UPDATE: (2023-02-10): The 2022/2023 BoD has made more changes to the LCA election process than any other Board. Below, the nature and implications for fair and open elections are discussed. As reported in the January 12, 2023 BoD Monthly Meeting, after the time period for nominations had ended, only four nominations had been received and these were for the four current Directors. No other LCA members wished to serve. Consequently, the BoD moved and passed a motion to declare the four candidates to be the next Board of Directors. No ballots will be sent to the membership.
Although the 2023 Election Committee has been disbanded, the proposed changes to the election process are so fundamental and fraught with By-law violations, the major problems are itemized below.
From the LCA Webpage: https://leilaniestates.org/2023-election-leilani-community-association/ article authored by Bethany Reynolds:"Please note that per our by-laws, your returned ballot will only be valid if you are a 'Member in Good Standing'—that is, your membership dues are current and you have no CC&R violations."
[Emphasis added.]
As if this abrogation of basic rights was not enough to invalidate the proposed 2023 election
process, this policy is
unenforceable for practical reasons. To verify that a member has or has not paid dues is a
simple matter of a computer search. To verify that a member has no CC&R violations requires that
all the properties of each and every voting member be inspected for compliance.
This (a) is physically
not possible (verifying compliance for 2046 lots at 4 per day requires 511 days),
(b) requires owner permission to access private property,
and (c) is the primary reason the 2019/2020 BoD chose to restrict the interpretation of
"in good standing" to mean only "no outstanding monetary obligations to LCA." (See below.)
Indeed, in recognition of the difficulty in accessing private property, the 2021/2022 BoD implemented
their vetting process "...based on what can be seen without entering the property. County records
and understood and known histories."
[R.
Stadnyk Meeting Comments]
From a transcript of the BoD Special Meeting of 2022-03-02: Page 12, lines 40-44.
This transcript was generated from an audio feed.
Link to audio transcript
The legal flaws in this process are that it does not treat all
members equally (many residences and structures are not visible from the road), nor is
"understood" or
"known histories" defined. Failure to be explicit and transparent raises the possibility that compliance (and therefore
voting rights) decisions
could be based on hearsay reports.
All of these issues were raised at the time the 2021/2022
BoD originally implemented the policy to "vet" candidates for office, and they are still valid as the
2022/2023 BoD continues to pursue this policy.
Now is the winter of our discontent
[Hover to View R. Stadnyk Transcript]
Hello World!
Link 1
From a transcript of the BoD Special Meeting of 2022-03-02: Page 12, lines 40-44.
This transcript was generated from an audio feed.
Link to audio transcript
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Equally devastating to the value of the 2023 Election Committee policy is that it infringes on a LCA member's right to due process as outlined in By-laws Article III, Section 6. In Section 6, a member found not in good standing has the right to be informed in writing of and to appeal the accusation, meet with Directors, and have an opportunity to address or correct the non-compliance. If "good standing" means only "current on dues", then correction requires only making a payment. If it means "CC&R compliance" and the correction requires infrastructure modification (e.g., reducing the height of the house), then the 2023 policies can not insure a member's rights of appeal in the time frame of an election. Nor does the policy specify how or when hearings of cases will be accomplished prior to the vote count.
This policy is not "per our by-laws", as quoted above. The By-laws do not explicitly define "in good standing", but the By-law authors intended to restrict the phrase to mean "current in assessment payments" when they wrote in Article III, section 6: "... Any member who is in default in the payment of any lot assessment shall not be a member in good standing..." And further on in the same paragraph: "... if, ..., the member shall fully pay his deliquency...such member shall then be considered a member in good standing". Again, in Article II, Section 2, the By-laws (and paragraph "Eighth" of the LCA Charter of Incorporation) allow voting rights to be suspended if a member is "...in default in the payment of any annual or special assessment levied by the Association..." Each of these conditions strongly support the view that the Charter and By-law authors meant to restrict "good standing" to mean "current in assessment payments." It is reasonable to infer that had the authors meant to include CC&R violations, they would have stated such in the quoted sections.
