By: Michael W. Rabkin, Esq.
November 21, 2023
We are pleased to provide you with a summary of important legislation which goes into effect on January 1, 2024, as well as recent case law which affects all homeowner associations.
I. NEW LAW:
Meetings by Teleconference – (AB 648 – Valencia)
On September 22, 2023, Governor Newsom approved AB 648 (Valencia).
As explained below in more detail, this new law will permit board meetings and member meetings (other than meetings to count ballots) to be conducted virtually.
For many years, California law has permitted boards of directors to meet via teleconference (via audio or video, or both) with certain prerequisites including, but not limited to, that the notice of the meeting identify at least one physical meeting location so that members of the association may attend, and at least one director or a person designated by the board shall be present at that location. Historically, there has not been a similar provision related to virtual meetings of members – all member meetings, or at least any meetings at which secret ballots are counted, have typically been conducted in-person.
During COVID-19, for safety reasons, almost all boards skipped the legal requirements that there be a physical location for board meetings and that there be a board-designated representative at a physical location. Both board meetings and member meetings went virtual during the pandemic, notwithstanding the law. Virtual meetings enabled boards and members to conduct the business of their associations safely. They proved not only to be effective, but extremely popular. Attendance and participation at meetings among non-board members jumped for most associations.
Emerging from the worst of the pandemic, most associations wanted to continue to be able to meet virtually. In response, the California Legislature passed urgency legislation (SB 391 – Civil Code 5450) in September, 2021, which authorized virtual board meetings and virtual member meetings if gathering in person would be unsafe or impossible because the common interest development was in an area affected by a federal, state and/or local emergency. Notably, Civil Code 5450 provides a mechanism for counting secret ballots at an emergency virtual meeting: (1) the meeting at which ballots are counted and tabulated must be conducted by video conference, and (2) the camera must be placed in a location such that members can witness the inspector of elections counting and tabulating the votes.
For a variety of reasons, and in the absence of any law expressly prohibiting it, many associations have decided that it is in their community’s best interests to continue to hold virtual board meetings and member meetings (including elections, votes to approve amend governing documents, etc.) under the auspices of the emergency provisions set forth in Civil Code 5450. Such reasons include, but are not limited to, that there continue to be government emergency declarations for other purposes, COVID-19 outbreaks have not faded away, virtual meetings are more cost effective, virtual meetings generally provide greater convenience and accessibility to all to conduct/stay informed about association business, and, notably, in order to comply with recent changes in the law related to independent inspectors of electioni. As of January 1, 2024, associations will need to change the manner in which they conduct meetings at which secret ballots are counted and tabulated to reflect the Legislature’s now-stated preference for in-person vote counting.
AB 648 expands the ability of boards and owners to meet virtually in non-emergency circumstances. It adds a new Civil Code Section 4926 which provides that, notwithstanding any other law or an association’s governing documents, a board meeting or meeting of the members may be conducted entirely virtually, without any physical location, if certain conditionsii are met, with one significant exception. Importantly, new Civil Code Section 4926(b) expressly states that the ability to meet virtuallyiii “does not apply to a meeting at which ballots are counted and tabulated pursuant to [Civil Code ] Section 5120.”
After years of tightening restrictions on the conduct of board meetings, it is notable that the California Legislature showed a willingness to acknowledge advances in technology and the overall benefits of virtual board meetings. That said, most people connected to homeowner associations (owners, board members, managers, attorneys, etc.) are likely to be disappointed that the California Legislature expressly excluded secret ballot meetings from being conducted virtually except in an emergency as set forth in Civil Code 5450. First and foremost, this exclusion is likely to increase the cost of holding member meetings, since many associations will need to return to paying for off-site physical locations and vendor travel to attend the member meetings at which ballots are counted. This is especially so for associations that have become accustomed in the last few years to retaining professional inspectors of election who count ballots offsite via video conference.
