Tag Archives: Elections

Developer Voting Rights & Classes of Membership

A member of an association is generally entitled to cast one (1) vote for each unit the member owns within the association. (See “One Vote Per Unit.”) However, the developer of the association (the builder of the common interest development (“CID”)) is permitted to establish different classes of voting memberships in the association’s governing documents. (10 CCR § 2792.18.) Developers do so in order to maintain control of the CID for as long as possible as units are sold to individual homebuyers while the CID is being built-out.

Class A Membership
Class A members are designated as owners of units and have one (1) vote for each unit/lot owned. (10 CCR § 2792.18(b)(1).)

Class B Membership
Class B membership is reserved to the developer, who is given up to three (3) votes for each unit/lot held by the developer. (10 CCR § 2792.18(b)(2).) Class B membership is tied to the developer’s ownership of separate interests (units) that are subject to assessments. (10 CCR § 2792.16(f)(2).) Pursuant to 10 CCR § 2792.32(c), Class B membership automatically converts to Class A membership when any of the following occur:

  • When 75% of the authorized residential interests transfer to homebuyers;
  • On the 5th anniversary of the most recent conveyance of a residential interest to a homebuyer. This deadline can be extended indefinitely as long as a residential unit is transferred once every 5 years; or
  • On the 25th anniversary of the first conveyance of a residential separate interest in a master planned community.

Class C Membership
Class C membership may only be used in master planned communities and extends only to votes for electing directors to the board. It allows the developer to preserve control of the board by giving the developer the right to elect a majority of the directors for an extended period of time. (10 CCR §2792.32(f).) Pursuant to 10 CCR § 2792.32(f)(1), these rights automatically terminate when any of the following occur:

  • 75% of the residential interests have been conveyed to homebuyers;
  • On the 5th anniversary of the first conveyance of a residential interest to a homebuyer; or
  • On the 25th anniversary of the first conveyance of a residential interest in a master planned community.

One Vote Per Unit

Virtually every set of association governing documents allow for only one (1) vote to be cast per “separate interest” (per unit) within the association, regardless of the number of persons on title to the unit. This is in accordance with the requirements contained within Title 10, Section 2792.18(a) of the California Code of Regulations.

Where ownership of a unit is vested in a number of persons (i.e., joint tenants, members of a partnership, etc.), whoever casts the secret ballot on behalf of that unit is presumed to be voting for all of his/her co-owners. (Corp. Code § 7612.) Once the secret ballot is received by the association’s inspector of elections, that ballot is irrevocable regardless if one of the co-owners desires for the ballot to be withdrawn or otherwise objects to the way in which the co-owner voted. (Civ. Code § 5120(a).)

Developer Voting Rights
The developer of the association (the builder of the common interest development) often establishes different classes of voting memberships in the association’s governing documents. Those classes allow for the developer to have up to three (3) votes per unit owned by the developer, subject to certain limitations. (10 CCR §§ 2792.18, 2792.32; See also “Developer Voting Rights & Classes of Membership.”)

Inspection of Ballots

Civil Code Section 5125 provides in pertinent part that:

“If there is a recount or other challenge to the election process, the inspector or inspectors of elections shall, upon written request, make the ballots available for inspection and review by an association member or the member’s authorized representative.”

This language does not explicitly address whether an association is required to permit the inspection of ballots in the absence of a recount or formal challenge to the election process brought by a member of the association. HOA industry attorneys take varying positions with respect to this issue and whether an association member has a right to inspect the ballots if there is no recount or challenge brought against the association by the member pursuant to Civil Code Section 5145. (See also “Legal Challenge to Election.”)

“Association Election Materials” as “Association Records”
Civil Code Section 5200 provides an association’s members with rights to inspect and copy specified “association records.” (See “Records Subject to Inspection.”) Returned ballots, signed voter envelopes, the voter list of names to whom ballots were to be sent, proxies, and the candidate registration list constitute “association election materials” that are “association records” subject to inspection. Signed voter envelopes may be inspected “but may not be copied.” (Civ. Code § 5200(c).)

Maintain Association Election Materials for 1 Year – An association is required to maintain association election materials for one year after the date of the election. (Civ. Code § 5200(c).)

