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Our bylaws state that two Inspectors of Election shall be "assigned" by the president or other person chairing the Annual Shareholders Meeting. Our president hired our property manager's assistant to work with the PM, paying her $100 for her time, and the two of them served as Inspectors, counting the proxies and other votes.
Please tell me, how are Inspectors normally "assigned"? Is the president permitted to hire an Inspector of Election?
Should the PM be counting votes?
Thank you Ethel, I appreciate your input. You're right, the inspectors are needed only if the election is contested. I wonder, though, if the word "assign" in the bylaws can be meant to "hire" an Inspector. In the case of your coop, it seems the Inspectors are far enough out of the day-to-day business to be impartial. Our property manager is in the thick of it and has personal reactions to several shareholders -- probably not the appropriate person to be counting the votes/proxies. To hire the PM's assistant seems to be inconsistent with the impartiality that is required. But the board president decides and doesn't see the irony of it. It's a conundrum!
If the bylaws are calling for inspectors of election, it really should be by two non-involved Shareholders at the Annual meeting who can tally the votes and determine the outcome. Although it may not be illegal for the Management company to count the votes, allowing an independent group of Shareholders to count the votes will lead to no conflicts of interest.
The PM can always review the work once it is finished and before the results are offered to ensure the consistency of the voting and to make sure that all votes are counted, non-signed proxies are eliminated and that the actual outcome is correct.
It's always easier and more transparent if it is done the correct way.
I agree with you 100 percent, and thank you very much for your sound suggestions.
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If the election is uncontested and the proxies are needed only for a quorum, so be it?
If the election is contested then an independent “proxy counter” should be employed. In our case, we use our outside legal counsel and a representative of our outside accounting firm, regardless, uncontested or contested.
This is far less expensive then hiring a proxy counting company.
We are self managed.
Our bylaws indicate that the corporate Secretary is to receive the proxies. But, if the Secretary is running for a position on the board, then it is inappropriate for the Secretary to “receive” the proxies. In this case, we allow our property manager to receive, hold and safeguard the ballots for the outside ballot counters.
Note that shareholders have the option of sending their proxy directly to outside counsel, if they feel more comfortable.
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