Second, ironically we anticipate that the carve-out for secret ballot meetings is likely to decrease owner participation at member meetings, in direct contravention to the stated goals of the new law, which is to enable greater access for all members of the Association. It is not that we expect the new law to have any meaningful impact on the number of secret ballots returned, but rather that owners may be less likely to show up in-person and participate at ballot counting meetings (and associations may be less likely to broadcast the meeting to owners who cannot personally attend the meeting). Over the last few years, most members have simply become accustomed to the flexibility of online meetings which allow members to participate from wherever they are (e.g., at home, work soccer practice, etc.) as opposed to a designated fixed location where the inspector of election is located.
In reviewing the legislative history related to AB 648, we note that the initial draft of the AB 648 permitted virtual ballot counting meetings in the same manner as Civil Code Section 5450. It appears that some legislators may have been persuaded to include the carve-out for secret ballot meetings by the unsupported arguments of an advocacy group that opposed the new law. The group claimed, without citation, that “at least half of California still exists within the ‘digital divide’ – some would say ‘digital abyss’ – meaning that thousands of associations are in areas where teleconferences and even cell service is unreliable if nonexistent” and, therefore, members of “thousands of associations” would be unable to witness the counting of ballots by video conference. We question this group’s assertion as to the number of associations that may be impacted, and, in any event, we believe that the Legislature could have found a work-around to accommodate communities living in a “digital abyss.” Furthermore, it is worth noting that members that are unable to connect to a videoconference still have the right to inspect the election materials pursuant to Civil Code Section 5200 et seq., which arguably protects the group’s goal of transparency and accountability.
Finally, we have considered whether the new law would permit a hybrid situation where an association provides a physical location where members can come and “watch” the remote counting by the inspectors of election. The legislative history does not specifically address this issue; it only contains more generic statements like “this bill does not permit HOAs to hold remote meetings to count ballots.” The Minutes from the April 19, 2023, Assembly Committee On Housing And Community meeting provide in part that: “[the] committee staff recommends deleting the authorization for boards to hold remote ballot counting meetings via video conference. The existing authorization for remote ballot counting meetings during disasters and states of emergency would still be available to boards in instances where physical ballot counting is unsafe.” Based on the generic statements, and the lack of clear instructions (e.g., the camera must be placed in a location such that members can witness the inspector of elections counting and tabulating the votes), we believe that the best interpretation of AB 648 is that the actual ballot counting must be performed at a live public meeting of the members. Going forward, associations should be very cautious about using the “emergency” exception to count and tabulate secret ballots now that this issue has been addressed by the California Legislature.
Quorum Requirements for Elections – (AB 1458 – Ta)
The proponents of this bill claim that a significant number of associations report having trouble meeting quorum requirements for board elections, and, as such, they are forced to waste time and financial resources in making additional attempts to obtain a quorum, with no guarantee that any of the subsequent election attempts will actually result in meeting quorum. The intent of this new law is to make it simpler to obtain a quorum of members at the second attempt at holding an annual election of directors. It does so by lowering the quorum requirement for the second attempt to 20% of the members and permitting such adjourned annual meeting to be held as soon as 20 days from the initial meeting, provided, as discussed below, certain notices are provided to owners in advance.
In our experience, many associations already have language in their bylaws which allows for a quorum requirement to drop to 25% of the members for an adjourned meeting of members. For those associations, AB 1458 will provide a path to an even lower quorum requirement for the adjourned meeting of members. For associations that have bylaws that do not permit a lower quorum requirement for adjourned meetings, AB 1458 will provide a path to do so.
It is essential to note that associations can take advantage of this new law only if they have provided two separate notices. First, an association must revise the notice which it is obligated to send to owners at least 30 days before the secret ballots are mailed to the owners to include additional information. Specifically, this pre-ballot notice must now include the language italicized below:
(1) 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.