Fees for Inspection
The Davis-Stirling Act does not address whether a member is required to pay any fees associated with the inspection of ballots (i.e., any fees charged by the inspector of election in making the ballots available for inspection).

Related Links

The New State of HOA Election Laws – Article published by Tinnelly Law Group

Legal Challenge to Election

Where the procedural requirements applicable to an association’s election are violated by the association, a member of the association may bring a civil action against the association for declaratory or equitable relief. (Civ. Code § 5145(a).) Election challenges may be brought in either superior court or, if the amount of the demand does not exceed the jurisdictional limits of smalls claims court, in small claims court. (Civ. Code § 5145(c).)

Challenge Period: 1 Year
The period within which a member may bring an action is one (1) year from the date the election violation occurred or one (1) year from the date the inspector of elections notifies the board and membership of the election results, whichever is later. (Civ. Code § 5145(a).) This time period coincides with the length of time that the ballots are required to be kept in the custody of the association’s inspector of elections following the tabulation of the vote and before custody of the ballots may be lawfully transferred to the association. (Civ. Code § 5125.)

Remedies

Civil Penalties – Where a member prevails in the action against the association, the court may impose a civil penalty against the association of up to five hundred dollars ($500) for each violation, except that each identical violation is subject to only one (1) penalty if the violation affects each member of the association equally. (Civ. Code § 5145(b).)

Costs & Attorney’s Fees – Where a member prevails in the action against the association, the member is “entitled to reasonable attorney’s fees and court costs.” (Civ. Code § 5145(b).) If a member prevails in a civil action brought in small claims court, the member is entitled to court costs and “reasonable attorney’s fees incurred in consulting an attorney in connection with the civil action.” (Civ. Code § 5145(b).)

If the association prevails, the association is entitled to recover its “costs” only if the “court finds the action to be frivolous, unreasonable, or without foundation.” (Civ. Code § 5145(b).) However, “costs” does not include attorney’s fees; even where the court finds the action to be frivolous, the association is not entitled to recover its attorney’s fees when it prevails in the action:

“While we agree that the trial court’s conclusion that [the member’s] decision to file this lawsuit was indeed frivolous, we must also agree with [the member] that the plain language of [Section 5145] does not support an award of attorney fees to [the association], as unfair at that may seem.” (That v. Alders Maintenance Corporation (2012) 206 Cal.App.4th 1419, 1428.)

Whether or not the member has prevailed in the action against the association is a determination made at the end of the lawsuit.  If a member secures only interim relief (e.g., a preliminary injunction), that does not, in itself, entitle the member to an award of her attorney’s fees. (Artus v. Gramercy Towers Condominium Association (2018) 19 Cal. App. 5th 923.) 

Void Results of Election – Where the court finds that the association violated the required election procedures, a court shall void the results of the election, unless the association establishes, by a preponderance of the evidence, that the association’s noncompliance did not affect the results of the election. The findings of the court must be stated in writing as part of the record. (Civ. Code § 5145(a).)

Inspection of Ballots
Where an action is filed to challenge the election process, the association’s inspector(s) of elections is required, upon written request, to make the ballots available for inspection by the member or the member’s authorized representative. (Civ. Code § 5125; See also “Inspection of Ballots.”)

Related Links

The New State of HOA Election Laws – Article published by Tinnelly Law Group

Candidate Nomination

Prior to a director election, an association typically distributes a “call for candidates” in order to solicit members to run for the board. There are several issues that pertain to how candidates are and may be nominated, such as ensuring that the candidates are “qualified” to serve on board, whether write-in candidates are allowed, and whether floor nominations are allowed.

Nomination Procedures
An association’s election rules must specify the qualifications for candidates for the board, as well as the procedures for the nomination of candidates, consistent with the association’s governing documents. (Civ. Code § 5105(a)(3); See also “Election Rules.”)  General notice of the procedure and deadline for submitting a nomination must be provided at least thirty (30) days before any nomination deadline. (Civ. Code § 5115(a).)

