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Subject: Biased Election Documents
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02/06/2006 4:08 AM  
Our community is conducting elections for a Director on the Board. This is for the annual meeting of 2005. The following document was sent to the homeowners (after sending out a call for nominations, a requested bio form and meeting announcement). (This is all on one page, not separate pages)

* * * * *

Falls Farm Homes Corporation
Proxy and Ballot for the
2006 Annual Meeting to be held on
Tuesday, February 28, 2006 at the
Potomac Community Center
Fax # (301) 388-0972 (ProCAM)
(Print Your Name Here)
as owners of hereby appoint:
(Choose One)
__ Michael Daley (Board President)
__ Steve Robinson (Board Secretary)
as my/our proxy for the purpose of establishing a quorum for the 2006 Annual Meting. This proxy is valid only for the Annual Meeting scheduled to be held on Tuesday, February 28, 2006 including any adjournments thereof.
Board of Directors Election
I/we cast my/our vote for the following individual to be elected to the Board of Directors. All candidates are listed alphabetically with no preference intended by the Board.

(Vote for no more than 1)
__ Duc Butcher
__ Steve Liu
__ Other_______________________________

The Owner(s) signing this proxy/ballot must personally check off or write in the name of the individual whom they wish to elect to the Board of Directors. VOTE FOR THE MAXIMUM NUMBER OF OPENINGS ON THE BOARD OF DIRECTORS WHICH IS ONE (1). Voting for more than one candidate will invalidate your ballot.

Signature of Owner Signature of Owner

Date Date


* * * * *

This document is biased in several ways:
1. Owners are allowed to appoint anyone as their proxy, not limited to the President or Secretary.

2. These elections are being held for the annual year 2005, but the form says its for the 2006 annual meeting. This allows existing board members to stay for another year. According to our bylaws, we should hold an election during our annual meeting every year! If 2/28 meeting did not reach the quorum, then they will push back to March or April, then they would eliminate 2006 election!

3. We usually received proxy and ballot in separate sheet and we must sign both to fax / mail them in or bring the ballot with us to cast our vote in person. I don't feel that it's right for the board to design the proxy and ballot like that. Something was not correct.
The problem is that our bylaws say that votes are to be submitted by secret written ballot (the ballot cannot be secret if it is opened to establish a quorum for the election), and that (according to county law) ballots are to be opened at the election (opening it before the elections violates this principal). Designing the ballot this way also opens the election to fraud -- if owners fill out the information on the top half to help the community meet its quorum requirements and leave the bottom blank, then anyone in possession of the proxies can simply check the boxes for the ballot and owners who simply wanted to establish a forum would be "voting" even though they did not want to.

(North Carolina)


02/06/2006 5:05 AM  
....the ballot cannot be secret if it is opened to establish a quorum for the election....

Actually, it can. Especially if you have a property manager who receives the proxy/ballots. I do agree that the proxy/ballot you have presented definitely favors the current board and in their attempt to make the document more owner friendly, takes away from the owner some rights that the board does not have the authority to do.

Challenging the proxy/ballot will be either costly or futile, IMHO. I would try to figure a way to use it against the board. Not knowing the complete situation there, I can't offer a solution, but it might be something you and your like-thinking owners might want to ponder.

I fly because it releases my mind from the tyranny of petty things . . . - Antoine de St-Exupéry
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