(2) The date, time, and location of the meeting at which a quorum will be determined, if the association’s governing documents require a quorum, and at which ballots will be counted.
(3) The list of all candidates’ names that will appear on the ballot (if applicable).
(4) Individual notice of the above paragraphs shall be delivered pursuant to Section 4040 if individual notice is requested by a Member.
(5) A statement that the board of directors may call a subsequent meeting at least 20 days after a scheduled election if the required quorum is not reached, at which time the quorum of the membership to elect directors will be 20 percent of the association’s members voting in person, by proxy, or by secret ballot.”
Additionally, at least 15 days prior to the second attempt, an association must provide general notice of the following:
“(A) The date, time, and location of the meeting.
(B) The list of all candidates.
(C) A statement that 20 percent of the association present or voting by proxy or secret ballot will satisfy the quorum requirements for the election of directors and that the ballots will be counted if a quorum is reached, if the association’s governing documents require a quorum.”
In our view, it is unfortunate that the new law added these additional notice requirements and did not simply lower the quorum requirement for adjourned member election meetings. The election process is already burdensome. Unfortunately, we have found that whenever the California Leglislature imposes additional steps for compliance before a new right may be exercised, it has the unintended consequence of creating more election challenges as boards, in good faith, attempt to comply with these new requirements. Associations should consult with their attorneys to ensure proper compliance with this new election law.
Perhaps more important than adding more steps to the election process is the fact that the new law is ambiguous as to who makes the decision whether or not to adjourn the initial member meeting for lack of a quorum. Pursuant to the Corporations Code and the bylaws of most associations, the adjournment of a members’ meeting due to a lack of a quorum is not automatic. A majority of the votes of members represented either in person (including secret ballot) or by proxy at the meeting may vote to adjourn the meeting. However, the new law states, as set forth above in subsection (5), that the “board of directors” may call a subsequent meeting. It also states in a different (new) section that if an association is a corporation, the “corporation” may adjourn the meeting. Until the California Legislature clarifies this point, in our view, the most reasonable approach is to continue to permit (or require) that the decision of whether or not to adjourn a members meeting be left to a majority of the votes of members present in person (including secret ballot) or (if not prohibited by the association’s bylaws) by proxy.
We note that this new law appears to apply only to elections and not to any member meeting held to recall some or all of the directors.
Term Limits and Qualifications of Board Member – (AB 1764 – Committee on Housing and Community Development)
Almost every year over the past five years, the California Legislature has tinkered with the election laws related to homeowner associations. While this year is no exception, except as provided above with regard to adjournment of member election meetings, the other changes it has made this year are minor and serve more to “clean-up” the existing laws.
After the last the major overhaul to the election procedures (which went into effect in 2020), associations were prohibited from enforcing provisions in their bylaws which limited the number of terms a director could serve. Put another way, beginning in 2020, candidates could no longer be disqualified from running for election on the basis they had exceeded the proscribed term limits set forth in their association’s bylaws. In 2023, the election laws were amended to permit the enforcement of term limits again, but the California Legislature inserted language into the provision of the law that dealt with voting to elect directors by acclamation rather than the general election laws. Insofar as most associations do not use the acclamation election procedures because of their complexity, it has been an open question this past year whether term limits in bylaws could be enforced. This bill removes the “term limit” language from the narrow section of the law relating to election by acclamation and moves it to the provision of the law covering all elections of directors. Additionally, this new law makes clear that board members who sell their homes are no longer qualified to serve on the board of directors. Specifically, Civil Code Section 5105(b) is amended by this new law to state:
“(b) An association shall disqualify a person from a nomination as a candidate for not being a member of the association at the time of the nomination. An association shall disqualify a nominee if that person has served the maximum number of terms or sequential terms allowed by the association. A director who ceases to be a member shall be disqualified from continuing to serve as a director.”
If associations have term limits in their bylaws, they may confidently resume their enforcement. Associations with term limits in their bylaws should amend their election rules to add as a qualification for candidacy that the candidate has not exceeded any applicable term limits.
