Reader Questions - Proxies, Member Petitions

Mr. Richardson,

I have been under the impression that a change to the governing laws in California no longer allowed proxies for elections. As such, we almost never get a quorum on the first try and therefore have to waste the homeowner’s money having a second annual meeting to meet the reduced quorum numbers. Yet, your [earlier] article sounds like proxies are allowed for quorum purposes. Can you clarify this for me??

Thanks, 

F.V., San Clemente

Dear F.V.,

There is a recurring myth that proxies were “outlawed” by the 2005 amendments to the HOA election law (Civil Code 1363.03). The confusion arises from the first sentence of 1363.03(d)(2): ” Proxies shall not be construed or used in lieu of a ballot.” This means that a proxy cannot be used as a ballot. The next sentence clearly contemplates that an association may allow proxies: “An association may use proxies if permitted or required by the bylaws of the association..”

Since the law requires each owner receive a ballot which can be cast in advance, there is no reason to use proxies in order to have one’s vote count. If they are unable to attend the meeting, members can still cast a vote, since they receive ballots well in advance. I routinely suggest associations delete proxies from their bylaws, except for proxies for the sole purpose of attaining quorum. So, proxies aren’t illegal- just unnecessary.

By the way, from time to time I hear a director say they are giving another director their proxy to vote in a board meeting. The Corporations Code refers to proxies regarding member votes only.

Thanks for your question,
Kelly

Dear Kelly,

If the Board of Directors declines to place a proposed amendment to the Bylaws before the membership for a vote, can members sign a petition to force the vote?

F.M., Irvine

Dear F.M.,

California law does allow for members in a non-profit mutual benefit corporation (such as a common interest development) to petition for a membership meeting. Corporations Code 7510(e) provides for the manners in which meetings of the membership can be called, and one of those is a petition of at least five percent of the membership. So, yes, technically, a group of members could have a proposed bylaw amendment drafted, and then petition for a membership meeting to vote upon it. If possible, the association counsel (or another HOA lawyer) should help draft the amendment, to prevent possible conflicts or other drafting mistakes that might bedevil the association in the future. The petition should have the exact proposed amendment attached to it, so it can be attached to the ballot.

Before embarking upon the expense of a membership vote, make sure there really is substantial interest in the proposed amendment. Consider asking the board to schedule the matter on an agenda, so that it may discuss it and see how much open forum comment comes from members. That gives the board (and you) opportunity to see if there is sufficient interest to warrant the expense.

Finally, if you gather petition signatures, make sure only members in good standing sign the petition. Petitions often fall short of the 5% requirement due to signatures of tenants or other ineligible persons.

Again, petitioning really should be a last resort, and carefully thought through.

Best regards to you and your HOA,
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®.