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HeidiB1
(Florida)

Posts:12


05/02/2011 12:57 PM  
Hello, everyone. I have another election question for you (sorry). I promise that I have scoured prior discussion in HOATalk on this issue and have failed to find an answer.

Our annual Members meeting and election was scheduled to be held in Mid-April. On the morning of the meeting/election, our PM provided what she claimed to be legal advice from the attorney regarding how to handle the failure to reach a quorum. According to the PM, the Board could determine that no rescheduling of the annual meeting was required and that the current Board could sit for another year. (I presume this is based on what either the atty. or the PM believed was silence in our docs on what happens if no election can be held).

Not surprisingly, there wasn't a quorum for the election. The Members in attendance asked that the meeting continue while a few Members went out into the neighborhood to get 14 more proxies so an election could be held. The PM said "No," without an explanation. The Members in attendance were upset that no election would be taking place that night. The President adjourned the meeting, stating the Board would meet to decide whether to try to conduct the election. Not surprisingly, when they met a week later, they voted that no election would be held and that they would continue to sit for another year.

I have since located the following provision in our Bylaws, which I think directly addresses what takes place when no quorum is reached at the annual meeting:

A quorum for the transaction of business at any annual or any special meeting shall consist of a majority of the Voting Members, represented either in person or by proxy; but the Voting Members present at any meeting although less than a quorum, may adjourn the meeting to a future date.

The way I read it, the Bylaws clearly place the decision as to whether to adjourn to a later date on the Members and not on the Board. In fact, it seems so obvious to me that I'm second-guessing myself and wondering if I'm missing something. So I turn to you, learned members of HOATalk, for your assistance.

Thank you in advance for your input,
Heidi
RogerB
(Colorado)

Posts:4885


05/02/2011 1:28 PM  
Heidi, You are not missing anything unless it is whether or not to terminate your management agreement due to an incompetant PM. The PM should not have been allowed to control the meeting and besides that gave wrong advice. I seriously doubt an attorney provided such advice. The usual procedure when there is not a quorum is to reschedule the annual meeting. Plus, many Bylaws reduce the percentage required for a quorum for rescheduled annual meeting.
GlenL
(Ohio)

Posts:5156


05/02/2011 1:33 PM  
If what you posted is the accurate and full section, then yes the homeowners should have been able to reschedule the meeting. Assuming you fall under 720 the percentage for quorum is inaccurate and has been superseded by law. (emphasis added)

720.306 Meetings of members; voting and election procedures; amendments.—
(1)  QUORUM; AMENDMENTS.—
(a)  Unless a lower number is provided in the bylaws, the percentage of voting interests required to constitute a quorum at a meeting of the members shall be 30 percent of the total voting interests. Unless otherwise provided in this chapter or in the articles of incorporation or bylaws, decisions that require a vote of the members must be made by the concurrence of at least a majority of the voting interests present, in person or by proxy, at a meeting at which a quorum has been attained.

"Common sense is like deodorant--the people who need it most never use it."
HeidiB1
(Florida)

Posts:12


05/02/2011 2:37 PM  
Posted By RogerB on 05/02/2011 1:28 PM
The usual procedure when there is not a quorum is to reschedule the annual meeting. Plus, many Bylaws reduce the percentage required for a quorum for rescheduled annual meeting.




Roger, the President is taking the position that we failed to achieve a quorum 2x instead of just one, and that the docs don't cover the situation of multiple failures to achieve a quorum. He's incorrect, of course, but here's the basis for his contention: The election was supposed to be held in Mid-March. However, due to some incorrect language on the ballot, the Board determined (prior to the mid-March meeting) that a corrected ballot needed to be mailed out. At the mid-March meeting, I dont recall there being a sign-in sheet nor any collection of proxies - thus no attempt to have a quorum. The President now contends (despite an audio recording to the contrary) that the Association failed to achieve a quorum at that mid-March meeting. Combined with the failure to achieve a quorum at the mid-April meeting, he contends there's been a repeated failure to achieve a quorum.

Unfortunately, our Bylaws do not provided for a reduced percentage for a quorum for a rescheduled annual meeting.

I happened to just get off the phone with the President, who's dug his heels in and said that the Members do not determine what happenes when there's been no quorum TWICE. It's very, very frustrating. I can be right until I'm blue in the face, but the President is very stubborn and rarely relents. I'd hate to get to the point where I have to take further action, but I've considered the following plan of action, which is provided for by both our docs and the Fla. Stat.:

First, request a Special Members Meeting. Fla. Stat. 720.306(3) (which is identical to our Bylaws) provides:

Special meetings must be held when called by the board of directors or, unless a different percentage is stated in the governing documents, by at least 10 percent of the total voting interests of the association. Business conducted at a special meeting is limited to the purposes described in the notice of the meeting.

The request for the meeting, signed by at least 10% of the Members will be specific that it is for the purpose of conducting an election. We can get the signatures of 10% with no problem. The issue will be getting the President to set the meeting, and then making sure we have a quorum for that meeting.

If the Presdient refuses to set the meeting, then my last resort is to request non-binding arbitration of this "election dispute" with the the State of Florida, pursuant to Fla. Stat. 720.311.
HeidiB1
(Florida)

Posts:12


05/02/2011 2:56 PM  
Posted By RogerB on 05/02/2011 1:28 PM
I seriously doubt an attorney provided such advice.




Roger, the PM posed the following question and received the following answer from the attorney. I should preface this by stating the information was allegedly given by the Atty to the PM in a phone conversation,k and then the PM reduced it to writing and sent it to the President, so it's difficult to determine if the atty actually said these things.
___________________________
What options does the board have if there is no quorum tonight?

The board can decide one of two things: 1) Since there is no quorum again and if it looks like it isn't that close or they don't want to go through the expense again of sending out notices, ballots, envelopes etc, they can refuse to schedule any future annual meetings until next year. The board would remain the same and following that, any member of that board may resign and the vacancies would have to be filled by the remaining members of the board.

2) If you think it would be possible to get a quorum, then postpone the meeting again and reschedule.

The Board is NOT OBLIGATED TO GO AHEAD AND HAVE YET ANOTHER MEETING.
___________________________
CarolynL2
(Florida)

Posts:73


05/04/2011 7:11 PM  
Heidi,

Take a look at F.S. 720.303(10) Recall of Directors. Prehaps this would get the President's attention.
Good Luck,
Carolyn
RogerB
(Colorado)

Posts:4885


05/05/2011 7:54 AM  
Heidi, three questions to consider:
1) Glen quoted the controlling statue on quorum requirement -
"Unless a lower number is provided in the bylaws, the percentage of voting interests required to constitute a quorum at a meeting of the members shall be 30 percent of the total voting interests."
Were 30% of the members present in person or by proxy?

2) Did the Chair allow a vote of those members present to reschedule at a future date?

3) Does your state's nonprofit act allow for a reduced percentage at rescheduled annual meetings?

Also, I suggest your HOA amend their bylaws to reduce the quorum requirement to 20% or less.
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