One of the other clarifications made by this omnibus housing law confirms what most practitioners have assumed since 2020 – the qualifications to run as a candidate for election to the board of directors should also apply to the candidates once elected to the board of directors. It is logical that if a qualification is important enough for a candidate to qualify for election to the board of directors, it should be important enough for a director to continue to meet while serving on the board. For example, if a candidate must be current in the payment of assessments, why should a director be allowed to be delinquent? This new law requires an association’s election rules to require a director to comply with the same qualifications as candidates (if the election rules do not already require this). Associations should review their election rules to confirm compliance with this new requirement.
Accessory Dwelling Units – (AB 976/AB 1033 – Ting)
Perhaps more than fiddling with association election laws, the California Legislature enjoys tinkering with the laws related to the construction of accessory dwelling units (“ADUs”) on residential lots.
This new law changes the standards that local agencies (i.e., cities and counties) may use to evaluate a proposed ADU on a lot that includes a proposed or existing single-family dwelling. Among other things, a local agency can no longer require owner-occupancy for either the primary dwelling or the accessory dwelling unit on the lot. Furthermore, under the new law, an owner of a lot with an ADU may sell the ADU separately from the primary residence by subdividing the lot into condominiums.
Shockingly, this new law states in relevant part:
“(G) (i) The owner of a property or a separate interest within an existing planned development that has an existing association, as defined in Section 4080 of the Civil Code, shall not record a condominium plan to create a common interest development under Section 4100 of the Civil Code without the express written authorization by the existing association.
(ii) For purposes of this subparagraph, written authorization by the existing association means approval by the board at a duly noticed board meeting, as defined in Section 4090 of the Civil Code, and if needed pursuant to the existing association’s governing documents, membership approval of the existing association.” (Emphasis added).”
This new law means that in any planned development, if there are no restrictions in that association’s CC&Rs that prohibit further subdivision of any lot, a board of directors could decide to allow an owner to subdivide the primary residence and ADU on his or her lot into condominiums, without any regard to how such new subdivision would integrate into that association1.
As we advised in 2022, when SB 9 went into effect, we STRONGLY recommend that every planned development have its legal counsel review its governing documents as soon as possible to confirm whether it has the appropriate restrictions in place that would supersede the new law and prevent further subdivision of lots, and to take away any discretion which a board of directors may have to entertain an application to subdivide a primary residence and ADU on a lot into a condominium project. If not, associations should take immediate steps to add such restrictions. Amending the association’s CC&Rs2 with the vote of the owners using the secret ballot process is required to add such a restriction to the association’s governing documents. In the interim, while the secret ballot voting process runs its course, we strongly encourage planned developments to amend their rules and regulations to prohibit such activity so that there is a rule in place before January 1, 2024. Rules may be adopted on 28-days’ notice in accordance with Civil Code Section 4360.
Imposition of Assessments on Deed-Restricted Affordable Housing – (AB 572 – Haney)
This new law has a very limited application and will not apply to most homeowner associations. Specifically, it will apply only to new homeowner associations whose initial CC&Rs are recorded on or after January 1, 2025, and which contain deed-restricted affordable housing units (a “new association with affordable housing units”). Pursuant to existing law, a homeowners association may raise regular assessments by up to twenty percent (20%) per fiscal year without a vote of the owners (provided the association has made the proper annual disclosures pursuant to Civil Code Section 5300) or by an even greater amount with owner approval. AB 572 revises Civil Code Section 5605 to provide that a new association with affordable housing units will be prevented from raising regular assessments against the owners of such deed-restricted affordable housing units by more than five percent (5%) plus the percentage change in the cost of living, not to exceed ten percent (10%) greater than the preceding regular assessment.
