Open Forum: Drudge or Jewel?

Open Forum: Drudge or Jewel?

The “Open Meeting Act” (Civil Code Sections 4900-4955), requires at Section 4925(b) that all membership meetings and board meetings have a time set aside for members to speak. This time is often called “open forum.” In open forum, a member can speak on topics on or off the agenda. Some associations avoid open forum and others have unrestricted open forum, but both extremes are unhealthy. The time for homeowners to contribute to the meeting is not during deliberations – that is the board’s role – but during open forum. Open forum is an important element of a healthy association. If members have a fair opportunity to address an attentive board, they will have a more positive view of their association, and directors will be better connected with the community they serve. Consider these guidelines: Directors: Establish reasonable time limits to protect participation by all. Most associations allow 2 or 3 minutes per speaker. Have a timekeeper and consider giving members a “30 second warning” to help them. Do not interrupt, argue with, or respond to the speakers during their time. Listen to the speakers and take notes. Show attentiveness to their concerns – you just might learn something new. Do not record open forum comments in the meeting minutes – comments are not actions. Some speakers may disagree with the board or criticize. Deal with it — you are in a position of service, and they might sometimes be right! After open forum concludes, the chair should inquire if any item from open forum should be referred to a committee or management. If an answer to a question is...
Improve Your Board Meetings: Drafting a Code of Conduct for the Board of Directors

Improve Your Board Meetings: Drafting a Code of Conduct for the Board of Directors

A common frustration for managers and association boards of directors is dealing with issues that arise out of conflict with individual board members. At some point we have all heard of the board member who is hostile, disagreeable or the proverbial “loose cannon.” Other boards have struggled with how to rein in the director who consistently advances his or her own agenda without regard to the best interests of the association. Finally, there are directors elected, for whatever reason, who feel compelled to reveal confidential information about the association to third parties. Unfortunately, the Corporations Code does not yet contain a provision allowing the board to remove a director for behaving badly. The slap on the wrist that follows improper disclosure or misconduct does little to undo the damage already done. There are, however, viable options available to managers and boards to address misconduct. In most cases, the most direct option to control improper behavior is censure. There is no more effective method of controlling improper behavior than by confrontation by one’s own peers. Like any disciplinary hearing, the director should be advised of the improper conduct committed and be provided with an opportunity to explain his or her actions. The director should also be cautioned that continued misconduct will result in further disciplinary action by the board to protect the association and could include obtaining a court order seeking to enjoin their conduct detrimental to the association. If the conduct committed is improper disclosure of confidential information, the best option is to exclude that board member from executive session meetings, or from receiving executive session material or both....

Renter Information, Who Votes?, and HOA Financials

Hi Kelly, What recourse does a Board pursue when they cannot get information from owners on tenants residing in their community such as names, phone numbers? I am not sure the best way to proceed. Thanks, M.H. (manager) Pasadena Dear M.H., Under Civil Code Section 1360.2(d), new in 2012, before an owner rents a residence, the association must be provided the: Date the owner acquired the residence; Name of the prospective tenant; and Contact information of the prospective tenant. This is a new law, so most members probably are unaware of it. If, after notification of the new law, the owner refuses to comply, the association may need to impose disciplinary proceedings. It has always been a good idea for the association to have record of who has the right to occupy a given residence, but now it is the law. Best,Kelly Dear Kelly, Are members permitted to make motions from the floor during Board of Directors meetings? Can you please provide the legal citation? Thanks, G.K., Anaheim Dear G.K., Members make motions at membership meetings, and directors make motions at board meetings. Membership meetings decide matters which are submitted to all of the members for decision. Common membership meeting topics would include the election or removal of directors, amendments of the CC&Rs or bylaws, or major assessments. There are various sections of the law which reference the board making motions in the board meeting, such as Corporations Code Section 307(a)(4-6). The “Open Meeting Act” provides at Section 1363.05(b) that members may attend, but does not say members participate. At subpart (h) of that law, members are to be...
How is the HOA Doing?

How is the HOA Doing?

If you read this, you probably either live in a common interest development (“CID” or “HOA”) or are considering it. How does one determine whether a CID residence is a good investment, or if your HOA is healthy? Is it simply price and “location, location, location”? A well-run association in a poor location may be more desirable than a poorly run association in a great location. Consider these factors: Maintenance Is the property well-maintained? Peeling paint, dead plants strewn in the walkway, and laundry hanging from balcony rails are not good signs. Some associations pinch pennies, deferring maintenance so to artificially hold the line on assessments – never a good idea. Board meetings HOA boards must by law meet at least quarterly, and most boards in all but the smallest associations meet at least monthly. Boards that meet infrequently (or too frequently) may be disorganized. Can you observe a meeting? The conduct at the meeting speaks volumes about the way the CID actually operates. Board minutes Board minutes must by law be made available to members within 30 days, and are a very informative resource. Are there minutes? Do they reflect regular meetings? What do they tell you about what the Board is addressing? Rainy day money – reserves The law requires HOAs to have very detailed reserve funding disclosures, so read those disclosures! A short-sighted HOA skimps on reserve fund saving to artificially avoid assessments increases, but that is actually a form of growing indebtedness. Some day that association will need to get a loan or impose a special assessment because it is not ready for major repairs....
Minutes, An Empty Board

Minutes, An Empty Board

Kelly, Is there a rule/law governing the timing required for Association Board meeting minutes to be distributed to the members of the Association? Our Board meets monthly. P.B., Rancho Palos Verdes Dear P.B., The Open Meeting Act, found at Civil Code Section 1363.05, requires that draft minutes of a board meeting be made available within thirty days of the meeting. Often, minutes are slow in coming from the board Secretary because the minutes are too detailed. Minutes should record actions, not discussion, and normally should be very succinct. Your Secretary may be working too hard, and unnecessarily so. Thanks for your question,Kelly Mr. Richardson, What happens if, with all the risks of being on a board of directors of a HOA, all the members choose to resign and there is no one else on the board to serve and no other homeowners volunteer?  D.J., Orange County  Dear D.J., If every single director resigns, it leaves the association in a difficult position. I hope that doesn’t happen to your association. If at least a quorum will stay on the board, they can fill the vacancies in an open board meeting. If less than a quorum remains on the board, under Corporations Code Section 7224 the remaining directors can act unanimously to appoint sufficient directors to achieve quorum. If even one director remains, that director can appoint remaining directors. Either way, the appointment must be in an open board meeting, with four days advance agenda notice. With one remaining director, that can seem a little awkward, but at least the association can have directors appointed properly. On the other hand, if the association has...