BREAKING NEWS: A Win for Community Association Governance; Reduced Quorum for Adjourned Annual MeetingsOct 05, 2023
Governor Newsom Signs Assembly Bill 1458 (Ta) Providing a Path for Community Associations to Achieve Quorum Necessary to Elect Directors
By Matt D. Ober, Esq., CCAL
The inability to achieve quorum at annual meetings has long prevented community associations from electing directors as provided in their bylaws. This would leave directors in place year after year, effectively frustrating the democratic process. Assembly Bill (AB) 1458 amends Civil Code Section 5115 and Corporations Code Section 7512, allowing a reduced quorum of 20% solely for purposes of association meetings to elect directors. This CAI-CLAC sponsored legislation provides much-needed relief for communities that have long struggled to hold director elections.
The 20% reduced quorum in Civil Code 5115 would apply 1) only if the association’s governing documents require a quorum to elect directors; and, 2) unless a lower quorum is authorized by the association’s governing documents in which case the lower reduced quorum in the governing documents would prevail.
In order for an association to invoke the reduced quorum provision of Civil Code Section 5115, the association must have provided the following language in its general notice required by Civil Code Section 5115(b):
“The board of directors may call a subsequent meeting at least Twenty (20) days after a scheduled election if the required quorum is not reached, at which time the quorum of the membership to elect directors will be 20 percent of the association’s members voting in person, by proxy, or by secret ballot.”
The legislation applies only to membership meetings to elect directors. The reduced quorum provision does not apply in the case of a special membership meeting to remove directors.
The bill is seen as an important measure to facilitate community association governance and director elections and is effective January 1, 2024.
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