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Is it fair to say that it is a conflict of interest if the by-laws state "The majority of the board must be members" where as the Rules and Regulations state "Only members can vote at annual meeting".
If a non-member can sit on the board, why isn't a person who lives in the co-op but not on the deed (inherited) entitled to vote?
Well said Steven. You stated everything clearly and correctly.
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Roughly put, a conflict of interest exists when an individual stands to receive a personal gain due to a decision they make or an action they take in an official capacity, without disclosing their potential personal gain to the rest of the official decision-making body.
First, a clarification. Shares in a co-op are *not* a deed to the apartment. Condominiums have deed and title. If you're talking about a condo (you mentioned the individual not being on the "deed") and not a co-op, please don't read any further because what follows doesn't apply to you.
In answer to your initial question, think of any public corporation. Only shareholders can vote at the annual shareholder meeting, but non-shareholders can be elected to and sit on the board of directors. They often are to get a diversity of opinions and expertise.
Votes are tallied based on the number of *shares* owned, not the number people or other entities (i.e. trusts, estates, etc) who own the shares or live in the apartment. An individual apartment may be allotted 100 shares. It doesn't matter if a single individual owns all 100 shares, if a couple own all 100 shares jointly, if four casual friends each own 25 shares, or if the estate of a deceased shareholder owns all 100 shares, they still have only 100 votes.
Please understand that what I've written is not a legal opinion or advise, because I am not a lawyer. To get a definitive legal opinion you need to consult with an attorney.
I hope this helps,
--- Steve
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