Ohio Case Law Update: Amending Governing Documents

In a case out of Butler County, an Association sought to amend their governing documents, and in doing so sent out a notice of the annual meeting informing the ownership that voting would begin at the meeting and continue on the two proposed amendments over the following 14 day period until the requisite number of votes was reached to pass the amendment. Like many Associations, the requisite percentage of voting power required was 75%.

At the annual meeting 71% voted in favor of the amendment and during the ensuing 14 day period the remaining percentage was obtained for a total of 77% approval of both amendments. The Association recorded the amendments and an owner sued claiming

that the Association did not receive the number of votes needed to pass the amendments properly.

The contention was that the Association took two separate actions and neither was sufficient to obtain the necessary approval for the passage of the amendments. There was an action taken at a meeting where the 71% was obtained and a separate action taken without a meeting where the remaining 6% was obtained. The Owner claimed that neither action, in and of itself, was sufficient to meet the requirements for amending the governing documents. In addition, the claim was that there was no provision in the governing documents that allowed for an amendment by a combination of the two methods.

The Association asserted that the notice sent to the owners regarding the open voting period constituted sufficient notice that the amendments were to be voted on as an action taken without a meeting. However, where the Association’s claim fell flat was that its resolution approving the amendment stated that the annual meeting was held for the purpose of amending the declaration and bylaws. Further, the certificate stated that the amendments were true and accurate copies of those passed at the annual meeting.

Lesson: Pick one method for voting and stick to it. Either vote at a meeting or do it outside a meeting, unless your documents specifically allow for the combination of the two methods.

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