QUESTION: I am secretary for our HOA. An executive session was held at a time when I could not attend and the president is telling me that as secretary it is my job to write a report on what took place at that meeting. I told him that he should do it, as I was not there and cannot report on what I did not witness.
ANSWER: The proper procedure when the secretary is not present at a meeting is for the president to appoint someone to take the minutes so there is a record of the board’s actions. (Robert’s Rules, 11th ed., p. 459.)
From Notes. If no one took notes, you can’t be expected to create minutes out of thin air. Someone who was at the meeting (the president or one of the other directors) needs to sit down and put to paper (or an email) who attended the meeting and what business was conducted. Then you can put that information into proper format as minutes.
Board Approval. Once the board reviews and approves the minutes, you can sign them. Remember, your signature does not mean you attended the meeting or approve the decisions made by the board. Your signature only means the board approved the minutes. To make that clear, you can include the following with your signature:
These minutes were approved by the Board of Directors.
Jane Smith, Secretary
RECOMMENDATION: For more information, see “Sample Minutes.”
QUESTION: If minutes from a meeting are never written, is that interpreted as the meeting never having taken place and thus all decisions made during that meeting are null and void? Also, what if minutes are never written until 65 days after the meeting and they are done by the president (who was conducting the meeting and thus not really able to take accurate notes)?
ANSWER: The meeting still occurred even if there is no written record of it. Written minutes are important because they serve as prima facie evidence of what occurred at the meeting. (Corp. Code §7215.) Without a written record, what took place can still be determined through testimony. The problem is that memories fade and disagreements may occur over what was approved and not approved.
Minutes Are Required. Boards are required by statute to keep minutes of their meetings. (Corp. Code §8320.) In addition, draft minutes must be made available for member review within 30 calendar days of the meeting. (Civ. Code §4950.)
RECOMMENDATION: If boards must create minutes from memory at a later date, they should do so. Once approved by the board, they become the agreed-upon record of the meeting, even if they are not entirely accurate. See “Approving Old Minutes.”
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Cang Le manages the firm’s Inland Empire office. His practice includes both transactional and litigation services and he works with all manners of common interest developments including planned unit developments, golf and lake associations, and senior communities, among others. Mr. Le is a well-recognized expert in this field and frequent speaker and author at events statewide. Mr. Le earned his law degree from the University of San Diego School of Law and an LLM (Master of Law) in taxation from there as well.
Jasmine Fisher Hale heads the firm’s Los Angeles transactional practice group and oversees all Northern California clients. Her practice includes representation of large master-planned communities, mixed-use projects, and high-rise developments, among others. Ms. Hale not only specializes in all manners of general counsel, she also has an extensive practice in employment law to assist clients. Ms. Hale earned her law degree from Pepperdine University School of Law and has a certification in entrepreneurship.
For more information about our legal services call (800) 464-2817 or email us at info@AdamsStirling.com.
Counting Days #1. I always enjoy your newsletters. In reference to the days for notification, I noticed Thanksgiving Day was omitted as it is the 4th Thursday in November. -Ruth H.
RESPONSE: I have no explanation for California’s exclusion of Thanksgiving. Legislators did, however, throw in a catch-all at the end for “Every day appointed by the President or Governor for a public fast, thanksgiving, or holiday.” Since Thanksgiving became a national holiday by an act of Congress in 1941 rather than being appointed by the President, it does not qualify under California’s catchall provision. Maybe Governor Brown will declare an annual public fast for the 4th Thursday of November, thereby making Thanksgiving a holiday. That means you can cook a turkey, you just can’t eat it.
Counting Days #2. I think I’m correct in my counting! At long last! -Sharon O.
Counting Days #3. We here at Miraleste Canyon Estates have reversed the 10 and 15 day notices, we mail the notice of violation hearing on the 15th day and the result of hearing by the 10th day. It is an easy way to remember the 10 and 15 day rules. -Virgil M.
Year-End Bonus #1. Since the bonus question is raising so many issues, I am the president of a HOA. We include in our budget and give cash gifts (“bonuses”) for the guards at our gatehouse. Is there anything wrong with that? -Eve W.
RESPONSE: There is nothing wrong with it. As I pointed out in last week’s newsletter, if the amount of the cash gifts are more than nominal, you should run them through payroll so appropriate employee withholdings and taxes are taken out.
Year-End Bonus #2. Residents in our association contribute to a holiday fund, which is for onsite staff. The fund is then distributed by the board using a formula to determine the proportion that is given to each staff member. Employees of the management company though must have the distributed gift go through as regular payroll, subject to all withholdings as they treat the gifts as remuneration…not a “tax free” gift. Let no good deed go untaxed. -Bill L.
Year-End Bonus #3. [Your readers’] snarky criticisms of the L.A. Times’ column “Associations” indicates the mentality of the critics. You may not agree with any or all of the “Associations” topics, but the mere fact that those subjects are covered provides insights into Davis-Stirling that would otherwise not get an airing. Although I’m computer literate many seniors still enjoy a newspaper over a cup of coffee. So ease off folks and consider our constitution’s provisions for expressing opinions that may even be disagreeable. -Eric D.
RESPONSE: I suspect readers are critical of the L.A. Times’ “Associations” column because of its inaccuracy when it comes to the law. If the Times writer were merely expressing an opinion about the weather, no one would take issue. But when the writer tells readers they are breaking the law and will lose their tax status, putting everyone into a panic, that gets people’s attention. Fortunately, the Times article was wrong and boards CAN give year-end bonuses and doing so will not change an association’s tax status. The Times writer made a mistake–it happens to the best of us. I’m sure the rest of the paper is good over a cup of coffee.
Year-End Bonus #4. As an addendum to the LA Times advice, I believe only one quarter of what I read these days, but that, of course, does not include your answers and analyses! -Angela D.
We’re friendly lawyers–boards and managers can reach us at (800) 464-2817 or info@AdamsStirling.com.