Moreover, this re-definition contradicts a determination by the 2019/2020 BoD in the December 12, 2019 Monthly Meeting as reported in the minutes:
From the LCA Webpage: https://leilaniestatesbusiness.files.wordpress.com/2021/11/12_12_2019_meeting_minutes_approved.pdf"b. Robert Golden, Governance. “In Good Standing” What does this mean? We propose that a member will be declared “In Good Standing” if they are current in their assessments, and do not have other monetary indebtedness to the association. This interpretation is consistent with LCA By-Laws. Previous boards have added CC&R violations as a reason to hold a person “Not in Good Standing.” Question: Does the board agree to support this interpretation currently proposed by the Governance committee? By unanimous affirmation, the Board votes to agree with this statement."
Could this 2023 Election policy be considered a case of governmental voter suppression?
The By-laws do not grant the BoD the power to prevent members from being candidates for office. This action was attempted for the 2022 election by the 2021/2022 BoD. By using CC&R violations as an excuse to eliminate candidates who expressed opinions against the then current 2020 lawsuit, the 2021/2022 BoD initiated what may prove to be one of the most divisive periods of the LCA Board of Directors. The argument that such a basis for elections violate the By-laws can be seen by skipping below. There you may also follow a link to a more complete history of attempts to change the By-laws.
“SECTION 1. Number. There shall be a board of directors for the corporation of not less than three (3) nor more than seven (7) members, as may from time to time be determined by the members of the corporation.”
It is well to remember: "The absence of explicit restrictions on executive power does not imply power with no restrictions."
For all of the above reasons, it is well that the 2023 election failed for lack of candidates; otherwise it would have likely been mired in confusion, uncertainty, lack of transparency, questionable accusations of CC&R violations, time and money consumed by challenges, and unhappy LCA members.
For details and references to the supporting documents referenced below, please read the full account in the History of LCA By-Law Changes.
AMENDMENT TO DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS INCLUDING CHAPTER OF INCORPORATION AND BY-LAWS OF LEILANI COMMUNITY ASSOCIATION
"ARTICLE III. MEETINGS ... SECTION 5. Quorum. ... a quorum for the effective amendment to any of these by-laws other than a by-law that relates to the internal government of the project governed by this corporation must consist of the members having at least a majority or more of the votes of all of the members of the corporation, and the concurring vote of the members holding a majority of the votes of the members constituting a quorum shall be valid and binding upon the corporation..."
[Authorized: July 11, 1969] [Emphasis added.]
"ADDITION TO BY-LAWS"
Shall members in violation of any Covenants and restrictions be allowed to serve on the Board of Directors?
YESNO
[Followed by options to vote directly by mail or assign a Proxy.]
Members returned their responses or proxies with their votes for Directors and the minutes of the Members' meeting on March 24, 1977 report: 57 "Yes", 362 "No". Beyond these two numbers, the minutes reveal nothing more about the results, but the resulting "by-law amendment" has issues: (a) There was no mention of the Article or section into which the addition is to be inserted; (b) The minutes did not record that a quorum as measured by the total number of votes cast (419) was declared or that a motion was made and carried; (c) There appeared to be no recognition that the 1969 Amendments required a quorum of 50% of LCA lots (or votes, i.e. 1,024, see Item #1 above); (d) Nor did the minutes indicate that the action was recorded in any format other than the minutes. At this time, there is no extant copy of the By-laws formally incorporating this amendment.
“I have reviewed the Bylaws to ascertain the procedure for determining the eligibility of nominees for the Board of Directors. At present there is no procedure established by the Bylaws. … I believe the Bylaws presently require that the nominee be allowed to go on the ballot. If the nominee is elected at the annual meeting, then under the provisions of Article IV, section 10 (removal), the Directors should call a special meeting for the purpose of removing the Director, if the violation has continued. ...” — 1981-01-12 — William S. Chillingworth, Attorney
(Emphasis added)
Based on the attorney's interpretation and advice: First, the BoD can NOT prevent a member from being a candidate by ANY CC&R or other restriction. This includes not being in "good standing" (i.e., having outstanding fines or in arrears on annual assessments). Nominators of candidates must be in good standing (Article IV, section 2), but not the member he or she nominates. The by-laws do require that a Board Director be in "good standing (current on LCA dues)" (Art. IV, sec. 1).
