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Habitat Magazine Business of Management 2021

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VIRTUAL PLANNING FOR THE ANNUAL MEETING

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Virtual Planning for the Annual Meeting

Apr 02, 2021

Marc Schneider, Schneider Buchel

With most people working from home, Zoom has become the new norm, and the comfort with this type of communication is leading many co-ops and condos to think about holding virtual annual meetings. How do boards need to prepare and plan if they’re going to make the switch?
 
Well, you hit the nail on the head because planning is the key to success in anything that you do, and more so in Zoom annual meetings. If you're not properly prepared, the meetings are going to be a disaster. Normally, you would go into an annual meeting in person and you'd have your audience right in front of you. Here, your audience may be in front of you, but they're on a screen, so you want to make sure that you're able to easily complete the main tasks of your annual meeting. Of course, we all know that one of the biggest issues for an annual meeting is an election, and in order to be prepared for an election on Zoom, you need to make it so that you have the fewest complications possible.
First and most important, you need to know who your candidates are, not only in advance of the meeting but in advance of the notice of the meeting going out. You want to send out a notification to your residents, telling them that you're contemplating a Zoom annual meeting and that in order to make it efficient and flow well, anybody who wants to run for a seat on the board of directors or the board of managers needs to declare their candidacy by a certain date - and that would be a date prior to when the formal meeting documents go out.
The other thing you want to do is make sure that the people who are going to attend that meeting and vote are actually shareholders or owners. One way of doing that is by requiring registration of individuals in advance. So in the  notice of the annual meeting, you're going to require anybody who wants to attend that meeting to register. And when they register – this is where knowing how to use Zoom is very important – they should have the right to do so automatically, and you should have the ability to approve their registration. And by the way, it’s important that they register with a name and an email so that when you get to the election portion of the annual meeting, you can do that with a polling feature that is tied to the registration. When the person actually votes, it will have their name associated with it. And you could actually run a report once the polling is done.
 
So the registration is done. On the day of the meeting, how do people sign in?
 
Obviously, it's important that you give clear instructions when that Zoom meeting starts. In addition, you want to make sure you are allowing people to sign in to the meeting in advance of the start time so that you're not taking an hour or so to get everybody in and know whether you have a quorum.
 
How would people ask the candidates questions in a virtual meeting?
 
Many community associations that are doing Zoom meetings are strongly encouraging people to submit their questions in advance. When you send out the notices, you include a portion that says that if you have a question, please submit your question in advance by emailing it. Now, how do we make that effective? We know that at most annual meetings, there's a report by the accountant to go over the financial statement of the prior year.  So when you send out the notices, it's probably a good idea to send out the financial statement at the very same time so that people can read it and have their questions ready. One of the beauties of Zoom is that you can control who asks a question and when, because as the host, you can mute people.
 
If you want to volunteer as a candidate or run yourself, you submit your name, you had said earlier, when you receive the notification  of the meeting. Is that different from when you hold an in-person meeting?
 
Many communities still allow you to stand up at the annual meeting and say, "I want to run for the board.” Of course, if you do that in a virtual sense, your polling is not going to be set up properly and it's going to be very difficult to accomplish. I always have been a fan of people being required to declare their candidacy in advance because it makes things easier and cleaner, as remember when you send out a proxy to an annual meeting, the proxy gives somebody else the right to vote for you however they want to vote. But, if you require people to declare their candidacy in advance of the notice going out, you can actually have what I call a proxy ballot that gives somebody the right to vote for you, with another section that says, "In addition, I hereby direct my proxy to vote as follows," so the person who's giving the proxy can direct how they want the voting to occur.
 
And by the way, one of the other ways of dealing with voting at a Zoom annual meeting is you could require somebody to literally use the proxy ballot by filling it out, taking a picture of it and emailing it back right from the meeting as well. You would have evidence of what the person voted for, because  you can electronically send in proxies now. The law has been amended by virtue of the executive orders in New York State to permit for this type of annual meeting. Interestingly, the law had been amended previously, I guess about a little over a year and change ago, where it allowed for business corporations, including co-ops, to actually hold annual meetings or allow people to attend annual meetings and other meetings electronically, provided they complied with certain things. The law talks about how you no longer have to have your annual meeting in the location of the building or the location of the corporation. It says that for purposes of location, the electronic platform is fine.
 
Are there any communities where you think virtual meetings wouldn't work?
 
There are communities where technically you still can't do it. Interestingly, the Business Corporation Law and the Not-for-Profit Corporation Law that would cover co-ops and homeowners associations was affected by the executive orders that came into play, and it's permissible. The Condominium Act of the New York Real Property Law has not been amended to provide for this yet. So technically, condos can't even do it. But are there communities where a virtual meeting wouldn't work? I think if you properly plan, it can work. However, there's a caveat. There are some communities where people are not very technology savvy, and those are ones where it becomes difficult. And I do have a lot of communities that are not doing it because they say, "Look, based on our population, there are people who will not be able to utilize this technology, and therefore it will be prejudicial to them." And what would happen is you wind up exposing yourself to election challenges.
 
I have one more question. Very practically speaking, who should run a virtual meeting?
 
My strong recommendation is that you allow your attorney to run the virtual meeting, for a whole host of reasons. You want to make sure that the meetings are run legally and in accordance with the law. And of course, you also want to have someone that's skilled in dealing with it. We've done them very efficiently. They've been smooth. They do work.

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