New York's Cooperative and Condominium Community
My sister's co-op in NYC does not allow for proxy voting. Can By-Laws actually disallow proxy voting? I thought the Business Corporation Law provided for proxies so that all shareholders have an equal chance to be heard in an election that they cannot attend.
If this is true, can they thus be forced to change the By-Laws? Or is changing them unnecessary because it's the law any way?
If it is not the law, how can people who cannot attend a meeting have their votes counted? In one case, due to construction on their property, it was not possible for shareholders in one building to reach the other building where the meeting was being held and thus they were disenfranchised as shareholders. The Board's attitude was, "It's not our problem." But is it?
I'd appreciate your input.
CDT,
Thank you for your prompt reply - That's exactly what I thought, but also knew that Board Talk would be the place to come to air out the situation.
My sister is getting a copy of her co-op's bylaws tomorrow (Monday) to confirm her understanding of them. If they don't prohibit proxies but her Board is dismissing the idea on their own, I hope there will be quite a shake-up, and will keep Board Talk advised. Thank you again.
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If the By-Laws of your sister's co-op are based on the same template as many others in New York, start by checking out Article II (Meetings of Shareholders), Section 5 (Voting): "At each meeting of shareholders, each shareholder present in person OR BY PROXY ...."
That particular phrase -- "in person or by proxy" -- appears over and over in our own By-Laws.
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CDT, That's a good tip to make it easier for her to find it - I'm chomping at the bit to hear what she finds. Thank you.
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There is a basic problem with all of this answers. Not all coops were created pursuant to the BCL. Basically, if you are a BCL coop, you must allow the use of proxies, and you cannot even have qualifications (such as you can give a proxy only to a relative or another shareholder). If you are a CCL coop, then there is no absolute right to use proxies. However the CCL coop can have a by-law provision allowing the use of proxies.
Finally, trumping all of this is a fairly new law, that says if your coop is a Mitchell-Lama, the Board CAN require the shareholders to use a specific form of proxy.
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The advocates @ ACCO (Alliance of Condo & Co-op Owners) would like to see any written rules or other documentation stating or suggesting that proxies will not be accepted.
If you or your sister are willing to share & discuss with people interested in helping her express her vote, please contact ACCO: advo@condocoopowners.org
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ACCO,
Thank you very much for your speedy reply - I'm forwarding this to my sister, who is getting hold of her bylaws tomorrow (Monday), and I'll ask her to contact you directly.
I was stunned to hear her tell me about no proxies being allowed. Hers is a self-managed co-op, and if the bylaws actually prohibit them, they're in for some changes. If it's the Board at her co-op twisting the rules to make them "fit" their agenda, they're in for a rude awakening, wouldn't you agree?
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I have the same situation in my coop in Queens and have been fighting it for years - It seems that we were incorporated as a "cooperative" coop which I am told does not allow proxy voting, although some of our sister buildngs were incorporated under the same documents and they allow proxy vote - I have read the BCL and it does not say that, but I did speak to the AG's office many years ago and he did say I would have to go to court,which as everyone knows is ridicuously expensive if the board is going to fight it which they will; however our bylaws even have a "savings Clause" which says NYS law prevails and that does not work. What is more a problem is that we have many illegal rentals and deceased and the notices of meetings are never sent to the actual shareholder and mostly put under the door therefore not allowing the actual shareholders the right to vote. We really need help - thank you
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In this case, too, ACCO (Alliance of Condo & Co-op Owners) would like to know of any undemocratic election practice in co-ops or condos. Specific documentation is essential.
Please contact ACCO: advo@condocoopowners.org
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My sister wrote this to me: "I obtained a copy of our by-laws and it clearly states no proxy votes."
I can't imagine attorneys would draw up such bylaws outside of the law, but maybe that prevailed at the time. She said that she would contact ACCO directly, and, like me, thanks one and all for their time and thoughts on it.
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Your Black book should tell you how voting is done. All Coop's have proxy voting. Your Certificate of incorporation should also tell you the same thing it is the mother load of laws. If the Certificate does not say that Cumulative voting is is the process to count the votes then legally Plurality voting is the process. When the Certificate is silent then Plurality can be applied. All Coops use proxy voting.
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While not specifically disallowing proxy voting, the By Laws can legally require that each vote to be cast in person.
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Proxy voting is one of the easiest ways to manipulate co-op elections. Be careful what you wish for!
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We definitely have the situation in your first posting stating that you must be present to vote - however again the Savings Clause does say if anything is not per NYS law then NYS law prevails - Yes proxy voting can be manipulated however as stated previously many, many shareholders are not notified or cannot attend because they do not live in the building or vicinity- and unfortunately many do not want to come down, but they would sign a proxy because I did try quite a few years ago and I could have beat them and get new people on the board with the proxies which were not allowed, and we have only 1 vote per apartment - unfortunately the opposition is able to get their people down and vote as they are told - no matter the horrible condition of our building and our finances- Over 70% assessments and raises in the last few years and much more coming and nothing done to repair the building -
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No co-op can prohibit proxy voting. That would be a direct violation of NY Business Corporation Law, Sec. 609(a): "Every shareholder entitled to vote at a meeting of shareholders or to express consent or dissent without a meeting may authorize another person or persons to act for him by proxy." See http://www.lawserver.com/law/state/new-york/ny-laws/ny_business_corporation_law_609
As I understand it, the co-op can require a certain *form* of proxy, but that's an entirely different matter.
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