Memorandum to Clients - Annual Meeting Refresher

Gelfand & Arpe, P. A.

November 1, 1993

MEMORANDUM TO CLIENTS
ANNUAL MEETING REFRESHER

The time is ripe for corporations to schedule their annual meetings. Every Florida corporation is required to have an annual meeting at least thirteen months after its last annual meeting. Many bylaws require annual meetings to occur on a specific date or within a specific time period. Of course, without an annual meeting new directors cannot be elected. If an annual meeting does not occur, then a corporate shareholder or member can petition the courts to order the holding of a meeting or to appoint a receiver.

Advanced planning for an annual meeting is necessary to insure that proper notice be provided to shareholders and members. The Florida Business Corporations Act requires commercial corporations to provide notice of annual meetings not less than ten nor more than sixty days before the meeting date unless the articles of incorporation provide otherwise. §607.0705 Fla. Stat. (1991). The Not-For-Profit Corporations Act requires "homeowners associations" which are not regulated as condominium or cooperative associations to set and notice their meetings as specified in the associations' articles of incorporation and bylaws. §617.0701 Fla. Stat. (1991).

Especially considering that many associations will seek to adopt amendments at their annual meetings, it is vitally important that associations set their annual meeting dates ninety days or more in the future. This advanced time will allow amendments and special notices to be prepared. The advanced time will also allow association officers and management to properly prepare the required detailed mailing lists and packets.

Advanced planning will allow an association to properly canvas members for nominations and allow the preparation and mailing of meeting materials. Regardless of whether an association utilizes absentee ballots, it is always suggested that proxies be provided to absentee owners to provide a quorum for undertaking other business. If a corporation's bylaws require a meeting to occur on a certain date each year, then a bylaw amendment may be appropriate to provide the corporation planning flexibility.

If you desire an attorney to attend your 1993/1994 annual meeting it is important that you contact the attorney at this time to avoid a scheduling conflict. In the interim, the following provides information on the timing of notices for regulated homeowner and condominium associations:

Homeowners Associations. The "Homeowners Association Act" provisions of the Florida Not-For-Profit Corporations Act applies only to association's with more than fifty lots and with assessments exceeding $150.00 per year, not under developer control. If a homeowners association is governed by the new law then ballots must be utilized for an election. Even though ballots are utilized, the law does not prohibit nominations being made at the annual meeting. Except for the ballot requirements, all of a homeowners association's bylaw provisions remain in force and effect for annual meeting elections.

Condominium Associations. All condominium associations except those authorized to "opt out" of the new election procedures must follow the statutory election procedures described in the next paragraph. Opt out's are authorized for condominium associations of less than twenty-five units. If there are less than twenty-five units then the association may vote to reaffirm the association's procedures as set forth in their bylaws.

Condominium associations must send an initial notice of meeting and opportunity to submit nomination sixty days before a meeting. Between forty and thirty-five days before a meeting the association's board of directors must meet to finalize the ballot and submit additional nominations if desired. Thirty days before the meeting the Association must provide a formal notice of meeting with agenda, and ballot.

The Division of Land Sales promulgated new condominium association election rules. If the rules are not followed then an election may be invalidated. If an election is invalidated then there is a potential for all actions undertaken by an illegally elected board to also be determined to be invalid. One of the election requirements is that ballots must not be counted before the beginning of a meeting. Outer ballot envelopes may be checked in the day of a meeting at a properly called meeting of a board or a committee. The first order of a condominium association's annual meeting shall be the collection of undeposited ballots.

PARKING LOT AND GARAGE SIGNAGE MUST COMPLY WITH STATE LAWS

With the onset of the "season" property owners are sprucing up their parking areas. The Florida Uniform Traffic Act requires that parking areas open to the public have traffic control signage that is in accordance with state guidelines. Thus, hand made stop and traffic speed limit signs are generally noncomplying and therefore illegal.

Similarly, §715.07(2)5 Fla. Stat. (1991) requires "no parking-towing zone" signs to not only have lettering of proper size, but also the sign must be located a certain distance from driveways and installed at a certain height. Noncompliance with these rules could place a property owner liable for damages in case of a traffic accident or improper vehicle towing.

This information is provided only for public information purposes and is provided without obligation or fee. It is distributed to the firm's association clients to provide a general notice of recent changes in the law. This information is not to be considered as legal advice. The changes in the law may not have been reviewed by the courts and may be subject to challenge. Before taking any action you are urged to consult with counsel to ensure that your legal rights are being protected.