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A New York court has considered a challenge to an election held by a REALTOR® association.
The bylaws of the Dutchess County Association of REALTORS® (“Association”) state that the president will appoint a nominating committee two months before the Association’s annual meeting in order to select a slate of candidates to fill the board of directors the following year. This slate of candidates is then presented to all members eligible to vote at least three weeks prior to the annual meeting. The bylaws also allow for an alternate slate to be placed on the ballot if at least 10% of the eligible voting members sign a petition in favor of the alternate slate and this petition is filed with the Association at least two weeks prior to the election.
The Association held its annual meeting on October 21, 2008. The Association mailed the meeting notice to the members on September 30, 2008, which was the last possible day to notify the members pursuant to the bylaws. An alternative slate of candidates with the required 10% of signatures was submitted, but the Association rejected this alternative slate because it was received 13 days before the election.
The Association conducted its election at the annual meeting. The ballots contained only a “yes” option for candidate voting. When questions were raised at the meeting about whether members could vote “no” for a candidate, the Association held an executive session and consulted with a parliamentarian. It was determined that members could vote yes or no on the ballot. Following this determination, voting commenced and the “no” votes carried the day.
Because a slate of candidates was not elected, the Association scheduled another election for December 16, 2008. However, the Association’s directors later determined that they had improperly allowed “no” votes during the election and so reversed their earlier decision, declaring that only “yes” votes counted. Therefore, the board determined that their slate had carried the day and there was no need for a second election.
A group of members filed a lawsuit challenging the election results (collectively, “Challengers”). The Challengers argued that even if the “no” votes were improperly allowed, the Association waived its right to later disallow “no” votes. The Challengers wanted the earlier election set aside and a new election ordered. Meanwhile, the Association argued that the election should be upheld. The trial court considered both arguments.
The Supreme Court for the State of New York, Dutchess County, agreed with the Challengers and ordered the Association to conduct a new election. The court noted that while the Association had followed its bylaws for annual meeting notification and had properly disallowed the alternate slate of candidates, the Association had made a conscious decision to allow “no” votes during the meeting.
The court ruled that it would be “patently unfair” to disregard these votes after stating that such votes would be accepted. Courts should only abridge the rights of those who vote in an election if it is absolutely necessary and it was not necessary for the Association to take such action here. Therefore, the court set aside the October 21st election and ordered the Association to hold a new selection.
Cassell v. Dutchess County Ass’n of REALTORS®, No. 9407/08 (N.Y. Sup. Ct. Mar. 12, 2009). [Note: This opinion was not published in an official reporter and therefore should not be cited as authority. Please consult counsel before relying on this opinion.]