Annual Meetings in the COVID Era and Beyond
Annual meetings have “evolved” since the onset of COVID. During 2020, some boards postponed their meetings, some held their meetings via an electronic platform. But by 2021, almost all had annual meetings and the remote option seems to have been a success. Indeed, buildings which could not get a quorum for years have now been able to have enough people attend—when people were told they could simply dial in from wherever they happened to be on the date of the meeting, they often did.
The Business Corporation Law, applicable to cooperatives, had previously been amended to allow meetings to take place via electronic platform, although the initial amendment to the law had an expiration date. That change has now been made permanent. BCL Section 602. A bill is pending which would allow the same in condominiums (S7278-A/22; A8185-A/22), although many condominiums held virtual meetings, particularly when there was really no alternative given health and safety concerns and governmental limits on gatherings.
There have even been some “hybrid” meetings when COVID transmission rates were low—those who could be present in person were (masked and distanced); others were present electronically. The few I attended worked, although boards had to address the technical issues of making sure everyone could hear and be heard.
Assuming whether electronic or hybrid, meetings are here to stay, there are certain things boards and management should keep in mind.
Notice of Meeting. The method of sending the notice of meeting is set out in the by-laws. Typically, it is by personal delivery and/or mail. Realistically, however, if you are giving someone a link to join a meeting, they should also receive it by email, and even as a calendar invite. Many buildings have been sending meeting notices as per the by-laws and, in a cover letter, stating that if management has the owner’s email address, notice will be emailed as well. Of course, anyone can send management their email address. Some buildings handle it slightly differently—they circulate a pre-notice letter asking for authorization to serve the notice of meeting by email.
A number of buildings used this opportunity to amend their by-laws to permit delivery of notices by email for all purposes, provided an owner gives management authorization.
Regardless of how it is done, it is to the building’s advantage to have current email addresses on file, for general management, but also for voting purposes, discussed below.
Nominations and Candidates. While each building’s by-laws are different, some boards have sought to require that anyone who wants to run must announce their candidacy in advance. They do this in a couple of ways. Often there is a “save the date” notice sent, asking all who want to run to submit their name and a brief statement or bio by a date certain so that their names can be included in the annual meeting material. The save the date may also specify, subject to the building’s documents, that since anyone who wants to run can run, there will be no nominations from the floor. Alternatively, or sometimes in addition, when the notice of meeting is sent, some buildings again ask for candidates and, assuming an owner comes forward by a particular date, management will circulate a proxy containing their name and bio along with all other candidates. In either case, the procedure should not bar the board from endorsing a particular candidate or candidates.
A building’s governing documents may be such that an owner may “run from the floor.” This can be handled similar to the way it is handled at in person meetings.
If an election is contested, boards should decide whether to allow each candidate to “unmute” and address the owners at the meeting. If so, we recommend that each presentation be limited to two minutes, and that no one be permitted to ask questions of the candidates.
Proxies. How are proxies delivered? There are a few options, really no different from an in person meeting. People should be able to deliver their proxy by mail, by hand to the door staff (if there is door staff), by email and even by facsimile.
Format of Meeting. Should the meeting be in “webinar” format, where attendees, other than the board and the building’s professionals, cannot be seen or heard, but can type questions in a Q&A? My experience is that most boards want to allow all owners the option of being on screen, even in larger buildings. The administrator of the meeting—often the managing agent—makes sure that everyone remains muted. However, anyone can communicate by asking to unmute (“raise your hand”), typing a question or even emailing a question to the administrator, whose email information should be available to everyone. Some buildings create special email addresses for the meeting.
Importantly, many boards ask that all questions be held until the end of the meeting, other than for presentations made by professionals who may leave the meeting when they are finished. This allows the meeting agenda to proceed uninterrupted.
Roll Call and Quorum. How do you know who is present at the meeting, and whether there is a quorum (if not already obtained via proxy)? Often electronic platforms have a “waiting room.” The administrator can communicate with those “on hold” and make sure that the person waiting is an owner, owner representative or proxy authorized to attend.
Alternatively, and particularly in smaller buildings, everyone can be “let in” to the meeting immediately. They may be asked for their apartment number.
Voting. Most people will have voted by proxy prior to the meeting. If someone runs from the floor, or an owner wants to change their vote, management can electronically distribute a ballot to anyone who wants one, and that owner can send the ballot electronically to the inspectors of election (often management employees). Another option is for the owner to send an email to the inspectors of election from a known email address, with the subject line “ballot.” There, they can list the candidates they wish to vote for (and share allocation if a cumulative voting building).
When there is a contested election, particularly if someone first announced their candidacy at the meeting, boards may elect to leave voting open for an hour or two after the meeting or even until the next day to allow owners to send their ballots to the inspectors.
Outside Company. There are a number of outside companies that can assist a board in an annual meeting, particularly if there is a contested election. The services are varied, but perhaps the most important is that, if there is a contested election, the company can set up voting on-line, to make voting easier for owners, and perhaps more efficient.
Back in the days before COVID, cooperatives and condominiums simply did not hold electronic meetings. I have little doubt that electronic, or hybrid, meetings are here to stay. Boards must plan for contingencies in advance, but these meetings often run smoothly, efficiently and without incident.
Reprinted with permission from the March 8, 2022 issue of New York Law Journal. © 2022 ALM Media Properties, LLC. Further duplication without permission is prohibited. All rights reserved.