Right to Self-Nominate – Some sets of association bylaws may contain provisions allowing for the creation of “nominating committees” that have the power to screen which people are eligible to run for a seat on the board. However, an association’s election rules may not prohibit any member from nominating himself or herself for election to the board. (Civ. Code § 5105(a)(3).) Therefore, an association (whether through its board or nominating committee) does not have the power to prohibit any member from nominating himself or herself and from running for the board, so long as the member satisfies all of the required qualifications. (See “Candidate Qualifications”; See also Friars Village HOA v. Hansing (2013) 220 Cal.App.4th 405 at 414 (the “right of self-nomination…applies to a ‘qualified’ candidate”).)

Candidate Qualifications – The types of candidate qualifications an association may adopt are limited only to that which is allowed and/or required under Civ. Code § 5105 (b)-(c). (See also “Candidate Qualifications.”)

Floor Nominations
An association is not required to allow for floor nominations unless such a requirement is contained in the provisions of the association’s governing documents or election rules. (Civ. Code § 5105(b).)

Floor Nomination Procedure – Once the required quorum has been established, the chair of the meeting (typically the board president) will at the designated time open the floor for nominations. Members in good standing may nominate any qualified individual as a candidate for election to the board. A member need not be recognized by the chair of the meeting in order to make a nomination and no second is required. (Robert’s Rules, 11th ed., pp. 431-432.) The nomination is valid provided the nominee is qualified for election to the board; the nominee need not be contacted in advance of being placed on the ballot. (Robert’s Rules, 11th ed., p. 434.)

Ballots Previously Cast – If member’s ballot has already been mailed in and received by the association’s inspector of elections, the ballot is irrevocable. (Civ. Code § 5120(a).) That member would thus be prohibited from voting for any person that was nominated from the floor at the meeting.

Write-In Candidates
Civil Code Section 5105 allows for an association’s election rules to permit write-in candidates. (Civ. Code § 5105(b).) Unless the election rules, or other provisions of an association’s governing documents, permit write-in candidates, there is no legal requirement for an association to allow write-ins. However, if an association’s nomination procedures (either contained in the election rules or other provisions of its governing documents) allow for floor nominations, many HOA industry attorneys take the position that write-ins are impliedly valid.

Related Links

The New State of HOA Election Laws – Article published by Tinnelly Law Group

Member Approval Requirements

Default Approval Requirement
Where the required quorum is present at a membership meeting, the affirmative vote of a majority of the voting power represented at the meeting, entitled to vote, and voting on any matter constitute an act of the members unless the vote of a greater number or voting by classes is required by law, or by the association’s articles or bylaws. (Corp. Code § 7512(a).) Governing documents of associations may use varying terminology and language setting forth the applicable member approval requirements for actions that must be taken by a vote of the membership.

“Approval by/of a Majority of All Members”
“Approval by (or approval of) a majority of all members” means approval by an affirmative vote of a majority of the votes “entitled to be cast.” (Corp. Code § 5033.) The number of members entitled to vote may be reduced to the extent of any members whose voting rights have been validly suspended.

Illustration – if 100 members are entitled to vote, 51 must vote to approve the proposed action. If an association has 100 members, but 10 of those members have had their voting rights validly suspended, then 46 must vote to approve the proposed action (a majority of votes “entitled to be cast”).

“Approval by/of the Members”
“Approval by (or approval of) the members” means approved or ratified by the affirmative vote of a majority of the votes represented and voting at a duly held meeting at which quorum is present. (Corp. Code § 5034.)

Illustration – if an association has 100 members, and the applicable quorum requirement is a majority of the members, at least 51 members must be present (in person, by written ballot and/or by proxy) in order to achieve quorum and allow for the vote to be taken on the proposed action. At least a majority of those present must vote to then approve the proposed action. If 51 members are present, 26 must vote to approve the proposed action. If 90 are present, 46 must to approve the proposed action. This could provide a lower approval threshold than situations where “approval by/of a majority of all members” or “approval by/of the voting power” is required.

“Approval by/of the Voting Power”
“Approval by (or approval of) the voting power” generally means the approval of a majority of all members eligible to vote (i.e., similar to “approval by/of a majority of all members”). (Corp. Code § 5078.)

Illustration – if 100 members are eligible to vote, 51 must vote to approve the proposed action.

“Approval by/of an Authorized Number”
“Approval by (or approval of) an authorized number” means five percent (5%) of the voting power. (Corp. Code § 5036(a).)

