Case Notes in

Elections

First published: Nov 2023
The Vote Must Be Wrong

TAKEAWAY If a board member feels that an election is questionable, he or she would be wise to make sure there are enough facts to back up the claim. It appears that in this case the former board president may have been so aggrieved that she didn’t obtain the board position she wanted that she was willing to spend her time and money, and that of the co-op’s also, to challenge the election outcome without the necessary proof. Unfortunately, lawsuits such as this tend to affect the collegiality of any board, and while it’s unclear why, the decision in this case points out that the president of this board has already resigned.

Read full article
First published: Oct 2022
You say toMAHto. I say toMAYto. The bylaws say….

Voter participation matters. When it comes to board elections, an informal practice, no matter how long-standing, or widely accepted, is not controlling authority. At the end of the day, the express language of the governing documents will determine permissible board election procedure. In this case, the common interest among residential unit owners was over 70% and the sponsor’s interest was less than 30%. However, due to the residents’ reliance on past, informal voting procedures, and a lack of participation by all residential unit owners in the formal election, the sponsor’s votes, while not controlling, ultimately became determinative.

Read full article
First published: Sep 2022
I Am Who I Say I Am

This is one of the first cases, if not the first, interpreting the language now codified in the recently enacted NPCL and BCL amendments allowing for board elections to have electronic voting, including voting by email and other electronic means. If this case is any indication of future decisions (and it is my bet that it is), courts will uphold board discretion as to the implementation of safeguards in electronic voting. Boards will likely have broad discretion in enacting safeguards in electronic voting. While boards should enact safeguards, they should be mindful of ensuring that the burdens do not prohibit voting by certain segments of shareholders.

Read full article
First published: Sep 2022
Lifesavers Bldg. Homeowners Group v. Bd. of Mgrs. of the Landmark Condo

TAKEAWAY This is one of the first cases, if not the first, interpreting the language now codified in the recently enacted NPCL and BCL amendments allowing for board elections to have electronic voting, including voting by email and other electronic means. If this case is any indication of future decisions (and it is my bet that it is), courts will uphold board discretion as to the implementation of safeguards in electronic voting. Boards will likely have broad discretion in enacting safeguards in electronic voting. While boards should enact safeguards, they should be mindful of ensuring that the burdens do not prohibit voting by certain segments of shareholders.

Read full article
First published: Aug 2022
Brooklyn Board Brouhaha

For shareholders who are disgruntled with the current board and want a new election, there are mechanisms for doing so. But if it’s not according to your co-op’s bylaws or New York’s Business Corporation Law, be warned. A court of law will not recognize the election, you will have spent an enormous amount of time (and potentially legal fees), and the old board will remain in place.

Read full article
First published: Aug 2022
Wyche v. Haywood-Diaz

TAKEAWAY For shareholders who are disgruntled with the current board and want a new election, there are mechanisms for doing so. But if it’s not according to your co-op’s bylaws or New York’s Business Corporation Law, be warned. A court of law will not recognize the election, you will have spent an enormous amount of time (and potentially legal fees), and the old board will remain in place.

Read full article
First published: Jun 2022
Roberts v. WVH Housing Corporation

These disputes happen all too often at cooperative and condominium elections. It would seem that the reason for this is the rush to close the meeting and announce the results the same evening. It is not uncommon for a board to insist that the vote be finalized the night of the meeting, no matter how late it gets. This is asking for trouble, since people often make mistakes. In many cases, if there was a simple comparison of the number of shareholders who signed in (either by proxy or in person) and the number of ballots, discrepancies might be discovered. In the lumberyard, it is common to hear “measure twice, cut once.” Perhaps an adage should be created just for elections at cooperatives and condominiums: Check twice, announce once.

Read full article
First published: Feb 2022
Getting on the Board

This is a good example of the need to comply with a building’s governing documents when determining whether an election was properly held.

Read full article
First published: Oct 2021
Siwana Green v. Al Cristancho

Often we hear that a court’s decision is based on a technicality and that form is as important as substance. In this decision, the court has made it clear that the will of the people will prevail, even if there may have been a technical mistake or two. Substance, in this case, was more important than form.

Read full article
First published: Jun 2015
Mishaan v 1035 Fifth Ave. Corp.

There is little question that most elections are uncontested. Even when contested, very few end in litigation. But for many people, an apartment is a very large asset and owners want to do what they believe is necessary to protect that asset. There can be huge disparity in how individuals believe their boards should act – how the building should be managed both financially and in terms of its physical plant. There can often be a situation where someone runs and he or she obtains one percent of the vote. But when it is clear there is going to be a closely contested election, boards and shareholders should try to come to some creative solution – if they can – to address one another’s issues. If that cannot be done – and sometimes the disagreements are too fundamental to come to agreement – the shareholders must be able to decide. When an election is close, from a practical standpoint, it is often good practice to have more than one inspector of elections. Another practice may be to close the polls at the end of the meeting so that no additional votes can be issued, and to allow the inspectors to place all the ballots in an envelope, seal it, and have someone sign his or her name across the flap – that way, they can open and count the ballots the next day at the office of the inspectors (often two members of the managing agent). If done this way, inspectors can check and double-check their work. There is one final point that, for some reason, was not addressed by the court. When an election is uncontested (and thus there is a successful candidate or slate by acclimation), proxies and ballots are not an issue. But when there is a contest, we want to remind people that a proxy is just that – a proxy. It is not a ballot and, indeed, New York does not use absentee ballots in these types of elections, even if the one giving the proxy identifies whom the proxy-holder must vote for. When a person or board is a proxy-holder, a ballot must be completed and submitted with the proxy. Without that procedure, no matter how duplicative it seems to be, the vote by proxy alone should not be counted.

Read full article