D&O insurance to protect them. Comments?

SwanB
(Washington)

Posts:194

06/15/2006 6:22 AM
I will take a stab at this one: First off it is customary for the association's attorney to only communicate with the Board. In our HOA, the attorney communicates with our Legal Director not our President. The communication is limited because an attorney charges exorbirant amounts of money per minute to talk to anyone. Would your association really want any member to have access to an attorney at over $270/hour? tick, tock, tick, tock Also, you don't give us the exact wording in your governing documents on the issue of using proxies for voting. The attorney could be interpreting the wording in your document to the President's 'self-serving' satisfaction. Our bylaws allow proxies at our AGM where our Board elections occur. Therefore, anyone holding a proxy or a number of proxies during the election has the right to use them and it would take a Bylaw amendment voted on during the AGM to change or alter or delete that right.

RogerB
(Colorado)

Posts:3726

06/15/2006 8:32 AM
William, I think the President made an error in judgement to unilaterally make this decision. The Board should have made this decision. But I concur with the attorney's advise not to send out ballots. I do not concur with the attorney IF he advised on the procedure described for the proxy (it is difficult to believe this is true). The proxy should only allow assignment to another person or member as defined in the association's Declaration or By-laws. Directing a vote to the secretary and having the Board direct how to vote the secretary's proxies is a NO NO IMHO. This creates an unfair advantages for current Board members.

Roger Borcherding Official HOATalk.com Sponsor DARCO Property Management (Colorado) (303) 925-0150 *See legal notice below (end of page) or go to www.hoatalk.com/legal

MikeS1

Posts:0

06/15/2006 8:46 AM
Roger, Ok, I'll bite. If members assign their proxies to the secretary as uninstructed, I thought that the BOD always decided on how the votes were to be allocated. If they not supposed to do so, then WHAT exactly determines WHO gets the votes? What mechanism governs how the uninstructed ballots are allocated? Any ideas? Golly, I think that proxies are subject to so much fraud and I see where a lot of states are banning them by statute. Last year, we had a special vote and although the proxy rules stating that no member could hold more then 5 'directed' proxies, that didn't stop several members from going door to door collecting proxies, and then they mailed them into the MC as if they were coming from each member. There's GOT to be a better way to conducting a vote. Maybe the internet and a verifiable software solution? Butterfly ballots and punch cards?

RogerB
(Colorado)

Posts:3726

06/15/2006 8:57 AM
William, since your documents state the means of voting, that should be followed. You can have a directed proxy otherwise you must trust the person to whom the proxy is given. If you have a problem with fraudulant signatures which can be substantiated I suggest a very stiff special assessment (in Florida) or a stiff fine (other places) to the guilty party. Is there really that much corruption in Florida

Roger Borcherding Official HOATalk.com Sponsor DARCO Property Management (Colorado) (303) 925-0150 *See legal notice below (end of page) or go to www.hoatalk.com/legal

SwanB
(Washington)

Posts:194

06/15/2006 8:57 AM
I am the Secretary of the Board and two members have signed their proxies over to me. However they didn't sign them over to me as Secretary, but me as fellow member and were specific about that. Personally, I would prefer not having any proxies to deal with at the meeting because I don't think this looks good but that is my opinion. I have contacted the two members and asked if they would consider signing their proxies over to other members.

JulieS
(Georgia)

Posts:412

06/16/2006 7:41 AM
I have had neighbors sign their proxies over to me personally to cast their vote. It is not because I am a board member but they know I am active and they trust my judgement. We had a special meeting last year to remove board members...I was removed by the exact number of votes because a lady went door-to-door every night collecting proxies from homeowners. In speaking with people, I have heard the lies she told them and a number of them admitted to just giving her their proxy so she would stop knocking on their door. Some say she terrorized the neighborhood. It was awful I like the idea of limiting the number of proxies...but I'm sure she would have found the 15 or so required to bring them to the meeting, but maybe not as there were not that many people at the meeting!

JulieS
(Georgia)

Posts:412

06/16/2006 7:45 AM
Mike...I was just reading an article in our attorney's newsletter about internet/web voting for annual meeting elections. It is out there and available, but of course you still need to do it the old fashioned way as not everyone is internet savy. Apparently, there are companies that only do this type of thing, either through their a site set up for this or your HOA's website.

MikeS1

Posts:0

06/16/2006 7:52 AM
Julie - This sounds so very familiar. Even if you limited the number of "instructed" proxies to per se 5; this still doesn't prevent someone from going door to door, collecting more than 5, (Say 53) and then just mail them into the MC in separate envelopes so that it looks like each homeowner sent in each proxy individually. Although, I'm a committee chair and not on the Board, I've personally heard this proxy solictor lie about the BOD and many of my neighbors signed the proxy in order to just get her out of the doorway. I still say that proxies are a bad idea and there really should be a better way to do this. I'm looking for newer techonologies to help provide a solution sometime in the near future.

JulieS
(Georgia)

Posts:412

06/16/2006 9:36 AM
We have 137 homes and she came to the special meeting with 65 proxies....the 'majority 2/3 eligible vote' at the time. But I'm back now!

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