Just what does go on in these closed sessions? The following is not meant to be a legal document, rather, just a lay person’s description of what the Board does in those sessions.
As I have mentioned in my previous reports, California requires that all common interest developments follow the laws governed by the Davis Sterling Act. These Civil Codes allow an HOA’s Board of Directors to discuss four areas in a closed session: personnel matters, member discipline, formation of contracts, and litigation.
The Board of Directors would be subject to legal action if we were to discuss personnel issues in public. Here are some examples of questions that may arise: complaints about a vendor’s staff member, or conflict between the employees of two vendors which falls under the code of conduct that is included in some of our contracts. On member discipline, we occasionally have members who simply do not feel it’s necessary to conform to our Rules and Regulations. Perhaps they do not go through the proper design review process and choose to paint their home purple;
or maybe a member acts in an uncivil manner toward a neighbor or staff member. These would be discussed during the Board’s closed sessions. For the most part, our members honor these simple rules; but issues do pop up.
Third party contracts are confidential, so these are discussed in closed session to ensure our bidding process is fair so that we obtain the best vendor for our community. If one vendor were to know in advance what another was offering,
that would not be fair. Litigation issues, such as filing a lien or foreclosing on a property, also need to be discussed in closed session to assure privacy for all parties. We have had small claims actions, cases that have ended up in Superior Court, and issues that required our Association counsel’s advice and action. It’s sufficient to say the outcome was successful for our members. Your community is represented by the firm of Epsten, Grinnell & Howell, which specializes in community association law. Attorney Mary Howell usually attends our executive sessions.
My first executive session extended beyond the normal morning session and well into an evening session that followed our General Meeting. Your Board has been successful in shortening these meetings dramatically; and it appears that we are having fewer problems, which is good for the community.