In a previous advisory, we set out some of the legal constraints governing electronic meetings of nonprofit boards and members. Many nonprofits remain unable to hold board or membership meetings in person because of "shelter in place" orders or social distancing recommendations issued by state and local authorities.
Last week, Governors Jay Inslee of Washington and Andrew Cuomo of New York each took emergency action to make it easier for nonprofit corporations to hold various types of meetings electronically. Both states have statutes empowering their governors to take such actions when a state of emergency is in effect.
In Washington, nonprofits generally may hold board or membership meetings through any electronic medium by which all participants can hear each other at the same time (including assistive technologies for participants with hearing loss). Under normal conditions, nonprofits may disallow such meetings through their bylaws or their articles of incorporation.
Governor Inslee's Proclamation 20-51 generally overrides nonprofits' power to require in-person meetings, providing that, for the duration of the COVID-19 emergency:
- Membership votes may be taken by mail, by electronic transmission, or by proxy, regardless of whether the bylaws or articles authorize such membership votes.
- Meetings of either the members or the board may be held electronically (i.e., by telephone or videoconference), even if the bylaws or articles do not allow for electronic meetings.
New York Executive Order
The New York Not-For-Profit Corporation Law is ambiguous about whether membership meetings may be held electronically. (It is not similarly ambiguous about electronic board meetings, which clearly are permitted.)
Governor Cuomo's Executive Order 202.18 resolves the ambiguity in the law for the duration of the COVID-19 emergency, allowing all membership meetings of not-for-profit corporations to be conducted electronically.
The facts, laws, and regulations regarding COVID-19 are developing rapidly. Since the date of publication, there may be new or additional information not referenced in this advisory. Please consult with your legal counsel for guidance.
DWT will continue to provide up-to-date insights and virtual events regarding COVID-19 concerns. Our most recent insights, as well as information about recorded and upcoming virtual events, are available at www.dwt.com/COVID-19.