Apparently, there is a controversy brewing within Sierra Canyon about the use of Cumulative Voting with regard to the upcoming election of Board Members (Directors). So, what is Cumulative Voting? Simply defined: “A system of voting in an election in which each voter is allowed as many votes as there are candidates and may give all to one candidate or varying numbers to several.”
Cumulative Voting has been permitted in the election of Sierra Canyon Association (SCA) Board Members since 2006. this in accordance of Section 4.05 (e) of the SCA Bylaws which state:
“Section 4.05 (e) Cumulative Voting. Each Member entitled to vote at any election of directors where two or more positions are to be filled by a vote of the Members shall have the right to cumulate his or her votes by giving one candidate a number of votes equal to the number of directors to be elected, multiplied by the number of votes to which the Member is entitled, or by distributing his or her votes on the same principle among as many candidates as he or she desires. No Member shall be entitled to cumulate votes unless (a) the candidate’s or candidates’ name(s) have been placed in nomination before the voting, and (b) a Member has given notice at the meeting, and before the voting, of the Member’s intention to cumulate his or her votes. If any one Member has given such notice, all Members may cumulate their votes for candidates in nomination. Those candidates receiving the highest number of votes, up to the number of directors to be elected, shall be elected.”
So, given the preceding, why the controversy? This because the current SCA Board has stated that Cumulative Voting will not be allowed in the upcoming election. Why? Apparently based on a legal opinion that an NRS Statute only permits Cumulative Voting if so defined within the SCA CC&R’s (Declaration), which it is not. Therefore, it is immaterial that Cumulative Voting is provided for in the SCA Bylaws. However, is this the correct intrepretation? Let’s take a look at NRS 116.2107(4)(b), which states:
“NRS 116.2107 Allocation of allocated interests
4. The declaration may provide:
(a) That different allocations of votes are made to the units on particular matters specified in the declaration;
(b) For cumulative voting only for the purpose of electing members of the executive board; and
(c) For class voting on specified issues affecting the class if necessary to protect valid interests of the class.”
Note that the Statute does not say the CC&R’s but refers to the “declaration”, which the SCA legal advisor must believe is synonymous with the CC&R’s. However, NRS 116.037 defines Declaration as follows:
“NRS 116.037 “Declaration” means any instruments, however denominated, that create a common-interest community, including any amendments to those instruments.”
One could argue under this definition, note the plural “instruments“, that the Bylaws are also a denominated instrument in the creation of the SCA.
Note also, that the NRS Statute states that the declaration “may provide” for cumulative voting and not “must provide” nor does it prohibit it from being addressed in any of the Association’s Governing Documents, which include both the CC&R’s and the Bylaws.
Regardless of how one may want to define “declaration”, It is clear that the intent of this statute is to allow for Cumulative Voting if so authorized under an Association’s Governing Document. Also, we all know that Homeowner Association legal opinions have not always been correct, when challanged before the Ombudsman’s office or in the Courts.
So why the change at this time? How did the legal opinion to support this change come about? Do some of the current Board Members fear that Cumulative Voting will result in them not being re-elected?
Good questions, perhaps our readers can provide some insight or comments on this matter.