When can a Board legally, ethically and meet the spirit of the law have SECRET meetings?
Secrecy doesn’t sit well with many Americans. As President John F. Kennedy said, “The very word, secrecy, is repugnant in a free and open society, and we are as a people, inherently and historically opposed to secret societies, to secret oaths and to secret proceedings.”
Yet secret proceedings are not uncommon in the community association world. Homeowners are often asked to leave for all or parts of board meetings. Minutes of these executive sessions are generally kept secret. At times, boards conduct business by telephone or e-mail to avoid public scrutiny.
On one level, it’s ironic. For every board that keeps residents out of board meetings, many others are begging for more homeowner involvement. Jim Slaughter.com pdf
Board determines confidentiality
Releasing confidential information could result in claims of defamation, invasion of privacy, violations of statute, etc. The Legislature made such matters confidential for a reason, so boards should be cautious about releasing executive session information. (davis-stirling.com) * Privacy * SB 563
Davis Stirling – Civil Code
§4935 (a) The board may [not shall or must] adjourn to, or meet solely in, executive session to consider [ONLY]
- litigation, [Attorney Client Privilege & More clarification]
- matters relating to the formation of contracts with third parties, — Learn More on Formation of Contracts
- member discipline, personnel matters, or to meet with a member, upon the member’s request, regarding the member’s payment of assessments, as specified in Section 5665.
(b) The board shall adjourn to, or meet solely in, executive session to discuss member discipline, if requested by the member who is the subject of the discussion. That member shall be entitled to attend the executive session.
See also Meet & Confer
1363 (g)
Civil Enforcement $500 penalty for failure to comply old 1363.09 Section 4955
california condo guru.com
hearing.rights.details
(c) The board shall adjourn to, or meet solely in, executive session to discuss a payment plan pursuant to Section 5665.
(d) The board shall adjourn to, or meet solely in, executive session to decide whether to foreclose on a lien pursuant to subdivision (b) of Section 5705.
(e) Any matter discussed in executive session shall be generally noted in the minutes of the immediately following meeting that is open to the entire membership.
Davis Stirling.com on Executive Session
I don’t see ANYTHING in Brown or Davis Stirling that allows Boards to discuss finance or budget in closed session. If any site visitors have a citation, please put that in comments below.
Links & Resources
1st Amendment Coalition Brown Act Primer
jimslaughter.com/Executive-Session–Closed-Meeting-Issues
Child Pages
Point of Sunshine Law’s
The strength of a sunshine law (letting the light come in, so everyone can see) depends on its exceptions. Every open-meetings act allows public bodies to close meetings or portions of meetings in some circumstances. School boards, for example, typically can close meetings to discuss student disciplinary cases. Most public bodies also can close meetings to discuss pending litigation, the acquisition of real estate, collective bargaining and individual personnel issues. Minutes from these closed sessions, however, generally must be kept and made public if and when the matter discussed is no longer confidential.
Courts across the country have held that public bodies must limit executive sessions to only those matters permitted. Under a circuit court case, Philadelphia Newspapers, Inc. v. Nuclear Regulatory Commission (1984), for example, federal agencies subject to the Government in Sunshine Act, 5 U.S.C. Section 552b, must attempt to segregate non-exempt portions of meetings from exempt portions and close only those portions of meetings involving exempt topics.1st Amendment Center
If the broad light of day could be let in upon men’s actions, it would purify them as the sun disinfects. Justice Brandeis (sun light foundation.com)
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An attorney recently asserted something I find inconsistent about what CA Boards can and cannot discuss in Executive Session.
He cited the Evidence Code sections 950-962 as a reference for his reasoning that is a board wants to talk to him, that becasue he is an attorney, those talks can be considered “legal issues” and so are protected.
What he seems to be saying is that CA CC 4935 [see above] has a loophole that the board may exploit, even in his absence… if they wish to talk about anything amongst themselves that they can connect, however remotely, to a potential, hypothetical “legal issue”, then it’s fair game. In my view, what he is saying seems to nullify CA CC 4935.
I also heard it expressed that every attorney might interpret this law differently, and that what is listed as authorized topics in CA CC 4935 is more like “guidelines” than an absolute/objective range of topics.
Is this correct?
If this is not correct, how does one go about telling an entire board of people who seem to very stubbornly be clinging to this idea, that they, as well as the attorney, and the manager, are incorrect?
If seeking injunctive relief in small claims court is the only option, who is the person to serve papers to?
Evidence Code? That’s a lot of codes to review. Might the attorney be more specific?
Executive Session – Litigation Privilege – See our webpage on that.
Different interpretations?
