Governor Lamont issued an emergency Executive Order on Wednesday May 13, giving Connecticut nonprofits the authority to conduct member meetings, including annual meetings, by entirely remote means. This will permit Connecticut nonprofits to eliminate in-person members meetings, but only during the Coronavirus Disease (COVID-19) emergency, currently effective through September 9. 

The Executive Order allows the board of directors to hold a members’ meeting by means of remote (virtual) communication if the nonprofit implements reasonable measures to verify that the remote participant is a voting member and that allows those members to participate and vote on matters submitted to the members.

Nonprofits must still follow the requirements for notice to members, quorum, access to member lists (which can be made available electronically), member participation, and voting. However, any bylaw provisions that require in-person meetings are suspended during the emergency.

Nonprofits that have already decided to hold their annual members’ meeting virtually, before this Executive Order was issued, may want to re-issue their meeting notices to fall within the “protection” of this Order. Of course, a nonprofit could instead choose to postpone its annual meeting until the crisis has passed. Directors and officers whose terms would have expired at the annual meeting will continue in office until their successors are elected and qualified.

The language of the Executive Order is set forth below. Following that are some tips and best practices regarding holding virtual meetings.

Here is the language in Section 2 of Executive Order No. 7NN:

  • 2. Remote Participation in Member Meeting.  Section 33-1061 of the Connecticut General Statutes is modified to provide a new clause (e), to read in its entirety as follows:

    “(e)(i) The board of directors may determine that any meeting of members shall not be held at any place and shall instead be held solely by means of remote communication. Participation by means of remote communication shall be subject to such guidelines and procedures as the board of directors may adopt.

    “(ii) Members participating by means of remote communication are deemed present in person and may vote at the meeting on matters submitted to the members and on which the members are entitled to vote if the corporation has implemented reasonable measures: (A) to verify that each person participating remotely as a member is a member; and (B) to provide the members a reasonable opportunity to participate in the meeting and to vote on matters submitted to the members and on which the members are entitled to vote, including an opportunity to communicate, and to read or hear the proceedings of the meeting, substantially concurrently with the proceedings.  The notice to members entitled to vote at a meeting to be held pursuant to this clause (e) shall describe the means of accessing the meeting.

    “(iii) Any statute, regulation or requirement, or part thereof, or any provision of the certificate of incorporation or bylaws of the corporation, inconsistent with this clause (e) shall be inoperative for the effective period of this Section 33-1061(e), and any meeting conducted by remote communication shall be deemed validly held if notice of the meeting is given during the effective period of this Section 33-1061(e).”

Best practices for virtual annual meetings:

The following issues and procedures are best practices that nonprofits should consider when setting up and conducting virtual meetings of their members.[1] The key goal is to ensure that members who participate in those meetings will be able to “hear and be heard” and have the information necessary to participate in discussions and to vote during the meetings. The specific procedures that should be followed will depend on multiple factors, such as the number of members entitled to vote, the issues to be voted on, and whether super-majority requirements apply. Not all of these best practices will be appropriate for every organization or meeting.

BEFORE THE MEETING

  1. Identify an accessible platform for meeting and provide information about it to all members in advance of the meeting. There are many commercial options available, some of which are free.
  2. Give members the option to dial-in by phone if they do not have the technology that permits access to a video conference.
  3. Set the record date to determine which members are entitled to vote (e.g., those who have been members for some minimum period of time, those who are current on dues, etc.). The organization’s bylaws may set the record date, or the board of directors may set it, but under the CRNCA it may not be more than 70 days before the meeting (C.G.S. §33-1067(a) and (b)). Prepare an alphabetical list of the members entitled to vote, with their addresses and the number of votes to which they are entitled.  Pursuant to C.G.S. §33-1070, members are entitled to see that list upon request before or during the meeting.
  4. Provide information required by the bylaws concerning candidates for director (and/or officer) positions, as appropriate.
  5. Prepare and disseminate, before the meeting, notice of the date and time of the meeting, the electronic form of the meeting, instructions on how to log on/call-in and, when required, the agenda, including the issues upon which a vote will take place. Organizations should consider providing members with the agenda even if such distribution is not required. Note that C.G.S. §33-1072(a) permits voting by proxy (unless otherwise prohibited by the organization’s bylaws or certificate of incorporation) and §33-1072(b) expressly allows proxies to be given by electronic mail.
  6. Test the system being used for the virtual meeting to make sure it is in working order.
  7. Determine the method for taking attendance.
  8. Determine the method for counting votes.
  9. Arrange to take and maintain minutes of the meeting.
  10. Appoint someone to manage the meeting to make sure that the meeting adheres to the agenda and allows an opportunity for attendees to participate — some virtual meeting programs have a feature that allows people to “raise their hands” or “chat.”
  11. Appoint someone to help people who are having trouble joining the meeting. A separate phone number should be disseminated to allow reporting and resolving problems in real-time.
  12. A record should be maintained of calls or complaints about logging-in.

DURING THE MEETING

  1. Confirm member status and record of attendance.
  2. Determine if quorum requirements are met. Note, organizations should review their Certificates of Incorporation or bylaws to determine quorum requirements. If those documents are silent on quorum, then quorum is met by whomever participates (C.G.S. §33- 1074(a)).
  3. Ensure that participants can hear (and, if applicable, see) the proceedings and communicate to the full group in real-time, via a text-based “comment” function or otherwise.
  4. Set time limits for presentations and discussions
  5. Give members the opportunity to communicate, consistent with the organization’s bylaws
  6. If contemplated in the organization’s bylaws, give members the opportunity to bring motions or nominations from the floor.
  7. Consider challenges to nominations, voting eligibility and requirements, consistent with the organization’s bylaws.
  8. Count votes.
  9. Contemporaneously maintain a record of votes.
  10. Contemporaneously record minutes. Many meeting platforms provide a recording feature which should facilitate the creation of written minutes.
  11. If directors hold a portion of the meeting in executive session (unusual), the record should reflect the basis for the executive session, the start and end times of the executive session, the attendees at the executive session, decisions made during the executive session and a record of the vote.

AFTER THE MEETING

To the extent consistent with the organization’s practices:

  1. Circulate draft minutes.
  2. Give member-attendees the opportunity to make suggested corrections or additions to minutes.
  3. Circulate final minutes.
  4. Obtain member approval of minutes at the next meeting if that is standard practice for the organization.

ADDITIONAL CONSIDERATIONS

Some sections of the CRNCA require the votes of members to approve significant transactions, such as sales of property, mergers, dissolution, and amendments of certificates. Additional protections may be required when conducting such votes, such as distribution of detailed documentation and discussion of issues involved, as well as super-majority requirements. Boards of Directors should make sure that members have all the necessary information and an opportunity to ask questions, so they may make informed decisions when voting on such matters.

The Pro Bono Partnership wants to recognize and thank the following attorneys for their invaluable work on this Executive Order: Lane T. Watson, Patricia Jimenez, and David A. Swerdloff of Day Pitney LLP; and Matthew H. Gaul of Carmody Torrance Sandak & Hennessey LLP.

This document is provided as a general informational service to volunteers, clients, and friends of Pro Bono Partnership. It should not be construed as, and does not constitute, legal advice on any specific matter, nor does distribution of this document create an attorney-client relationship.

[1] Note – Many of these practices are already required under law and/or are best practices for any kind of meeting.

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