By Ann Rankin, Attorney at Law

1. All Board meetings, except for those in executive session, must be open to the members of the Association under Civil Code 1363.05. "Meetings" include any congregation of a majority of the board members to hear, discuss or deliberate upon any item of business except for those to be heard in executive session. The Board may no longer exclude members from "working sessions" outside regular board meetings. However, there is no requirement to let members speak at every meeting. It is usually a good idea to provide an "open forum" at regular board meetings, but not necessarily at working sessions; it is also wise to limit the time members have to speak at the "open forum."

2. The Board may meet in "executive" (closed) session only to discuss: litigation; matters relating to formation of contracts with third parties; member discipline and personnel matters. The board shall meet in executive session if requested by a member who may be subject to a fine, penalty or other discipline, and the member shall be allowed to attend the executive session.

3. Any matter discussed in executive session shall be "generally noted in the minutes." It is neither necessary nor advisable to write a lengthy description of the discussion.

Example of appropriate minutes: "The Board met in executive session to discuss the developer's proposal to settle construction defect litigation. The board voted unanimously to accept the developer's offer to pay $2.2 Million in exchange for a complete release and dismissal of the lawsuit."

Example of inappropriate minutes: "The Board met in executive session to discuss the lawsuit. The attorney pointed out that the Association has serious statute of limitations problems. The attorney said the association would have to discount its claims because the developer might otherwise win the case. Board member Jones began a heated argument with the attorney; Board member Smith joined in, but the Board President sided with the attorney."

4. You must provide minutes, proposed minutes or draft minutes to members within 30 days of the meeting. They shall be distributed to any association member upon request and upon reimbursement of the association's costs for making the distribution. The secretary should sign the minutes, or they will be invalid. The manager should not sign the minutes.

5. When you distribute the pro forma operating budget or when you send out a mailing to the association membership, notify the members in writing of their right to have copies of the minutes of the board, and of where to obtain them.

6. Unless the time an place of board meetings is set forth in the bylaws, or unless the bylaws provide for longer periods of notice, the members shall be given notice of the time and place of board meetings, except for emergency meetings, at least four days before the meeting. The notice may be posted at a prominent place or places in the common area, mailed or delivered or furnished in a newsletter. The president or any two board members other than the president may call an emergency meeting if circumstances which could not have been reasonably foreseen require immediate attention and possible action by the board.

7. Minutes should:

• Record each Board action and state which board members voted for and against the action; which ones were absent and which ones abstained.

Minutes should not:

• Contain lengthy recitals of the discussions of the merits and arguments against resolutions;
  
• Contain material that is libelous or slanderous (such as purported factual statements that cast aspersions on board members and/or on association members and that may be untrue; for example, watch out for trouble if you include names of members who are alleged to be delinquent in paying dues as you could be defaming the person if your records are inaccurate).
  
• Contain information that may cause problems for the Association down the road if it gets into the hands of the wrong people. Example: "Board President Jones noted that the Association is suing the developer because the association's consultants have determined that the wooden decks are improperly designed. Board member Smith expressed the opinion that the only reason why the decks are rotting is that people are overwatering their plants."

8. When you are seeking to enforce Association rules, be certain that there is authority for the rule in the governing documents. If you are not sure, discuss this with your attorney.

9. Make sure you are following all association procedures set forth in the governing documents. For example, follow the architectural control guidelines in the CC&Rs to the letter; if you fail to do so, you may be unable to enforce the guidelines.

10. Rules will generally be enforceable if: there is a basis for the rule in the governing documents. Governing document provisions will generally be enforceable if: the provision is related to an association purpose; does not have an onerous effect on property values; and does not violate public policies such as anti-discrimination statutes.

11. Do not surprise the members. Try to make sure that they have copies of rules, governing documents and any amendments.

12. Communicate before you discipline! Sometimes a phone call or a personal visit results in solving a problem before formal discipline is necessary.

13. Know ahead of time what you can do to enforce your rules and governing documents. Be familiar with the documents. If they contain inadequate enforcement provisions so the board's rules have no "teeth," consider amending them.

14. Before you may impose fines, it is necessary to have and publish a written "fining schedule." The punishment should fit the crime; stiffer penalties are usually more appropriate for ongoing violations than for an isolated infraction; stiffer penalties are usually more appropriate for a serious violation that endangers safety or property values than for a violation that is merely annoying.

15. Always give members notice of the alleged violation and possible penalty and the opportunity for a hearing before you take any disciplinary action. This is required by law and is known as "procedural due process."

16. Protect the confidentiality of attorney-client communications. Normally, attorney-client communications are "privileged" and do not have to be disclosed to outsiders. However, if you disclose them voluntarily, you lose the privilege: this can be a disaster!

For example, consider the problems you could cause for the association if you showed your friend, who is not on the Board, a copy of a letter from the Association's attorney which discusses weak points in the association's lawsuit against the developer or problems the attorney is having in defending the association from a lawsuit by a former employee. The attorney must be able to discuss problems with the case in confidence, and may recommend a settlement that recognizes the weakness or problems with the association's case. However, if the privilege is lost because the communications are disclosed to unauthorized people, the developer and/or the former employee may acquire the right to obtain copies of the attorneys letters! This would obviously hurt the Association's ability to negotiate a favorable settlement! Never put confidential attorney-client communications into minutes of executive session; never distribute confidential letters to members who are not on the board.

17. Always have an agenda and stick to it. This will save you lots of time.

18. Adopt a recognized system of parliamentary procedure. For annual meetings, consider using a parliamentarian.

The material in this article is not a substitute for qualified legal advice about a particular issue. This article constitutes a summary only. If you have a legal issue involving these requirements, seek competent legal advice.

Law Offices of Ann Rankin, in Oakland, California, practices in the areas of common interest development law, real estate law and construction defects law.