I am drafting this response in response to a posting made by Vic Espinoza on Vic’s Ramblings site on October 11, 2017. I emailed him to ask if he would post my response on his page and I didn’t hear back from him. I decided that this information is too important to let stew with people and them not hear both side of the issue. Here is a link to his Rambling’s page if you have not seen it and need to put this in perspective: Ramblins’
Vic,
I believe that you have posted only the information that substantiates your position and not the information that leads to the decision that was made by most of the Board. To ensure openness, Valerie Cawley also believed we should use the larger quorum number. To that end, I am going to do my best at providing the facts from which the decision of the Board was made. First, let me say that I am discouraged with the charges and challenges that you have made against this Board in regard/ to the “democratic process” being under attack. I am unclear as to what you meant by the Silence is Approval attack.
Following the CCR’s is hardly an attack on democracy. Whether or not the quorum is 18 or 133 every member has an opportunity to vote. We made sure that there is a process in place that gives everyone a chance to vote. We ensured that there was an election process in place that will protect the integrity of the election to include identifying members, members in good standing, and legitimate Proxy process that can’t be abused. That is democracy in its simplest terms.
You have challenged our openness and transparency. That is so unfair and unjust. We have been open and transparent since Day 1. We have held town halls, provided videos and handouts all to help educate our membership about what is happening in this community. We have responded to every email, met everyone who has asked to meet, and enhanced communications. We have been talking about the Special Meeting since August and have been very open about how it will work. Notices were sent out with appropriate notice – in fact, with notice of close to 30 days instead of only 14, which if we were trying to stack the votes would have been a much better strategy.
First, it was your advice, which was still confirmed through the appropriate legal channels, to separate the budget from the assessment vote in August based on an appeal and newly established case law. It was good advice, well received and appreciated, and was substantiated by our legal adviser. And as you said, this is the reason that it became necessary to hold a Special Meeting to vote on the proposed increase.
Second, let me clarify that we do not “shop” for our legal advice and then use what is of benefit to us. We have used Goldstein’s law firm as have many other boards. What we have not done is get advice from one attorney that we don’t like and then move on to someone else, as has happened in the past. Just as it is a Board Director’s responsibility to protect the HOA, our legal counsel works for the HOA, not the Board and has an obligation to protect the HOA as well.
Additionally, this is the first Special Election that has been held since 2007. So, in the last 10 years, this will be the second one held and is hardly precedent setting.
Yvonne and I met with a past officer who is very familiar with the history of this association to clarify questions that were coming forward as to the intent of a resolution passed in 2007 about mail in ballots. During that discussion, I listened carefully, looked at all the available documentation, and with the advice of our attorney determined that the resolution in 2007, which had the intent of eliminating Proxy votes, instead, based on the language that was approved “by the membership” did in fact, through the democratic process, restrict the count of a quorum. Was the argument and reasoning given for what the intent was compelling? Yes, it certainly was, but when it came down to the requirements in the CCR’s, there was no question as to what action needed to be taken. Do you really think membership wants a Board that picks and chooses what legal advice to take? That error, in those early years is not the fault of this Board and it leaves us with the option of either following the governing documents and using the appropriate calculation to reach a quorum; or ignoring the CCR’s as they are written. And I might add, that the CCR documents themselves were reviewed since the changes in language approved by the membership and nothing was done to clarify the language at that time either. To ignore our legal counsel and what he finds defensible, leaves the HOA at prime risk of an election challenge which could result in the election being challenged (and we know they are as we had one from the August election – which I might add went nowhere because there was no basis for a challenge) and overturned; resulting in additional legal costs to the HOA. It is my job as a Board Director, and that of every other Director to do their fiduciary duty to protect the HOA through effective management. In this case, while I understood what perhaps the intent might be, the fact remained that the language in the CCR’s defines the quorum for a special meeting because of the definition of “Members Present”. It was a vote of the members that approved that change in 2007. When the word Proxy was taken out of the definition is took away the flexibility of interpreting a mail in ballot as being a “member present” based on the presumptive meaning of Proxy, which means to “stand in for”. Had the board sought the appropriate advice on the re-write of a governing document, it would have been clear that a mail in ballot would not count at a Special Meeting. In fact, the language that defines Special Meeting would have had to be altered in the Governing documents.
“Voting at meetings, other than Annual Meetings, shall be by members present in good standing or their authorized agent”
This language makes it clear that there is not even an option for Mail in Ballots at a Special Meeting because it is specific in its requirements.