Second, once elected, a Director can ONLY be removed in a special members' meeting by a majority of votes, provided a quorum of 2/3 of "the total votes of all the members of the corporation" (Article IV, section 10; see below for more details) is present.
[The first public indication of disagreement within the BoD over the lawsuit. Denney, Farrell, and Penny support withdrawing from the lawsuit and oppose the views of Armstrong, Bandmann, Stadnyk, and Tieche.]
[Some of the 2021/2022 Directors embrace the 1977 "amendment", but apparently not the July 1969 Amendments changing the quorum requirements for the 1977 By-law amendment. (See: History of LCA By-Law Changes.)]
[This is the first indication that the election would either be delayed indefinitely, or canceled for some reason. Denney, Farrell, and Penny are consistently in the minority opposing vetting.]
"...Noted that ballots were sent out without the knowledge of four board members.
Election details still needed to be worked out. CC&R compliance amongst candidates
still needed to be verified...
Motion: Keola moved that the Election Committee be dissolved and that further tasks
be done by assignment. Keola -yes, Jim -no, Greg -yes, Lee -yes, Marianne -no, Phil -
no, Ross -yes. Motion Approved ...
Motion: Keola moved that the election be moved to April 23rd 9th, 2022, and the
Annual Membership meeting be held at 1:00 pm at the LCA Pavilion. During discussion,
Greg noted that there needed to be more time for members to respond and the date
was amended to April 23rd. Keola -yes, Jim -yes, Greg -yes, Lee -yes, Marianne -yes,
Phil -yes, Ross -yes. Motion Approved. ...
Motion: Ross moved that vetting of the candidates for the upcoming election end by
Friday, March 4, at 5 P.M. Keola -yes, Jim -no, Greg -yes, Lee -yes, Marianne -no, Phil -
no, Ross -yes. Motion Approved. ...
Motion: Moved the annual meeting will be at 1:00pm on April 23rd, 2022. Keola -yes,
Jim -yes, Lee -yes, Marianne -yes, Ross -yes and Phil -yes. Motion approved. ..."
[The motion votes and especially the video recording and audio transcription reveal considerable disagreement concerning vetting candidates for CC&Rs between Denney, Farrell, and Penny on the one hand and the other Directors. But there is agreement that an election will be held.]
[Candidates (as listed in the January 13, 2022 minutes) rejected by the 2021/2022 BoD CC&R compliance committee: Marianne Farrell, Mick Kalber, Jim Penny, and Pete Wilson. All of these had previously voiced a desire for LCA to withdraw from the lawsuit. The reasons that two other orginally nominated candidates were not designated as valid candidates (Petra Weisenbauer and Sean Dougherty) were not reported.]
[The Board did not publish a written and signed opinion by the attorney affirming the power of the BoD to eliminate candidates, as was done in 1981 when the 1980 BoD published their attorney's letter denying the Board's power to eliminate candidates.]
[This BoD 4-3 vote officially canceled the 2022 election a mere 13 days before the previously scheduled election was to occur and under a cloud of unclarity and dispute as to the precise reasons candidates were declared in violations of CC&Rs. A similar election cancellation reported in the minutes of the March 22, 1979 General Members' Meeting is not comparable (contrary to widely circulated social media claims) since in that case the selection of the candidates was by the choice of the membership (only 7 members volunteered to be candidates for the 7 positions), and was not the fiat of an outgoing 2021/2022 BoD intent on selecting a majority of Directors that supported continuation of the lawsuit. Moreover, in the 1979 General Members' Meeting, those members attending the meeting chose to vote regardless and, to quote from the minutes: "A unanimous vote for the slate of officers from the members present was received." Thereby providing a welcomed frisson of membership participation in the election process.]
[The motions produced the effect that the LCA was to leave the lawsuit immediately. This action in turn initiated many court motions and much intra-BoD dissension. The Settlement page lists the legal motions.]
