Does our co-op have to hold an annual meeting during the pandemic? Can it be done virtually?
There’s anecdotal evidence of higher involvement at shareholder meetings now that virtual attendance is allowed.
iStock
Does our co-op have to hold an annual meeting during the pandemic? Can it be done virtually?
“As a result of the pandemic, a co-op or condo building’s annual meeting can be adjourned or held virtually in whole or in part at the board’s discretion,” says Steven Wagner, partner at the Manhattan law firm Wagner, Berkow & Brandt, who represents co-op and condo boards and owners and is president of his 420-unit Manhattan co-op building.
This flexibility was established by Governor Andrew Cuomo by executive order at the beginning of the coronavirus outbreak. However, Wagner points out you can’t postpone annual meetings indefinitely, even in a public health crisis. “People should be given a chance to serve on the board if they wish and annual meetings provide that platform. These are large investments that people make and there’s no reason why there should be a small group of people on the board for ever and ever,” he says.
There are two parts to a virtual meeting, Wagner says. First there’s the video conference part, where people can sign in and see and hear others speak. Second, there’s a balloting part, which is typically run by an election company.
Quorum issues
Annual meetings need to be attended by a certain number of members in order to make the proceedings valid. Most co-ops and condos require their meetings to be attended by owners holding 50 percent of the shares or common interest. This is called a quorum. If you’re concerned about reaching this minimum number of participants, Wagner says there’s anecdotal evidence of higher involvement at shareholder meetings now that virtual attendance is allowed.
“None of my clients who have conducted virtual annual meetings have had difficulty reaching a quorum,” he says.
Zoom has been the most popular software for conducting these meetings. “The upgraded version of Zoom is required because the standard membership limits the number of people who can attend and also limits the amount of time for the meeting to less than an hour,” he says. This software upgrade may be available to you through your management or balloting company.
The platform gives you the option to have either a meeting, which allows everyone to see others in attendance (assuming each individual shareholder allows visual access) or a webinar, which will only allow the speakers to be seen.
The format of the virtual meeting
Ahead of the meeting you will need to choose a host who can mute participants to reduce background noise as well as allow participants to unmute themselves in order to contribute to the meeting. “The host will be different from the chair of the meeting,” Wagner says.
He recommends muting non-scheduled speakers for the duration of the meeting.
“Not only is it unwieldy to mute and unmute people who wish to speak, but background noise with a large number of unmuted participants makes it difficult to hear anyone,” Wagner says.
Instead, ask residents to text their questions to the chair of the meeting both ahead of time and during the meeting itself.
Virtual voting
Typically the balloting part of the meeting is run by an outside company. “There are several companies offering this service, many with years of experience conducting virtual elections and voting in other states both for co-ops and condos and other entities such as unions,” Wagner says.
Federal and state labor laws generally regulate union elections and the companies that do this work say they comply with all of these strict rules.
“The services of the companies vary, but likely include preparing and sending out meeting notices and proxies, suggesting, sending and utilizing unique codes for each of the shareholders, conducting the balloting and providing results for elections, and any other issues that may properly be voted on by the shareholders,” Wagner says.
In deciding which company to use, consider that many are able to quickly provide results if they conduct all of the balloting.
“This is simplified if they carry out a completely virtual meeting as opposed to a combined actual and virtual meeting,” Wagner says. He points out many of the balloting companies also say they are willing to serve as the inspectors of election under New York State law.
The balloting companies also provide web pages where voting on candidates or other issues that come up during the meeting, and require a vote, may be conducted.
“Some of them will modify the webpage to accommodate specific needs or by-law requirements and will even make real time changes to the items being voted on as the meeting progresses,” Wagner says.
Real time changes may be needed if candidates are nominated from the floor or motions are made and voted on during the meeting.
“As you consider which balloting company to use, you should ask about fees and the experience they have in the event there is a contested election and affidavits or testimony are required,” Wagner says.
New York City real estate attorney Steven Wagner is a founding partner of Wagner, Berkow, & Brandt, with more than 30 years of experience representing co-ops, condos, as well as individual owners and shareholders. To submit a question for this column, click here. To arrange a free 15-minute telephone consultation, send Steve an email or call 646-780-7272.
You Might Also Like
