Home Author: Jillian Wright

Emergency vs. Special Meetings: When the Board Needs to Act Fast

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By Jillian M. Wright, Esq.

It happens all the time: something important suddenly comes up that needs to be resolved quickly but the next regularly scheduled board meeting isn’t for weeks! The board president copies you, the manager, on an e-mail to the entire board explaining the problem asking everyone, “What should we do?!”

This article will discuss the difference between an emergency meeting and a special meeting of the board and the requirements for both so that the next time you are copied on that frantic email you will know, after assessing the facts of the situation, whether you should stop the e-mail chain immediately or reply with your opinion.

What is a “board meeting?”

Whenever a majority of the board is meeting at the same time and place (or via telephone conference) to “hear, discuss, or deliberate” upon matters within the board’s authority that is a board meeting. (Civ. Code §4090(a) and (b).)

What is an emergency?

Civil Code §4923 defines an emergency as (1) something that could not have been reasonably foreseen, (2) which requires immediate attention and possible action, and (3) for which it is impracticable to provide notice. So, if in the hypothetical above, your board president is emailing about a burst pipe currently flooding a vacant unit, that satisfies all three requirements and is likely an emergency. If the email, instead, is about a maintenance item that needs attention quickly but is not a life safety threat and can wait for a few days to be addressed, then the email chain should cease and the board should instead call a special meeting.

Special Meetings: for items than can wait a few days.

Civil Code §4920 discusses the requirements for a special meeting. If the board meets to discuss an executive session issue the association need only give two-days’ notice to the members with an agenda via general delivery (Civil Code §4920(b)(2).) Recall, however, that there are only a few items allowed to be discussed in executive session: litigation, forming third party contracts, member discipline, personnel matters, etc. (See Civ. Code §4935 for the entire list.)

If the board is discussing anything other than those limited issues then Civil Code §4920(a) requires four-days’ notice of the meeting, including an agenda, be sent via general delivery (unless your governing documents have a longer notice requirement [Civ. Code §4920(b)(3)]).

Board action v. board discussion

“But wait,” a board member might argue, “we won’t make a decision in this e-mail, we are just discussing the issue. How is that illegal?” True, Civil Code §4910 states that a board may not take any “action” outside of a board meeting and makes no specific prohibition of discussion of board matters outside a meeting. However, as mentioned above, the definition of “board meeting” includes when the board meets to hear, deliberate or discuss. Indeed, the purpose of the Open Meeting Act (§4900 et seq.) is for the membership to be invited to see the deliberative process by which decisions are made for their community. We suggest erring on the side of caution; just call the meeting.

When are emails allowed?

Sometimes, in an emergency, emails are the most efficient way to take care of board business.  So, in those cases the board must act within a few set rules: (1) it must be an emergency, as defined above, (2) all directors must consent in writing to act by email in an emergency situation, and (3) written consent must be filed with the minutes of the next board meeting. So if you forward the board a settlement offer with a response due a week from now and a board member excitedly replies asking everyone’s opinion, that email thread should be stopped.

If your board is quick to define  everything as an emergency, kindly remind it of the requirements noted above and remind the board that a member may bring civil action against the association (and potentially be entitled to attorneys’ fees and costs) for a board’s acts outside of the Open Meeting Act.

 

 

Rules of Procedure, Codes of Conduct: Keeping it Civil & Getting Association Business Done

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By Jillian M. Wright, Esq.

Productive board meetings are productive business meetings. However, the issues handled by community association boards are not necessarily easy. Productivity can be sidelined by flaring tempers, controversy, interruptions and the challenges that come with addressing sensitive and sometimes complex matters. To successfully manage productivity and decorum issues that may occur at board meetings, a board should consider enacting procedural rules to govern meeting conduct. A board might also consider adopting a code of conduct applicable to directors and other association volunteers.

Rules of Procedure

While some associations’ governing documents specify a particular “order of business” or parliamentary procedure (e.g., Robert’s Rules of Order), most do not (and if they do, they are more likely prescribed for membership meetings, rather than board meetings). Thus, the majority of boards are left with little guidance on how to hold effective meetings which allow for efficient conduct of business and which also facilitate a healthy level of member input.

We recommend boards set forth standing procedures for meeting conduct. For example, establish  a “first, second, final warning” or similar system for admonishing those who interrupt board meetings,  set forth the process and criteria for recessing and adjourning unmanageable meetings, and set time periods and guidelines for member input. Such standing procedures for meeting conduct can help provide an atmosphere conducive to conducting business, preserving decorum, and facilitating member contribution.

It is, of course, still important to encourage member attendance and participation at meetings, so more members become interested and participate in community activities. Member participation mitigates accusations of a lack of board transparency and improves the board’s chances for achieving better long-term results for their community. However, the board must also be permitted to conduct business without unreasonable interference. Thus, owner participation should remain orderly and be limited to the portion of the meeting set aside for such participation, what we call “open homeowner forum.” An association is required by Civil Code §4925 to allow members to attend and speak at a board meeting.

 

Topics of Discussion

The Open Meeting Act restricts the ability of community association boards to take action on non-agenda items, albeit with certain limited exceptions. (Civil Code §4930) In certain respects, these restrictions can be helpful to boards challenged by meeting interruptions and by the temptation to engage in excessive dialogue with those in the “audience.”

However, items that are not on the board’s agenda often arise during the open homeowner forum. Civil Code §4930(b) allows the board to “briefly respond to statements made or questions posed” by members during open homeowner forum. Responses should be brief to inform the membership that the concern will or has been addressed by the board. If the board cannot address and/or decide on the issue at that meeting – either because of a lack of time or because it is not on the agenda – let them know of that constraint and inform them that the board will look into it in the future. Members want to feel heard and respected.

If the board’s response devolves into an argument or a back and forth with a member, inform the member that his or her time for comment has expired and that the board needs to attend to other board business. Board meetings for associations should be treated like board meetings at for-profit companies; it is a time to conduct business in a respectful and civil manner, not bicker about personal issues. This is difficult especially because members of a for-profit board do not have to live in a community together, a much more personal experience.

Codes of Conduct

Having a code of conduct for the board helps set forth expectations of board conduct, another way to help keep board meetings civil and efficient. While there is no statutory requirement for a director to execute a statement or agreement regarding ethics as a condition of serving on a board, many associations find such policies to be good general statements of what the board expects in terms of individual director performance. A code of conduct or code of ethics is something that could be used for both the board and members of an association’s volunteer committees. Professional and courteous treatment of fellow directors and of association management, employees (if any) and vendors is necessary to accomplish the business of the association, and to help protect the association and its directors from liability.

Codes of conduct can be helpful for things outside of board meetings as well. Codes of conduct vary in their exact content and level of detail, yet their provisions typically target three objectives: maintaining decorum, facilitating efficient business operations and fulfilling fiduciary duties. In addition to keeping meetings civil and accomplishing association business, the need for directors to fulfill their fiduciary duties must not be overlooked. Director duties of loyalty, confidentiality and fair dealing are owed by each director to the association as a whole and are assumed upon taking office as a director. Adopting and adhering to a code of conduct can thus help an association and its directors minimize potential liability.

Although the policies discussed above are operating rules, in that they apply generally to the management and operation of the association or the conduct of its business and affairs, they are not among the specified rules subject to the rulemaking procedures of Civil Code section 4360. Before adopting rules of procedure for board meetings or a code of conduct, a board should nevertheless consult with the association’s legal counsel to review its proposed rules and policies or to assist in drafting such rules and policies to suit the association’s particular needs and concerns.