#42-09, Brown v. Americana Finmark Condominium Association #42-09 (June 30, 2010) (Panel: Stevens, Gelfound, Kali)

Brown complained that the condominium association had conducted an improper election because at the election meeting the members present voted to reduce the size of the board from 7 members to 5, thereby disqualifying from office some of the candidates for election.  The motion to reduce the size of the board was approved by a simple majority of the members present.  Brown claimed that the reduction in size of the board was in effect a Bylaw amendment and should have been approved by a 2/3 majority.

The evidence at the hearing showed that after the election was announced and candidates requested, there were 3 vacancies on a board of 7 directors.  However, there was only 1 candidate.  Therefore, the board decided to ask the members to vote on reducing the size of the board from 7 to 5, which meant there would be only 1 vacancy up for election.  The bylaws of the association provided only that the board would consist of an odd number of directors, no less than 3 and no more than 9.  The bylaws did not state how this number could be fixed or changed.  At the election meeting itself, there were nominations from the floor; but the motion to reduce the size of the board was still made and passed by members voting in person or by proxy.

The hearing panel held that the board had a good reason for the proposal to change the size of the board, and that in the absence of any bylaw specifying how the size of the board could be changed, the board had the authority to allow the membership to decide the issue by a simple majority vote.  Since the bylaws only specified a range in the size of the board, changing the size of the board within that range was not an amendment of the bylaws.

On Brown's motion for reconsideration of that decision, the panel clarified its decision, noting that it was applying the "business judgment rule" as stated in