Real Estate & Property Law

Should You Include Proposals in HOA / Condo Board Packages?

Here is a question about what goes into the Board packet:

"I read your updates and articles regularly and find them enlightening and extremely informative. I'm hoping you can help with a dilemma I'm facing. As a manager for the last few years, I have included in my packages (general session) proposals/contracts for various types of maintenance to be reviewed by the BOD and discussed in open session for general information to the membership. I consider these either old or new business and have believed that the membership has the right to be informed on what we are considering. Since our agenda does refer to unfinished/old and new business, doesn't a proposal fit into this category? One of my Board Presidents has asked that the proposals be handled primarily in Executive Session.

What is your take on this issue?"

I always appreciate good questions that are generic enough to help others. Here is what I would say about these things (relating to California law).

Old/New Business on an Agenda is an "old" concept that should not be used as a "catchall" in California HOAs or Condo associations these days because the agenda law which requires notice of the agenda to owners consistent with notice of the open meetings intends that owners should be advised of what business is up for discussion/action at the upcoming meeting. If a contract is going to be discussed (with a cavaet discussed below about what is subject to executive/closed session), that should be noted. There is also provision in the law for addressing emergency items (see prior blogs).

Proposals/Contracts are subject to executive session meetings (not open) if there are negotiations taking place with regard to the contract. If the Board is going to discuss work that is being performed or complaints about the contractors, without any negotiations, then I believe it is subject to open business meetings. (Except be sure not to speak in a manner that constitutes slander of a contractor, that is an actionable offense.)

There are many "ifs, ands and buts" to consider about contract discussions so I would want to know specific circumstances before telling a client which is appropriate. If the subject is reserved for executive session, then still, the fact that an executive session was held and the subject/purpose of the meeting (such as to discuss contract negotiations) should be noted at the next open board meeting and show up in the minutes.

Contracts are subject to inspection by members if they are not subject to confidentiality - I would not normally suggest they be attached to minutes. They may be provided to the board members if there is to be discussion on them.

Other attorneys may feel differently. You get what you pay for so if you are looking for specific advice on a particular scenario, it's best to seek the advice of counsel.

Full post as published by California Condo & HOA Law on November 24, 2009 (boomark / email).