Alternative Methods to Conducting Meetings and to Limit In-Person Interactions within your Community Association during the Covid-19 Outbreak

To help prevent the spread of the Coronavirus we have all had to substantially alter the way we work and live and social distancing has become the new normal – at least for now.  As a result, it is more important than ever for Community Associations to maintain solid and steady communication between Board members and their residents.

Many Condominium Associations and HOA’s are required to hold their annual meetings in the spring of each year per the provisions of their governing documents. However, with the recent enactment of Executive Order 2020-21 by Michigan’s Governor which limits all private and public gatherings of any number of people occurring among persons not part of a single household, Boards are currently faced with the dilemma of complying with their Association’s Bylaw requirements. On one hand, the Association cannot violate the law if state government prohibits sizable in-person meetings. However, Boards may have other choices available to them which includes postponement; action without a meeting; voting at an electronic polling place; or to hold the meeting in a virtual manner entirely by remote electronic access.

Many Associations’ Bylaws require the physical presence of a certain number of members as a condition of reaching a quorum for election voting purposes. Others will allow acting on crucial business, such as amending Bylaws, without a meeting. It is important for Boards to evaluate their governing documents with their legal counsel to determine what methods are readily available to them.

Boards should also review the applicable provisions of the Michigan Non-Profit Corporation Act, (the “Act”), if they choose to delay their group’s annual meeting or take other alternative actions. A key provision in the Act allows Boards leeway to hold an annual meeting soon after the scheduled date which is convenient to the business organization. This time period is usually anywhere from 90 days of the original date, but not more than 15 months since the last annual meeting (MCL 450.2402).

Alternatively, there is another option in lieu of a meeting postponement should an organization only wish to complete their member voting process to allow for the election of directors for the upcoming term. For voting purposes only, and if an Association’s Articles of Incorporation or Bylaws allow for it, the group may vote at an electronic or online voting place. Once again, the Act, at MCL 450.2409, supports such actions with proper notice to members who are entitled to cast ballots.

In order to complete the assembly process entirely, some Boards may prefer to conduct the meeting either by conference call or virtually by electronic means through certain online platforms such as Zoom, GoToMeeting or Skype. However, these methods may pose a challenge to certain members of the community that have limited access to technology, such as some seniors or those with limited financial resources.

Nevertheless, unless restricted by the Association’s governing documents, the Act allows for members to participate in a meeting by remote communications means (MCL 450.2405(1)). Of course, Boards will still want to follow parliamentary procedure as dictated by Robert’s Rules of Order in conducting the meeting. Reasonable measures are also necessary to verify that each member is present and permitted to vote. They must have an opportunity to read or hear the proceedings in real time and a record of the vote must be maintained.

Finally, in some instances, Boards may act without a meeting entirely if the Association’s governing documents allow for meetings to take place without members being physically present or by electronic means. This may include annual meetings where an election of directors is required. Basically, the voting procedure would be to provide proper notice and a ballot to members which fulfill the statutory requirements of the Act (MCL 450.2408).

It is important to note that many of the methods for conducting meetings and completing a voting process are possible even if an Association’s governing documents do not presently allow for it. It may be that the Board will require an amendment of its Association’s governing documents beforehand which comports to the applicable provisions of the Michigan Non-Profit Corporation Act. As such, it is advisable that Boards consult with their group’s experienced legal counsel to determine what the best approach is for their particular organization as a result of the unusual circumstances that we face today.

John D. Gwyn focuses his practice on the representation of community associations, management companies and developers with a particular emphasis on real estate and commercial litigation. He has handled many types of community association related matters including assessment collections, lien foreclosures, bylaw violations, civil rights defense and creditor bankruptcy matters. Mr. Gwyn has gained experience in community association law over the years through his representation of condominium and homeowners associations, as well as individual homeowners, in matters involving real estate, contract, and construction defect litigation issues. His extensive litigation and transactional background provides him with the experience necessary to handle even the most complex legal issues that neighborhood associations may encounter. He may be reached at (734) 261-2400 or jgwyn@cmda-law.com.