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May 26, 2006
May an HOA Board Take Action Without A Meeting?
A reader asked me if an HOA Board can take action without a Board meeting, and then proceeded to tell me what other attorneys say about it. What I got was that attorneys apparently do not agree on the subject. (What a surprise?) My take on it is that Board's sometimes need to take an action by unanimous consent. There are times when things come up that need attention right away, and the Board members may be scattered. Or one or two are out of town and can be reached by email but that's it. Or the Board cannot meet or get a conference call going in time for a decision.
Now I realize that in California, the legislature ruled that meetings at associations should be open to members except for certain protected meetings such as executive sessions (because of the confidentiality) and emergency meetings (because of the inability to give proper notice to owners).
This is part of what the Davis Stirling Act says on the subject:Civil Code Section 1363.05 is known as the Common Interest Development Open Meeting Act. It says:
"(b) Any member of the association may attend meetings of the Board of the association, except when the board adjourns to executive session to consider litigation, matters relating to the formation of contracts with third parties, member discipline, personnel matters, or to meet with a member upon the member’s request, regarding the members payment of assessments as specified in Section 1367 or 1367.1. The Board shall meet in executive session, if requested by a member who may be subject to a fine, penalty, or other form of discipline, and the member shall be entitled to attend the executive session. ... and ... "(f) As used in this section, “meeting” includes any congregation of a majority of the members of the board at the same time and place to hear, discuss, or deliberate upon any item of business scheduled to be heard by the board, except those matters that may be discussed in executive session.
Ok, that's the rule on meetings. However, that is not the end of the inquiry on board action. The California Corporations Code says (and most HOAs in California are corporations):
"7211. (a) Unless otherwise provided in the articles or in the bylaws, all of the following apply: ...
(b) An action required or permitted to be taken by the board may be taken without a meeting, if all members of the board shall individually or collectively consent in writing to that action. The written consent or consents shall be filed with the minutes of the proceedings of the board. The action by written consent shall have the same force and effect as a unanimous vote of the directors. For purposes of this subdivision only, "all members of the board" does
not include an "interested director" as defined in Section 5233, insofar as it is made applicable pursuant to Section 7238."
So you can see, the Corporations Code allows action by written unanimous consent. However, so as not to violate the spirit of 1363.05, it is best, I believe, to confine such action to items that are either of a emergency nature or exeutive session meeting where all HOA directors could not be at a meeting.
Posted by Beth Grimm at May 26, 2006 9:48 PM