Q&A: A Board Cabal

Q. We have a board member who has been locked out of meetings. According to that board member, the board has formed an executive committee that has, for all intents and purposes, shut them out. The board member is no longer able to view board discussions and cannot participate in board debates, decisions, or activities. The person has been disenfranchised and marginalized for reasons that have them stymied. It appears that the member’s perspective is not accepted, and the executive committee felt the need to censor that person. Is this action legal? Why the secrecy? What action can be taken to stop this rogue board, other than waiting for election day?

                            —Seeking Transparency

A. “Board members may not legally create an ‘executive committee’ to shut out a duly elected board member,” says attorney Benjamin Altshul of the Chicago firm Levenfeld Pearlstein. “In Illinois, a condominium board can only create a committee if it is expressly authorized by the association’s declaration or bylaws. Committees can be comprised of board members as well as unit owners not on the board. However, even if a board can create a committee, that body cannot have any decision-making authority. Pursuant to Section 18.4 of the Condominium Act, all powers, duties, and authorities of the association are vested in the board, except for those reserved by law to the members of the association. The Condominium Act does not reserve any powers for committees; thus, to the extent a particular declaration allows for the formation of a committee, it would essentially just be an advisory body that makes findings and recommendations, while the board ultimately makes all final decisions. So if this board has properly created a committee, this disenfranchised board member should be entitled to review all of the committee’s findings, ask questions to the committee, and ultimately vote on the topic.  

“Further, boards cannot act in secret, behind-closed-door meetings. According to the oft-cited condominium case Palm v. 2800 Lake Shore Drive Condominium Association, 2014 IL App (1st) 111290, 10 N.E.3d 307, 381 Ill.Dec. 307, the appellate court clarified that all board business must be conducted at an open meeting. Pursuant to Section 2(w) of the Condominium Act, a ‘meeting’ of the board is defined as ‘any gathering of a quorum of the members of the Board of Managers … held for the purpose of conducting board business.’ The Palm court held that ‘conducting board business’ includes both discussions and votes on a topic.  

“Section 18(a)(9)(A) of the Condominium Act provides for a limited exception to the open meeting rules and allows for the board to break away into an ‘executive session’ to discuss certain limited topics. These topics include, but are not limited to, ongoing litigation, employment issues, and violations of the rules and regulations. While certain private discussions are permissible, the eventual vote on a matter must be conducted at a board meeting open to the unit owners.  

“So once again, if this board has properly met in ‘executive session,’ the fact remains that the whole board should be participating in this meeting—including this disenfranchised board member. The other board members’ refusal to conduct board business at an open meeting and continued exclusion of a duly elected board member constitutes a breach of their fiduciary duty.  

“If this board continues to conduct business in this matter, the alienated board member’s options include the following: 1) have legal counsel prepare a cease-and-desist letter; 2) have legal counsel file a declaratory judgment lawsuit; or 3) influence/lobby the other unit owners to vote out one or more of these board members at the next election. Once the board member notifies the board of its improper actions, hopefully the board will do the right thing without attorney involvement.”

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