Illustration – in an association with a voting power of 100 members (100 members eligible to vote), at least five (5) members vote to approve the proposed action.

Failure to Achieve Quorum

A “quorum” of the membership is the minimum number of member votes in person, by proxy and/or by written ballot that is required before the association may conduct business at a membership meeting. (Robert’s Rules, 11th ed., pp. 21, 345.) The quorum requirements are usually contained in provisions of an association’s bylaws or CC&Rs. (See “Member Quorum Requirements.”)

Loss of Quorum
Failure to achieve the required quorum is different from a situation where quorum is first achieved at the beginning of the meeting, but enough members withdraw (leave) from the meeting to leave less than a quorum. In that situation, actions may continue to be taken at the meeting so long as they are approved by at least a majority of members required to constitute a quorum. (Corp. Code § 7512(c); See also “Member Quorum Requirements.”)

Ballots Count Toward Quorum
If a quorum is required by the governing documents, each ballot received by the association’s inspector(s) of elections must be treated as a member present at the meeting for the purposes of establishing quorum. (Civ. Code § 5115(b).)

Adjournment Procedures
If an association fails to achieve quorum, the membership meeting may be adjourned by the vote of a majority of the votes represented either in person or by proxy; however, other than the vote to adjourn the meeting, no other business may be transacted. (Corp. Code § 7512(d).)

Vote to Adjourn – If there is a failure to achieve quorum, the chair of the membership meeting (typically the board president) calls the meeting to order, announces the absence of quorum, and then entertains a motion to adjourn the meeting to a later date. (Robert’s Rules, 11th ed., p. 349.)

Date of Reconvened Meeting – When a meeting is adjourned for a failure to achieve quorum, the time period within which the reconvened meeting must be held is usually dictated in the provisions of the association’s governing documents (typically in the bylaws). Common provisions establish time periods of no less than five (5) and no more than thirty (30) days from the date of the adjourned meeting. No meeting may be adjourned for more than forty-five (45) days. (Corp. Code § 7511(d).)

Notice of Reconvened Meeting – Unless otherwise provided in an association’s bylaws, when a membership meeting is adjourned to another time or place, notice of the reconvened meeting need not be given if the time and place are announced at the meeting at which the adjournment is taken. (Corp. Code § 7511(d).)

Impact on “Record Date” – The record date set for the initial meeting is not modified in connection with the reconvened meeting. (Corp. Code § 7611(b); See also “Record Date for Elections.”)

Special Adjournment Procedures for Board Elections and Recalls
If an association is unable to hold a membership meeting to elect or to recall directors due a failure to achieve quorum, unless a lower quorum is authorized by the association’s governing documents, the association may adjourn the meeting to a later date at which time the quorum required for the meeting will be twenty percent (20%) of the membership voting in person, by proxy, or by secret written ballot received. (Civ. Code § 5115(d)(2); Corp. Code § 7512(e).) The procedural requirements for adjournment are the same as described above, with the following exceptions:

Date of Reconvened Meeting – The reconvened meeting may not be held on a date less than twenty (20) days after the initially adjourned meeting. (Civ. Code § 5115(d)(2); Corp. Code § 7512(e).)

Notice of Reconvened Meeting – Not less than fifteen (15) days prior to the date of the reconvened meeting, the association must provide general notice of the reconvened meeting to the membership that includes:

    • The date, time and location of the reconvened meeting. (Civ. Code § 5115(d)(3)(A).)
    • The list of all candidates. (Civ. Code § 5115(d)(3)(B).)
    • A statement that 20 percent of the members present or voting by proxy or secret ballot will satisfy the quorum requirements for the election of directors and that the ballots will be counted if a quorum is reached. (Civ. Code § 5115(d)(3)(C).)

Quorum Requirement for Reconvened Meeting – Unless a lower quorum is authorized by the governing documents, the quorum required for the reconvened meeting is twenty percent (20%) of the association’s voting members present in person, by proxy, or by secret written ballot received. (Civ. Code § 5115(d)(2); Corp. Code § 7512(e).)

Court Petition to Reduce Quorum
If a meeting cannot be held due to a failure to achieve quorum, the board or any member of the association may file a petition in superior court to either lower the required quorum amount or to dispense with the quorum requirement entirely. (Corp. Code § 7515.)

