Have you ever received a demand from an owner or multiple owners to call a special meeting of members? The demand may have been to schedule a recall meeting, or it may have been to discuss a particular issue. Regardless of the cause for such demands, many boards do not know what to do with them and do not take the statutorily-required steps. The good news is the law provides clear guidance on this topic.
Section 308(1) of the Colorado Common Interest Ownership Act (“CCIOA”) specifically addresses meetings of unit owners and sets forth the criteria requiring association to call a special meeting of owners. It is important to note this provision applies both to pre and post-CCIOA communities (i.e. communities created before and after July 1, 1992).
Section 308(1) of CCIOA requires associations to call special meetings of members if any one of the below criteria are met:
1. Board president calls the meeting;
2. A majority of the board calls the meeting;
3. 20% of all owners request special meeting; or
4. A lower percentage of owners specified in the governing documents requests special meeting.
Based on the above, any provisions contained governing documents requiring more than 20% of the owners to request special meetings, are contrary to CCIOA, unenforceable, and automatically lowered to 20% of the owners.
Another item of note is the Colorado Revised Nonprofit Corporations Act (the “Nonprofit Act”) supplements CCIOA requirements with respect to the owner request criteria to require such requests to be in writing and to state the purpose of the requested special meeting. Additionally, the Nonprofit Act requires the written request to be signed by all owners who are requesting the special meeting.
Pursuant to the Nonprofit Act, once an association receives a demand for a special meeting from owners, it must take appropriate steps to review the signatures to ensure the request truly represents at least 20% of the owners (or lower amount if so specified in the governing documents). This means reviewing the signatures themselves to ensure they are from owners and not renters or individuals who are not on the deeds.
The Nonprofit Act also requires associations to perform the above verification within 30 days of receipt of the request, and to send notice of the special meeting by the 30th day of receipt. If a board fails to send notice of the special meeting within the specified 30 days, the owners who requested the meeting may set the meeting and mail out their own notice on behalf of the association, which would mean the association would have no control over the date, time, or location of the meeting.
Please also keep in mind meeting notices must be provided at least 10, but not more than 50 days before the meeting. Therefore, notices of special meetings must also follow such timeline. Based on these requirements, it is possible for an association to technically wait 80 days from the date a request is submitted before holding a special meeting (i.e. notice is sent 30 days after receipt and meeting date is 50 days after notice date). However, this may be viewed as bad faith by a board and cause further political ramifications.
For more information concerning calling of special meetings or if you have specific questions, please contact an Altitude attorney at 303.432.9999 or [email protected]..