HOA Homefront – Reader Questions – Open Meeting Act Questions
By Kelly G. Richardson, Esq.
Our HOA has regularly scheduled, monthly, closed meetings. Based on your columns this doesn’t seem right to me. What types of topics are to be considered in closed session?
Closed session is strictly limited to a very few topics. It is for discussion of personnel matters (if the HOA has employees), litigation, certain member issues (discipline, foreclosure votes, or payment plan proposals), and “formation of contracts”. If it is not under one of those four categories, it cannot be discussed in closed session.
Some associations construe “formation of contracts” very broadly, and change vendors in closed session. However, the formation of contract is different than the selection of the vendor. The vendor selection comes first. That discussion should be in open session. After selecting the vendor which the Board prefers, then the negotiation of the contract ensues, and discussion of negotiation terms should be in closed session.
The fact that your HOA board meets in closed session each month does not necessarily mean it is abusing closed session. Larger associations often need a closed session each month, because they have disciplinary hearings and foreclosure votes almost every month.
Thanks for your question, Kelly
We are probably the first (mobile home) park in California to be owned by the members. The corporation which we are now governed by a Board of Directors and our meetings are held every month. We have a nine member Board of Directors voted by the members of the park. Your article regarding Open Forum is at question to some of the members. Our important question to you is, are we governed by Civil Code 1363.05?
Respectfully, R.C., Anaheim
The Open Meeting Act (Civil Code 1363.05) is part of the Davis Stirling Common Interest Development Act. For an association to be governed by the Act, it must qualify as a “common interest development,” which is defined in Civil Code Sections 1351(c) and 1352. If each member owns a separate real estate interest, a recorded declaration of covenants binds all property owners, and there is shared common area or mandatory membership, your park is probably a common interest development.
Consider consulting an attorney to review your documents to confirm this.
Dear Mr. Richardson,
Thank you for all the informative and interesting articles. They are extremely helpful.
I am a Realtor and also on the Board of my HOA, as Treasurer. The past few months a situation has recurred that concerns me. Our President discloses confidential issues that are discussed and/or voted upon in Executive Session with his wife (a non-homeowner) after the meetings. On several occasions she has in turn shared information from Executive Session with other neighbors.
What is your opinion please?
Thank you, M.M., Fountain Valley
If something is properly in closed session, it needs to stay there. I routinely suggest my client boards annually sign confidentiality agreements, to remind them of the importance of their discretion. Breaching that confidentiality can lead to serious consequences.
Sometimes current or even former directors breach that confidentiality for their own purposes, which is even worse. If someone will not protect the confidences they are privy to as a director, that person should not be allowed to participate in closed session.
Think about adopting a board confidentiality agreement – it might help.
Kelly G. Richardson is Managing Partner of Richardson Ober PC, a law firm known for community association advice. Send questions to KRichardson@ROpc.com. Past columns – www.HOAHomefront.com. All rights reserved® 2013