One of the surest ways a condominium board can invite criticism and mistrust is to make decisions in secret. Unit owners quickly become disenchanted when they feel the neighbors they elected to represent them are acting behind their backs. Blame it on human nature, but they’re not inclined to think a closed door means their assessments are going down next year.
The Illinois Condominium Property Act and the Illinois Not-For-Profit Corporation Act spell out the procedures boards must follow to conduct their business and the requirements for disclosing their actions. To keep your board above reproach, consider the following:
– The board must hold at least one meeting of the unit owners to elect new members and four business meetings each year. Unit owners must be given notice not less than 10 and not more than 30 days before the annual meeting. The notice must be written and either mailed or delivered. Business meetings must be open to the unit owners, who should be notified at least 48 hours in advance. Notice of business meetings must be posted in a conspicuous place such as at an entry or an elevator.
– Closed meetings, sometimes called “executive sessions,” may be held in certain circumstances. Board discussions are limited to: pending, probable or imminent litigation; violations of rules and regulations; a unit owner’s unpaid assessments; and the hiring and firing of employees.
No votes may be taken in executive session.
– Board members should watch what they discuss among themselves when not in official meetings. They could be guilty of illegal conduct.
A problem that arises is that board members sometimes gather over coffee or at the swimming pool. Matters of the association naturally come up in their conversations. That’s OK, says Wheaton attorney David Keay, but they can’t conduct business, which he defines as “something that commits the association to a contract, liability, responsibility or obligation.”
– Minutes must be taken at all open meetings. Minutes do not have to be taken at executive sessions.
“There is no safe harbor in executive session if boards need to record matters being discussed,” says attorney Allan Goldberg of Arnstein & Lehr in Chicago.
The board must reconvene from its executive session to take action. The confidentiality of the matter can be retained while making the decision public, says Goldberg. For example, if a decision is made to discipline an employee, the employee’s name does not have to be given.
“Be certain anything discussed in executive (session) is identified, even though in generic and abbreviated format, when voting so you have a record and non-board owners can understand what led to a decision,” he says.
Executive sessions do not have to be announced in advance to the unit owners but doing so is a courtesy, he adds.
– Keep executive sessions to a minimum.
“The members are not your enemies,” says Keay. “It gains the board of managers nothing to create an adversary relationship with its fellow unit owners. It raises suspicion, discourages participation among unit owners and ultimately invites litigation.”
– Boards may hold emergency meetings. If a tornado blows the roof away, which has been known to happen in this part of the country, the board can order immediate repair.
– Boards may hold planning sessions, perhaps to evaluate a multiyear landscaping overhaul or to make out a budget for the following year.
“While we might not classically call them such, those are committees, which, under the Illinois Not-For-Profit Corporation Act, are recognized as vehicles, arms or extensions of the board,” says Goldberg. “The board has the authority to delegate to committees the tasks of reviewing, analyzing and recommending action to be taken.”
Committees–whether composed of board members, unit owners or a combination–can’t adopt whatever proposal it is recommending. The board must do that at an open meeting.
– Unit owners may record the proceedings of open meetings on tape or film.
“Boards do have the right to make reasonable rules and regulations to govern the recordings so they don’t interfere with the meeting,” says Keay.
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WORKSHOP: The Illinois Chapter of the Community Associations Institute is sponsoring a one-day workshop, “Achieving Better Communities,” for board members and other association volunteers from 8:30 a.m. to 4:30 p.m. Nov. 15 at the Chicago Marriott Schaumburg. The workshop, which is conducted nationally, covers topics such as board control, how to prepare an operating budget and how to reduce risk. The cost is $45 for members and $65 for non-members. For information or reservations, call 630-372-7510.
MEETING: The Near North Association of Condominium Presidents will hold its quarterly meeting from 9 a.m. to noon Saturday in the Hospitality Room at 1212 N. Lake Shore Dr. Representatives from the Near North Insurance Group and Condominium Insurance Specialists of America will discuss coverage options for condominium communities. Call 312-236-6900 for reservations.
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Do you have an issue you’d like to see discussed in a future column? You can write to Pamela Dittmer McKuen at Community Living, Chicago Tribune, Your Place section, 435 N. Michigan Ave., 4th Floor, Chicago, Ill. 60611. Please include your phone number. Or e-mail Pmckuen@aol.com.
