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Home 9 Condominium and Planned Community Practice 9 Amending Title 68: Changing the Definition of “In-Person” Meetings and the Nature of Voting for Pennsylvania’s Homeowners’ Associations, Among Other Crucial Changes: Part 1- Meeting & Voting

Amending Title 68: Changing the Definition of “In-Person” Meetings and the Nature of Voting for Pennsylvania’s Homeowners’ Associations, Among Other Crucial Changes: Part 1- Meeting & Voting

by | Dec 19, 2023 | Condominium and Planned Community Practice, News, Real Estate Practice

Co-Authored By: Bradley S. Dornish, Esq. and Nathan Morgan

Part 1: Meeting and Voting

The coronavirus pandemic altered every aspect of life within every facet of society. The operations of Pennsylvania’s Condominiums, Planned Communities, and Cooperatives, collectively known as Common Interest Communities (CICs), were also substantially impacted. Pandemic mandates restricting “in-person” activities were at odds with Pennsylvania’s CIC statutes which required associations to hold “in-person” meetings, vote “in-person or by proxy,” and to mail meeting notices. These stipulations, found in three separate statutes within PA Title 68 on Real and Personal Property—including the Uniform Condominium Act (UCA) (68 Pa.C.S.A. § § 3101 et seq.), Real Estate Cooperative Act (RECA) (68 Pa.C.S.A. § § 4101 et seq.), and Uniform Planned Community Act (UPCA) (68 Pa.C.S.A. § § 5101 et seq.)—created significant challenges for associations attempting to comply with their governing documents while navigating pandemic restrictions. Some aspects of the older Unit Property Act (68 P.S. § § 700.101 et seq.) also apply to, and spurred pandemic-related challenges for, older condominiums formed after its passage in 1963 and before the passage of the UCA in 1980.

Challenges faced by associations throughout 2020, 2021, and 2022 were numerous…

The “Meetings” provisions of the three central acts—§ 3308 of the UCA, § 4308 of the RECA, and § 5308 of the UPCA—each state, using identical language, that CIC bylaws must require “meetings of the association be held at least once each year.” As a result of pandemic restrictions, it became difficult to hold annual association meetings.

The “Quorums” provisions under each act further complicated operations. Applying to associations’ annual and special meetings, § 3309 (a) of the UCA, § 4309 (a) of the RECA, and § 5309 (a) of the UPCA each state, in identical language, “Unless the bylaws provide otherwise, a quorum is present throughout any meeting of the association if persons entitled to cast 20% of the votes which may be cast for election of the executive board are present ‘in-person or by proxy’ at the beginning of the meeting.”

Applying to meetings of Boards of Directors or Executive Boards, § 3309 (b) of the UCA, § 4309 (b) of the RECA, and § 5309 (b) of the UPCA all state, “Unless the bylaws specify a larger percentage, a quorum is deemed ‘present’ throughout any meeting of the executive board if persons entitled to cast 50% of the votes on the board are present at the beginning of the meeting.”

Changing the bylaws of an association (i.e., “unless the bylaws provide otherwise”), allows for associations to increase or decrease the percentage of voting-eligible, present members, but “not [to] less than 10%.” However, changing association bylaws is costly and time-consuming, and this would not alter these laws’ requirements for “in-person” attendance. We quickly learned that it was difficult, if not impossible, to hold in-person meetings during the pandemic.

In lieu of these many obstacles, CICs were faced with the choice to either violate their bylaws, declarations, and statutes by allowing meetings to be held virtually and/or with some form of electronic voting, or, they had to institute complex proxies to allow a small number of individuals to cast proxy votes as instructed by each individual owner.

These issues were the topic of discussion at a virtual meeting conducted by the Real Property Section of the Allegheny County Bar Association in early 2020. After this vigorous discussion amongst Real Property Section members, I alerted PA State Representative Valerie Gaydos (R-44), who had previously hosted public meetings for CIC property owners in her district, to these various matters.

Representative Gaydos and her staff worked with other representatives to address the concerns of CIC homeowners and associations via the introduction of House Bill (HB) 1795, which was a series of omnibus amendments applying to the three primary CIC-governing acts. HB 1795 was passed by the PA House of Representatives on October 25, 2022, and the PA Senate approved it on October 26, 2022. Governor Wolf signed the bill, then passed as Act 115, into law on November 3, 2022, and it took effect on May 1, 2023. This new law simplifies the operations of homeowners’ associations and their executive boards, defining new ways in which CICs can conduct their meetings and voting. Here are some of those changes:

  • § 3308, § 4308, § 5308: Meetings

Title 68’s § 3308 (a), § 4308 (a), and § 5308 (a) have been amended to read, “The notice of a meeting may be delivered by electronic means if the unit owner has agreed in writing to accept the notice by electronic means or where the bylaws permit electronic notices….” Unlike the prior laws which required mailing of meeting notices, notices can now be sent electronically, provided that unit owners’ consent or the bylaws permit the same.

