Reader Questions - Open Board Meetings

Dear Kelly,

I am the president of a small HOA. Some of the board members feel that it is ok to meet without calling a board meeting. They say that this has been the practice in the past. When should board meetings be called? Is there any hard and fast rule? I want the board’s action to be open.

B.E., San Pedro

Dear B.E.,

Many volunteers in associations view the Open Meeting Act (Civil Code 4900-4955) as a nuisance. If a quorum of the board is discussing ANY association business, in person, telephonically, or in e-mails, that is a “board meeting” under the law, and the Open Meeting Act must be followed. There are some items which can and should be discussed in closed session (see below). Conducting board business in meetings is important not only for legal compliance but also to preserve the trust of your neighbors. Otherwise, such decisions are arguably not corporate actions but are the actions of you directors personally – exposing you all to personal liability.

Encourage your neighbors to work with you to govern properly. It’s well worth it on many levels.

Thanks for your question,
Kelly

Mr. Richardson,

I am on the board of our HOA and keep reminding our President that she cannot do business outside of a board meeting. She is of the opinion that the Treasurer and she can form the year’s budget without the rest of the Board’s input.

Could you give me your opinion on these matters?

A.P., Newhall

Dear A.P.,

Boards act in board meetings. Until the board, in a meeting, approves the budget, it isn’t the budget, but is only the recommendation of those two directors. Seeking input from the rest of the board is not just a good idea, it is required. Furthermore, budget discussions by the board should occur in a board meeting, with members able to observe – you are talking about their money.

Best regards,
Kelly

Kelly Richardson,

We attended two board meetings because of a car illegally towed by the association and we were asking for reimbursement. The board tabled the discussion and continued it to the next meeting so they could review the documentation we provided. At the next meeting, the board announced they would reimburse my towing charges, and it appeared the board had already discussed and decided it at a closed meeting.

Can a Homeowners Association board have a closed meeting? If so, are there limits? Is the board required to discuss the closed doors items at the open board meetings?

Sincerely

C.S., Orange

Dear C.S.,

Closed meetings are authorized by the Open Meeting Act for certain narrow topics defined by Civil Code 4935. Closed session is an important tool for that small group of subjects which need to be discussed privately for confidentiality reasons. Those topics are: Member disciplinary or common area damage reimbursement hearings, personnel (not vendor) matters, litigation (including litigation risk), contract formation (i.e., negotiating the terms of a contract) assessment lien foreclosure votes, and discussions of payment plans proposed by delinquent members.

It is important that at the next open meeting (which could be the same day, If the board has closed session before its open session), the board note generally what transpired in the previous closed session, without identifying the homeowner or the specifics of the action.

Best regards,
Kelly

Written by Kelly G. Richardson

Kelly G. Richardson Esq., CCAL, is a Fellow of the College of Community Association Lawyers and a Partner of Richardson | Ober | DeNichilo LLP, a California law firm known for community association advice. Submit questions to [email protected]. Past columns at www.hoahomefront.com. All rights reserved®.