Requirements for establishing a board of directors
Dennis,
Our HOA bylaws have 4 main requirements for establishing a board of directors and holding meetings. It should be noted that these are listed in order which establishes a precedence.
1) All directors must be members of the Association.
2) The board shall always have between 3 and 9 directors and the number of directors shall always be odd.
3) The only matter the board can vote on when the number of board members in item 2 is not met is to fill director position(s) that have resigned.
4) A majority of directors present at a meeting shall constitute quorum.
We have a situation where one director tendered her resignation. At the next board meeting this was acknowledged and accepted by the 4 remaining board members. I would have expected them to either appoint and approve a new director or adjourn the meeting. But they continued to hold the meeting and vote on some serious measures in an open session. All 4 directors voted and all measures passed unanimously.
Is it within our bylaws to hold a meeting with only 4 directors and vote on measures proposed at those meetings?
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Ken,
Your board is in full compliance with the law and your governing documents. Your governing documents require that you establish a board of between odd numbers 3 and 9 members, so either 3, 5, 7 or 9 members. Your association has chosen 5 board members. A quorum of 5 members is 3 members. So, any meeting of the board that consist of 3 or more members can act. While you have a vacancy you can actually have two vacancies and still operate as a board of three because that is a quorum of the number of positions on the board. Those three members can appoint anyone to fill the two vacancies at any time. But if a third board member resigns the remaining two board members cannot act to do anything other than to call for a special meeting of the members to elect the replacement board members to fill the unexpired terms of the vacancies.
Dennis
I would agree with your assessment if the requirement in item 2 above said “The board shall always have between 3 and 9 “seats” and the number of “seats” shall always be odd.” But in fact, the requirement is to always have an odd number of “directors” and not an odd number of “seats”. Until the requirement in item 2 is met quorum should not come into play and this is the reason why that is. If this line of thinking were true, replacing “seats” with “directors” and we were to expand to the maximum of 9 “seats” available this would be the worst case outcome. With only 5 “seats” filled then a board could in theory conduct business with just 3 “seats” occupied at any given meeting. This is exactly why the authors of the bylaws worded it as they did.
Ken,
You asked me a question and I gave you the correct answer. While you are free to disagree with that answer it does not make my answer incorrect. I’ve read hundreds of these documents and how I answered this question will be how any court also interprets the language of the documents. That is just how these communities work. In your example if you had a board of 9 members then a quorum of that board would be 5 members and 5 board members would be required to hold any meeting and conduct any business.
Dennis
Dennis, I understand. I just wanted to make sure of your interpretation of the bylaws. As you are very well aware it is these slight differences of interpretation that quite often cause conflict. And we both know how HOA attorneys can talk their way out of a locked cage. Now that I fully understand your interpretation I will take heed and accept it. I do appreciate all of your help and advice and everything you do for homeowners in HOA’s.