NEW ELECTION PROCEDURES FOR COMMUNITY ASSOCIATIONS (2006)

The Legislature has spoken on elections. Legislation that took effect on July 1, 2006 established several mandatory procedures and requirements for elections in which the members vote directly. This article summarizes those procedures and requirements. It is not intended to be a complete guide, and counsel should be consulted before implementing the procedures and requirements.

Adoption of Association Rules

Associations now must adopt rules, in accordance with the proper statutory procedures, that do all of the following:

(1) Ensure equal access to association media, newsletters, or internet web sites during a campaign for all candidates and members advocating a point of view, including those not endorsed by the board, for purposes that are reasonably related to the election. (The association must not edit or redact any content from these communications, but it may include a statement specifying that the candidate or member, and not the association, is responsible for that content.)

(2) Ensure access to the common area meeting space, if any exists, during a campaign, at no cost, to all candidates, including those who are not incumbents, and to all members advocating a point of view, whether or not endorsed by the board, for purposes reasonably related to the election.

(3) Specify the qualifications for candidates for the board of directors and any other elected position, and procedures for the nomination of candidates, consistent with the governing documents. (Any member must be allowed to nominate himself or herself for election to the board of directors.)

(4) Specify the qualifications for voting, the voting power of each membership, the authenticity, validity, and effect of proxies, and the voting period for elections, including the times at which polls will open and closed, consistent with the governing documents.

(5) Specify a method of selecting one or three independent third parties as inspector(s) of election, which can be appointment by the board, election by the members, or any other method for selecting the inspector(s).

(6) Allow the inspector(s) to appoint and oversee additional, independent third parties to verify signatures and to count and tabulate votes, as the inspector(s) deem appropriate.

Election Inspectors

The job of the inspector(s) is to (1) determine the number of memberships entitled to vote and the voting power of each; (2) determine the authenticity, validity, and effect of proxies, if any; (3) receive ballots; (4) hear and determine all challenges to and questions about the right to vote; (5) count and tabulate all votes; (6) determine when the polls shall close, consistent with the governing documents; (7) determine the tabulated results of the election; (8) do whatever else as may be proper to conduct the election with fairness to all members in accordance with the law and valid association rules. If there are three inspectors, the decision or act by two of them is effective in all respects as the decision or act of them all.

Each election inspector must be an independent third party, which includes without limitation a volunteer poll worker with the county registrar of voters, a licensee of the California Board of Accountancy, and a notary public. Although an inspector may be an association member, an inspector may not be a member of the board of directors, a candidate for the board of directors, related to a member of the board of directors, or related to a candidate for the board of directors. An inspector also may not be a person, business entity, or subdivision of a business entity who is currently employed or under contract to the association for any compensable services, unless expressly authorized by the rules mentioned above.

Nominations

The association rules may provide for the nomination of candidates from the floor of membership meetings or nomination by any other manner. The rules also may permit write-in candidates for ballots.

Ballots

Elections regarding (a) assessments requiring a vote, (b) election and removal of members of the association board of directors, (c) amendments to the governing documents, or (d) the grant of exclusive use of common area property must be held by secret ballot.

At least 30 days before the deadline for voting, the association must mail, by first class mail, or deliver to every member ballots and two preaddressed envelopes with instructions on how to return ballots. The voter must not be identified by name, address, lot, parcel, or unit number on the ballot. The voter also does not sign the ballot itself.

The ballot is inserted into a sealed envelope, and that envelope is inserted into a second envelope that is also sealed. In the upper left hand corner of the outer envelope, the voter signs his/her name and writes his/her name and the address or separate interest identifier that entitles him/her to vote. The outer envelope is addressed to the election inspector(s). The envelope may be mailed or delivered by hand to a location specified by the inspector(s). The voting member may request a receipt for delivery. Once a secret ballot is received by the inspector of elections, it is irrevocable.

The inspector(s), or their designee, count and tabulate all votes in public at a properly noticed open meeting of the board of directors or members. Any candidate or other member of the association may witness the counting and tabulation of the votes. No one may open or otherwise review any ballot before the time and place at which the ballots are counted and tabulated. However, the inspector(s), or their designee, may verify the member’s information and signature on the outer envelope before the meeting at which the ballots are tabulated.

The tabulated results of the election must be promptly reported to the board of directors, recorded in the minutes of the next board meeting, and made available for review by the members. Within 15 days of the election, the board must publicize the tabulated results in a communication directed to all members.

If there is a recount or other challenge to the election process, a member, or the member’s authorized representative, may inspect and review the ballots. The confidentiality of the vote must be preserved.

The inspector(s) keep custody of the sealed ballots at all times until after the tabulation of the vote, and the time allowed for challenging the election has expired. The ballots are then transferred to the association, which must store them in a secure place for at least one year after the election.

Proxies

Members cannot be required to use proxies instead of ballots. However, an association may use proxies if permitted or required by the bylaws and if the proxies meet the requirements of applicable laws and the governing documents.

Any portion of a proxy directing the manner in which the proxyholder is to cast the vote must be set forth on a separate page of the proxy that can be detached and given to the proxyholder to retain. In any event, the proxyholder must cast the member’s vote by secret ballot. The member may revoke the proxy before the election inspector receives the ballot.

Number Of Votes

A quorum shall be required only if so stated in the governing documents or other provisions of law. For purposes of establishing a quorum, if required by the governing documents, each ballot received by the inspector of elections is treated as if the voting member were present at a meeting.

Cumulative voting must be allowed if cumulative voting is provided for in the governing documents.

Use Of Association Funds

The statutes prohibit the use of association funds for campaign purposes in connection with any board election. Association funds may not be used for campaign purposes in connection with any other association election, except to the extent necessary to comply with the association’s duties imposed by law.

Examples of prohibited campaign purposes include (1) expressly advocating the election or defeat of any candidate that is on the association election ballot; and (2) including the photograph or prominently featuring the name of any candidate on a communication from the association or its board, other than the ballot and ballot materials, within 30 days of an election. However, providing required equal access to another candidate or advocate is not considered a prohibited campaign purpose.

Enforcement

A member may seek to have a court void election results if the required procedures were not followed.

A member who prevails in enforcing his/her rights under the election procedure statutes is entitled to reimbursement for reasonable attorney’s fees and court costs from the association. Also, the court may impose a civil penalty of up to $500 for each violation. A prevailing association may not recover any costs, unless the court finds the member’s lawsuit was frivolous, unreasonable, or without foundation.

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