I can’t argue with the statement that statistically a larger attendance will provide a better overall outcome that likely mirrors the desires of the whole. Are we concerned about the effect of the special meeting and its results? You bet we are, but because statistically, more people show up to vote against something they don’t want more than they show up to vote for what they do want. So, what is the answer? To encourage more people to attend to get a larger voters base. This board has not stopped for a moment in its efforts to get a good attendance at this meeting. I hope there are 300 people there or by proxy. I know that I have received several already and I will be casting their votes on election day. This board planned to the detailed degree the process to ensure that everyone had the chance to vote, that everyone received notice, and that the Proxy process could not be abused.
You criticize the need to have the Proxy notarized. I refer you to the definition of Authorized Agent in the CCR’s:
“means an individual or firm authorized by a member to act in his or her behalf in CCA matters including voting at meetings and elections. Each matter of authority shall be identified specifically in writing, notarized and filed at the CCA Office”.
We created a form that contained all the necessary information to meet legal requirements to cast a proxy vote to include the notary section.
And in addition, many members expressed to me their concern that the proxy vote has been abused in the past, and by having them notarized with specific choices identified or manners in which the person giving the proxy expects to have their vote recorded, we have eliminated that possibility. When we vote in person we have the option to identify owners through sight. Mail in ballots come back directly from the person to whom they were mailed. Proxy votes also have a need to establish identity of the owner to ensure voting eligibility. Without the notary verifying the member identification, we leave the process open for fraud. Proxy forms that are not notarized will not be accepted, no matter whom the Proxy is given to.
In response to what you have advised the collective of members to do:
- You tell everyone to contact me as president and insist I keep the quorum 133. I /we can’t do that because it is adverse to the written CCR’s. Shall we also decide that we are going to change other definitions? If we took the word “recreational” out of the definition of Lot, then how many places in the CCR’s would it require a change to process, assessments, etc. and have an adverse impact? Instead of dwelling on the definition, let’s dwell on getting people to come to meetings if they wish to have a say in their community.
- You tell members to vote no just to make a point. To vote NO on both issues will only hurt the community. We need that increase in 2018, and up until now you acknowledged that. So, you would jeopardize the health and betterment of the community just to make a point? Be that as it may, in the name of good business practice, the Board is already prepared to make the hard decisions that will affect the services and standards we currently enjoy should the Assessment increase fail.
- You tell members to refuse to sign in at meetings. We will continue to use sign in sheets as it is used to identify members in good standing via a check with the Office Staff and then to establish quorum. How else do you propose that we identify and record attendance at the meetings and then determine good standing to establish quorum? Or should the Board just guess who is in good standing, or who is an owner versus authorized representative or renter? If they do not sign the log, they will be hurting the community when not counted as a part of the members present to establish a quorum.
- You say we must change the verbiage: We are way ahead of you here. If it could have been done before the election, we would have. I even explored the possibility of an Operations Resolution to validate the intent in 2007 when the Proxy was removed and inadvertently impacted the quorum. It could not be done – Why? because it affected membership and the membership “voted” on the change in 2007. You have never had to apply this principle to a Special Meeting before and we are finding the impact is not what was intended. The verbiage change is something that we have already determined is needed. There are many places in the CCR’s where they are written so that they are confusing and difficult to interpret. They need to be written in plain talk so that everyone understands exactly what they mean.
- You encourage people to attend the meetings: I agree with you wholeheartedly. This Board has always encouraged attendance at all meetings. In fact, if we can identify a cost neutral way to broadcast our meetings so that people can participate from the comfort of their home, we would be happy to do that. We will however have to determine how that affects being “present”. And, what about electronic voting? There are some guidelines in the RCW’s about what must happen to enjoy that right as well.
While I respect your experience as a hearing officer and relate to the differences in arguments on both sides of a law, there is still always one ruling at the end. And that was your decision and it had to be respected. In this case, the end ruling comes from the Board after seeking legal advice (from our hearing officer per se). I personally talked to the attorney and told him we “wanted” to use the larger quorum number if he could support it in the event of an election challenge. I spent an entire day working through this issue and consulting with Board members, past and present. So, forgive me if I am discouraged that you accuse us of being closed and secretive. The attorney said he could not defend it because the definition of members present is so clear. By following the By-Laws (CCR’s) I am confident that we can defend our election results. And in that respect, we protect the community from people within the community who would not hesitate to suit or challenge. I believe we deserve the respect of doing our due diligence in hearing all sides and making the choice that is in the best interest of the community.
In closing, I am going to provide you with a PDF copy of the Legal Advice that was received by the Board in regards to this matter. You can click HERE to read that document.
Thank you for taking the time to read this and I am happy to answer any questions that anyone has.
Laura Drybread
President, Clearwood Community Association