When a Board Is Afraid to Take the Heat on a Controversial Topic

May 25, 2012

In this week's tip, we answer a reader's question about whether his board can slink away into executive session simply because there's a controversial topic—which management company to hire—on the agenda.

What's executive session? It's a process by which a board meets privately to discuss matters that shouldn't be revealed generally. Each state has different rules on the practice.

Some don't permit it. "If Florida, we don't have this executive session concept," says Jed L. Frankel, a partner at Eisinger, Brown, Lewis, Frankel & Chaiet PA in Hollywood, Fla., who advises community associations. "Everything is open unless there's an attorney–client privilege issue. Maybe there's litigation or there need to be confidential communications between the board and its counsel. That would be an exception where only board members and possibly the manager would be permitted to attend. Other than that, everything in Florida is going to be an open meeting."

Many other states, however, permit use of executive session in specific circumstances. "There are times when boards can and should go into executive session depending on state law and the governing documents," says Elizabeth White, a shareholder and head of the community associations practice at the law firm of LeClairRyan in Williamsburg, Va. "In Virginia, we have open meeting requirements, which compel boards to meet in the open. So members should have notice of the meeting and an opportunity to attend and observe. Then there's a list of exceptions, which say a board may go into executive session to discuss things like legal advice, pending litigation, contracts under negotiation, and anything required by law to be confidential."

Minnesota's law is similar but has fewer and different exceptions to the open meeting requirement. "Typically in Minnesota, a board meeting held in person is required to be open to owners to attend," says Matthew A. Drewes, a partner at Thomsen & Nybeck PA in Edina, Minn., who represents associations. But he explains there are three basic scenarios in which a Minnesota board can close the meeting, when the board will discuss personnel matters; pending or potential litigation or other adversarial proceedings as long as they involve unit owners or the board and the board decides it's important to protect the privacy of the board or unit owner; or if there's criminal activity in the community and the board decides that it's necessary to protect the privacy of the victim or to not jeopardize the investigation.

Still, there can be discussion over when going into executive session is proper. See our new article, Discussion Forum Follow–Up: Can an HOA Board Go Into Executive Session to Dodge Controversy?, to learn more.

Best regards,
Matt Humphrey
President