Condominium Associations and Electronic Communications

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Heard this before? Most if not all of my association clients struggle with attendance and/or quorum issues at some point.

Community associations, like other corporations require input from directors to take most actions. To make attendance and participation more convenient some not-for-profit corporations have resolved to engage interactive technology to meet… virtually. Community associations, however, have been slow to properly adopt these procedures despite having the legal authority to do so for almost three years.

Absent prohibitions in the condominium association’s Declaration or By-Laws Associations are permitted to conduct meetings through use interactive technology so long

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as all persons participating in the meeting may communicate with each other. Participation in such meetings will constitute attendance for matters requiring a quorum. Unless prohibited by association Declaration or By-Laws, voting on matters may also be done using electronic means provided certain safe guards are followed.

Interested in how this came to be?

In 2010, the Illinois Not

for Profit Corporation Act (NFPCA) amended the definition of “delivery” to include not only transfer by person or post, but transmission by electronic means to the email address or fax number on the records of the corporation. 805 ILCS 105/101.80(g)

The Illinois Condominium Property Act allows (ICPA) allows notices to be delivered. 765 ILCS 605/18(b)(6). Therefore, notices may now be delivered via email or other electronic means provided that is the address on record for the corporation. These include notices of future board meetings.

Under the NFPCA, unless “specifically prohibited by the articles of incorporation or bylaws, a corporation may allow members entitled to vote to participate in and act

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at any meeting through the use of a conference telephone or interactive technology, including but not limited to electronic transmission, Internet usage, or remote communication, by means of which all persons participating in the meeting can communicate with each other.” 805 ILCS 105/107.05

Wondering how this amendment affects a board meeting?

A board can host a “virtual” meeting provided that all of those attending had the ability to communicate with one another.

Furthermore, “participation in such meeting shall constitute attendance” which would allow boards more opportunity to have enough voting members to constitute a quorum even when physical presence in the meeting is impractical or impossible.

What about voting?

The NFPCA also allows voting by electronic means. Such action is effective “only if notice is delivered 5 days prior with respect to the subject matter thereof” 805 ILCS 105/107.10 (b) But again, notices may be delivered electronically as well.

Once notice has been given of the impending vote, unless otherwise provided, any In particular if you’re an online slots player and enthusiast then there’s no comparison really when it comes to payout percentages you’re much better off playing online. action taken at a meeting of members entitled to vote may be taken by ballot without a meeting in writing by mail, email, or any other electronic means which the members entitled to vote are given an opportunity to vote for or against the proposed action so long as the number of votes cast (either electronically or otherwise) constitutes a quorum. 805 ILCS 105/107.10 (a)

There are a couple of caveats that must be followed. When voting by electronic means, the voting must remain open for 5 days (in addition to the 5 days notice prior to voting). When the voting is regarding removal of directors, merger, consolidation, dissolution or sale, or lease or exchange of assets, however, the voting must remain open for 20 days from date of delivery.

Electronic voting may also be utilized in associations that operate under a direct ballot procedure. While proxies are not permitted under direct ballot procedure, voting can be done using an association-issued ballot either in person OR by “other means of delivery specified in the Declaration, By-Laws, or rule.” 765 ILCS 605/18(b)(9)(B) Those specifications in the Declaration or

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By-Laws must be in place at least 120 days prior to beginning the election. Further, ballots must be delivered to unit owners at least 10 and not more than 30 days before the election. Any unit owner who submits a ballot by “other means” may request to cast in person, thereby voiding their previously cast ballot.

If you wish to discuss this topic further or are interested in introducing technology to make operation of your association more efficient, please do not hesitate to contact us!