Board Meetings . . . who’s missing and can we have a meeting?

Board Meetings . . . who’s missing and can we have a meeting?

It’s time for the monthly board meeting but not everyone shows up.  Is it okay to conduct the meeting if they call in, or to conduct it at all for that matter?  Below is an article from the Newsletter by ADAMS | STIRLING PLC regarding the business of attempting to have meetings without a quorum.

Meetings without a Quorum

QUESTION: Two out of five board members attended an open meeting. To establish quorum, the president called one of the absent members on his cellphone and called the meeting to order. The director on the phone then hung up. With just two of five directors the meeting began. Is that legal?

ANSWER: It’s legal but if the board does not have good reason for its action, it abuses the statutory provision. By statute, a board can continue meeting once quorum is present notwithstanding the subsequent loss of quorum provided any action is approved by at least a majority of the required quorum for the meeting. (Corp. Code §7211(a)(8).)

In other words, a board of five directors needs three to establish quorum. It then needs two of the three to approve any motion. If one of the three leaves the meeting, business can continue as long as the remaining two directors vote in unison.

Duty to Attend: Directors are required by statute to perform their duties as directors (Corp. Code §7231(a).) Attending meetings to conduct the business of the association is the primary duty of a director. Failure to attend meetings without good reason is a breach of that duty.

Attendance by Phone: By law, directors can attend meetings by telephone provided all directors can hear and participate in discussions. (Corp. Code §7211(a)(6); Civ. Code §4090(b).) There is no reason for directors to miss meetings since conference phones are inexpensive–including conference speakers for cell phones. I’ve attended meetings where directors were on vacation and called in for meetings. One dedicated director called from France. It’s not that hard to do.

RECOMMENDATION: Unless there was critical business that needed to be done and the other three directors truly could not attend in person or by phone, it may be time for them to resign and be replaced with three members who can attend meetings.

For more knowledgeable information regarding the business of HOA’s, visit: The Newsletter