Executive Session - Minutes

Started by JoyceS1 • 12 replies • 2229 views

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JoyceS1 (Indiana)
Posts: 140

Posted:

This week the BOD received a letter from a homeowner falsely accusing the husband of the president (me) of performing maintenance. The letter also attacked (me) the president in generalties, not specifics.

Along with other business before the board, I chose to address that letter in executive session. Now, the secretary needs to prepare the minutes and neither of us are sure how to handle that portion of the meeting in the minutes.

Can anyone help?

JulieS (Georgia)
Posts: 412

Posted:

I would just state that the BOD went into executive session and nothing more, or 'to discuss letter from homeowner'.

WilliamT (Arizona)
Posts: 489

Posted:

Minutes of an executive session are written up the same as minutes of the regular meeting. It should reflect the action (resolutions) taken, and/or a note that a particular discussion took place if there was no action on the subject of discussion. The details of the discussion should not be made.

The executive minutes are not published. They remain available only to board members. Every person (usually only board members) present during the executive session must be made aware that the discussion in the meeting are secret and may not be disclosed to anyone.

I question why you would deal with this complaint in executive session. A person has written a letter to the board complaining about a board member.

If the board decides to take action on the letter, then it should be read in open session because it is a complaint about a board member(s) from a home owner. If the recipients of the complaint wish to respond to the letter, then the response should also be in open session.

This is a home owner complaining about a board member(s) so that should be dealt with in open session.

If a board member is complaining about the job performance of another board member, or an individual employee of a management company or vendor, then that must be dealt with in executive session (according to Arizona law) Your state laws may be different, and as President of the HOA you need to know them.

GeraldT1 (<Not Specified>)
Posts: 519

Posted:

JoyceS1,

Did the letter seek a board resolution? If so, you'd need to recuse yourself from a motion of the drafting of same. However, I'd structure the minutes as follows:

New Business:

A letter was received by the BOD members via US post from name of unit owner on such and such a date. The contents of which are made part of the official minute book. The President addressed receipt of the letter resolution, of which is as follows:

Example. To inform the unit owner of receipt of the letter, thanking the owner for her concerns and that the information contained therein is not association related. However, in furtherance of resolving the owners concerns, the letter will be placed on the board's next executive agenda, as an opportunity for the owner to address any matter relating to same. However, the board suggests the owner resolve the matter neighborly with the individuals concerned.

Best of luck!!
GeraldT1
NNJ

GeraldT1 (<Not Specified>)
Posts: 519

Posted:

I agree with WilliamT on discussing the matter in open rather than executive.

However, executive minutes may or may not be published.

While this is a digression to the original post, it is to address a comment by WilliamT.

There are many communities including mine, where owners are permitted to listen only during executive and workshop meetings. All meetings in my community are open. The purpose is to invite owners, increase participation, and give the board the ability to vote during executive and workshop meetings. My community is only three years old, going through transition and there are very important matters the board needs to ratify during the month and can't wait for the next technical "open meeting". It was necessary to open all meetings.

If all meetings of your community are open to owners to attend, including executive, you may be required to publish those minutes or at least make them available for unit owners upon request. I'm not advocating this procedure, just stating a fact in my community and New Jersey State Law.

In NNJ State Law, minutes of all open meetings must be taken, ratified at the next open meeting, and posted soon thereafter. See the link:

http://www.state.nj.us/dca/codes/newhome_warranty/assoc_regs_initiative.shtml

GeraldT1
NNJ

WilliamT (Arizona)
Posts: 489

Posted:

Gerald,

Both our Master Association Board and our sub-association board have executive sessions immediately following the regular open meetings. They take a 5 minute recess to allow the members time to leisurely leave the meeting room before going into executive session.

Below is the Arizona statute regarding closed meeting. It seems that the purpose of the closed session is to avoid embarassment to anyone and to maintain privacy for an individuals personal, financial and health information as well as to follow legal advice and keep pending litigation matters private.

The law as written does allow other than board members to attend, and it does imply that these matters may be discussed in open meetings. However, it leaves it up to the discretion of the board, and my understanding is that HOA attorneys here do advise that the matters that are shown below be discussed in closed rather than open session.

ARS 33-1804. Open meetings; exceptions:

"...Any portion of a meeting may be closed only if that closed portion of the meeting is limited to consideration of one or more of the following:

1. Legal advice from an attorney for the board or the association. On final resolution of any matter for which the board received legal advice or that concerned pending or contemplated litigation, the board may disclose information about that matter in an open meeting except for matters that are required to remain confidential by the terms of a settlement agreement or judgment.

2. Pending litigation.

3. Personal, health or financial information about an individual member of the association, an individual employee of the association or an individual employee of a contractor for the association, including records of the association directly related to the personal, health or financial information about an individual member of the association, an individual employee of the association or an individual employee of a contractor for the association.

4. Matters relating to the job performance of, compensation of, health records of or specific complaints against an individual employee of the association or an individual employee of a contractor of the association who works under the direction of the association."