§ 3308 (b) (2), § 4308 (b) (2), and § 5308 (b) (2) now also allow notices to be sent by “Facsimile transmission, e-mail or other electronic communication to the [unit owner (§ 3308, § 5308)/proprietary lessee (§ 4308)]’s facsimile number or address for e-mail or other electronic communications supplied by the [unit owner (§ 3308, § 5308)/proprietary lessee (§ 4308)], provided that the unit owner has agreed in writing to accept the notice by electronic means or where the bylaws expressly permit means of delivering electronic notice.”

The amendments also allow for the “Use of remote technology.” § 3308 (c), § 4308 (c), and § 5308 (c) state, “Except as otherwise provided in the bylaws, an individual may participate in a meeting of the executive board or association by means of a conference telephone or other remote electronic technology, including the Internet, which allows participants in the meeting to hear each other. Participation in a meeting as authorized under this subsection shall be deemed in-person attendance at the meeting.” Subsection (c) is crucial for CICs, allowing electronic meeting attendance to be considered “in-person.” Whether a member attends through Zoom, Microsoft Teams, telephone, or otherwise, they are considered “in-person” if the other members can audibly hear them.

Recordings of association meetings are now permitted with notice. § 3308 (e), § 4308 (e), and § 5308 (e) state, “Unless the bylaws provide otherwise, meetings of the association may be recorded by the executive board via audio or video technology, provided that an announcement is made by the presiding officer at the commencement of the meeting that the meeting will be recorded. A recorded meeting under this subsection shall be maintained and available to [unit owners (§ 3308, § 5308)/proprietary lessees (§ 4308)] for a period of no less than six months after the date of the meeting.”

  • § 3310, § 4310, § 5310: Voting; Proxies

The three acts, under their “Approved methods of voting” sections, now also contain subparts permitting associations to vote by electronic means.

Subsections § 3310, § 4310, and § 5310 (e) (1) (i) permit voting “in-person or by proxy at a meeting of the association;” § 3310, § 4310, and § 5310 (e) (1) (ii) allow voting “by absentee or electronic ballot in accordance with this subpart;” and § 3310, § 4310, and § 5310 (e) (1) (iii) permit it “by another method of voting expressly provided in the association’s declaration or bylaws.”

Subsections (e) (2) (i) provide that absentee or electronic ballots may “be counted as a unit owner present and voting for the purpose of establishing a quorum, and otherwise, only for agenda items appearing on the ballot,” and (e) (2) (ii) stipulates that such ballots “Not be counted even if properly delivered, if the unit owner attends the meeting to vote in-person.” Unit owners may submit absentee or electronic votes to establish quorums or on other ballot agenda items, but any such votes will be voided should that owner attend a meeting to vote in-person. This averts the potential of “double counting” votes.

Subsections (e) (3) stipulate that, “For the purposes of this subsection, the term ‘electronic ballot’ means a ballot cast or given by electronic transmission over the Internet, vote management system or the association’s community network, whether by direct connection, intranet, telecopier, electronic mail or other technological means, if the identity of the unit owner submitting the ballot can be confirmed and a receipt of the electronic transmission and ballot can be made available to the unit owner.” In essence, any electronic apparatus can be used to cast and record votes if the system provides secure voter identification and accessible voting receipts.

  • § 3103, § 4103, § 5103: Definitions – Vote Management System

The term “vote management system,” is introduced in § 3310 (e) (3), § 4310 (e) (3), and § 5310 (e) (3). The respective “Definitions” portions of each act—§ 3103, § 4103, and § 5103—each define the term as, “A third-party vendor who operates a digital or subscription service that securely manages the conduct of elections and voting procedures.” Third party providers who offer fair, honest, and secure voting services can constitute a “vote management system” for an association.

  • § 3310, § 4310, § 5310: Voting; Proxies – Acclamation

Subsections § 3310 (f), § 4310 (f), and § 5310 (f) provide new rules for voting by “Acclamation.” These amendments each read, “Unless the bylaws of the association provide otherwise, in the event that an election for a position on the executive board is uncontested, the officer or chair presiding at the election meeting may declare the nominee elected by acclamation after determining there are no further nominations.” Barring different association rules, a presiding election meeting officer or chair can appoint a candidate to the executive board if said candidate’s race is uncontested and no other nominations exist. This has been a longstanding practice for many associations but is now clearly referenced in and permitted by Pennsylvania law.