Many associations have a problem getting enough people to serve on the board due to apathy, but that is another subject, for another column, on another day.
Other associations experience massive turnover and politics of a Chicago ward, and the board of directors and the property manager must be prepared to meet the issues head on or they will not survive (politically, that is) another day.
Preparation is obviously the best solution and if the board appears to be united, calm and does its homework, the leaders can put down any kind of coup d'état. Here are the most common issues that one might see in anticipating an upcoming annual meeting where the community might be in upheaval.
The rabble-rousing open letter: Frequently these are unsigned, which means the people who are circulating them do not have the courage of their convictions to stand up and be counted. The owners should just disregard this type of diatribe because what kind of leader does not even sign their own manifesto? I will generally advise boards just to ignore them and not even respond, otherwise, you give the author credibility.
The longer the letter, the less likely people will be to read it. It is hard enough to get owners to read the official newsletter. Even if they do, it is usually after one paragraph that they lose interest. Only if serious issues are addressed, such as untrue accusations of fraud, theft, mismanagement of association funds or property, etc., should the board respond. Even in those instances, once the lies are specifically addressed, then the board can write a more positive and upbeat response that talks about all the good things officers or directors have done.
A board must always remember that these are people's homes, and members do not want to engage in a clash of personalities, or have to worry about the validity of the board so long as they are comfortable with the incumbent leadership.
Someone is getting lots of proxies: One day associations may be rid of this archaic leftover from corporate law that can turn the entire election process on its ear. If a smiling person comes to the door of someone who does not want to go to a meeting, this resident will more often than not sign a "blank check" that may not always be used for its appropriate purpose, by allowing this smiling person to accumulate votes.
If it's a condominium association and they have to use a proxy ballot with known candidates designated, the unknowing owner signs it and places an "x" by his choices, and then the proxy holder can disregard the selection and vote for whomever they want. (Section 18 (a) (18) Illinois Condominium Property Act, 765 ILCS 605/18 (a) (8).
A much better way to go is for the board to develop rules to conduct elections by mail (Section 18 (b) (9) (B). Or, effective Jan. 1, Section 107.10 of the Illinois General Not for Profit Corporation Act (805 ILCS107/ 107.10) permits voting by e-mail, subject of course to rules and regulations adopted in advance by the board of directors.
The newer methods of voting can alleviate many problems of the past. Now if only the legislature could do something about abolishing cumulative voting!
Dealing with a faction: In 33 years of dealing with association elections, I have never seen one where there was an insurgency that operated in silence and surprised the incumbents and other candidates on the night of the election. They are always vocal, and attempting to stir up the masses to support their cause by either the mass collection of proxies or getting everyone to come to the meeting. Depending upon the issues and the numbers, a board confronted by an unhappy minority has several options:
• Contact the leaders and set up a meeting to discuss the issues.
• Schedule a separate owners meeting to have an airing of grievances and exclude these issues from discussion on the night of the annual meeting.
• Take the ringleaders aside at the beginning of the meeting to see if their issues can be addressed before or after the meeting, so as to not politicize the election.
If these options fail, then the board must be prepared to address their opponents at the annual meeting itself.
Handling the difficult meeting: If the preparedness approach is unsuccessful, the board should aggressively seek out the activists and draw them aside to discuss items of contention. If there is a reasonable effort on the part of the board to take the wind out of their sails, the meeting may be a lot quieter and controlled. First, an agenda needs to be constructed and followed to the letter. Second, keep people on point and only let them prattle on if the subject absolutely warrants it, or else they tend to take over the meeting, and the board will lose its focus. If there is a tight agenda and order is maintained, these folks may prevail but at least the ground is set for an orderly meeting and not a tar-burning mob. The term "you're out of order" can go a long way toward restoring it. The chair or any other directors do not have to deal with an owner's unhappiness and not engage them in an argument. It is not required. I also recommend against nominations from the floor. Nowhere is it written that a board must do this. If the rules so provide, and the owners are astute enough and concerned enough to turn in their candidate applications ahead of time and before the ballot, why should someone at the last minute be able to step up and knock the people who play by the rules out of the box. This is overly unfair and prejudicial to the diligent candidates, and you have to ask yourself; How good is a director going to be who cannot even get an application on file?
Balloting: When it is time to vote, the candidates should be introduced or even be able to make a brief statement talking about their credentials. Under no circumstances do I permit the owners to question the candidates standing for election. This can be all too intimidating, especially if someone wants a candidate to look bad. This is not a union election, and I believe most people will then want to run for and be elected to the board and not have to worry about being confronted by confrontational tactics. If there is a strong desire by a number of people who want to ask questions of a candidate about where they stand on the great issues of the day, the association should sponsor a candidates' night with a tight control format, questions from the audience, and advance preparation for all parties involved.
If the incumbents and new candidates are fully aware of the rules they have to play by, the election should go off without a hitch, and the new board will be off on the right foot. Let the best man/woman for the job win.
• Jordan Shifrin is an attorney with Kovitz Shifrin Nesbit in Buffalo Grove. Send questions to him at email@example.com. This column is not a substitute for consultation with legal counsel. Past columns can be read at www.ksnlaw.net.