HOA Election Rules

CENTRE STREET LOFTS COMMUNITY ASSOCIATION

ELECTION AND VOTING RULES

(California Civil Code Section 5100 et seq.)

1. INTRODUCTION

These Election and Voting Rules (“Rules”) establish certain procedural rules for the successful management of membership meetings and implement the relevant provisions of the Association's Bylaws, the California Civil Code, and the California Corporations Code concerning membership elections and membership voting. Any conflict or inconsistency between these Election and Voting Rules, the Bylaws and/or the Civil Code, shall be resolved in accordance with Civil Code Section 4205.

2. EQUAL ACCESS

If any candidate or member advocating a point of view is provided access to Association media, newsletters, or Internet Web sites during a campaign, for purposes that are reasonably related to that election, equal access shall be provided to all candidates and members advocating a point of view, including those not endorsed by the Board, for purposes that are reasonably related to the election. The Association shall not edit or redact any content from these communications; provided, however, the Association shall not be responsible or liable for the content of any such communications, and the Association may include a statement in the communication specifying that the candidate or member, and not the Association, is responsible for the content. Equal access to common area meeting space, if any, shall exist during a campaign, at no cost, to all candidates, including those who are not incumbents, and to all members advocating a point of view, including those not endorsed by the Board, for purposes reasonably related to the election.

3. USE OF ASSOCIATION FUNDS FOR CAMPAIGN PURPOSES PROHIBITED

Association funds shall not be used for campaign purposes in connection with any Association Board election. Funds of the Association shall not be used for campaign purposes in connection with any other Association election except to the extent necessary to comply with duties of the Association imposed by law. As set forth in Civil Code Section 5135, for the purposes of this section "campaign purposes” include, but are not limited to, the following:

A. Expressly advocating the election or defeat or any candidate that is on the Association

election ballot.

B. Including the photograph or prominently featuring the name of any candidate on a

communication from the Association or its board, excepting the ballot and ballot materials, within 30 days of an election, provided that this is not a campaign purpose if the communication is one for which subdivision (a) of Civil Code Section 5105 requires that equal access be provided to another candidate or advocate.

4. CANDIDATE QUALIFICATIONS AND NOMINATION PROCEDURES

The Association shall not disqualify a person from nomination if the person has not been provided the opportunity to engage in internal dispute resolution.

Subject to the requirement to first provide an opportunity to engage in internal dispute resolution, the following persons are disqualified from nomination as a candidate:

(1) Any nominee who is not a member of the Association;

(2) Any nominee who has been a member of the Association for less than one year;

(3) Any nominee who, if elected, would serve on the Board at the same time as another person who holds a joint ownership interest in the same condominium unit as the nominee and the other person is either properly nominated for the current election or an incumbent director;

(4) Any nominee who discloses, or if the Association is aware or becomes aware of, a past criminal conviction that would, if the nominee was elected, either prevent the Association from purchasing the fidelity bond coverage required by Section 5806 or terminate the Association’s existing fidelity bond coverage.

(5) Subject to subparagraph (6) below, a nominee for a Board seat, and a Director during his or her Board tenure, must be current in the payment of regular and special assessments. A nominee shall be disqualified from nomination for nonpayment of regular and special assessments, but may not be disqualified for nonpayment of fines, fines renamed as assessments, collection charges, late charges, or costs levied by a third party (e.g., management, or a collection firm).

(6) The nominee shall not be disqualified for failure to be current in payment of regular and special assessments if any of the following circumstances are true:

(a) The nominee has paid the regular or special assessment under protest pursuant to Section 5658; or

(b) The nominee has entered into a payment plan pursuant to Section 5665.

(c) The nominee has not been provided the opportunity to engage in internal dispute resolution (IDR) pursuant to Section 5900.

