I have been president for about five years. The bylaws call for an election every three years but no one has ever been interested so it’s just me keeping things moving along. Can I get in trouble?
ANSWERS:
Most Bylaws provide that officers serve for X years or until their successor is elected. If that language is in the Bylaws, then an officer serving longer than the set term is still serving properly. If that language does not appear in the Bylaws, it should be (according to state law) and the Association must decide how to proceed. It may decide to leave in place the officer(s) whose term(s) has/have expired in order to accomplish business, or it may let that/those officer(s) leave and have no ability to conduct business.
Sara A. Austin
Austin Law Firm LLC
226 E. Market St.
York, PA 17403
717.846.2246 phone
717.846.2248 fax
saustin@austinlawllc.com
The Association should elect board members as provided in the Bylaws. Typically, the board members then elect officers. Failing to follow the Bylaws may be a breach of fiduciary duty. My advice is that the Board/President strictly follow the Bylaws going forward.
David G. Hellmuth
Attorney at Law
Direct dial: (952) 746-2107
dhellmuth@hjlawfirm.com
8050 West 78th Street
Edina, MN 55439
Phn: (952) 941-4005
Fax: (952) 941-2337
Typically by=laws provide that the officer is to hold the position
fo a period of time or until the successor is selected. If there have been
no elections this type of language would be sufficient. I suggest that if
no one else seeks the office that an election be held each time with you as the only nominee.
Kenneth D. Roth, Esq.
Marchetti Law, P.C.
900 N.Kings Highway, Suite 306
Cherry Hill, NJ 08034
kroth@marchettilawfirm.com
Tel: 856-824-1001
856-414-1800
Fax:267-219-4838
I believe that you have confused the term of officers with the term of directors. However, under either circumstance, you are not in trouble.
Directors are elected by the home owners at the annual meeting. Association by-laws may provide that the term of directors be staggered so that only some of the directors’ terms expire each year as opposed to the terms of all board members expiring each year which would be the case if each director’s terms was for one year. For instance, if there is a nine member board, all directors will have a three-year staggered term so that only one-third of the board members’ terms expire each year. However, association by-laws typically provide that the term of a director shall continue “until their successors have been duly elected and qualified.” Under your circumstances, although your three-year term as a director may have expired, you continue to serve as a director until your successor is elected and qualified at an annual meeting of the home owners. Since no one is interested in serving as a director on the board, there is no problem with you continuing in service beyond the expiration of your term.
Officers are elected by the board members. Association by-laws typically provide that the officers are elected annually by the directors immediately after the annual meeting of the home owners. As such, your term as president was for one year. However, there is no problem with the directors electing you president for successive years.
John H. Gettinger, Esq.
Shapiro Gettinger & Waldinger, LLP
118 North Bedford Road, P.O. Box 320
Mount Kisco, New York 10549-0320
Phone: (914) 595-1468
www.kiscolaw.com
This is not an ideal situation and has the potential for liability.
A non-profit corporation such as a homeowners’ association must call an annual members’ meeting. At such annual members’ meeting association business is discussed and reviewed. One of the most important items of business that takes place at the annual members’ meeting is the election of directors. If no other parties submit their names for consideration either before or at the meeting then the previous elected directors continue to serve. The meeting minutes need to reflect the lack of nominations, though.
In addition, at least once a year, I recommend that the serving Board Members elicit help in writing and cause that request to be included in the association records. Still further, make sure the association has D&O insurance in case an action is ever instituted claiming that you “commandeered” the association.
Patrick F. O’Dea, Esq.
Nelson Mullins Riley & Scarborough, LLP
3751 Robert Grissom Parkway, Suite 300
Myrtle Beach, SC 29577-6412
Phone: (843) 946-5631
patrick.odea@nelsonmullins.com
www.nelsonmullins.com
It is not readily apparent from your question how it has been determined that “no one has ever been interested,” in running for the governing board. Has a call for self-nominations gone out? Has the association scheduled an annual meeting of the membership? Have you and your fellow board members made an effort to encourage fellow owners to participate by running for the board?
While you don’t say how large your community may be, any community of more than a 100 units – and many with less than that – have a committee structure where interested owners serve on committees that assist the board in its functions. People who serve on committees are often good candidates for service on the board since they have become more familiar with the workings of the community and they have shown an interest in working for the interests of the community. Even if there is no committee structure, it is often a good idea to draw on expertise that may exist in your community. If there are owners with a financial background, they may be interested in assisting with a review of the budget; if there owners involved in facilities management, they may be able to help in creating a plan for properly maintaining the community, etc. Once involved, it may be possible to encourage those owners to run for the board.
If all reasonable efforts have been made to solicit candidates and no one has stepped up, then no, under most state laws you would not be in jeopardy of having violated any law.
J. David Ramsey
Becker & Poliakoff
1776 on the Green
67 Park Place, Suite 702
Morristown, NJ 07960
Tel: 973.898.6502
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