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What if a director on the Board
of Directors decides that the association won’t hold an election and annual
meeting? What are the consequences?
Annual meetings, as their name
suggests, is a meeting called once a year.
In that meeting, members vote on association business that requires a
membership vote (amendments to dedicatory instruments and elections,
etc.). But, are HOAs required to call an
annual meeting? Yes, a resounding
yes.
There are two code sections that
deal with this subject. Texas Business
and Organizations Code §22.154 and Texas Property Code §209.014. 22.154 states that the nonprofit corporation
must call an annual meeting. 209.014
states that the association must hold an annual election.
Under the Property Code, if an
association does not hold an election, the membership may demand that the
association hold an election in writing.
If the association still does not hold an election as demanded, the
membership can then move forward with appointing an election committee and hold
their own elections. This action can
essentially force the association to have a new board of directors which will
force out the “original board of directors”.
209.014 is very specific in its
requirements. The code section needs to
be followed with intention to be effective.
The Bylaws must be followed, or
the association may be at risk of falling to the code sections referenced
above. Annual meetings and elections are
essential to the association conducting business. These code sections were drafted and passed
for a reason. Members need to elect
representatives that reflect what the membership wants as it pertains to the
association.