Let’s see if CA Supreme Court has ruled?
https://caselaw.findlaw.com/california.html
Here’s some case law I’ve found. I’m not sure if it applies.
https://caselaw.findlaw.com/ca-court-of-appeal/1772253.html
Try going to the Law Library at your local courthouse. http://www.lalawlibrary.org/ There you can use Westlaw https://www.westlaw.com/ for free!
https://www.hoaleader.com/members/login.cfm?hpage=Getting-Your-HOAs-Executive-Session-Step-by-Step.cfm
I know of a case in small claims court where the Board cited the corporations code 1600? for a purpose reasonably related to such holder’s interests as a shareholder.
And said they didn’t have to release records under 5200 et seq
The Judge fined the HOA $1,000 two counts and said there was NOTHING in 5200 to allow the HOA to refuse records under the Corporations Code! 5200 did not mention Corporations Code.
Let’s look at legislative intent:
Analysis CARA comments, “In its study of the state’s 36,000 common interest developments, the California Research Bureau reported that associations either do not disclose to homeowners how their money is being spent or else they report it inaccurately.
The report also states that between 14-20 percent of all lawsuits filed by shareholders against associations are for financial mismanagement. AB 1098 (2005) corrects this lack of disclosure by association boards and lack of knowledge by homeowners. It assures that association shareholders (i.e., homeowners) have access to the association financial records to find out how boards are spending the billions under their control. It makes good fiscal sense that homeowners, who have the biggest financial stake, should be watching the books. asm_floor.html
See our webpage on How to read a statute
Georgetown University Law Center
A GUIDE TO READING, INTERPRETING AND APPLYING STATUTES
Explaining complex subjects?
See if you can find a citation for what I know about the Small Claims case on records disclosure, where you can’t bring up stuff not mentioned in the statute. It might be in the rules for reading a statute.
https://tinybuddha.com/blog/the-best-thing-to-say-to-someone-who-wont-understand-you/
I’m not an attorney and can’t give you legal advice. https://boardtraining.info/links-resources/unlawful-practice-of-law/
Try https://www.legalmatch.com/
If an HOA board discusses unauthorized topics in Executive Session, and also votes on said unauthorized topics, is the unauthorized business conducted valid, and is the discussion regarding the unauthorized topics required to stay confidential?
If a board director is concerned about unlawful activity, do they have a duty to bring the matter up in open session?
By unauthorized topic, you mean something not allowed per Section 4935 above right?
I would say the vote is not valid.
The discussion can’t remain confidential.
Yes, I would say a board member needs to get this thing fixed.
Give me a day or so to find the citations. I’m not an attorney and can’t give legal advice.
The Board needs to fix this, before someone takes them to court to enforce it!
Civil Code §4955. Civil Action to Enforce Article.
[Old: Civ. Code §1363.09(a)-(b)]
(a) A member of an association may bring a civil action for declaratory or equitable relief for a violation of this article by the association, including, but not limited to, injunctive relief, restitution, or a combination thereof, within one year of the date the cause of action accrues.
(b) A member who prevails in a civil action to enforce the member’s rights pursuant to this article shall be entitled to reasonable attorney’s fees and court costs, and the court may impose a civil penalty of up to five hundred dollars ($500) for each violation, except that each identical violation shall be subject to only one penalty if the violation affects each member equally. A prevailing association shall not recover any costs, unless the court finds the action to be frivolous, unreasonable, or without foundation.
(Added by Stats. 2012, Ch. 180, Sec. 2. Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.) https://www.davis-stirling.com/HOME/Statutes/Civil-Code-4955#axzz2CR2ljirY
Equitable and Declatory Relief definitions https://www.hg.org/legal-articles/what-are-equitable-compensatory-and-declaratory-relief-35593
What defenses might the Board’s attorney assert?
How strongly would you say that the item of business was null, even if the board had “moved on” as if the business was valid?
What if that item of “business” took place six months ago?
What do you think of the ethics if an Attorney sits on the Board, while he is not representing the Board, must he speak up? Is he more “liable” as he should know better?
My California Community assoc published all the executive minutes in the public website available to anybody not just members.
They discuss personnel matters, fines, small claims litigation, and people who are critical of the assoc.
Are they personally liable?
Small Claims litigation is available to the public at the court house. Some courts have it posted online. Take a look at the case where ACA/ObamaCare was just declared unconstitutional. Then look at Court Listener.com every motion, everything is available to the public.
What are the damages? What is the loss or injury?
https://en.wikipedia.org/wiki/Damages
https://litigation.findlaw.com/filing-a-lawsuit/filing-a-lawsuit-should-you-sue.html
http://www.courts.ca.gov/9616.htm
https://legal-dictionary.thefreedictionary.com/damages
What is really secret about personnel records?
Transparent CA
Personally, I’m glad that they publish complaints about the HOA. That’s why Davis Stirling and the Brown Act are also known as “Sunshine Laws!”
While the Board might have privilege NOT to disclose records, where does it say they can’t?
See Davis Stirling.com a non official website on Board Members being protected against personal liability.