State Law Allows for Owners’ Proxies ‘for Quorum Only’
Question: There are more than 100 units in our condominium complex. Before the association’s annual meeting, the management company sends out a proxy form that includes an option for the owner to check the proxy “to be used for quorum purposes only.”
The corporate proxies that I have seen do not have this wording. I maintain that, unless it names a proxy holder, the proxy is invalid. I believe that a quorum is satisfied only by the presence of the appropriate percentage of voters and proxy holders appointed by owners who are unable to attend.
At the annual meeting, the proxies marked “for quorum purposes only” are counted to establish the 50% needed to conduct the meeting.
Please share your opinion of this method of obtaining a quorum. Is this correct?
Answer: Based on the information provided in your letter and review of California Corporations Code Section 7514, I believe that the association and the management company are providing the correct type of proxy and are counting the proxies properly.
Because your association has more than 100 units, the owners should also be given the opportunity to indicate their votes on issues, including election of directors, that will be decided at the meeting. This proxy form is called a “directed proxy”; the proxy holder appointed by the owner must vote according to the directed proxy.
Many associations use directed proxies as ballots to ensure that owners’ wishes are respected. Owners who use directed proxies give up their right to secret ballots, but they are able to vote.
California Corporations Code Section 7514 specifically addresses proxies and written ballots. The law reads:
“Any form of proxy or written ballot distributed to 10 or more members of a corporation with 100 or more members shall afford an opportunity on the proxy or form of written ballot to specify a choice between approval and disapproval of each matter or group of related matters intended, at the time the written ballot or proxy is distributed, to be acted upon at the meeting for which the proxy is solicited or by such written ballot, and shall provide, subject to reasonable specified conditions, that where the person solicited specifies a choice with respect to any such matter, the vote shall be cast in accordance therewith.
“In any election of directors, any form of proxy or written ballot in which the directors to be voted upon are named therein as candidates and which is marked by a member ‘withhold’ or otherwise marked in a manner indicating that the authority to vote for the election of directors is withheld shall not be voted either for or against the election of a director.
“Failure to comply with this section shall not invalidate any corporate action taken but may be the basis for challenging any proxy at a meeting or written ballot and the superior court may compel compliance therewith at the suit of any member.”
An attorney who is familiar with this law probably prepared the proxy form for the association, and I see no reason to criticize it. I am not an attorney, but I have attended many legal seminars on annual meetings in my 20 years as a community association manager and I’ve coordinated hundreds of annual meetings.
Consult your own attorney if you feel that you need legal advice on this matter or other association procedures.
Avoid Acrimony Over Grounds Maintenance
Q: I live in a large association of single-family homes. The association maintains the landscaping on the slopes behind of the homes as well as the “green belt” walkways and parks. There are large weeds growing on the slope behind my house. One spot is almost bare and the soil is starting to erode.
Other areas of the development look much better than the area where I live. I think the board is discriminating against me. I attended a board meeting and questioned the board about maintenance costs when our assessments were increased last year. Now it appears that the board has directed the landscape company to cut back on the maintenance of my area. How can I combat these unfair tactics?
A: Your use of the word “combat” makes it sound as though you are preparing for war. Don’t think of your association board as your enemy without giving members the benefit of the doubt.
I have seen boards that try to punish owners. It is unfortunate when that happens. Boards have a duty to treat each owner with respect and to see that the association is maintained in a fair and consistent manner. Owners should treat the board with respect also.
Put your past contact with the board out of mind and proceed as though you are just informing someone of a problem. Because you live in a large association, you probably have a manager. The normal way of reporting a maintenance problem is to contact the manager. Start with a phone call to report the condition of the slope. Be specific about the location and the problems so that the manager will have enough information to pass along to the landscape maintenance company.
If you do not see improvement within a couple of weeks, put your complaint in writing and send copies to the board. Be business-like and courteous. Invite board members to look at the slope so they will understand the problems. Slope erosion is serious, and the problem should be addressed before the rainy season starts.
Jan Hickenbottom is a community association management consultant and a founding director of the California Assn. of Community Managers. She selects questions of general interest for the column and regrets that she cannot respond to all questions. Send questions to: Condo Q&A;, Private Mailbox 263, 4790 Irvine Blvd., No. 105, Irvine, CA 92620-1998.