Proxy Rules
- A proxy is a written authorization signed by a member or the member’s attorney in fact giving another person or entity the power to vote on behalf of the issuing member. A proxy can only be voted by another member of the homeowners Association.
- The articles or by-laws may limit or preclude the use of proxies altogether. In the alternative, the Association by-laws or CC&Rs may allow limited proxy voting. The governing documents control whether and to what extent proxy voting is permissible.
- The Association is not required to prepare or distribute proxies.
- A proxy issued for an election, which directs the manner in which the proxyholder is to vote, for purposes of a secret ballot, shall be set forth the directions on a separate page that can be detached and given to the proxyholder to retain.
- No proxy shall be valid for more than eleven (11) months from the date of the proxy unless the proxy provides otherwise.
- Unless irrevocable, the maximum term of a proxy is three (3) years from the date of execution. (There are certain limitations as to who may hold an irrevocable proxy.)
- If a proxy is revocable, the following matter may be voted on only if the proxy form generally describes the matter:
- Removing a director without cause.
- Filling vacancies on the board that requires a membership vote.
- Approving a transaction in which a director has a material financial interest.
- Approving a change in proxy rights.
- Amending the articles of incorporation.
- Selling or disposing of all or substantially all of the corporation’s assets.
- Merging with another corporation.
- Dissolving or winding up the corporation.
- In a corporation with several classes of membership, approving any distribution or liquidation that is inconsistentwith the liquidation rights of any class.
- If a proxy is distributed to 10 or more members of an Association with 100 or more members, the proxy must provide for the issuing member to specify whether he/she approves or disapproves of each matter to be acted upon. (Corps. Code §7514(a).) 10 Cal.Code Regs. §2792.17(g) requires the same opportunity to approve or disapprove, but does not limit the requirement to a proxy is distributed to 10 or more members of an Association with 100 or more members. Therefore, the proxy should provide the issuing member the opportunity to specify whether he or she approves or disapproves each matter.
- The name of a candidate for the governing body need not but should be included on the proxy.
Power of Attorney
A power of attorney is a very different “creature.” It is an instrument by which a member can “delegate” very broad authority to act on his or her behalf. In the alternative, the member’s delegation can be limited to very specific matters.
At a minimum, a power of attorney must name the member and the attorney in fact and describe the powers granted. It must be dated and notarized or signed by two disinterested witnesses.