A person is entitled to nominate himself or herself for election by submitting his or her name as a candidate using the candidacy form prescribed by the Association, provided the form is received by the stated deadline. Persons who fail to submit the candidacy form prescribed by the Association by the stated deadline will not have their name included as a candidate on the secret ballot. Nominations may also be made from the floor of the election meeting, provided the nominee is present at the election meeting and accepts a nomination for election. Self-nominations from the floor of the election meeting are also permitted. “Write-in” candidates on the secret ballot are permitted, provided the “write-in” candidate is present at the election meeting and accepts a nomination for election.

The Association shall, at least 30 days before any deadline for submitting a nomination, provide general notice (Section 4045) of the procedure and deadline for submitting a nomination. Individual notice shall be delivered pursuant to Section 4040 if individual notice is requested by a member.

The Association shall retain, as association election materials (Section 5200(a)(13)), both a candidate registration list and a voter list. The voter list shall include name, voting power, and either the physical address of the voter’s separate interest, the parcel number, or both. The mailing address for the ballot shall be listed on the voter list if it differs from the physical address of the voter’s separate interest or if only the parcel number is used.

Members shall be permitted to verify the accuracy of their individual information on both lists at least 30 days before the ballots are distributed. The association or member shall report any errors or omissions to either list to the inspector or inspectors who shall make the corrections within two business days.

5. THE VOTING POWER OF EACH MEMBERSHIP

Each membership shall be entitled to one (1) vote per condominium unit, provided that in the case of election of directors, each condominium is entitled to one (1) vote for each position to be filled on the Board of Directors, and Members shall be entitled to cumulate their votes for one or more candidates when more than two (2) Directors are to be elected.

If title is held by a legal entity that is not a natural person, the governing authority of that legal entity shall have the power to appoint a natural person to be a member of the Association for purposes of Sections 5100 through 5145.

The Association shall, at least 30 days before the ballots are distributed, provide general notice (Section 4045) of all of the following:

A. The date and time by which, and the physical address where, ballots are to be returned by mail or handed to the inspector or inspectors of elections;

B. The date, time, and location of the meeting at which ballots will be counted; and

C. The list of all candidates’ names that will appear on the ballot. 

Individual notice of the above paragraphs shall be delivered pursuant to Section 4040 if individual notice is requested by a member.

6. INSPECTORS OF ELECTION

In accordance with Civil Code Section 5110, the Board of Directors shall appoint either one (1) or three (3) independent third parties to serve as Inspector(s) of Election. An “independent third party” includes, but is not limited to, (a) a volunteer poll worker with the county registrar of voters, (b) a licensee of the California Board of Accountancy, (c) a notary public, or (d) a member of the Association who is neither a director, a candidate for election as a director, nor related to a director or candidate for election as director. An Inspector of Election, and any person appointed by an Inspector of Election to assist in verifying signatures or in counting and tabulating votes, may not be a person, business entity, or subdivision of a business entity who is currently employed or under contract to the Association for any

compensable services other than serving as an inspector of elections. The Inspector(s) of Election shall perform the duties set forth below and shall sign a report or certificate evidencing the voting results. The decision of a majority of the Inspectors shall control.

A. Duties of Inspectors of Election:

1. Determine the number of memberships entitled to vote and the voting power of each;

2. Confirm the number of memberships represented at the meeting;

3. Confirm the existence of a quorum;

4. Determine the authenticity, validity, and effect of proxies and ballots;

5. Hear and determine all challenges and questions in any way arising in connection with the right to vote;

6. Count and tabulate all votes;

7. Determine when the polls shall close;

8. Determine the result of the voting;

9. Perform any acts as may be proper to conduct the balloting or election with fairness to all members.

The Inspector(s) of Election shall deliver, or cause to be delivered, at least 30 days before an election, to each member both of the following documents:

A. The ballot or ballots; and

B. A copy of the election operating rules. Delivery of the election operating rules may be accomplished by either of the following methods:

i) Posting the election operating rules to an internet website and include the corresponding internet website address on the ballot together with the phrase, in at least 12-point font: “The rules governing this election may be found here:”; or

ii) Individual delivery, as described in California Civil Code section 4040. 

