Although most HOA decisions are made the board, some of the most important ones must be by membership vote. However, an amazing number of associations struggle to attain quorum, so no decision can be made. “Quorum” is the minimum number of members participating (in person, by ballot cast in advance, or by proxy) so that a vote can be taken. Quorum insures that a membership vote is truly a decision of the community.
Certain decisions can only be made by members, such as election or recall of directors, major assessment changes, or amending CC&R’s or bylaws. Without quorum, associations can be paralyzed in these important decisions.
Membership quorum pertains to decisions in which the deciders are not the board, but the entire community.
Usually the bylaws will specify the required membership quorum, but if the governing documents are silent, Corporations Code 7512(a) applies a one third quorum. The most common quorum is 51% or a majority of the voting power. “Voting power” is the number of members entitled to vote. Should some members be ineligible under the bylaws or as the result of suspension of voting rights, the voting power decreases.
Unfortunately, many associations have not been able to attain quorum for years, and so cannot elect directors. In such associations, the boards simply appoint to fill vacancies as directors leave. One of my client associations received a recall petition demanding election of a new board. The board, having been unable to achieve a quorum in over five years, agreed, and asked the petitioners for help!
Tips toward meeting quorum
- Some associations make their annual meeting a social event, with a party following the meeting, or catered snacks at the meeting. Not necessarily an expense, perhaps just a “pot-luck” meal along with the meeting.
- Make sure the voting materials are easy to follow and the ballots clear. Sometimes members will abstain if they don’t understand the issue.
- Investor owners often do not participate in HOA governance – ask them for “quorum-only” proxies, so the other members can make decisions.
- Consider a prize drawing for those that vote in advance, attend or give a proxy that is voted. The expenditure can be added to future budgets as part of the annual meeting cost.
- Amend the bylaws, adding a provision that if a meeting fails to attain quorum, the meeting can be adjourned to another date with a reduced quorum of 25% of the voting power. Some believe this is already in the Corporations Code, but it is not.
- Some experts suggest elimination of quorum, but this ignores its purpose. Quorum provides stability, and helps insure membership decisions have broad-based support. Except perhaps for electing directors, do not eliminate quorum minimums. Membership decisions should be made by a representative group of members, and not a small handful.
- The Corporations Code provides a “last resort” provision. Section 7515 permits a Superior Court Judge to dispense with quorum requirements, upon a finding that it is “impractical or unduly difficult” for the association to call or conduct a meeting. This requires a court petition (legal expense), and proof that the association tried but now needs court assistance.
Don’t give up. Quorum is possible. Remind neighbors that, to paraphrase Paul Sweeney, “Democracy [in HOA’s], like love, can survive any attack— save neglect and indifference.”
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 Kelly@rodllp.com. Past columns at www.HOAHomefront.com. All rights reserved®.