Dispute over Voting at Manhattan Condo Sparks Demand for Independent Oversight

When a Manhattan condominium with over 200 units allowed residents to vote via chat during a virtual annual meeting, it created a perfect storm of election problems: public votes that should have been private, potential for miscounting, and heightened tensions in an already contentious situation where some board candidates wanted to replace the managing agent who was running the election. “Board members have done free work the whole year,” says Corinne Arnold, a managing partner at EZ Election Solutions, the firm called in to sort out the mess. “You just want to be able to focus on the results and you don't want to focus on all of these things that bring you backwards and make you look incompetent.” 

The voting was supposed to take place with paper ballots and there wasn’t a plan for electronic voting. But people began to vote over chat and “then they couldn't figure out how to count the votes and they didn't want the liability of it,” recalls Arnold. EZ Election Solutions was called to unravel the mess. They went through the chat log, reviewed all the documents and gave the board the election results. “But we had to bring in our own attorney and then they had to bring in their attorney and it got just very, very, very messy.”

The situation highlights a growing challenge: digital meetings have become commonplace but election protocols haven't always kept pace. "The risk is that it's not done legally," Arnold warns. "A lot of managing agents would just set up a Zoom meeting link and that's the standard they would set out, and people can join," Kwan notes. "We have a different process." 

That process begins weeks before an annual meeting is scheduled. "If we engage at least six weeks before an election, we review bylaws and see their prior years of documents,” says Will Kwan, an EZ Election Solutions managing partner. The next step is to confirm who is going to be voting. "We like to validate people, so we have a registration form that we have people register and we confirm that registration to the shareholder in the co-op or the unit-owner in a condo to the registry that the managing agent provides to us." Using Zoom webinar rather than Zoom meeting is another aspect of meeting control that allows an independent voting company to track attendance similar to sign-in sheets at in-person meetings. Offering digital voting, if a building’s documents allows this, requires more scrutiny to make sure there is no overvoting. "We would then validate and make sure that if they do digital voting, there's rules set in place to make sure that they don't overvote," says Kwan.

One benefit to working with an independent company is when the board is considering a management company switch. In one scenario, recalls Arnold, "Several of the board members were against the current managing agent, wanted to switch, and then the managing agent themselves were running the election and then it all went awry," Of course, going out of house carries an additional expense which can range from $3000 to $7000, depending whether the meeting are online, in-person or hybrid. The trade-off for this expense is that an independent election manager provides a neutrality that preserves community relationships, something that is extremely valuable in any contested election.

While annual board elections are the most common application, independent election services are increasingly being used for other important votes. "We've been engaged also for amendment votes," Kwan says. "For example, changing their smoking policy or dropping the name of an entity, changing their name entity or amending their proprietary lease, changing the flip tax, sublet fee amendments." These matters often require supermajority approval and longer tracking periods, making professional management particularly valuable.

"There's more of a reason to do it if you like your managing agent, so that everything is above board, so that no one has any questions," Arnold emphasizes. "There's an outside party that everyone knows is neutral and doesn't have a vested interest at all in the outcome of the election."