Coronavirus Creates Meeting Mayhem
Community associations of all kinds, regardless where they’re located, are subject to stringent requirements regarding board of directors and annual membership meetings. Strict compliance can pose a challenge for some associations in the best of times, let alone during a public health emergency.
Social distancing protocols and prohibitions against gatherings make traditional meetings nearly impossible in some states, including most of those with the highest number of associations.
Many boards are weighing whether to cancel meetings or hold them remotely, via telephone or, increasingly, online video conferencing tools like Zoom, Microsoft Teams, or Facebook Live.
The decisions they make now could have lasting effects on how their associations operate in the future.
“We didn’t want to stop having board meetings,” says Ken Bertolucci, president of NS Management in Skokie, Ill, which manages around 90 associations. “You can’t not conduct business.”
Kevin Hirzel, managing member of Hirzel Law, PLC, a Michigan-based firm that works with community associations, agrees: “We’re encouraging our boards to continue to meet remotely rather than cancel because there’s a lot for them to be doing right now related to the coronavirus.”
But what about open meetings laws? Will remote meetings satisfy the requirements?
“In California, we can have meetings telephonically as long as everyone can hear each other and owners can attend,” says Sandra Gottlieb, a founding partner of California homeowner association law firm SwedelsonGottlieb. “Everybody has a call-in number and the ability to speak during the homeowner forum, subject to limitations on, for example, time.”
California law requires at least one physical location where members can attend, though, with at least one director or a board-designated representative (generally, a manager) present at that location.
“I can’t believe a court would say an association violated a statute because the association didn’t expose people just to meet strict compliance. I’d rather be wrong on that than on having three people catch the virus because we insisted on strict compliance.”
Gottlieb isn’t the only one questioning the need for strict compliance in extraordinary circumstances. “We’re trying to be pragmatic, and then we’ll think about the legalities in the aftermath,” says Michael Kim of Schoenberg Finkel Newman & Rosenberg, LLC in Chicago.
“You don’t necessarily abandon everything, but you have to be thoughtful,” he says. “Most of my clients are trying to replicate as best we can something that satisfies the open meetings requirement. If owners can call in and listen, it’s a good enough approximation of your traditional open meeting.”
Kim notes that emergency provisions also might give boards some leeway. “[The Illinois Condominium Property Act] says the board can act without a meeting in an emergency if they later ratify it, but there are notification requirements.
“We’re letting owners know the board might have to act without a meeting — because things are moving quickly, and we can’t have a meeting every time we have to make a decision — but we’ll let them know what occurs. It’s really not subject to question whether it’s a bona fide emergency with the governmental declarations.”
Non-condo associations in Illinois don’t have such an explicit statutory out, but Kim says “you can go by analogy. Your townhome isn’t a condo but close enough in these circumstances.”
Paul Grucza, director of education and client development at the Seattle-based management company CWD Group, Inc., says his clients are either going the virtual route for board meetings or making decisions by unanimous email votes. It’s important to note, though, that not every state will allow email votes.
Email voting also might not be permissible under the governing documents. “Many associations haven’t updated their governing documents in years and don’t have provisions that permit voting outside of a meeting,” Hirzel says.
In such circumstances, virtual meetings may be unavoidable. Boards should, of course, consult counsel before making any departures from their usual meeting processes and procedures.
Annual Membership Meetings
While many boards have found success meeting remotely during the coronavirus crisis, the approach may be harder to implement for annual membership meetings.
“For annual meetings, it’s a different ballgame,” Hirzel says. “It really depends on the makeup of the association — how tech savvy people are.”
CWD Group, Inc. seems have the right kind of clientele for tech-driven annual meetings. Grucza reports the firm held nine annual meetings on Zoom in the second half of March 2020.
“Each one went tremendously well,” he says. “They’ve embraced the technology, and they’re following the rules we’ve established.” Among the rules:
- Everyone logged in must be muted. The host (board) unmutes to allow conversation when a “hand” is raised.
- Only person can speak at a time.
- The board coordinates the flow of the meeting, acting as those all attendees are there in person.
- The host reserves the right to remove any participant who becomes unruly or otherwise disruptive.
But that virtual meetings won’t work everywhere, for multiple reasons. For example, many associations have zero experience holding meetings remotely, let alone a meeting for dozens or hundreds of owners of varying online capabilities and access.
For some associations, it might be easier to simply postpone the annual meeting in hopes the crisis will have dissipated by the new date. “Depending on the state, if the association has the meeting within 90 days of when it’s supposed to, no one can sue,” Hirzel says.
“And even if the meeting is held beyond that time, an emergency order from the governor would supersede the requirement.”
The term “the new normal” gets tossed around a lot, but those in the know in the community association world do expect — or at least hope — that some of the virus-triggered changes in operations will endure.
“One good thing to come out of this is that boards are finally realizing they can do business without having to meet every month,” Grucza says.
And they might end up conducting more business remotely.
“Now that people have seen how well this works, we may see a move to convert a lot of meetings to this method,” Bertolucci says. “Probably the biggest thing to resolve is how to handle voting for annual meetings.”
Managers should expect that most associations will need help adopting to remote technologies. If managers don’t possess the requisite tech expertise, they should be ready to recommend qualified vendors with the necessary knowledge. They also need to be properly equipped themselves.
When the current crisis arose, Aperion Management Group, LLC, which manages around 65 associations in Central Oregon, was ready to go. “We had the technology in place that we could deploy pretty quickly,” says CEO Katie Anderson. “Canceling meetings would have made our lives harder down the road, so we went virtual with all of our meetings.
“If management companies aren’t figuring out a way to get on board on this,” Anderson says, “they should be. I think this is going to be one of those things that lasts after the coronavirus.”