Notwithstanding any other law, the Association and the Inspector(s) of Election shall not:

(A) Deny a ballot to a member of the Association for any reason other than not being a member of the Association at the time the ballots were distributed;

(B) Deny a ballot to a person with general power of attorney for a member. The ballot of a person with general power of attorney for a member of the Association shall be counted if returned in a timely manner.

7. SECRET BALLOT PROCEDURES APPLICABLE TO CERTAIN VOTING AND PROXY USE

Membership voting regarding assessments, election and removal of members to the Board of Directors, amendments to the governing documents, and the proposed grant of exclusive use of common area pursuant to Civil Code Section 4600 (hereinafter “Secret Ballot Topics”) shall be conducted through secret ballot procedures in compliance with Civil Code Section 5100 et seq. The Association may distribute proxies in connection with Secret Ballot Topics, and the Inspector(s) of Election shall be entitled to invalidate any proxy or other document purporting to cast a Member’s vote used in connection with Secret Ballot Topics that does not comply with these Rules and applicable law, including the secret ballot procedures set forth in Civil Code Section 5100 et seq.

A Member may cast his or her vote on a Secret Ballot Topic in person at a meeting, provided the Member casts the vote using a secret ballot in compliance with Civil Code Section 5115. In the event the required quorum is not attained at an initial or adjourned meeting at which secret ballots will be used, and in the event the meeting is adjourned to another date, all secret ballots cast shall carry over until quorum is attained.

In instances where proxies are used, in order to be counted the proxy must (a) identify a proxy holder (who must be in attendance at the meeting for which the proxy is given), (b) contain voting instructions, and (c) be dated and signed by the Member in good standing giving the proxy. The Inspectors may disqualify a proxy that does not satisfy these requirements. Any instruction given in a proxy that directs the manner in which the proxy holder is to cast the vote must be set forth on a separate page of the proxy that can be detached and given to the proxy holder to retain. The proxy holder must cast the Member’s vote by secret ballot in accordance with any instructions the Member provides.

The Association may distribute proxies for quorum purposes only prepared in accordance with California law. Such proxies shall be used solely for quorum purposes and shall not be used for purposes of voting.

8. VOTING AND COUNTING OF BALLOTS/PROXIES

All votes shall be counted and tabulated by the Inspector(s) of Election in public at a properly noticed open meeting of the Board of Directors or at a properly noticed meeting of the members. Any candidate or other member of the Association may witness the counting and tabulation of the votes from a reasonable distance, as determined by the Inspector(s) of Election. Members may not interfere with the counting and tabulation of the votes, and the Inspector(s) of Election may order any person the Inspector(s) of Election determine to be interfering with the counting and tabulation of votes to leave the area. In accordance with the holding of Chantiles v. Lake Forest II Master Homeowners Association (1995) 37 Cal. App. 4th 914, only the Inspector(s) of Election and the Association’s legal counsel shall be permitted to inspect the proxies during the voting process in those instances in which proxy voting is permitted in order to protect the members’ privacy rights.

No person, including a member of the Association or an employee of the management company, shall open or otherwise review any ballot prior to the time and place at which the ballots are counted and tabulated.

A. Unless otherwise provided in the Notice of Meeting or the Ballot solicitation, as applicable:

1. The voting period for Secret Ballot Topics shall commence when the first ballot is mailed or delivered to an Association Member, and shall end at such time as the Inspector(s) of Election determine the polls close;

2. With respect to voting at membership meetings on topics other than Secret Ballot Topics, the voting period shall commence at the meeting at such time as the chairperson declares the voting period open and shall end at such time as the Inspector(s) of Election shall determine the polls close; and

3. With respect to voting through a mail-in ballot on matters other than Secret Ballot Topics, voting shall commence when the first ballot is mailed or delivered to an Association Member and shall end at such time as is specified on the ballot.

