Newly Elected Shareholders for 2025
Wait, is that a board meeting?
Meetings are a perennial topic in my discussions with association boards, property managers and unit owners, and with good reason, and I’m frequently asked whether boards can have general discussions by email outside of meetings, whether to “prepare” for meetings or simply to schedule them. The answer as to the former is usually no, and to the latter, usually yes. As usual, there are a lot of nuances here.
Any discussion of this issue has to start with the law. Certain provisions of Vermont’s Common Interest Ownership Act (the “Act”) apply to all residential common interest communities without regard to the date they were created. Among them is Section 3-108, entitled Meetings, which sets out requirements for meetings of association members and meetings of association executive boards, sometimes known as boards of directors.
The requirements themselves are pretty straightforward in theory: they mirror the open meeting requirements that apply to governments. It’s worth noting that they apply not only to boards but also to board committees that are authorized to act for the board. Advisory committees aren’t subject to them (though if there are enough board members on an advisory committee to constitute a quorum of the board, it may be treated as a board meeting).
So what are the requirements? They’re set out in detail in the Act, but in a nutshell:
- Meetings must be open to the unit owners except during executive sessions, which can be held only for specified reasons, like consulting with counsel, and any final vote or action must be taken in the open portion of the meeting;
- The board must meet at least four times per year while the declarant controls the association, and afterward at least annually and in a location at or convenient to the community unless the unit owners amend the bylaws to vary that location;
- Unit owners must be provided a reasonable opportunity to comment on matters the community and the association.
- Unit owners as well as directors must be provided with notice of non-emergency meetings, whether in a schedule given to them or separate notice at least 10 days before the meeting and stating the time, date, place, and agenda of the meeting.
- If materials are distributed to the board before a meeting, copies must be made reasonably available to owners, with limited exceptions;
The drafters of the Act emphasized the value they placed on open meetings especially in two sections of Section 3-108. First, recognizing the breadth of the open meeting requirements in the Act, they expressly provided that “a gathering of board members at which the board members do not conduct association business is not a meeting of the executive board.” They went on to caution, however, that a “board and its members may not use incidental or social gatherings of board members or any other method to evade the open meeting requirements of [the Act].” Additionally, the drafters strictly limited the common corporate law authority of boards to act by unanimous written consent: association boards may act by unanimous consent “only to undertake ministerial actions or to implement actions previously taken at a meeting.”
Sometimes it’s useful to know what the drafters of a law had in mind when they wrote it, and in this case we have some guidance. In their official comment on Section 3-108, the drafters specifically noted that the revisions to the section added “entirely new open meeting requirements” for board meetings and meetings of committees authorized to act for the Board.
There doesn’t appear to be any judicial construction of the Act’s open meeting requirements, at least in Vermont, but the Vermont Open Meeting Law, which applies to public commissions, boards, and councils and agencies, imposes similar requirements, so may be instructive.
In one 2015 case, the Vermont Supreme Court rejected an argument that an email forwarded to all school board members for discussion at a later meeting did not violate the Open Meeting Law because that law defined “meeting” as a gathering “for the purpose of discussing the business of the public body or for the purpose of taking action,” and did not include organizing agendas or distributing materials. The group email communication at issue did not violate the law because it simply forwarded an email for later discussion at an open board meeting.
That case suggests that in Vermont email exchanges simply distributing – and not discussing the substance of – materials or attending to the mechanics of scheduling meetings and setting agendas are not likely to be treated as meetings for purposes of the Act. On the other hand, substantive discussions of those matters are likely to be treated as subject to the Act’s open meeting requirements. Therefore, those discussions must take place in an open meeting, duly noticed.
This is definitely an instance in which consulting “the Google” can land a board in hot water. Not all states have adopted the Act, and not all necessarily concur in its construction, so evaluating the results of a search can be challenging. For example, I searched “condominium association board group email discussions legal?” The first link was to a law firm’s “HOA Lawyer Blog” post gleefully announcing that “email discussions between HOA board members are not “meetings,” based on a 2023 ruling. What may not be immediately clear to the non-lawyer is that the ruling forming the basis of the post is from a California court, applying California law, which is not the uniform act on which the Vermont Act is based. The post looks like great news for California associations, but it just doesn’t apply in Vermont.
Fortunately, the Act allows boards the flexibility to address issues which need investigation or background research to allow for reasonable board discussion at open meetings: advisory committees. Committees which do not have authority to act for association boards are not subject to the open meeting requirements of the Act, so are free to communicate by email or in person. The composition of such committees should be carefully considered to ensure that they do not comprise a quorum of board members, but that’s a topic for another day.
