President should run board meetings
Q. Our condominium association recently hired a new property manager. The property manager, rather than the board president, runs the board meetings. As an owner, this is a concern. Am I overly concerned?
A. Your concern is legitimate. The statutory role of the president of the association is to preside over meetings of the owners and board. While it is acceptable for the property manager to provide support to the president and to be a resource at meetings, the president should run the meetings. The board may look weak and ineffective if the president isn't able to run a meeting.
Q I live in a condominium association. We held an annual meeting last year to elect members to the board. However, a quorum of the owners was not present at the meeting, and the meeting was never called to order. The owners who did attend were advised that, since there was no quorum to hold the annual meeting, the current board would remain in office. Does this mean they assume their position until the next election?
A. There are several options if a quorum of the owners is not present at the annual meeting. The board can call and notice up another annual meeting, and encourage owners to attend in person or by proxy in order to establish a quorum. Owners could also collect proxies in hopes of establishing a quorum. As an alternative, the board could simply continue with its current composition until the next annual meeting.
If the board chooses the latter option, the owners with 20 percent of the votes could file a petition with the board calling a meeting of the owners to hold an election. But if the owners were that interested in matters, wouldn't they just have attended the annual meeting when it was originally called by the board?
Although rare, some declarations do address this issue and require the board to make a second attempt to hold the annual meeting; and often with a reduced quorum requirement.
Q. The board of our association routinely discusses whatever it does not want owners to know about in the "executive session" portions of board meetings. Does the Palm II case really mean our board can no longer choose to discuss issues in "executive session" unless they do fall in the areas of staff, pending legal actions and individual homeowners financial issues?
A. Meetings of the board of the association need to be open to any unit owner. The only exception is for the portion of any meeting held to discuss litigation when an action against or on behalf of the particular association has been filed and is pending in a court or administrative tribunal, or when the board of managers finds that such an action is probable or imminent; to consider information regarding appointment, employment or dismissal of an employee; or to discuss violations of rules and regulations of the association or a unit owner's unpaid share of common expenses. Votes on matters that can be discussed in "executive session" still must take place at the portion of a board meeting open to any unit owner. Further, discussion by the board on any topic other than those exceptions must occur at the portion of a board meeting open to any unit owner.
Q. No one at the board meetings of our association is taking minutes and minutes of board meetings are not maintained. Is an association required to maintain minutes of board meetings?
A. It is fundamental corporate law that board action be memorialized in minutes of its meetings. The failure of the board to prepare and maintain minutes exposes the board and association to liability, and is a breach of the board members' fiduciary duty. The statutes that govern Illinois condominium associations, master associations and common interest community associations all require minutes of board meetings to be available for inspection and copying by owners.
• David M. Bendoff is an attorney with Kovitz Shifrin Nesbit in Buffalo Grove. Send questions for the column to him at CondoTalk@ksnlaw.com. The firm provides legal service to condominium, townhouse, homeowner associations and housing cooperatives. This column is not a substitute for consultation with legal counsel.