Q&A: A Board-less Board

Q We are a small 24-unit condo complex. Nobody wants to serve on the board and the  same people have to keep serving over and over again just to keep things  running. What happens if no one wants to serve and there is no board?  

 —Worried in West New York  

A “What you describe is a common problem, especially in smaller condominium  associations,” says Bruce J. Ackerman, partner and head of the corporate/commercial Practice of the Hackensack-based  law firm of Pashman Stein, P.C. “It is typical that one person is the true force and leader in terms of getting  anything done. When that leader moves or retires, many associations are set adrift and apathy  often prevails. Unless the association is large enough to engage professional management, all  work is left to those unit owners who are willing to spend their time to manage  the property.  

 “The bylaws in most associations cover the scenario when no one wants to serve as  trustee, at least in part. For example, most by-laws provide that the remaining trustees shall have the  right to choose to replace the open positions, at least until the next general  election or annual meeting. In addition, it is usually provided that the last standing trustee shall appoint  his or her replacements. The New Jersey not-for-profit statute, N.J.S.A. 15A:6-5, provides that, unless  otherwise set forth in the bylaws, whatever vacancy occurs shall be filled by  the remaining trustees, except where all trustees are removed. A special election of the unit owners (the members) shall be called to fill the  vacancies. The law also provides, “If by reason of death, resignation or other cause, a corporation has no trustees  in office, any member or the executor or administrator of a deceased member may  call a special meeting of members for the election of trustees and, over the  signature of that person, shall give notice of the meeting” as provided by law.  

 “As a last resort, if no one will serve, the hurdle to overcome is that most  bylaws restrict the appointment of trustees to those owning units. Therefore, if you need to secure outside paid managers/trustees, then you likely  need to amend your bylaws to permit the appointment of trustees who are not  unit owners.”  

 

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Comments

  • Mr. Ackerman, I think you began to answer the question above in the last paragraph, but you did not "wrap it up." If an association is forced to change bylaws (if needed) and get outside paid trustees, what is the process? Are there legalities that must be adheared to? What does this mean to the association/unit owners? I know this questions comes up often in ours and neighboring condos but we have all been unable to get a complete answer. We'd love more details or a referral for where we could find the answers. Thank you very much - Worried Board Members in NJ