B. A ballot shall be irrevocable upon the Association’s receipt of the ballot, and a Member’s submission of a secret ballot shall be deemed to be the Member’s presence at the meeting for purposes of determining the presence of a quorum at the meeting.

C. All questionable proxies and ballots are to be separated for a determination of validity by the Inspectors.

D. If the number of votes cast on a ballot or proxy exceeds the number of permissible votes, the ballot or proxy, for voting purposes, shall be invalid and shall not be counted, but shall be counted for quorum purposes only.

E. When a voting box for a candidate is “checked” or otherwise marked by a non-numerical symbol (e.g., an “X”), and it is the only box “checked” or marked, all of the member's votes shall be counted for that candidate. When fewer boxes are “checked” or marked by a non-numerical symbol on the ballot than the number of directors to be elected, the count shall be one vote per “check” or mark not to exceed the number of authorized votes.

F. If votes are cast on a proxy, but the Member failed to check the box indicating that the proxy is to be voted in accordance with the Member’s instructions, the votes cast shall be counted as marked by the Member, provided there are no conflicting instructions on the proxy and the proxy is otherwise valid.

9. ANNOUNCEMENT OF RESULTS/CUSTODY OF VOTING MATERIALS

The tabulated results of the election shall be promptly reported to the Board of Directors of the Association and shall be recorded in the minutes of the next meeting of the Board of Directors and shall be available for review by members of the Association. Within 15 days following the election, the Board shall give general notice pursuant to Civil Code Section 4045 of the tabulated results of the election.

The sealed ballots, signed voter envelopes, voter list, proxies, and candidate registration list shall at all times be in the custody of the Inspector(s) of Elections or at a location designated by the Inspector(s) until after the tabulation of the vote, and until the time allowed by Section 5145 for challenging the election has expired, at which time custody shall be transferred to the Association. If there is a recount or other challenge to the election process, the Inspector(s) of Election shall, upon written request, make the ballots available for inspection and review by an Association member or the member’s authorized representative. Any recount shall be conducted in a manner that preserves the confidentiality of the vote.

10. INCUMBENT REQUIREMENTS

Pursuant to California Corporations Code Section 7221, the Board may declare vacant the office of a Director who has been declared of unsound mind by a final order of court, or convicted of a felony.

In addition, in accordance with Section 2.2.2 of the Bylaws, to remain qualified to serve on the Board of Directors following election or appointment, a Director must

(a) Not be absent from more than three (3) consecutive regularly scheduled meetings of the Board;

(b) Attend at least seventy-five percent (75%) of the Board meetings held during the year and attend the entire meeting each time;

(c) Comply every duly approved action of the Board;

(d) Comply with the Governing Documents and correct, within five (5) days after receipt of notice, any violation of the Governing Documents for which that Director has been determined to be responsible pursuant to applicable due process requirements;

(e) Not be more than three (3) months in arrears in the payment of any Assessment;

(f) Exhibit respect, professionalism and courteous behavior to Owners, committee members, vendors, the Manager and its staff, and any other Persons associated with or retained by the Association;

(g) Be at all times an Owner in good standing.

(h) Refuse any type of gain, such as money, services, products, gifts or gratuities of a significant value, as determined by a majority vote of the Directors who meet all of the required qualifications to serve as such, which gain is offered in relation to the Owner’s service as a Director. In addition, the Owner must disclose such offers at an open meeting of the Board. Compensation for services duly approved by the Board and unrelated to duties as a Director or Officer of the Association, and reimbursement of expenses associated with services to the Association, do not constitute prohibited gain within the meaning of this subsection; and

(i) Not act in a manner determined by a majority vote of the Directors to be grossly detrimental to the general safety, health or welfare of the Association and its members.

Pursuant to California Corporations Code Section 7221(b), the Board of Directors, by a majority vote of the Directors who meet all of the required qualifications to be a Director, shall also have the power to remove a Director and declare his or her office vacant if he or she ceases to meet any qualification for serving on the Board of Directors which was in effect at the time the Director was elected or appointed.