There are additional exceptions to the application of this new limit on regular assessment increases for deed-restricted affordable housing units (e.g. the development must have more twenty units). Accordingly, for any new association with affordable housing units with CC&Rs recorded on or after January 1, 2025, it is important to verify with the association’s attorney whether it qualifies for an exemption from AB 572.
Surprisingly, this new law does not appear to apply to special assessments levied against deed-restricted affordable housing units. This would seem to provide a glaring loophole which would permit new associations with affordable housing units simply to forego regular assessment increases in favor of special assessments.
II. REMINDER OF LEGAL OBLIGATION- Balconies and Decks (SB 326 now Civil Code Section 5551)
On January 1, 2020, a new law went into effect that establishes a mandatory inspection regime for exterior elevated elements (“EEEs”), defined as the load-bearing components and associated waterproofing systems in a condominium project in order to determine whether such EEEs are in a generally safe condition and are performing in compliance with applicable standards. The goal of this bill is to help prevent structural failures like the one that occurred in Berkeley, California, in 2015, where six people died when a fourth floor apartment balcony collapsed. The new law applies only to buildings containing three or more multifamily dwelling units.
Under the new law, at least once every nine (9) years, the board of a condominium association must cause a reasonably competent and diligent visual inspection to be conducted by a licensed structural engineer or architect. The inspection must be of a random and statistically significant sample of EEEs for which the association has maintenance or repair responsibility. The first inspection must be completed by January 1, 2025. Every nine years thereafter the board must complete an additional inspection in coordination with the reserve study inspection pursuant to Civil Code Section 5550.
The inspector’s written report must contain certain information including whether the condition of any EEE presents an immediate threat to the health and safety of the residents. The inspector must provide a copy of the report to the association immediately upon completion of the report. Additionally, if the inspector’s report advises that an EEE poses an immediate threat to the safety of the occupants, the inspector has fifteen days to provide a copy of the report to the local code enforcement agency. If health and safety issues are raised by the report, an association is obligated by the new law to take preventive measures immediately, including preventing occupant access to the EEE until repairs have been inspected and approved by the local enforcement agency. Notably, a local enforcement agency can recover from the association its enforcement costs associated with the requirements of the new law.
Associations that contain EEEs that have not yet complied with the requirements of SB 326 should seek to do so immediately. As the deadline for compliance approaches, we anticipate that there will be a scarcity of licensed structural engineers or architects willing to perform such work and that the cost of obtaining such inspections will skyrocket as a result of the shortage of qualified experts.
III. REMINDER – EMAIL OPT OUT
As a reminder, under California law, a member of an association can request that the association provide him or her with a copy of the membership list, including the names, property address, mailing address and (since 2022) email address of each member (including directors) (collectively, “Membership Information”). The member’s request must be in writing and must set forth the purpose for which the list is requested, which purpose must be reasonably related to the requester’s interests as a member of the association. The association will be obligated to provide the member with a copy of the Membership Information unless it reasonably believes that the member will use the information for another purpose or unless a member has “opted out” of having some or all of such member’s personal information from being included with the Membership Information which must be distributed to members upon request.
In our experience, most members do not want to share personal membership information, especially their email addresses, with the entire community. We encourage associations periodically to ask members whether they want to opt-out of sharing their information to help ward off complaints from members who are frustrated that their neighbor now has their email address and is sending them unsolicited emails about upcoming association issues.
II. PUBLISHED CASES:
LNSU #1, LLC. V. Alta Del Mar Coastal Collection Community Association (2023 94 Cal.App.5th 1050)
Over the last ten years, there has been a continuous stream of new laws from the California Legislature which have targeted how boards of directors conduct meetings and make decisions. While these laws are aimed at providing transparency, they have had the net effect of making it more cumbersome for volunteer Board members to conduct business, especially with regard to the ability of board members to email each other between meetings to discuss association business. As explained below in more detail, this LNSU Case makes clear that email exchanges among a majority of board members to discuss (but not make decisions related to) pending association business are permissible under the law.
