Minutes Approval for Successive Inquorate Meetings

[Ray Harwood]

Background

Homeowners associations are perhaps notorious for lack of member attendance at annual member meetings.  With two previous years (2019 and 2020) of inquorate meetings, it is likely that this year's meeting will also be inquorate, as predicted by the number of absentee ballots on hand.  (Arizona statute ARS 33-1812(B) states "Votes cast by absentee ballot or other form of delivery, including the use of e-mail and fax delivery, are valid for the purpose of establishing a quorum.")

FYI: The quorum is set by the bylaws as 1/10 of the number of lots; with 345 lots, there's only twice on record of ever meeting a 35 member quorum, and one of those had only 8 lots physically represented at the meeting, with the remainder made up of absentee ballots.

We will document this year's (apparently inquorate) meeting with minutes, as we have with the two previous inquorate meetings (last year's is attached).  There are currently no standing rules for the association (but there are for the Board of Directors), and no provision in the bylaws referring to approval of annual meeting minutes. 

The provision of RONR 48:12 allows for the assembly "to authorize the executive board or a special committee to approve the minutes", but it would seem that a motion to do so would be out of order at an inquorate meeting (RONR 40:6-10) -- unless I'm missing something.

I'm prepared - in the event there is a quorum, this year or ever - to move the creation of a standing rule stating that the board may approve annual meeting minutes, absent any other provision by the assembly of association members (perhaps the members wish to authorize a committee at a future meeting).

Question

Absent any other provision -- do these prior draft minutes of inquorate meetings continue to sit unapproved and marked DRAFT until such time as the annual member meeting actually has a quorum?  Or can the board approve the minutes, noting the inaction/inability of the members to do so and considering the provisions of RONR 49:7?

2020-11-05-DRAFT2-AnnualMeeting-NoQuorum-redacted.pdf

Edited October 27, 2021 at 01:44 PM by Ray Harwood

[Joshua Katz]

On 10/27/2021 at 9:43 AM, Ray Harwood said:

The provision of RONR 48:12 allows for the assembly "to authorize the executive board or a special committee to approve the minutes", but it would seem that a motion to do so would be out of order at an inquorate meeting (RONR 40:6-10) -- unless I'm missing something.

 

You are correct.

On 10/27/2021 at 9:43 AM, Ray Harwood said:

Absent any other provision -- do these prior draft minutes of inquorate meetings continue to sit unapproved and marked DRAFT until such time as the annual member meeting actually has a quorum?

Yes. Of course, I'd think they'd be rather brief and uninteresting. 😉

But, if you go back far enough, there must be some quorate meeting whose minutes were also never approved, right? At X meeting there was a quorum, then at X+1 and thereafter there wasn't. Those are also sitting unapproved, so one might wonder if that has any affect on the motions in them. The answer is no, a motion takes effect as soon as it is adopted (unless your rules say otherwise), not when the minutes are approved. You need to approve the minutes so that they serve as an official record, agreed to by the body, if there is dispute as to what happened, not for any other immediate purpose.

 

[Richard Brown]

@Ray Harwoodyou might check (or have your attorney check) to see if Arizona law contains a provision  for holding a meeting with a reduced quorum requirement if the first one or two attempts at obtaining a quorum are unsuccessful.  Some state laws contain such a provision, but the terms vary from state to state.

[Ray Harwood]

On 10/27/2021 at 7:04 AM, Joshua Katz said:

Yes. Of course, I'd think they'd be rather brief and uninteresting. 😉

Agreed... but as evidence that a meeting was held, in case a member chose to compel a meeting in accordance with ARS 10-3703, the minutes are an essential defense.  Not that anyone cares enough to get a judge to compel a meeting... but you know -- it could happen!

A. The court in the county where a corporation's principal office is located, or if the corporation has no principal office in this state, the court in the county where the corporation's known place of business is located, may summarily order a meeting to be held on application by any of the following:

1. Any member, if an annual meeting was not held within fifteen months after its last annual meeting.

On 10/27/2021 at 7:04 AM, Joshua Katz said:

But, if you go back far enough, there must be some quorate meeting whose minutes were also never approved, right? At X meeting there was a quorum, then at X+1 and thereafter there wasn't. Those are also sitting unapproved, so one might wonder if that has any affect on the motions in them. The answer is no, a motion takes effect as soon as it is adopted (unless your rules say otherwise), not when the minutes are approved. You need to approve the minutes so that they serve as an official record, agreed to by the body, if there is dispute as to what happened, not for any other immediate purpose.

I was focused on the minutes of inquorate meetings, yes... but in preparing my script I realized exactly that -- Aha, there's one more set from 2018!  It is only slightly less brief, and not much more interesting... but nevertheless, an essential corporate record. 

Thanks for the thoughtful response.