Annual Meeting

Sure, You Can Go for Electronic Voting. Should You?

The Answer, Frankly, Is “probably, but It Won’t Solve Everything.” 

All three jurisdictions—Maryland, Virginia, and the District of Colum­bia—allow for electronic notice of meetings and electronic voting in condo­minium associations.  The Virginia and Maryland codes also explicitly permit elec­tronic notice and voting in homeowners’ associations, while the D.C. code is silent on the matter.   There are, however, certain requirements that must be met.   Before notices of upcoming meetings may be sent electronically, the governing documents should permit such notice, and the board must authorize the practice; also, the indi­vidual member must send a written notice that he/she will accept electronic notices.

With each notice, a board representative must certify that the notice was properly sent.   Also, electronic notice will be deemed ineffective if it was returned twice as unde­liverable.   See D.C. Code §§ 42-1903.03(b)(1); Md. Code, Real Prop. Art. §§ 11-139.1, 11B-113.1; Va. Code §§ 55-79.71:1, 55-79.75(A), § 55-515.3(B).  These steps are important because only business con­ducted at properly noticed meetings, with proper quorums, can be considered effec­tive.  Without these safeguards in place, the board risks defending against a later chal­lenge to the actions taken at the meeting—and at that point, it’s far too late to make things right again.

Similarly,—and, again, if authorized by the board and permitted by the governing documents—unit owners may submit their votes or proxies for association meetings by electronic means, as long as the means to submit electronically is in a consistent form, is available to all unit owners, and contains sufficient information to verify that the vote or proxy is authorized by the unit owner.   See D.C. Code § 42-1903.05(g)(1); Md. Code, Real Prop. Art. § 11-139.2, 11B-113.2; Va. Code § 55-79.77(D); § 55-515.3(D).  This is where the technology becomes important.  The board must make sure that each electronic vote or proxy is properly authenticated, that each unit owner has only voted once, or submitted only one proxy, and that all the electronic votes are properly counted.  Again, you don’t want to be in a position of trying to defend, years after the fact, a board resolution or bylaw change with shaky facts about how the electronic votes were col­lected.

Electronic notices and electronic voting can make the associa­tion meeting process more efficient and will improve the chances of having a quorum for any meeting where a vote of association members will occur.  Having the option of voting electronically will allow residents to participate in the decision-making process, even if they cannot attend the meeting or just don’t feel like attend­ing.   It will also streamline the vote-counting process.  However, it is not a panacea.  Electronic notice is an “opt-in” procedure; the association must still provide regular notice for those residents who do not opt in.  More importantly, regardless of the number of people who choose to vote electronically, the association must still provide a means for residents to cast their votes by written ballot in paper form at the meeting itself.  There is no escape from counting at least some paper ballots.

Nor, for that matter, is there any escape from the requirement to hold the meeting itself, to ensure that there is a quorum, or to allow members to participate in the discussions.   No matter how con­venient electronic voting might be—either for residents or board members and management—the association still has to meet.   While the governing documents may permit the board to take cer­tain actions outside of a formal meeting, there remains the annual meeting, as well as regular meetings to conduct the business of the association.   The touchstone for any functioning organization—whether it’s a community association or a large corporation—is that the membership meets at least once per year and discusses the issues at hand.   Functional community associations also provide for frank and open discussion of various issues by the members themselves.

Just as the board needs to meet and confer, the residents—neigh­bors, friends, and family who comprise the building or community occupants—need to meet and air their opinions to the board.  Rely­ing too heavily on electronic voting diminishes this aspect of asso­ciation meetings as it is likely to reduce overall attendance, again to the detriment of the association.

In all, electronic notice of meetings and electronic voting are im­portant tools that community associations can use to efficiently and effectively increase participation by association members who are unable to attend meetings in person.  In the end, an over-reli­ance on one tool can lead to future trouble.It’s called a “community association” for a reason: you’re living in a community.

By Thomas Mugavero, ESQ.
Thomas is currently of counsel with the law firm of Whiteford,  Taylor & Preston, LLC. He has engaged in business litigation practice throughout Vir­ginia, Maryland, and the District of Columbia for over 20 years.