JulieS (Georgia)
Posts: 412

Posted:

The only items we discuss in executive session have to deal with lawsuits in which we do not want to hinder the outcome of the case with sensitive information being made public.

GeraldT1 (<Not Specified>)
Posts: 519

Posted:

WilliamT,

Matters such as you have outlined are permitted in my HOA to be discussed in private session and closed to the membership. All other other such matters are permitted to be open. The only time a meeting (in my HOA) is mandatory to be open is when a binding vote is taken, unless it pertains to the matters you have outlined.

Where your HOA and mine differ (regarding meetings) is that executive sessions are open.

Best of success!!
GeraldT1
NNJ

JoyceS1 (Indiana)
Posts: 140

Posted:

I wasn't sure if sensitive information such as this was to be disclosed. The individual making the allegations was doing so based on assumptions, not fact. I questioned whether it was beneficial to bring such erroneous assumptions by a homeowner public and embarrassing the party making the allegations along with stirring the pot or if it was something that needed to be dealt with by board members only.

Since no one but the board was present at the meeting, I suppose it didn't matter one way or the other if I presented it as an Executive Session matter except for the contents of the minutes.

We do have an Open Door law in our state, so I suppose this would fall within that authority.

Basically, it was decided to send a letter setting straight the misinformation contained in the letter from the homeowner.

GeraldT1 (<Not Specified>)
Posts: 519

Posted:

JoyceS1,

You make a very good argument for addressing the matter in executive session in relation to privacy and for not bringing erroneous assumptions to the public.

That's why I provided the example of your doing it in executive session, but inviting the owner to participate.

My concern (for you), especially after reading WilliamT's post is your refuting the specifics of the letter on a board level. Plus the POSSIBLE new claim by the unit owner that you are using the power of the board to address a matter regarding your ethics, or some other such nonsense.

So given that possibility and WilliamT's response you may want to reconsider providing a response refuting the specifics of the letter.

I too dealt with a very similar matter on a board level. It was handled executively, never made it to the open meeting much to the happiness of the owner. Her intent was to cause just enough of a stir...

GeraldT1
NNJ

EdR (Texas)
Posts: 170

Posted:

So, Gerald, what would you do about a homeowner reading their letter in open session with over 30 other people in attendance, complaining (falsely) that a board member had misappropriated funds and should be removed from the board?
EdR

WilliamT (Arizona)
Posts: 489

Posted:

Posted By EdR on 09/06/2006 10:54 AM

So, Gerald, what would you do about a homeowner reading their letter in open session with over 30 other people in attendance, complaining (falsely) that a board member had misappropriated funds and should be removed from the board?
EdR

The question was addressed to Gerald, but I'll also provide my opinion.

A home owner is allowed to speak on a subject, and if he or she feels there has been a misappropriation of funds, they have the right to state that. They can go door to door and present their letter and ask for a petition to be signed to remove a director(s). It seems this person has elected to confront the board member in the meeting, which is permissible as long as he is properly recognized to speak, and conducts himself in a businesslike manner.

The president should allow the home owner to read the letter, and provide the board with the original that has the home owners signature. If the owner will not provide the board with an original signature, then the board can refuse to consider the complaint.

The president should ask the member to provide specific details, in writing, of transactions that prove a board member misappropriated the funds. The burden of proof is on the accuser.

If the accuser needs to see certain records to obtain proof, then the records should be provided to the home owner in accordance with your state laws and governing documents.

The president should ask for the proof and state that after receiving the proof, he/she will investigate the matter and report to the association.

Then go on to the next item of business.

The accused should not respond to the complaint at this meeting. The accused should only respond to the board in a written letter with evidence that refutes the accusers evidence. The accused can read this letter with evidence that refutes the charges at a future board meeting.

If the president finds that the accuser is correct, that the accused has in fact misappropriated funds, then the board should decide in closed session what action to take regarding the accused. Most likely they would elect to ask for the accused to resign from the board. If the accused is an officer, then the board can remove the person from the office.

In the event that the accused resigns, then that is all that needs to be reported to the association.

I don't think you misappropriated funds, I'm just working the process through using both scenarios.

GeraldT1 (<Not Specified>)
Posts: 519

Posted:

EdR,

Glad you asked, because the occurrence of both JoyceS1 and your scenario have occurred in my association.

WilliamT has answered in my opinion appropriately and I could not have stated it better, so in this instance, I'll say a little more than ditto, on the the philisophical end since WilliamT focused upon the protocol.

There is nothing to prevent an owner from stating their opinion, however false. There are ramifications of complaints and false complaints. There is freedom of speech which can not, and should not ever be silenced. The board in many ways must fascilitate a way to resolve owner complaints, the best method of which is to do it as openly, objectively, and business-like as possible.

Where it becomes tricky is when the President is both chair of a board, a meeting, and the subject of a written complaint with false accusations. The intent, in my opinion, of an owner that writes a false complaint, to board members about a board member as Joyce has received, is to undermine, or to subvert the system. This kind of behavior requires turning the table, and playing the best way possible. Which is to open the matter to the general public. Rats scurry when this happens.

GeraldT1
NNJ

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