[The remaining minority three continued to hold the meeting, including conducting LCA business by passing motions 3-0. This action was challenged because (a) it was done without the required quorum of 4 for the seven-member Board (By-laws Article IV, section 7), and (b) it violated By-laws Article IV, section 10 that states that removal of a Director requires a concurring vote of a meeting comprising a quorum of two-thirds (2/3) of the votes (lots) held by all the members of the LCA Corporation. (Note: The three Directors who subsequently maintained control of the LCA webpage have posted a long defense of this action that contains factual errors.)]
[There followed several weeks of divisive dispute over the true nature of the LCA Board of Directors. This caused Revere and Associates to withdraw as counsel for the lawsuit Plaintiff (LCA). Eventually, due in large part to the fact that Best, Kindel, and Vizena had control of the physical and electronic records of the LCA, control of access to the LCA business office, and control of all means of communicating with the LCA membership through email, website, and social media, they became the de facto BoD. Two months later (June 2022), Dendra Best, Greg Armstrong, and others orchestrated a campaign to discredit and remove Delaney, Denney, and Ellis from the 2022/2023 BoD (thereby acknowledging that the actions taken by Dendra Best in the April 26, 2022 Zoom meeting were illegal). Mike Ramsdell was not one of those targeted, and, unless he has voluntarily resigned in writing, was never legitimately removed as required by Article IV, section 10.]
[That the legitimacy of the June 2022 removal vote can be questioned is evident from the complete text of section 10 quoted below:]
"SECTION 10. Removal. Any director may be removed from office by the concurring vote of the members holding two-thirds (2/3) of the total votes of all the members of the corporation present at any meeting duly called and held for such purpose." [Emphasis added]Interpretation: (1) "...any meeting duly called..." means in other by-law sections that a meeting of the members is duly called if 10% of the total LCA votes call for the meeting and this number shall constitute a quorum (Article III, section 5); (2) HOWEVER, Article III, section 5 qualifies 'quorum' by concluding: "...except as other-wise provided by law or by these By-Laws or by the Charter of the corporation."; (3) this exception applies to Director removal as quoted above: "...concurring vote..." means 50% of those members present at the meeting with a quorum of at least 2/3 of the total votes of the LCA corporation; (4) As reported in the June 9, 2022 minutes for the BoD Monthly meeting there were 218 votes for removal and 61 votes against; 279 fails to satisfy the quorum requirement of 2,046 * 0.6667 = 1,365 votes; (5) therefore, the removal vote failed for lack of a quorum.
[In the end, the invalid removal vote was a waste of time and money, since 5 months later (December 20, 2022, Docket 819) the Plaintiffs agreed that the lawsuit should be dismissed with prejudice, with no financial burden placed on the Defendants individually. The Plaintiffs had lost their ill-considered and unfounded lawsuit begun on September 29, 2020.]
[For the second time in two years, LCA will not have an election of its Board of Directors. The 2023/2024 Board of Directors will be the same four who directly or indirectly lent the weight of their office to the failed 2020 lawsuit, to an invalid Director removal action, and promulgated the flawed 2023 election policies.]
(2022-04-26): In the April 14, 2022 regular monthly meeting of the appointed 2022 BoD, President Dendra Best opened the Zoom session, then immediately closed the Open session and the BoD retired to Executive Session. The minutes do not report if a formal motion to enter Executive Session was made. (No motion was made view a transcript here.) Eventually, the Open Session resumed with Best, Vizena, Kindel, and Ellis, the latter of which left the meeting shortly afterwards. Subsequently, Best, Kindel and Vizena proceeded to conduct the meeting after declaring that three Directors (Jeff Delaney, Phil Denney, and Mike Ramsdell) were not legal Board Directors would be excluded from re-joining the open session. The remaining three continued to hold the meeting, including passing motions 3-0. This action was flawed because (a) it was done without the required quorum of 4 for the seven-member Board (By-laws Article IV, section 7), and (b) it violated By-laws Article IV, section 10 (removal of a Director requires a 2/3 vote of the members). As of this writing, the 2022 BoD comprises Best, Delaney, Denney, Ellis, Kindel, Ramsdell, and Vizena. Here is a synopsis of the facts as explained fully in the History of LCA By-Law Changes. History of LCA By-Law Changes. History of LCA By-Law Changes.