Karen L

I appreciate all your responses I will be able to speak confidently when I present my beliefs to the BOD and maybe be asking for a clarification in our By-Laws. You are all a blessing to me! Thank you!

On 11/10/2022 at 4:09 PM, Gary Novosielski said:

I am not a lawyer, but my understanding is that headings are for information only, while the text is what counts. 

Section 8 provides that all committees are appointed by the board, and that except for the chair, the members may be any stockholder.  Yet in 8.A.1, we are told that the EC has a fixed membership, and all members are officers.  So it is already not a typical committee.

Furthermore, in both Section 2.B, and in 8.A.2 we are told that the EC handles the business of the organization between meetings of the board, which is exactly the situation anticipated in 49:13.  In my view, that means that the EC, when sitting as the EC per se, is empowered to act without prior approval from, yet subordinate to, the Board, as described there.

In this case, the EC is also assigned additional duties in 8.B as the Law and Order Committee.  This is a different role from that of a typical EC, but it is another exception to the stated rules for appointment of committees, since its has the same fixed membership as the EC.  And in this case it is empowered to make decisions which are subject, after the fact, to appeal to the Board.  But presuming its decision is not appealed, a decision of the EC stands as the decision of the organization.

And in 8.B.3, it is given enforcement power with respect to the (standing?) rules of the organization, which suggests more independence than a simple committee.

I imagine that Sections 8.C,D, etc. may go on to establish more typical standing committees, which function as such, but this EC seems to be more in the nature of a board-within-a-board, as described in RONR 49:13

Thank you for your response. Yes, the rest of Section 8 defines the responsibilities of our standing committees, all of which report back to the Board of Directors.

Our By-Laws are being questioned by Board members regarding our Executive Committee. I have included the verbiage for assistance with an answer. I believe the Executive Committee can function on its own between meetings. Other members believe the Executive Committee can not make any decisions without Board approval because our By-Laws specifically refer to the EC as a Committee even though the verbiage directly indicates the EC manages the details of the Association during the interim of meetings and spells out how to handle disputes, with the BOD involvement when residents do not agree with EC decision. Please advise. Thank you for your consideration of this matter.

Our By-Laws read:

SECTION 2  BOARD OF DIRECTORS MEETINGS

A.   The Board of Directors shall meet as often as deemed necessary to transact the business of ECWPA but shall in all cases meet at least six (6) times per year and shall be subject to the provisions of Paragraph six (6) of the CHARTER.

B.   The management of the details of the business of the Association, during the interim of the meetings of the Board shall be committed to the Executive Committee.  The Executive Committee is also to function as the Law-and-Order Committee.

C.  Special meetings of the Board of Directors must be called by the President upon written request of five (5) members of said board within two (2) weeks of such request.

SECTION 8  COMMITTEES

All Standing Committees shall be appointed by the Board of Directors annually after the election of officers. The Chairperson of each committee shall be appointed from the membership of the Board of Directors. Any stockholder is eligible to serve as a member of these committees.

A. EXECUTIVE COMMITTEE

1.   Shall be made up of the Officers of the Board of Directors.

2.   Shall manage the business of the ECWPA during the interim of the meetings of the Board.

3.   Shall be their duty to determine the character of the building plans or alterations of such cottages located on leased lots and other such matters as may arise in connection with the leasing of lots.

B. LAW AND ORDER COMMITTEE

1.   Shall be the Executive Committee.

2.   Shall be responsible to arbitrate all differences which may arise between lease holders. An appeal of the decision of the committee may be presented in writing to the Board of Directors and the decision of the Board will be final.

3    Shall enforce and interpret the rules of ECWPA as necessary.

Thank you for your input. You are correct the shares are not publicly traded but do have a value of $10. I will share your responses with our Board and most likely contact our attorney for further advice.

On 9/20/2022 at 4:59 PM, Josh Martin said:

As this is a stock corporation, I expect that this is a question which should ultimately be directed to an attorney. It is very possible that applicable law requires your organization to have a President.

So far as RONR is concerned, unless and until the position of President is filled, the board would elect a Chairman Pro Tempore at each meeting. (The Secretary would call the meeting to order and preside until that person is elected.) Certainly, this position could be rotated among members of the board at each meeting, if that is what the board desires.

It must be noted, however, that such a person only assumes the duties of presiding officer. If your organization's rules provide any other duties or authority for the President, that authority can only be exercised by a person who is actually the President. RONR does not contemplate a "rotation" in the actual office of President. While I suppose an organization theoretically could accomplish the desired "rotation" by electing a President at each meeting (who would resign at the next meeting), this does not strike me as a very good idea.

Mr Martin

Thank you for your kind response. I might add that that the Shares which are held have no monetary value. They are for voting purposes only. Our Association owns land upon which persons have cottages and rent the lot from us. Each cottage owner must hold Ten shares of stock (sold at $10 each) in order to maintain their lease. No matter how many shares are held, the stockholder has only one vote. Does this information make a difference? Thank you again. Karen

Our Board Vice President resigned at our Annual Stockholder meeting. Our By-Laws state that the Board of Directors "Shall transact such other business as may properly come before the meeting as soon as convenient after the Annual Meeting of the Stockholders and elect from the members of the Board: a President; a Vice President; a Recording Secretary; a Stock Secretary and a Treasurer."  These members serve as our Officers and make up the Executive Committee. 

During our first meeting after the Annual Meeting of the Stockholders, no member of the BOD would accept the vote for the office of either President or Vice President. Our By-Laws also indicate "In the event of a vacancy on the Board of Directors or in any office, the same shall be filled for the unexpired term by the Board of Directors." A recommendation was made that we research rotating the "President" seat during our monthly meetings among the members of the Board of Directors. 

I am not certain how to go about making this happen. I currently serve as an office in the Stock Secretary position and will "Chair" our October meeting. Please advise! Thank you for your kind consideration of this matter.