Reader Questions - What Is “Full” Management, Closed Session Appointments

Hi Kelly,

Would you please tell me what a “Full-Service” management company is as compared to one which is not.

Thank you in advance for your help,

E.G., Lomita

Dear E.G.,

I use the term “full service” to mean that the management company provides financial management as well as manages the property. Under “financial management,” at least in the way I understand it, the manager handles the association financial matters but is not responsible for the property maintenance. “Full service” managers typically handle both the association financial affairs and also property maintenance and repair issues with the property, and usually also attend board meetings. Some associations hire one company for the financial management, and a different manager to handle the property and attend board meetings.

There is usually a wide range of service level available to the association, and typically the cost will vary along with the level of service.

When seeking a management proposal, know that the cost, by itself, does not answer the question. Some very important questions are: How much service is the association receiving for the cost; how qualified is the manager; and how stretched is the manager. To fairly compare proposals, you need to compare those factors.

Thanks,
Kelly

Closed Session Appointments

Dear Kelly,

Recently our board appointed two members to the board during executive session. This item was not placed on the published executive session agenda. The board appointed [a company] to be the Inspector of Elections for the annual election during executive session. This item was not on the executive session agenda. About two months later, the board conducted the annual election using rules that were not provided to the membership 30 days before they were adopted as required by California Civil Code 1357.13(a). Before the election one candidate withdrew from the election after the name was placed on the ballot; this candidate received the highest vote total. The Inspector of Election declared the candidates with the second and third highest vote total the winner. The next month the board appointed a member to the board during executive session. This item was not placed on the published executive session agenda.

Was this an election illegal? Does the members appointed have a right to serve?

T.H., Pomona

Dear T.H.,

None of the actions you describe should have occurred in closed session. Civil Code Section 4935 lists the matters which can be discussed in closed session. Appointing a director and appointing an Inspector of Elections must be handled in an open meeting, with a published agenda announcing the subject at least four days in advance.

Your board has erred, and as a result three of your directors may not actually be properly appointed. If that affects your ability to attain quorum, ask your association’s legal counsel for suggestions as to how to deal with that problem. As to the election’s validity due to the questionably adopted rules and incorrectly appointed Inspector, that should also be analyzed by your HOA attorney.

Best to 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®.