This is the first part of a planned series of posts advising our community association clients and their management companies how to proceed and conduct business during these unprecedented times.
With confirmed cases of the coronavirus (COVID-19) increasing every day across the State of Florida and the White House on March 16, 2020 urging all Americans to avoid groups of more than 10, some of our community association clients are asking whether they can cancel their scheduled meetings. With each association being unique in the way that their governing documents are drafted, there are some general considerations that each association board can take into account in making a tough decision.
Board or directors for community associations are required to conduct business at duly-noticed, open board meetings. Per Chapters 718 and 720, Fla. Stat., members of condominiums and homeowners associations have the right to attend and participate in all meetings of the board. While many of these board meetings have low attendance (even less than 10!) and the risk of spreading the virus may seem low, it is still best to take as much precaution as possible. The question is whether legally they can we cancel a board meeting. The simple answer is yes, but the association’s business must continue to run.
Board members are fiduciaries of the association and are expected to analyze, consider, and discuss all options and actions. Statute may allow board of directors to use e-mail as a means of communication, but recent statute changes prohibit directors from casting a vote on an association matter via email. However, association governing documents will often have a provision that allows for the board of directors to conduct business via unanimous written consent in lieu of an in-person meeting. That action taken outside of the meeting can then be ratified at the next scheduled meeting.
There may additionally be a possibility of conducting a board meeting telephonically. There is no statutory requirement of a physical location for a meeting (though your governing documents may require one). Therefore, arguably, the board could provide all members with call-in information for a phone conference and business could be conducted in that manner. The board would have to be mindful, however, that it still would have to give owners the opportunity to participate per Chapter 720. Before proceeding with telephonic meetings, please consult with your attorney to help adopt a policy to deal with unique challenges (verifying identity of those participating, requiring that all callers be on mute while the board is discussing agenda items, etc.)
Due to the timing of the onset of this pandemic, we are already a quarter of the way through 2020, which means most associations have already had their annual election meeting.
If, however, your association has an upcoming annual and election meeting, you should ask your attorney to examine your association’s bylaws to see what they require. If you are able to cancel the meeting legally, then you should strongly consider it.
If rescheduling your annual meeting is not possible, you should make sure to give the option to members to attend the meeting via proxy. By encouraging members to give their proxy to another member that they trust, this will limit the number of members of attendance at the meeting.
Additional simple steps can be taken at the meeting if it has to physically take place. Encouraging everyone to wash their hands before and after the meeting and having cleaning wipes and hand sanitizer readily available can go a long way. The association should stay up to date with all local news, World Health Organization, and Center for Disease Control and Prevention recommendations.
You may find yourself in a situation where it isn't black and white whether you may legally cancel. In those instances, we feel that as a fiduciary to your members, cancelling your annual meeting and rescheduling it until after the pandemic is contained is the sensible, reasonable, and likely legally-defensible solution. Please consult with your attorney to discuss what options you have and what liability might arise.
