Can the board set requirements for how proposals from shareholders and

Spring is just around the corner, and that means it is the season for annual meetings and general assemblies in housing cooperatives and condominium associations. Many boards are in the process of planning and have already notified their shareholders and unit owners of the deadline for submitting proposals. This notification is required by the Condominium Act § 41 and the Housing Cooperative Act § 7-4. Proposals submitted within the deadline should, as a rule, be included in the notice for the annual meeting/general assembly.

Our experience is that the variation in proposals submitted to the board is large. Some are less suitable for direct inclusion in the notice than others. This raises the question: Can the board set requirements for how a proposal should look?

The law does not have specific formal requirements for how proposals should be submitted. For example, the board cannot require that the proposal must be in writing to be included in the notice. A requirement for written proposals can probably not be set in the bylaws either.

However, it is not entirely without rules. The Condominium Act § 43 and the Housing Cooperative Act § 7-7 set requirements for the content of the notice. It is stipulated that the notice must clearly indicate which matters are to be dealt with. The board must be able to require the same from the proposal submitter, i.e., that the submitter clearly describes the matter to be dealt with. It cannot be required that a desired decision for the proposal must be formulated, but as indicated by the bullet points below, the board can recommend it.

If the proposal concerns a matter that requires a 2/3 majority, such as bylaw amendments, both the Housing Cooperative Act and the Condominium Act also require that the main content must be indicated in the notice. In such proposals, the board can ask the submitter for the same.

Although the board cannot set major requirements for proposals, the board can recommend that proposals:

be submitted in writing
include a brief explanation of the background of the matter and why it is being submitted
include a formulation of the desired decision for the matter

Also remember that:

Only shareholders and unit owners have the right to submit proposals for the annual meeting/general assembly, not other residents, such as tenants.
The board always has the opportunity to provide its own comments on the proposal when formulating the notice.

If you are on the board and have questions about this, feel free to call us for an informal chat.

Can the board set requirements for how proposals from shareholders and unit owners should be formulated?