Board meetings are governed by the Common Interest Development Open Meeting Act found in Civil Code Section 4900 et seq. (referred to in the LNSU Case as “OMA”). There are three provisions under OMA (Civil Code Sections 4090iv, 4155v, and 4910vi) which, when read together, have long been interpreted by legal practitioners to mean the following:
- A board cannot take action on any item of business outside of a board meeting.
- Board meetings generally require notice to owners and an agenda.
- Board meetings may be held in 1 of 3 ways: (1) A congregation, at the same time and place, of a sufficient number of directors to establish a quorum of the board, to hear, discuss, or deliberate upon any item of business that is within the authority of the board; (2) a teleconference where a quorum of directors is connected by electronic means, through audio or video, or both and (3) by email in an emergency if all board members consent to such emergency email transmissions.
- A chain of emails among a quorum of board members in a non-emergency situation violates OMA because it may be considered a board meeting (i.e. it could be construed as a virtual congregation of board members at the same time and place hearing, discussing or deliberating upon an item of business), without having provided owners the proper notice and an agenda.
OMA permits owners to sue an association for $500 for each OMA violation (plus reasonably attorneys’ fees). Accordingly, boards have been have been advised to avoid emails among a quorum of directors to avoid the possibility of being sued for OMA violations. In our experience, as earnest as boards are in attempting to comply with this historic interpretation of the OMA, because of the unpredictable nature of homeowner associations, unexpected (but non-emergency) problems arise all the time in between scheduled board meetings, and all of a sudden there is a chain of emails by and among the entire board discussing a plan, and expressing opinions on how to address the problem. The legal consensus has been that, under certain circumstances, OMA permits these good faith efforts to be challenged.
Favorable Court Ruling
The LNSU Case offers a starkly different, and, frankly, liberating, interpretation of OMA. Going forward3.:
1. Email exchanges among directors on those business items that occur before a meeting at which and in which no action is taken do not constitute a board meeting.
Those email exchanges (as long as no action is taken) do not constitute a “congregation” of directors and, therefore, do not qualify as a meeting) under OMA. “Congregation” means an in-person gathering in the same physical location of a quorum of board members at the same time for the purpose of talking about and taking action on items of association business.
This means that a quorum of board members, or even the entire board, can be part of an email thread and discuss, brainstorm courses of action and offer opinions thereon, without fear of violating the OMA as long as no final board decision is made in the thread. Actual decisions must still be made a duly-called board meeting. Although group texts are not discussed, we believe that the same reasoning would apply to this mode of communication among directors.
The LNSU Case strikes a reasonable balance between transparency of board actions and the flexibility and efficiency of allowing volunteer directors to communicate in between meetings in order to move their communities forward.
Lake Lindero Homeowners Assn., Inc. v. Barone (2023 89 Cal.App.5th 834)4
In this case, the entire board of directors was recalled by the affirmative vote of 156 owners. Some of the recalled directors refused to recognize the validity of the recall, compelling the association to file a lawsuit against them to confirm the validity of the recall.
The question presented to the Court was whether an association’s bylaws can require a higher threshold vote of members to remove a director than the standard set forth in the Corporation Code. The bylaws for this association provide that a majority of all members (which would be 230 out of the 459 members in the Lake Lindero Association) must vote in favor of the recall for it to be successful. However, in contrast, Corporations Code Section 7222(a) provides that in a corporation with 50 or members, only the majority of the votes represented and voting at a duly held meeting at which a quorum is present is needed to remove a director, which is a far lower approval threshold. The Court held that the standard forth in Corporations Code 7222(a) is the controlling standard and that associations do not have the discretion to deviate therefrom in their bylaws.