Directors Continue to Serve
If an annual meeting of the members is not able to be conducted due to a failure to achieve quorum, and thus the election of new directors at the annual meeting is unable to take place, the directors then in office generally continue to serve on the board until successors have been formally elected and qualified (typically at next year’s annual meeting). (Corp. Code § 7220(b).) Any vacancies on the board which were unable to be filled through membership vote at the annual meeting may generally be filled by approval of a majority of the board (by board appointment), subject to certain exceptions. (Corp. Code § 7224; See also “Filling Vacancies on the Board.”)

Member Quorum Requirements

A “quorum” of the membership is the minimum number of member votes in person, by proxy and/or by written ballot that is required before the association may conduct business at a membership meeting. (Robert’s Rules, 11th ed., pp. 21, 345.) The quorum requirements are usually contained in provisions of an association’s bylaws or CC&Rs. Such provisions typically set the applicable quorum as a simple majority of the association’s voting power.

Default Quorum Requirement
Civil Code Section 5115(b) provides that a “quorum shall be required only if so stated in the governing documents or other provisions of law.” If the governing documents require a quorum but do not specify the quorum amount, and unless otherwise provided in the association’s bylaws or other provisions of law, one-third (1/3) of the voting power of the association, represented in person or by proxy, constitutes a quorum. (Corp. Code § 7512(a).)

Failure to Achieve Quorum
Where the required quorum is not achieved, the membership meeting may be adjourned by a vote of a majority of the votes represented at the meeting either in person or by proxy, but no other business may be transacted. (Corp. Code § 7512(d); See also “Failure to Achieve Quorum.”)

Reduced Quorum for Board Elections and Recalls
Effective January 1, 2024, if an association is unable to hold a membership meeting to elect or to recall directors due its failure to achieve quorum,  unless a lower quorum is authorized by the association’s governing documents, the association may adjourn the meeting to a date at least twenty (20) days after the adjourned meeting, at which time the quorum required for the meeting will be percent (20%) of the membership voting in person, by proxy, or by secret written ballot received. (Civ. Code § 5115(d)(2); Corp. Code § 7512(e); See also “Failure to Achieve Quorum.”)

Quorum Set by Statute
For particular matters, provisions of the Davis-Stirling Act may specify the applicable quorum requirement, regardless of anything to the contrary contained in the provisions of an association’s governing documents. For example, where a membership vote is required to increase assessments above a certain amount, Civil Code Section 5605(c) sets the applicable quorum requirement as more than fifty percent (50%) of the association’s members, regardless of anything to the contrary in the association’s governing documents. (See “Limitations on Assessment Increases.”)

Ballots Count Toward Quorum
If a quorum is required by the governing documents, each ballot received by the association’s inspector(s) of elections must be treated as a member present at the meeting for the purposes of establishing quorum. (Civ. Code § 5115(d)(1).)

Loss of Quorum
If the required quorum is achieved at the beginning of a membership meeting, and enough members withdraw (leave) from the meeting to leave less than a quorum, actions may continue to be taken so long as they are approved by at least a majority of the members required to constitute a quorum. (Corp. Code § 7512(c).) For example, assume that the required quorum is fifty (50) members. If sixty (60) members attend the meeting, but then twenty (20) members leave during the meeting, actions may continue to be taken provided that they are approved by at least twenty-six (26) members remaining at the meeting (at least a majority of the members required to constitute a quorum).

Association Funds in Campaigns

In general, an association is prohibited from using association funds for “campaign purposes” in connection with:

  • Any association board election, or
  • Any other association election except to the extent that the use of association funds is “necessary to comply with duties of the association imposed by law.” (Civ. Code § 5135(a).)

“Campaign Purposes” Defined
The term “campaign purposes” with regard to this issue includes, but is not limited to, the following:

Advocacy – the term “campaign purposes” includes expressly advocating the defeat of any candidate that is on the association election ballot. (Civ. Code § 5135(b)(1).)

Candidate Photo or Candidate Name – the term “campaign purposes” includes the inclusion of a photograph or prominently featuring the name of any candidate on any communication from the association or the board within thirty (30) days of an election. (Civ. Code § 5135(b)(2).)

