Reader Questions - Spouses Both Serving as Directors?

c c & rs h o a homefront reader questions Aug 22, 2016

Dear Kelly,

There is a pending vacancy in our board, and our new president hinted that he will name his wife to the vacancy. I don’t see anything in our laws that prevent this. What do you think?

Thank you,

A.P., Newhall 

Kelly,

Our HOA recently had their annual election of board members and one of the candidates was the wife of the president. They both won the votes, but I questioned the legitimacy of having two board members from the same unit. Our management representative announced that it was OK because our bylaws and rules did not prohibit it. It doesn’t seem ethical to me, and I’m wondering what you think about this.

Thanks,

D.D., Long Beach

Kelly,

My question regards the make-up of our board. Several members have questioned the presence of a husband and wife team on the board. We have been told by the management company that this is not a conflict, but have not been shown any proof. We have extremely poor involvement in HOA meetings or activities because of this couple. Is there hope for our complex?

Thank you,

S.D., Redlands

Dear A.P., D.D., and S.D.,

Unless your association currently has a rule, bylaw or CC&R provision banning it, spouses can both serve as directors, if each otherwise qualifies.

However, while not illegal, it is still not good for the community. It is a bad idea, just as it is a bad idea to have bylaws that do not require a director to be an association member. A husband and wife are not expected to be independent voters, and will be perceived by most as a voting block.

Far too often, bylaws, and particularly the original bylaws supplied by the developer, will be all but silent on the subject of board qualifications. Someone can be elected or appointed to the board regardless of whether they are a member, or delinquent in their assessments, or even presently suing the association. At the same time, it is quite difficult to get association members to vote to approve revised bylaws, even bylaws which provide strong qualification requirements for directors.

The 2013 case of Hansing v. Friars Village offers associations hope in this regard. Friars Village, an association in San Diego, had passed election rules containing board eligibility requirements beyond those stated in the bylaws (which apparently said little on the subject). The rules barred directors from serving with another person related by blood or marriage. The court held that the association could adopt election rules with new board eligibility requirements so long as the requirements did not contradict the law or the existing governing documents. The fact that the bylaws did not previously contain such a restriction was not deemed by the court a “contradiction”.

If possible, associations should adopt bylaw amendments barring directors from being related (by marriage, blood or ownership) from another director (among other sensible eligibility requirements). If the membership will not turn out to vote to support such amendment (sadly, quite common), then the board could adopt such a requirement as a rule. Of course, the problem with rules is that they can be overturned by a future board vote, while bylaw amendments are more permanent and preferable.

Thanks for your questions (and hoping this was helpful),
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®.