Under the lower standard set forth in the Corporations Code, the recall was successful. The association received secret ballots from 196 owners (which met the association’s quorum requirement of 25% of the members), and more than a majority of the quorum (156 members out of the 196 members represented and voting at the meeting) voted in favor of the recall. The association in this case was comprised of 459 members, and the association’s bylaws stated that a majority of all members (which would be 230 members) must vote in favor of the recall for it to be successful.
1 Would the condominium association for that newly subdivided lot be the member and be obligated to pay assessments? Who would the association fine if an occupant of the subdivided lot violated the association’s governing documents? The unanswered questions and obstacles to operation potentially created by this new law are stunning.
2 CC&Rs are enforceable equitable servitudes and generally carry more weight with the courts than rules because, among other things, they are approved by a vote of the members, as opposed to rules and regulations, which are approved by only a majority of the board members. If an association proceeds to adopt rules related to AB 976 only (and does not amend its CC&Rs), we do not believe that a court would find that a rule alone is sufficient to prevent an owner’s subdivision of his or her lot.
3 Although it is possible that the California Legislature may choose to override the LNSU holding by further amending California law, the current legislative session has ended for the year. Accordingly, the LNSU Case should be applicable for at least the near future, and, we hope, permanently.
4 This decision does not apply to the recall of less than all of the board members pursuant to Corporations Code Section 7222(b)(1), where cumulative voting is applicable, in which case there is a specific formula for a successful recall.
i Civil Code 5110 was amended in 2020 to prohibit persons or entities employed or under contract for any compensable services with an association (e.g., a property manager or attorney) to act as that association’s inspector of election.
ii The conditions to hold a non-emergency virtual meeting are the same as those to hold an emergency virtual meeting. Namely, in addition to other required content for meeting notices, the notice for each meeting conducted under Civil Code Section 4926 must includes all of the following: (A) clear technical instructions on how to participate by teleconference; (B) the telephone number and electronic mail address of a person who can provide technical assistance with the teleconference process, both before and during the meeting; and (C) a reminder that a member may request individual delivery of meeting notices, with instructions on how to do so. Additionally, every director and member must have the same ability to participate in the meeting that would exist if the meeting were held in person, any vote of the directors must be conducted by a roll call vote, and any person who is entitled to participate in the meeting must be given the option of participating by telephone.
iii In the absence of an emergency described in Civil Code 5450.
iv Civil Code Section 4090 provides:
4090. “Board Meeting”
“Board meeting” means either of the following:
(a) A congregation, at the same time and place, of a sufficient number of directors to establish a quorum of the board, to hear, discuss, or deliberate upon any item of business that is within the authority of the board.
(b) A teleconference, where a sufficient number of directors to establish a quorum of the board, in different locations, are connected by electronic means, through audio or video, or both. A teleconference meeting shall be conducted in a manner that protects the rights of members of the association and otherwise complies with the requirements of this act. Except for a meeting that will be held solely in executive session or conducted under Section 5450, the notice of the teleconference meeting shall identify at least one physical location so that members of the association may attend, and at least one director or a person designated by the board shall be present at that location. Participation by directors in a teleconference meeting constitutes presence at that meeting as long as all directors participating are able to hear one another, as well as members of the association speaking on matters before the board.
v Civil Code Section 4155 provides:
4155. “Item of Business”
“Item of business” means any action within the authority of the board, except those actions that the board has validly delegated to any other person or persons, managing agent, officer of the association, or committee of the board comprising less than a quorum of the board.
vi Civil Code Section 4910 provides:
4910. Board action outside of meeting prohibited
(a) The board shall not take action on any item of business outside of a board meeting.
(b) (1) Notwithstanding Section 7211 of the Corporations Code, the board shall not conduct a meeting via a series of electronic transmissions, including, but not limited to, electronic mail, except as specified in paragraph (2).
(2) Electronic transmissions may be used as a method of conducting an emergency board meeting if all directors, individually or collectively, consent in writing to that action, and if the written consent or consents are filed with the minutes of the board meeting. These written consents may be transmitted electronically.