Related Links

Attorney’s Fees and Costs are not Available to a Moving Party who Secures Interim Injunctive Relief
-Published on HOA Lawyer Blog (March, 2018)

Equal Access During Campaigns

Associations are required to adopt and adhere to election rules in connection with elections that require the use of secret ballots. Those election rules must, among other requirements, provide candidates and association members with access to association media and common area meeting spaces for purposes that are reasonably related to the election. (Civ. Code § 5105(a).)

Equal Access to Association Media
The election rules must ensure that if any candidate or member* advocating a point of view in connection with the election is provided access to association media (i.e., newsletters, websites, etc.) during a campaign for purposes that are reasonably related to that election, the association must provide equal access to all candidates and members advocating a point of view on the issue, including points of view that are not endorsed by the board. (Civ. Code § 5105(a)(1).) The association may not edit or redact any content from such communications, but may include a statement specifying that the candidate or member, and not the association, is responsible for the content. (Civ. Code § 5105(a)(1).)

*Director Points of View & Advocacy – The term “member” has been interpreted by the California Court of Appeals to also include directors of the association (members of its board):

“…to the extent board members advocated their point of view in association media, whether expressing a personal viewpoint, or the collective viewpoint shared by a majority of the board members, the text of the equal-access provision straightforwardly applies…while in the midst of an election, the board must either give equal access to opposing viewpoints, or forego the use of association media to advocate [the board’s] viewpoint.” (Wittenburg v. Beachwalk HOA (2013) 217 Cal.App.4th 654, 664-665.)

Thus, where the board utilizes HOA media to advocate its point of view in connection with an election, it must also provide equal access to that media to any member or candidate advocating a point of view on the issue.

Equal Access to Common Area Meeting Spaces
The election rules must also ensure that access is provided to the association’s 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, including those not endorsed by the board, for purposes reasonably related to the election. (Civ. Code § 5105(a)(2).)

*A “Campaign” May Pertain to Multiple Elections – The term “campaign” does not necessarily apply to a particular election. If an association holds multiple elections in short succession, and those elections pertain to the same generalized matter, the term “campaign” could encompass activities relating to the multiple elections as a collective group for the purpose of challenging the results of the election on the basis that equal access was wrongfully denied. (Wittenburg at 669.)

Violations of Equal Access Requirements; Judicial Enforcement
In an association violates the equal access requirements, a member of the association may bring a civil action for declaratory or equitable relief within one (1) year of the date the cause of action accrues. (Civ. Code § 5145; See also “Legal Challenge to Election.”) Causes of action based upon violations of the equal access requirements may also be brought in small claims court. (Civ. Code § 5145(c).)

Attorney’s Fees – If a member prevails, the member is entitled to his/her reasonable attorney’s fees and court costs, and the court may impose up to five hundred dollars ($500) for each violation. (Civ. Code § 5145(b).) By contrast, if the association prevails, it is not entitled to any of its costs “unless the court finds the action to be frivolous, unreasonable, or without foundation.” (Civ. Code § 5145(b).) However, the term “costs” does not include attorney’s fees; a prevailing association is not entitled to recover its attorney’s fees even where the court finds the action to be frivolous. (That v. Alders Maintenance Corp. (2012) 206 Cal.App.4th 1419, 1428; See also “Legal Challenge to Election.”)

Court Discretion to Void Election Results – When a court finds that an association violated the equal access requirements, or any other requirements applicable to the balloting and election procedures, Civil Code Section 5145 allows a court to void the results of the election. (Civ. Code § 5145(a).) This does not affirmatively require a Court to void the results, but rather gives the Court the discretion to do so. (Wittenburg at 667 and 670.)

Expenditure of Association Funds
Civil Code Section 5135 generally prohibits the use of association funds for “campaign purposes” in connection with board elections and other elections, subject to certain exceptions. (Civ. Code § 5135(a); See also “Association Funds in Campaigns.”) However, association funds may be used in connection with campaign communications that must be provided to comply with the equal access requirements discussed above. (Civ. Code § 5135(b)(2).)

Related Links

Attorney’s Fees and Costs are not Available to a Moving Party who Secures Interim Injunctive Relief
-Published on HOA Lawyer Blog (March, 2018)